Lawyer to Help You Discharge Medical Bills in Bankruptcy Wondering what to do about medical debt? You’ve probably heard that medical bills are the kind of unsecured debt that can be discharged in a bankruptcy case. This is true. However, there are three important considerations to keep in mind when deciding to file a bankruptcy case to discharge medical debt. The point of filing bankruptcy is to get a fresh start. What kind of fresh start has you searching for new medical providers, or dealing with post-petition debts that are not discharged, or having a lien placed on your house that you must satisfy if you sell or refinance? Medical bankruptcies are very common, unfortunately. If you are dealing with medical debt you cannot pay, contact us to schedule a consultation. We will help you time your bankruptcy filing to get the maximum amount of medical debt discharged. Using careful strategy and forethought to plan the timing of your filing will get the best result possible for you.  We have been able to save people tens of thousands of dollars with proper planning, that would otherwise been owed to medical providers. #1 – If you have just fallen ill or just had surgery, you may want to wait to discharge medical bills in bankruptcy. Why? Because if you file too soon, you risk failing to capture medical bills that are incurred after the date you file. Post-petition medical bills are not discharged, and you will still be responsible for paying them. Talk with your medical providers to find out what treatment, therapies, or medications you will likely need in the short term and in the long term. This will be valuable information in determining when to file your bankruptcy case.  People with medical debt rarely file bankruptcy right away for this reason. However… #2 – If you are being sued over medical debt, you may want to file bankruptcy sooner rather than later. Doctors rarely sue their patients. It is more likely that your debt will be sold to a medical bill collection agency, which will hound you day in night with letters, phone calls, and threats. After a few months of this the agency may sue you. If you fail to defend in a medical bill collection lawsuit, or you defend and lose to the plaintiff debt collector or creditor, the court will enter a money judgment against you. The plaintiff can then levy your bank accounts or other property, or the plaintiff may choose to file a state-wide lien on your real property. This means that if you refinance or sell you home, that debt must be paid. If debt collectors are harassing you over medical debt, or if you have been sued by a medical bill collector or medical provider, contact us. We can discuss the timing of a bankruptcy petition so that the debt collector does not have time to file a lien on your property or seize any of your money. What to do if You Face Ongoing Medical Expenses and a Medical Debt Lawsuit at the Same Time If you are not done with treatment and know that you will face more medical bills in the future, yet you are being sued or threatened with a lawsuit over medical debt, call us. We will help you weigh your options and decide the best timing of your filing. #3 – If you like your doctors and require continuing care, you may want to pay them.  It is possible that if you file bankruptcy and get your doctor’s bills discharged, that doctor will decline to see you again. If you want to keep this doctor, know that it is not permissible to take that debt out of your bankruptcy filing and continue to pay it while getting your other debts discharged. This is called “preferential treatment” of one creditor over another, and many a Trustee and creditor has objected to discharge on this basis. To do this right, we must include all of your medical and other unsecured debts in your bankruptcy filing and get them discharged. However, there is no law in the Bankruptcy Code forbidding you from paying back a discharged debt after the bankruptcy is over. Know that this is an option for you if this situation applies. Speak with an Experienced Bankruptcy Lawyer in Philadelphia about Clearing Your Medical Debt As you’ve read, two or all three of these considerations can compete for priority in any individual case, and it can be a challenge to figure out what is best to do. File now? Wait to file? Don’t file at all? We will help you decide. Give us a call at 215-515-5046 to schedule your free, no-obligation consultation. We will take a look at your overall financial situation as well as your past and continuing medical status, and help you determine what course of action is best for you. We will help you get that fresh start. The post Can I Eliminate Medical Bills in Bankruptcy? appeared first on David M. Offen, Attorney at Law.

