On cross motions for summary judgment, the Court determined that 1) the language in the Debtor-Hospital’s confirmed Chapter 11 plan was broad enough to enjoin claims against former employees of the Debtor-Hospital relating to claims against the Debtor-Hospital and has res judicata effect even if such third-party injunction is contrary to the requirements of the Bankruptcy Code;  2) that Plaintiff received actual notice of the commencement of the bankruptcy case, the hearing on confirmation of the Chapter 11 plan, and the deadline for filing administrative claims; and 3) fact issues concerning whether the content of the notice was sufficient to satisfy due process and bind plaintiff to the injunction contained in the Confirmed Chapter 11 plan precluded summary judgment.

The Court denied summary judgment on the Trustee’s preference and fraudulent transfer claims to recover a vehicle as an asset of the bankruptcy estate.  Fact issues existed concerning whether the limitations period under § 546(a) could be extended under the doctrine of equitable tolling, which has a fraud component generally requiring active deception that lulls the plaintiff into inaction, and a diligence component measured by an objective standard.  The Court granted Trustee’s request under Fed.R.Civ.P. 56(g) to treat facts not subject to genuine dispute as established in the adversary proceeding.

The Court denied the Trustee’s motion for partial summary judgment on claims to recover preferential and fraudulent transfers due to the following deficiencies: 1) the facts not subject to genuine dispute failed to establish the debtor’s insolvency at the time of the transfers – Trustee could rely on the presumption of insolvency only as to those transfers made within 90 days of the petition date and only with respect to the Trustee’s preferential transfer claims under § 547; 2) a lack of evidence of the value of the transferred property and the amount of creditor’s claim prevented the Court from determining whether the Trustee satisfied § 547(b)(5)’s hypothetical liquidation element for preferential transfers; 3) fact issues concerning reasonably equivalent value precluded judgment on the Trustee’s constructive fraud claims; and 4) circumstantial evidence of actual intent to hinder, delay, or defraud was not so overwhelming as to warrant summary judgment – such claims involving issues of intent and credibility are less susceptible to summary judgment.

Plaintiffs sought summary judgment that their debt was nondischargeable based on a prepetition state court judgment.  The Court previously determined the judgment established liability under Section 523(a)(2)(A) (actual fraud) and 523(a)(6) (willful and malicious injury).  The only remaining issue was whether the entire amount of damages was also nondischargeable.  The Court determined that all damages stemmed from defendant's fraud and/or willful and malicious conduct.  The Court therefore entered a nondischargeable judgment for the entire amount of damages in the state court judgment.