October 25, 2016
Appeal from the United States District Court for the Eastern
District of Pennsylvania (D.C. Civ. No. 2:15-cv-00197)
District Judge: Honorable Gerald J. Pappert
Raymond Ross Pro Se
Charles J. Hartwell, Esq. (Argued) Dethlefs Pykosk Law Group
Counsel for Appellee AmeriChoice Federal Credit Union
William H. Burgess, Esq. [ARGUED] Kirkland & Ellis
Court-Appointed Amicus Curiae in Support of Appellant Raymond
Before: VANASKIE, KRAUSE, and NYGAARD, Circuit Judges
VANASKIE, Circuit Judge.
Ross appeals from a broad filing injunction issued against
him by the Bankruptcy Court after he and his wife used the
bankruptcy process to stave off the sheriff's sale of
their home. Ross argues that, as a matter of law, a
bankruptcy court may never issue a filing injunction against
a Chapter 13 debtor who requests voluntary dismissal under 11
U.S.C. § 1307(b) because doing so would undermine the
debtor's statutory rights. We disagree, and hold that a
bankruptcy court does indeed have the authority to issue a
filing injunction even in the context of approving a
debtor's § 1307(b) voluntary dismissal because
nothing in the Bankruptcy Code's express terms says
we also find that the Bankruptcy Court's filing
injunction against Ross cannot survive this appeal due to
this case's particular circumstances. The Bankruptcy
Court provided no reasoning for the broad nature of its
filing injunction, which went well beyond what had been
requested and what the Bankruptcy Court found appropriate in
the case of Ross's similarly-situated wife. Accordingly,
we will vacate the injunction and remand this matter for
Raymond Ross and his wife Sandra have lived in their home in
Ambler, Pennsylvania, since 1993. In 2003, the Rosses took on
a mortgage from Appellee AmeriChoice Federal Credit Union.
The Rosses fell behind on their payments, and in 2012
AmeriChoice filed a foreclosure action in Pennsylvania state
court. The state court entered default judgment against the
Rosses, and AmeriChoice scheduled a sheriff's sale to be
held on October 30, 2013. Ross v. AmeriChoice Fed. Credit
Union, 530 B.R. 277, 280 (Bankr. E.D. Pa. 2015).
before the sheriff's sale, Raymond-acting alone,
without Sandra-filed the first of the Rosses' three
relevant Chapter 13 bankruptcy petitions. Raymond's first
petition triggered Chapter 13's automatic stay and put a
halt to the sheriff's sale, but was dismissed about six
months later after Raymond failed to make required payments.
AmeriChoice rescheduled the sheriff's sale for August 27,
day of the rescheduled sale, Raymond filed a second Chapter
13 petition-the one that led to this appeal- stalling the
sale for a second time. The Bankruptcy Court quickly granted
AmeriChoice relief from the automatic stay, and the
sheriff's sale was rescheduled yet again, this time for
October 29, 2014. On that day, however, Sandra filed her own
Chapter 13 petition, delaying the sale of the Rosses'
property a third time. In re Sandra Dixon-Ross, No.
15-CV-581, 2016 WL 1056776, at *1 (E.D. Pa. Mar. 17, 2016).
Sandra's case was assigned to the same Bankruptcy Judge
overseeing Raymond's case, and a week later the court
dismissed Sandra's petition for failure to obtain
required pre-petition credit counseling. Id.
Raymond's second case, AmeriChoice filed a motion under
11 U.S.C. § 1307(c) to either convert Raymond's case
to Chapter 7 or dismiss it altogether due to what AmeriChoice
saw as Raymond's bad faith use of the bankruptcy process.
The Bankruptcy Court scheduled a hearing on the motion. About
two weeks prior to the hearing, Raymond filed a motion to
postpone the hearing due to a scheduling conflict and his
anticipated absence from the state. The Bankruptcy Court
denied the motion to postpone a week later. Raymond then
requested, the day before his hearing, that his case be
dismissed pursuant to § 1307(b).
did not appear at the hearing on AmeriChoice's motion.
AmeriChoice did appear, and indicated that its preference
would be for the Bankruptcy Court to convert Raymond's
case to Chapter 7; dismissal was its second choice. If the
Bankruptcy Court decided to dismiss, AmeriChoice requested
that the court also issue one of two proposed filing
injunctions: a filing injunction "barring future filings
[of both Raymond and Sandra Ross] for 180 days, " or a
filing injunction "barring the use of the automatic stay
in any future filings by either one of them." (Addendum
to Amicus Br. at 24 (transcript of hearing).) The Bankruptcy
Judge expressed due process concerns with the prospect of
issuing an order that extended to Sandra because the hearing
was held only in Raymond's case and Sandra had not been
given notice. The Judge instead suggested that if AmeriChoice
wanted a filing injunction entered against Sandra, it should
return to Sandra's case and request one there. Neither
the Bankruptcy Judge nor AmeriChoice mentioned or discussed
Raymond's request for dismissal at the hearing. ...