The country may be shut down for business right now, but it’s business as usual for many credit card lenders. They want their money back plus interest, and most don’t care that you’ve been laid off or your hours have been reduced and you can’t afford to pay right now. While some lenders are offering various forms of assistance during the coronavirus pandemic, others are collecting on money judgments by garnishing wages or levying on bank accounts. Some are in ongoing collection lawsuits against their customers or threatening to sue their customers. If your credit card lender is not offering assistance and you can’t afford to pay, we are here to help, whether through debt settlement, Chapter 7 bankruptcy, or Chapter 13 bankruptcy. It’s not your fault that the economy is at a standstill and you are struggling to pay your bills. Don’t be a financial victim of COVID-19. Call us at 215-515-5869 to talk about your options.  Why Should I Worry About Credit Card Debt Now? Your Credit Card Lender May Cancel Your Card or Reduce Your Credit to Prevent Abuse During the recent recession, credit card lenders pulled back by lowering credit lines or canceling cards entirely to minimize the risk of default. It is likely the same will happen sooner or later as our economy suffers during the nation-wide lockdown. You May Need Cash as the Coronavirus Emergency Continues If the country is basically shut down for the next few months to stop the spread of COVID-19, you may need cash on hand, especially if your credit is reduced or canceled altogether. Money that you would otherwise use to pay your monthly credit card payment will be needed for the bare necessities like food, rent or mortgage, and utilities. Even if your credit card lender is offering some type of assistance or forbearance, you should have cash on hand to spend on necessities. That way, you don’t need to use your credit card, and your credit card balances don’t continue to grow.  Some Credit Card Lenders are Offering Relief Many credit card lenders, including Capital One, Chase, Citi, U.S. Bank, and Wells Fargo, have released statements on their websites announcing that they are offering assistance for their customers during the COVID-19 outbreak. Such help may include: Changing Your Payments Due Date Allowing You to Skip a Payment or Two Payments Lowering Your Interest Rate Forbearing to Collect on Defaulted Debt Visit your lender’s website or call them to find out what help is available to you. Managing Other Debt During the Coronavirus Outbreak If you’ve lost your job due to the pandemic and can’t pay all of your bills, managing your finances will be a balancing act. You must decide which bills to pay. Some of your creditors are offering assistance, and others will demand payment as usual. You must allocate funds thoughtfully to avoid the consequences of default and to ensure that your basic needs are met in this challenging time. Student Loans The federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) passed on March 27, 2020 provides for a six-month interest-free forbearance on all federal student loan payments and stops wage garnishments for student loan default. The six-month forbearance does not apply to Perkins loans, FFEL loans, or private loans, so if you have those loans, you must continue to pay unless your lender or servicer is offering relief. Contact them to find out. Also, keep in mind that the CARES Act does not provide any student loan forgiveness. You’ll have to resume payments after September 30, 2020 unless further legislation is passed. Mortgages Federal mortgage lending companies Freddie Mac and Fannie Mae offer payment forbearance for up to 12 months. There are also private lenders granting forbearance for up to 120 days. Contact your lender to find out if you can defer payments. If you are already in foreclosure, contact a mortgage foreclosure attorney in Philadelphia. While tax sales and sheriff sales are temporarily postponed in many communities, inevitably they will happen. Let us help you keep your home. Auto Loans – Can You Defer a Payment? Perhaps. If you’ve lost your job or your work hours have been reduced due to the pandemic, call your lender to explain and ask for help with your car payments. For example, Ally Bank is deferring monthly auto loan payments for up to 120 days. Hyundai Finance is deferring payments for up to three months. Call your lender to explore your options. Memberships and Subscriptions Perhaps this occurred to you already, but if you have a gym membership, or a subscription to a concert series, or season tickets to sports events or an amusement park, you can cancel these because you won’t be going anytime soon.  Contact Your Credit Card Lender for Help If your lender is not listed about and there is no information about any form of assistance on their website, call them to ask for help. Your lender will likely want to work with you to keep you as a paying customer in whatever way is possible for you. It is much less expensive for your lender to allow you to skip a payment or two than to sue you. Right now there is no credit card debt forgiveness being offered by lenders or being mandated by the government. This may change as the pandemic continues to affect the economy. What to Do if Your Credit Card Company Sues You Do NOT ignore it! If you fail to respond to a credit card debt lawsuit, you let your lender win by default! If you get notice in the mail or are served personally with lawsuit papers, look at them carefully. The court gives you a period of time in which you can respond and defend, and there will be instructions on how to do so. If you’ve already ignored a lawsuit, it hasn’t gone away – your credit card lender will get a judgment against you and take efforts to collect. Call us or email us sooner rather than later to prevent a judgment against you, wage garnishment, levy on bank accounts, or a lien on your property. We can help you get a fresh start, even during the pandemic. The post What to Do About Credit Card Debt During the Coronavirus Pandemic appeared first on David M. Offen, Attorney at Law.

