IN RE: GARTH F. LANSAW, d/b/a Forever Young Childcare DEBORAH LANSAW, Debtors
FRANK ZOKAITES, Appellant GARTH F. LANSAW and DEBORAH LANSAW
December 5, 2016
Appeal from the United States District Court for the Western
District of Pennsylvania (W.D. Pa. No. 2-15-cv-00404)
District Judge: Honorable David S. Cercone
Jeffrey M. Robinson, Esq. [ARGUED] Robinson Law Group Counsel
Mariani, Esq. [ARGUED] Warner Mariani, LLC Counsel for
Before: FISHER, [*] KRAUSE and MELLOY, [**] Circuit
MELLOY, Circuit Judge.
filing of a bankruptcy petition operates as an automatic stay
of debt collection activities outside of bankruptcy
proceedings. 11 U.S.C. § 362(a). If "an individual
[is] injured by any willful violation of [the] stay, "
that individual "shall recover actual damages, including
costs and attorneys' fees, and, in appropriate
circumstances, may recover punitive damages."
Id. § 362(k)(1). In the present case, Frank
Zokaites committed several willful violations of the
automatic stay arising from Garth and Deborah Lansaw's
bankruptcy petition. Because of these violations, the
Bankruptcy Court awarded the Lansaws emotional-distress
damages as well as punitive damages under § 362(k)(1).
The District Court affirmed the awards, and Zokaites now
appeals. We conclude that § 362(k)(1) authorizes the
award of emotional-distress damages and that the Lansaws
presented sufficient evidence to support such an award. We
also conclude that the Lansaws were properly awarded punitive
damages. Accordingly, we will affirm.
Lansaws operated a daycare in a space leased from
Zokaites. Over the course of several years, the
relationship between the Lansaws and Zokaites devolved into
various disputes. The present dispute arose after the Lansaws
entered into a new lease with a different landlord, but
before they vacated Zokaites's property. When Zokaites
learned of the new lease, he served the Lansaws with a Notice
for Distraint, claiming a lien against the Lansaws'
personal property for unpaid rent. The following day, August
16, 2006, the Lansaws filed for bankruptcy,  thereby
triggering the automatic stay under 11 U.S.C. § 362(a).
Zokaites's attorney was notified of the bankruptcy filing
by a letter dated August 17, 2006.
nevertheless, violated the automatic stay in three separate
incidents. First, on August 21, 2006, Zokaites and his
attorney visited the Lansaws' daycare during business
hours to take photographs of the Lansaws' personal
property. Although Mrs. Lansaw initially denied Zokaites
entry, Zokaites entered the daycare by following a daycare
parent inside. Zokaites then entered Mrs. Lansaw's office
and backed her against the wall, getting so close that she
could feel his breath. During the incident, Zokaites asked
Mrs. Lansaw three times in quick succession, "Do you
want to hit me?"
on Sunday, August 27, 2006, Zokaites visited the daycare
after business hours and, this time, used his key to enter
the building. He observed that the Lansaws had removed some
personal property and plumbing fixtures from the space.
Zokaites then padlocked and chained the doors. Mrs.
Lansaw's mother, who had arrived to clean the daycare,
attempted to stop Zokaites and called the police. A police
officer, as well as the Lansaws, arrived at the daycare
shortly thereafter. Zokaites suggested that Mrs. Lansaw
inform the daycare parents that the daycare would not be open
the next day. At the request of a police officer, he allowed
Mrs. Lansaw to reenter the daycare and obtain the
parents' contact information. Zokaites, however, insisted
that Mrs. Lansaw be escorted in and out of the property by
the Lansaws returned home, they received a call from their
attorney informing them that Zokaites had left a proposed
"interim standstill agreement" in the door of the
daycare. It stated that Zokaites would not unchain the
daycare doors unless (1) Mrs. Lansaw's mother agreed that
she had not been assaulted by Zokaites, (2) the Lansaws
reaffirmed their lease with Zokaites, and (3) the Lansaws
ceased removing property from the daycare. The Lansaws
informed their attorney that the agreement was not
acceptable. They then returned to the daycare, removed the
chains themselves, and decided to sleep in the building to
prevent Zokaites from chaining the door again. Later that
night, Zokaites also returned to the daycare. Before the
Lansaws could reach the door, Zokaites removed Mrs.
