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abstains from hearing the third-party complaint.
Reasoning: The 'related to' language is different in § 1367(a) than it is under § 1334(b). It is unlikely that SRP would be affected by a determination, either way, as to WML's indemnification duties. To determine the validity of the indemnity agreement, the Court will necessarily hear evidence related to the proof of claim against the debtor. Based only on the 'compelling reasons' factor in the abstention statute, the court will not hear the third-party complaint. The court notes the long and tortured history of litigation in the receivership state court action over this exact issue. Thus, the state court should determine the validity of the engagement and indemnification letters.
Facts: Jordyn Holdings IV, LLC (the "Debtor") and Nueva Inversiones, LLC ("NI") entered into an agreement in which NI would purchase the Debtor's only asset - 298 acres of real estate. To finance the purchase, NI borrowed money and provided a security agreement that ended up in the hands of Seacoast National Bank, the appellant. Although the Debtor and NI had a falling out and sued each other, they settled their lawsuit and asked the bankruptcy court to approve the settlement. Seacoast objected to the settlement and appealed the ruling of the bankruptcy court, which approved the settlement over Seacoast's objection.
Issues: Whether Seacoast, as a third party, has standing to object to the settlement between the Debtor and NI.
Rules: "Standing to appeal a bankruptcy order is not limited to a real party in interest. The 'person aggrieved' doctrine is recognized as a prudential prerequisite to standing. The 'person aggrieved' doctrine limits standing to appeal a bankruptcy court order to those individuals who have a financial stake in the order being appealed. A person may appeal an order only when the person is directly and adversely affected pecuniarily by the order. A person has a financial stake in the order when that order 'diminishes their property, increases their burdens or impairs their rights.'"
Holding: The bankruptcy court is affirmed in finding that Seacoast did not have standing to object to the settlement between the Debtor and NI. The district court also affirms the bankruptcy court's approval of the settlement.
Reasoning: Seacoast was not a creditor of the estate - Seacoast did not file a proof of claim and had not formally intervened in the adversary proceeding in which this fight arose. Further, although Seacoast may, at some point, be impaired under the terms settlement, it is not the case now. Lastly, the court noted that Seacoast had already sued NI in a different forum to pursue its interests. Thus, Seacoast did not have standing to object to or appeal the settlement.
Facts: The liquidating Trustee for the creditors' trust sued a number of defendants (the "Defendants") by alleging that they had harmed the debtor by "wrongfully exercising their control over the company and taking unfair and harmful actions to advance their own interests." The Trustee alleged that the Defendants had installed their designees as a majority of Insilco's board of directors, induced Insilco to sell a valuable portion of its business at a reduced price, and caused Insilco to violate certain loan covenants with third parties. The bankruptcy court dismissed the causes of action for lack of subject matter jurisdiction. The Trustee appealed.
Issues: Whether the causes of action "had a close nexus to the bankruptcy plan or proceeding as required by Resorts Int'l."