April 29, 2020From: JD SupraBy: Kathleen Muthig; Haynsworth Sinkler Boyd, P.A.As the COVID-19 pandemic marches on, more homeowners than ever are seeking assistance from their lenders. The American Bankruptcy Institute reported on April 24, 2020 that over 3.4 million homeowners have entered into COVID-19 related mortgage forbearance plans. This is a significant increase since April 3, 2020, when just over one million homeowners were utilizing COVID-19 related mortgage forbearance plans. Undoubtedly, COVID-19 and the resulting Coronavirus Aid, Relief and Economic Security (CARES) Act have changed the landscape of consumer bankruptcy cases, especially with regard to the treatment of mortgage debt. Below are 10 changes that Creditors should be aware of in Chapter 13 and Chapter 7 cases.1. COVID-19 relief payments are excluded from definition of “income.” Payments made under federal law related to COVID-19 are excluded from the disposable income requirement of confirmation in the Bankruptcy Code and the income calculation for eligibility under Chapter 7.2. Chapter 13 plans may exceed five years. If the Debtor is experiencing hardship due to COVID-19, then a Chapter 13 Plan confirmed before March 27, 2020, may be modified to extend the repayment period up to seven years after the first payment was due under the Chapter 13 Plan after confirmation. Under the Bankruptcy Code, Chapter 13 Plans are limited to a length of five years. If a plan is modified from five years to seven years, and a Creditor’s arrearage is paid over those seven years, the Creditor will receive less monthly arrearage payments in the modified plan than under the original confirmed plan.3. Second Moratoriums. Some Chapter 13 Trustees have agreed to consent to second moratoriums and longer time periods in order to bring cases current, even without the existence of a qualifying hardship under the CARES Act provisions.4. Practical changes to Bankruptcy Court procedures.U.S. Bankruptcy Court for the District of South Carolina Judges Duncan and Waites entered an Operating Order 20-08 setting forth procedures in light of COVID-19. The Order includes a requirement for Debtors to make all mortgage payments to the Trustee on claims secured by a first priority security interest in the Debtor’s principal residence. Chapter 13 Plans in which mortgage payments are paid to the Trustee, instead of directly to the Debtor, are called “Conduit Plans.”5. Payment deferments due to COVID-19 in conduit plans. Chapter 13 Creditors will need to work with the Chapter 13 Trustees and the Debtors to agree upon and seek Court approval for modifications to the Plan due to COVID-19. Creditors should be mindful to file a timely Notice of Payment Change if the loan payments due are modified under Bankruptcy Rule 3002.1.6. Payment deferments due to COVID-19 in plans where Debtor is paying mortgage payments directly to the Creditor. Chapter 13 Creditors will need to work directly with Debtors to agree upon a loan modification, forbearance, or deferment. Again, Creditors must file a timely Notice of Payment Change pursuant to Rule 3002.1.7. CARES Act foreclosure relief for federally-backed loans. A servicer of a federally-backed loan may not initiate any foreclosure process, move for a foreclosure judgment, order a sale, or execute a foreclosure-related eviction or foreclosure sale for sixty days from March 18, 2020. Note that this stay is separate from any state-mandated stay of foreclosures, like the one currently in place that prohibits foreclosures until May 1, 2020, in South Carolina.8. CARES Act forbearances. Borrowers with federally-backed mortgage loans can request a forbearance from mortgage payments for up to 180 days if they have been affected by COVID-19. The Act also provides for separate forbearance rights for owners of multi-family property (five or more units) and provides protection for tenants from eviction if the owner applies for a forbearance.9. CARES Act eviction relief. A Landlord of a “covered dwelling” may not file an action for eviction or charge additional fees for nonpayment of rent during a 120-day period beginning on March 27, 2020. A covered dwelling is one where the building is secured by a federally-backed mortgage loan or one that participates in certain federal housing programs. Note that this stay is separate from any state-mandated stay of evictions, like the one currently in place that prohibits evictions until May 1, 2020, in South Carolina.10. CARES Act student loan relief. For covered student loans, the CARES Act suspends payments and waives interest from March 13, 2020, through September 30, 2020. Many Chapter 13 Plans provide for the Debtor making student loan payments outside the Plan, so the CARES Act relief is vital to Chapter 13 Debtors, because a moratorium or deferment in the Plan would not affect those payments owed outside of the Plan.

When Does a Small Business File for Bankruptcy? And 8 More QuestionsThe coronavirus is expected to permanently shut millions of small businesses in the next several months. Here are issues for owners to consider.Jerry Stetina, chief operating officer of A to Z Total Heating and Cooling outside Detroit. The firm filed for bankruptcy protection under a new law for small businesses.Jerry Stetina, chief operating officer of A to Z Total Heating and Cooling outside Detroit. The firm filed for bankruptcy protection under a new law for small businesses.Credit...Sylvia Jarrus forThe New York TimesBy Amy HaimerlMay 1, 2020, 5:00 a.m. ET All the forecasts point in the same direction: A wave of small-business bankruptcies is coming.More than 40 percent of the nation’s 30 million small businesses could close permanently in the next six months because of the coronavirus pandemic, according to a poll by the U.S. Chamber of Commerce.