Lansaw's keys that had been hanging from the inside
keyhole and locked the door from the outside. Zokaites left
with the keys, which included personal keys in addition to
the daycare keys, and returned to his vehicle. The Lansaws
called the police once more.
on August 28, 2006, Zokaites directed his attorney to send a
letter to the Lansaws' new landlord. The letter demanded
that the new landlord terminate the Lansaws' new lease
and stated that, if the lease was not terminated, Zokaites
would file a complaint. A draft of that complaint was
included with the letter. Zokaites's attorney also
admitted having multiple phone calls with the new landlord in
an attempt to have the new lease terminated.
reasons that are unclear, the procedural history of the
present action is somewhat complex and spans two separate
adversary proceedings. The Lansaws first initiated an
adversary proceeding in August 2006 to enjoin Zokaites from
committing further violations of the stay. In the same
proceeding, they also sought punitive damages, attorney fees,
and other relief. After a trial, the Bankruptcy Court entered
a December 2006 order finding that Zokaites had violated the
stay and granting the Lansaws' request for an injunction.
Although the Bankruptcy Court heard testimony related to
emotional distress, it did not make a ruling on damages or
attorney fees in its memorandum opinion. See Lansaw v.
Zokaites (In re Lansaw) ("Lansaw I"), 358 B.R.
666, 672, 675 (Bankr. W.D. Pa. 2006).
Lansaws again raised the issue of damages before the
Bankruptcy Court in February 2007. This time, they did so in
a counterclaim to Zokaites's proof of claim in the main
bankruptcy case. This counterclaim for damages, however, also
went unresolved. Approximately five years later, in December
2012, the main bankruptcy case was reassigned to the
Honorable Thomas P. Agresti. After a status conference
revealed that the counterclaim for damages was yet to be
settled, the Bankruptcy Court determined that the best way to
resolve the issue was to initiate a new adversary proceeding.
adversary proceeding, now before us in the present case, was
tried in August 2014. At the outset of the trial, the
Bankruptcy Court noted it was "building on" what
the previous judge had already found in 2006, namely, that
Zokaites had willfully violated the automatic stay.
Lansaw II, 2015 WL 224093, at *3. The previous
judge, however, had not made "definitive findings with
regard to certain details of those violations, " so the
Bankruptcy Court again heard testimony regarding the
violations. Id. at *13.
Lansaws also presented evidence of emotional distress, which
the Bankruptcy Court summarized as follows:
The only evidence that the [Lansaws] presented as to
emotional stress was their own testimony, though that was
often compelling. Mrs. Lansaw testified that she continues to
have nightmares about Zokaites entering the building and
taking her business away. After these experiences she
sometimes wakes up screaming and crying. She stated that when
she is out in public and happens to see someone who looks
like Zokaites she can experience moments of "sheer
fear." She testified that she has lost trust in others
and this has affected her relationship with friends. She is
taking prescription medication for depression and an ulcer,
conditions which she attributes to stress from Zokaites,
beginning with [an incident prior to the stay violations] and
continuing thereafter. She felt physically threatened when
Zokaites entered her office on August 21, 2006, and backed
her up to a wall. Mrs. Lansaw acknowledged that she has not
sought psychological counseling, but said she is considering
Mr. Lansaw testified about the effects on his wife that he
has observed. He said that she has changed markedly since the
incidents involving Zokaites. She just goes to work and comes
home, rarely going out in public, avoiding human contact, and
not enjoying life. He testified to similar effects on
himself, stating that he has become very withdrawn and has a
fear of making new friendships. He testified that he has only
one friend who understands what he has gone through and he
has no one else to talk to about it.
Id. at *7-8 (citations omitted). The Bankruptcy
Court found this testimony credible and also noted that it
was consistent with the previous judge's 2006 decision.
The 2006 decision states that "Mrs. Lansaw was in tears
in her various appearances before the Court and ...