United States District Court, D. Idaho
In re FARMERS GRAIN, LLC, Debtor.
BURKE ELECTRIC, INC., Defendant. NOAH G. HILLEN, Trustee, Plaintiff,
MEMORANDUM DECISION AND ORDER
LYNN WINMILL U.S. DISTRICT COURT JUDGE
the Court are two motions filed by Defendant Burke Electric,
Inc.: (1) an unopposed motion to withdraw the reference; and
(2) a motion in support of a demand for a jury trial.
See Dkts. 1, 2. The Court will grant the motion to
withdraw the reference but will delay doing so until the
matter is ready for trial. Because the Court is delaying
withdrawal of the reference, the bankruptcy court will decide
the pending motion in support of the jury trial demand. To be
clear, an Article III judge will ultimately preside over any
trial in this proceeding (be it bench or jury) and issue the
final judgment, but the bankruptcy court will decide pretrial
issues, including the threshold issue of whether Burke
Electric waived its right to a jury trial.
April 2017, Farmers Grain, LLC filed a chapter 11 bankruptcy
petition. Nearly two years later (after the bankruptcy was
converted to a chapter 7), the Trustee filed this adversary
proceeding. The Trustee alleges that Farmers Grain
fraudulently transferred $36, 912 to Burke Electric before
filing bankruptcy. Burke Electric says the payments were for
electrical work done before the petition was filed.
Electric answered the Trustee's complaint on June 20,
2019. The answer did not include a demand for jury trial. On
August 7, 2019 (the same date as the first pretrial
conference conducted in the proceeding), the Trustee filed a
notice of consent to final judgment by the bankruptcy court.
Shortly afterward, Burke Electric filed both pending motions.
The Trustee does not oppose the motion to withdraw the
reference but says Burke Electric waived its right to a jury
1.The Motion to Withdraw the Reference
Electric has acknowledged that the Court need not withdraw
the reference immediately. Accordingly, as has been its
practice with fraudulent transfer claims in the wake of
Stern v. Marshall, 564 U.S. 462 (2011), the Court
will grant the unopposed motion to withdraw the reference but
will delay doing so until the bankruptcy court certifies that
the matter is ready for trial.
11 U.S.C. § 157(c), the bankruptcy court may
“hear” the Trustee's fraudulent transfer
claims, and submit proposed findings of fact and conclusions
of law to the district court. See, e.g., Executive
Benefits Ins. Agency v. Arkison, 573 U.S. 25 (2014). If
either party files a dispositive motion, the bankruptcy court
may entertain that motion and submit proposed findings of
fact, conclusions of law, and a recommended disposition of
the case to this Court. See Id. When the bankruptcy
court certifies that the case is ready for trial, the Court
will withdraw the reference and set the matter for trial.
Motion in Support of Jury Trial Demand
the Court is delaying withdrawal of the reference until the
proceeding is ready for trial, the bankruptcy court will take
up defendant's motion in support of its jury trial demand
and will thus decide whether Burke Electric waived its right
to a jury. Regardless of how the issue is decided, the
parties should be aware of two rules not mentioned in the
Federal Rule of Civil Procedure 6(b).
this rule, a court may extend the time “[w]hen an act
may or must be done within a specific time: . . . (B) on
motion made after the time has expired if the party failed to
act because of excusable neglect.” Fed.R.Civ.P.
6(b)(1)(B). Rule 6(b) thus provides a potential avenue of
relief if the bankruptcy court determines Burke Electric
failed to timely demand a jury. Accordingly, the ...