“It’s a crisis that will impact our economy for generations,” said Amanda Ballantyne, executive director of Main Street Alliance, an advocacy group for small business. “We’re going to lose so much of the small-business sector.”Commercial bankruptcies in the first quarter of 2020 ticked up 4 percent from a year earlier, according to data from the American Bankruptcy Institute. But many of those filings were made before the pandemic, when the economy was healthy. Right now, some owners are waiting to find out if they will receive federal stimulus aid before deciding whether to file for bankruptcy protection.Many of them may just disappear. But for others, a bankruptcy law that took effect in February, the Small Business Restructuring Act, could help them survive the pandemic.Before that law, if a struggling small business wanted to restructure its debt, its only option was Chapter 11, which is the commercial bankruptcy code. It allows a company to negotiate with creditors for better terms — a process known as debt restructuring — and in some cases dismiss debt. The goal is for the company to get a fresh start.But the Chapter 11 process is long and expensive, and a recent report by the Brookings Institution found that it is better suited to large firms. The new rules, known as Subchapter 5 because they are part of Chapter 11, give firms with less than $2.73 million in debt the power of reorganization with a few key simplifications. Two main changes: A judge can enforce a restructuring plan even if creditors don’t like it, and the owner can continue running the business.Congress recognized that this tool could be a lifeline to small businesses trying to get through an economic shutdown. So as part of the federal stimulus program, it expanded eligibility to firms with up to $7.5 million in debt. That change means Subchapter 5 could help up to 70 percent of all businesses that might file for bankruptcy, Brookings estimated.“A number of small businesses who are prone to just giving up could be saved,” said Bob Keach, who leads the bankruptcy practice at Bernstein, Shur, Sawyer & Nelson, a law firm in Maine.A to Z Total Heating and Cooling in suburban Detroit was one of the first companies in the country to file for bankruptcy protection under the new rules. The family-owned firm has been operating for nearly four decades, but business really took off in the past few years. The company struggled to manage the growth.Its primary problem? Labor. The company’s two dozen employees weren’t enough to keep up with demand, and Jerry Stetina, A to Z’s chief operating officer, said it couldn’t find additional workers. That meant the firm got bogged down paying overtime on top of the typical $35 hourly wage — and tapped out cash reserves.Latest Updates: EconomyWall Street tumbles as tech stocks take a hit.Exxon Mobil lost money for the first time in decades.The center of the U.S. oil boom is now the center of its demise.See more updatesUpdated 58m agoMore live coverage: Global U.S. New York“I know it sounds really crazy, but the process of growing put us in the situation we’re in,” he said.Then a mild winter hit Michigan this year, and fewer customers called for new furnaces or repairs. What little work the employees did have was shut down by the coronavirus. But they didn’t want to give up: Mr. Stetina could see a strong summer season; A to Z just needed a bridge to get there.“People will live without heat, but they won’t live without air-conditioning,” he said. “Our phones are ringing now with questions about A.C. start-ups to get ready for summer.” When A to Z exits bankruptcy, the company plans to hire a controller to better handle its finances.ImageA to Z said it had needed a bridge to get to what it expected to be a busy summer season.A to Z said it had needed a bridge to get to what it expected to be a busy summer season.Credit...Sylvia Jarrus for The New York TimesHere are some of the main questions to consider if you are thinking about a bankruptcy filing for your small business.How do I know when to call it quits?Business owners must search their hearts and assess their balance sheets.“The first question to ask is: ‘Do the owners want to keep this going?’” said Kimberly Ross Clayson, whose firm, Clayson, Schneider & Miller in Detroit, advises small-business clients.If your heart isn’t in it, call a lawyer to help you wind down operations. But if you still think your business can become viable, a Chapter 11 bankruptcy might be the right call.Sign up to receive an email when we publish a new story about the coronavirus outbreak.Sign UpInitially, Mr. Stetina of A to Z was scared to call a lawyer. He knew the stigma around bankruptcy and was worried what clients might think even though A to Z planned to restructure, not discharge, debt. Once he did call, he said, he wished he had done it earlier.“A lot of big businesses have been doing it for years, and it’s some of the reason that they are in business still,” Mr. Stetina said.How do I know if restructuring would help?Write a business plan for a post-pandemic business world. How will your business operate? Where will revenue come from? What new expenses — for marketing, infrastructure and more — will you incur to help your business pivot? If you can write a business plan that shows a positive balance sheet after bankruptcy, restructuring might work.“Chapter 11 bankruptcy is designed to fix people’s balance sheets,” Mr. Keach, the Maine lawyer, said. “It allows you to restructure some debt, eliminate other debt. It doesn’t generate revenue for you.”Should I take out a loan or file for bankruptcy?Every business owner’s situation is different. But a general rule is: If you can’t identify enough future revenue to pay off the debt, borrowing may make matters worse. Some business owners no longer have any personal resources to draw on and may not receive federal stimulus funding.“Don’t borrow blindly and say, ‘It will all work out,’” said Ms. Clayson, who is a federal trustee for Subchapter 5 claims. “If you are thinking a credit card is how you will open your doors and bridge yourself to the next stage, then you really need to be thinking about how viable your business is.”If you find yourself considering nonbank lenders with high interest rates, it’s time to call a lawyer, she said.Do I have to file for bankruptcy to close my business?No. If you can pay off your creditors or negotiate a deal with them, you don’t need to file for bankruptcy protection. But you will want a lawyer to draft agreements.Also: Don’t forget about withholding taxes. When times are tight, many small-business owners who manage their own payroll dip into that pot of money they set aside at each pay period and use it for other expenses.“If you have unpaid withholding taxes, the business owner becomes personally liable,” Ms. Clayson said.Should I file for Chapter 7 or Chapter 11?Think of Chapter 7 as a funeral and Chapter 11 as a do-over.Chapter 7 is used for both individual and business bankruptcies when the goal is to wipe out debt. The debt can go away, but you may also lose your assets.If you wanted to restructure your business debt, you would consider a Chapter 11 bankruptcy and, more specifically, Subchapter 5 for small businesses. But you can always try to negotiate with creditors outside of a formal bankruptcy.“The only reason you need to use Chapter 11 at all is to deal with recalcitrant creditors,” Mr. Keach said. “If creditors won’t negotiate with you, bankruptcy allows you to cram down a plan of restructuring.”There are other forms of bankruptcy filing: One, Chapter 13, is used for personal reorganizations, when you want to try to keep your assets and renegotiate the terms of your debt. Another, Chapter 12, oversees businesses in farming and fishing.Will I lose everything in bankruptcy?It depends on what personal guarantees you made. Most small-business owners put up their home or some other asset as collateral for start-up loans. In fact, the Small Business Administration requires that as part of its non-Covid-related lending.If you used your house as collateral, it’s possible you would be forced to sell it as part of a Chapter 7 settlement. Under Chapter 11, you may have more luck.Must I file both personal bankruptcy and business bankruptcy?Possibly, but not necessarily. It depends on whether you are closing the business or trying to restructure, and what liabilities you have.If you are trying to restructure, the goal is for your lawyer to negotiate with your creditors and create a plan that lets you avoid a personal bankruptcy. But if the creditors don’t like the deal, they could come after you for any debts you personally guaranteed. In that case, you might be forced to file for personal bankruptcy.How does the new Subchapter 5 work?Here is the main thing to know: Like all bankruptcies, it has a magic power called the “automatic stay.” Filing for bankruptcy stops creditors from collecting from you.“It buys you time,” Mr. Keach said.And time is everything. For example, take a restaurant that was having its best year before the pandemic, but then its revenue disappeared. A Subchapter 5 bankruptcy could help the company by halting creditor collections and allowing owners to renegotiate terms.“What it might allow is, with a couple of exceptions, a built-in moratorium on rent,” Mr. Keach said. “You could propose a plan where you could literally not pay anything toward old debt for four to six months as long as your projections show that you have positive projected income after that.”In exchange, business owners will need to use their net operating income — what’s left after the usual expenses like rent, payroll, cost of goods — to pay creditors for the next three to five years.Can I ever open another business?Yes. Securing funding may be more challenging, but it’s not impossible.“My favorite clients have always been those who are already on to their next idea,” Ms. Clayson said. “This is the American way. You can start over. This isn’t a black mark.”

Published: April 28, 2020From: Overton County NewsThe Trump Administration has put a timely halt on the ability of the government to garnish Social Security benefits to pay for defaulted student loans for an indefinite period during the COVID crisis, reports Association of Mature American Citizens [AMAC].Seniors are the fastest growing segment of the population with outstanding student loan debt. Research conducted by Consumer Financial Protection Bureau [CFPB] shows that, “In 2018, Americans over the age of 50 owed more than $260 billion in student debt, up from $36 billion in 2004, according to the Federal Reserve. Nearly 40% of borrowers aged 65 and older are in default.”Bob Carlstrom, president of AMAC Action initiative, said, “Forty-five percent of unmarried Social Security recipients and 21% of married couples rely on their benefits for at least 90% of their income. Garnishing that fixed income for student loan debt can have a particularly devastating impact on their lives.”In a statement issued Wednesday, March 25, Carlstrom expressed AMAC’s appreciation for the decision to suspend the garnishment of Social Security benefits.“We commend the administration and the Secretary of Education for suspending the ability of the federal government to garnish the Social Security income of beneficiaries for payment of student debt during this challenging time,” Carlstrom stated. “The Secretary has indeed responded to the concerns and pleas of many members – and non-members – of AMAC. This action is a good first step on this issue.”Social Security benefits are off limits to nearly all creditors, but not the federal government, which can garnish Social Security benefits for certain debts, including federal student loan debt cosigned by retirees.According to the Federal Reserve, Americans over 50 hold $260 billion in student loan debt. Benefits can be garnished for court-ordered child support or alimony, or for debts owed to the government. For many seniors, however, their monthly Social Security check is both a critical part of, and indeed the safety net, of their income and financial situation.“We believe Social Security benefits should be protected permanently from student loan default garnishment by any party, including the federal government,” Carlstrom said.

Many people tend to fear bankruptcy because they believe they will lose everything. Many other people don’t want to hear of bankruptcy as an option to manage their debt because of social repercussions or because they fear they will have problems at work. What many people fail to understand is that bankruptcy can be your […] The post Will My Employer Find Out if I File Bankruptcy in Philadelphia? appeared first on .

Many people tend to fear bankruptcy because they believe they will lose everything. Many other people don’t want to hear of bankruptcy as an option to manage their debt because of social repercussions or because they fear they will have problems at work. What many people fail to understand is that bankruptcy can be your […] The post Will My Employer Find Out if I File Bankruptcy in Philadelphia? appeared first on .

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO WESTERN DIVISION AT DAYTON TAGNETICS, INC., Appellant, v. KENNETH KAYSER, et al., Appellees. : : : Case No. 3:19-cv-00363 : : Judge Thomas M. Rose : : : : ENTRY AND ORDER AFFIRMING THE BANKRUPTCY COURT’S OCTOBER 25, 2019 ORDER AND TERMINATING CASE This matter is before the Court on an appeal from the United States Bankruptcy Court for the Southern District of Ohio (“Bankruptcy Court”) pursuant to 28 U.S.C. § 158(a). The case arose from the Appellees, Kenneth W. Kayser, Ronald E. Earley, and Jonathan Hager (collectively, the “Petitioning Creditors”) filing an involuntary bankruptcy petition as to the alleged debtor corporation, the Appellant, Tagnetics, Inc. (“Tagnetics”). (See Doc. 2-2.) The Petitioning Creditors allege in the petition that they are owed unpaid wages and salary related to their employment with Tagnetics. (Id. at PAGEID # 30-31, 33.) However, the issues on appeal only concern the parties’ settlement negotiations and settlement agreement. Petitioning Creditors are acting in this appeal pro se.1 1 Tagnetics requests oral argument, while Petitioning Creditors ask that this Court not require oral argument. (Doc. 12 at PAGEID # 475; Doc. 14 at PAGEID # 745.) Pursuant to Federal Rule of Bankruptcy Procedure 8019, the Court has examined the briefs and record and determined that oral argument is unnecessary because “the facts and legal arguments are adequately presented in the briefs and record, and the decisional process would not be significantly aided by oral argument.” FED. R. BANKR. P. 8019(b)(3). 1 Tagnetics appeals the Bankruptcy Court’s October 25, 2019 “Order Granting in Part Tagnetics’ Motion to Enforce Settlement Agreement (Doc. 101) and Ordering Other Matters” (the “October 25 Order”). (See Doc. 1; Doc. 12.) Petitioning Creditors ask that the Court affirm the October 25 Order. (See Doc. 14.) For the reasons discussed below, the Court AFFIRMS the Bankruptcy Court’s decision. More specifically, the release in the parties’ settlement agreement does not extend to related third parties (related individuals/entities), and the parties’ settlement agreement—formed by an exchange of emails between the parties on July 26, 2019—is enforceable and does not suffer from a lack of a meeting of the minds. I. BACKGROUND (1) The July 26, 2019 Email Exchanges The parties commenced settlement discussions in earnest on or about July 19, 2019. (See Doc. 12-1 at PAGEID # 512-13.) After a series of offers, counteroffers, and rejections (see id. at PAGEID #507-12), Tagnetics and the Petitioning Creditors agreed to a settlement on July 26, 2019, the key terms of which were documented in an email from Tagnetics’ counsel (Stephen Stern) to the Petitioning Creditors at 3:27 p.m. that day. That email stated: Ron, Ken, and Jon: Below sets forth the terms of the agreement we reached by phone. Each of you please reply confirming agreement to these terms and then I need you to initiate a call with the court to advise of the settlement (it makes no sense for any of us to have to show up at court on Monday now that we have an agreement in place that will be documented more thoroughly in a settlement agreement. We can work on the written settlement agreement over the weekend. Key terms: Payment of $90,000 total ($30,000 each) within three days of a fully executed agreement. The remaining schedule of payments as you proposed below,2 except in 12 and 18 months instead of 6 and 12 months. Full mutual releases (no carve outs) Dismissal/withdrawal of claims by each of you to be filed within one day of receiving payment I believe this captures the key terms we discussed. Please confirm. Stephen (Doc. 12-1 at PAGEID # 506.) In response, one of the Petitioning Creditors (Mr. Hager) sent the following email to Mr. Stern approximately 30 minutes later: Stephen Mr. Earley is discussing this with the court at this moment. I am responding for Kayser, Earley and Hager [i.e., the Petitioning Creditors] saying we agree to the terms put forth as documented above [i.e., Mr. Stern’s July 26, 2019 at 3:27 p.m. email]. (Id.) Two minutes later, Mr. Hager followed up with another email to Mr. Stern (copying the other two Petitioning Creditors) in which he stated: Stephen, I will clarify that we agree to the terms you set forth in your last email and represented below [i.e., Mr. Stern’s July 26, 2019 at 3:27 p.m. email]. Key Terms: Payment of $90,000 total ($30,000 each) within three days of a fully executed agreement. The remaining schedule of payments as you proposed below, except in 12 and 18 months instead of 6 and 12 months. 2 The “remaining schedule of payments as you proposed below” is a schedule of payments reflected in an email sent by one of the Petitioning Creditors on July 25, 2019 at 1:25 p m. (See Doc. 12-1 at PAGEID # 507-08.) 3 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:248/o2f02009:P2A1:G16EIDD#e: s8c00Main Document Page 4 of 20 Full mutual releases (no carve outs) Dismissal//withdrawal of claims by each of you to be filed within one day of receiving payment (Id. at PAGEID # 505-06.) Thus, the “Key Terms” listed in Mr. Stern’s email and the “Key Terms” listed in Mr. Hager’s second response matched. Mr. Stern responded one minute later with an email that simply states: “Thank you.” (Id. at PAGEID # 505.) (2) The Draft Agreement On August 14, 2019, approximately two-and-a-half weeks later, Tagnetics’ counsel sent the Petitioning Creditors a draft agreement titled “Settlement and Mutual General Release Agreement.” (Doc. 12-2.) Among other things, the draft agreement contained language in which each Petitioning Creditor “releases and discharges Tagnetics, as well as its current and former parent companies, corporate and operating affiliates, subsidiaries, and related entities (including specifically Compass Marketing, Inc.), as well as each of their current and former directors, officers, shareholders or other equity holders, agents, employees, accountants, attorneys, and insurers … from any and all causes of action, claims, debts, costs, liabilities, and demands arising from the beginning of time until the date of this Agreement … [Each Petitioning Creditor] understands that this is a GENERAL RELEASE.” (Id. at PAGEID # 517-19.) The draft agreement also contained similar language in which Tagnetics “releases and discharges [the Petitioning Creditors] from any and all causes of action, claims, debts, costs, liabilities, and demands arising from the beginning of time until the date of this Agreement … Tagnetics understands that this is a GENERAL RELEASE.” (Id. at PAGEID # 519.) In response, the Petitioning Creditors raised several concerns about the draft agreement and stated that several changes would need to be addressed. (See Doc. 12-4 at PAGEID # 530.) 4 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:258/o2f02009:P2A1:G16EIDD#e: s8c01Main Document Page 5 of 20 In turn, Tagnetics’ counsel challenged what he alleged to be mischaracterizations and said that many of the terms included in the Petitioning Creditors’ response to the draft agreement fell outside of the scope of what had been agreed to in the parties’ July 26, 2019 email exchanges. (Id. at PAGEID # 528-29.) The Petitioning Creditors did not sign the draft agreement. (3) The Bankruptcy Court’s Decision on Tagnetic s’ Motion to Enforce Settlement Agreement Tagnetics then filed a “Motion to Enforce Settlement Agreement.” (Doc. 2-12.) In its motion, Tagnetics argued that the parties reached a settlement agreement (with its key terms) by email on July 26, 2019, but the Petitioning Creditors were seeking to include additional terms that were not part of the agreement. (See id; see also Doc. 7-3 at PAGEID # 379; Doc. 12-5.) In response to the motion, the Petitioning Creditors argued that, because terms that they wanted included in the settlement agreement were mentioned in their initial proposal by email on July 20, 2019 (i.e., six days before the July 26 email exchanges discussed above), and Tagnetics (allegedly) did not dispute those terms, such terms were accepted and the parties’ subsequent negotiations only concerned an acceptable payment schedule. (See Doc. 2-14; see also Doc. 7-3 at PAGEID # 379; Doc. 12-5.) On October 18, 2019, the Bankruptcy Court held an evidentiary hearing on Tagnetics’ motion. (See Doc. 12-5 (transcript of evidentiary hearing).) On October 25, 2019, the Bankruptcy Court rendered an oral decision telephonically that included its findings of fact and conclusions of law (the “October 25 Oral Decision”). (See Doc. 7-3 (transcript of October 25 Oral Decision).) In line with its subsequent October 25 Order issued later that day (Doc. 2-21), the Bankruptcy Court determined in its October 25 Oral Decision that the parties had entered into a settlement agreement on July 26, 2019, the terms of which were reflected in the parties’ emails from July 26, 2019. (Doc. 7-3 at PAGEID # 386, 388, 392.) Thus, 5 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:268/o2f02009:P2A1:G16EIDD#e: s8c02Main Document Page 6 of 20 the Bankruptcy Court rejected Petitioning Creditors’ primary argument in response to the motion. (See also id. at PAGEID # 385-86.) The Bankruptcy Court determined that “the emails from July 20th through July 26th … show the numerous rejections and then finally an acceptance and memorialization in writing of agreed key terms” later on July 26, 2019. (Id. at PAGEID # 386.) The Bankruptcy Court also specifically addressed the agreement’s “Full mutual releases (no carve outs)” term. It determined that the Petitioning Creditors and Tagnetics released each other from all liability and obligations owed or claimed to be owed. (Doc. 7-3 at PAGEID # 389- 90.) However, the Bankruptcy Court did not construe that term “to include affiliates, parent corporations, officers, directors or other undisclosed third parties.” (Id. at PAGEID # 390.) The Bankruptcy Court also stated: Although the settlement may not have resolved all disputes between Tagnetics and the Remaining Petitioning Creditors, by an objective standard a meeting of the minds occurred as to the payments to the Remaining Petitioning Creditors and a mutual release of any other obligations or damages. The agreement did not address Compass or any affiliates, parent corporation, officers, directors or third parties. Nor did it cover equity interests of the Remaining Petitioning Creditors, if any. The parties either by reference to rejected offers which no longer have any legal effect or by draft settlement agreement proposed after the agreement date of July 26th, have attempted to expand the agreement beyond the plain meaning of its terms. Thus, the agreement was as the parties agreed to by email on July 26th, 2019. … The parties mutually released any obligations to each other as to the salary, benefits, loans or other similar obligations owed to the Remaining Petitioning Creditors. The agreement does not address any equity interests of the Remaining Petitioning Creditors. It also does not release any third party obligations, including but not excluded to Compass Marketing. Absent specific reference to such matters that had not occurred as of July 26th, the release of a stranger to a settlement is not ordinary, nor would ownership interest in a corporate entity be finalized by a general release. (Doc. 7-3 at PAGEID # 391-393.) Later that day, the Bankruptcy Court issued the October 25 Order, granting, in part, 6 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:278/o2f02009:P2A1:G16EIDD#e: s8c03Main Document Page 7 of 20 Tagnetics’ motion. (Doc. 2-21.) The October 25 Order states, in relevant part: Based upon the evidence admitted during the hearing, including the testimony of the witnesses and the documentary evidence, and the arguments of the parties, and in accordance with the court’s oral decision rendered telephonically on October 25, 2019 at 11:30 a.m., including its findings of fact and conclusions of law stated therein, Tagnetics’ Motion to Enforce Settlement Agreement (doc. 101) is granted in part. Accordingly, IT IS ORDERED that the settlement agreement agreed to by the parties on July 26, 2019, shall be enforced as follows: • [payment schedule] • Excepting the payments required by this Order as defining the terms of the settlement reached by the parties, the parties are mutually released from any past obligation to each other arising out of any contract or claim of any nature … … Except as otherwise noted, nothing in this order should be construed as addressing any equity interest, if any, of the Remaining Petitioning Creditors. It also does not release any obligations owed to or from third parties, including, but not limited to, Compass Marketing, or any affiliates, subsidiaries, parent corporation, officers, or directors of Tagnetics, Inc. …. (Doc. 2-21 (emphasis in original).) This appeal of the October 25 Order followed. II. STANDARD OF REVIEW A district court, serving in an appellate capacity, reviews a bankruptcy court’s findings of fact for clear error and conclusions of law de novo. Wesbanco Bank Barnesville v. Rafoth (In re Baker & Getty Fin. Servs., Inc.), 106 F.3d 1255, 1259 (6th Cir. 1997); 28 U.S.C. § 158(a). “A factual finding will only be clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” United States v. Ayen, 997 F.2d 1150, 1152 (6th Cir. 1993). Issues that were not raised in a bankruptcy court will not be considered by the district court on appeal. See In re Eagle–Picher Industries, Inc., 963 F.2d 855, 863 (6th Cir. 1992) (“appellate 7 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:288/o2f02009:P2A1:G16EIDD#e: s8c04Main Document Page 8 of 20 courts are not to address issues not raised for the first time in the trial court”). Additionally, the district court “is not obligated to search the record for support” of a party’s argument. Nat’l Credit Union Admin. Bd. v. Zovko, 728 F. App’x 567, 569 (6th Cir. 2018). III. ANALYSIS Tagnetics raises two issues in this appeal. First, whether the Bankruptcy Court erred when it held that the parties’ settlement agreement did not include a release of Tagnetics’ (and the Remaining Petitioning Creditors’) related individuals/entities. (Doc. 12 at PAGEID # 478.) Second, if the Bankruptcy Court properly found that the release did not include a release of individuals/entities related to the parties, whether there was no meeting of the minds and, thus, no settlement agreement to enforce. (Id.) The Court will now address each of those issues. (1) Scope of Release As Tagnetics acknowledges, the first issue on appeal is narrow. (Doc. 12 at PAGEID # 484 (“While [Tagnetics’] Motion to Enforce the Settlement Agreement concerned several terms of the agreement between the parties, the only issue on appeal regarding the terms of the agreement is whether the scope of the release included individuals/entities that are related to the parties, such as parent companies, subsidiaries, affiliates, officers, directors, heirs, and personal representatives”).) Tagnetics argues that the Bankruptcy Court erred “when it found that the scope of the release given by the parties did not extend to related third parties, such as parent companies, subsidiaries, affiliates, officers, directors, heirs, and personal representatives.” (Id. at PAGEID # 474.) “A settlement agreement is a type of contract and is governed by reference to state substantive law governing contracts generally.” Cogent Solutions Grp., LLC v. Hyalogic, LLC, 8 CasCea3s:e1:93-b:1k9-3-c0v8-202036D3o-TcM1R80DocFi#le:d1604F/2ile7d/2: 004/2E7n/t2e0rePda0g4e/:298/o2f02009:P2A1:G16EIDD#e: s8c05Main Document Page 9 of 20 712 F.3d 305, 309 (6th Cir. 2013) (internal quotation marks omitted). Here, there is no dispute that the substantive law to be applied is Ohio law. (See generally Docs. 12, 14, 15; see also Doc. 7-3 (transcript of October 25 Oral Decision) at PAGEID # 380 (Bankruptcy Court’s analysis to support application of Ohio law).) Under Ohio law, “[t]he purpose of contract construction is to effectuate the intent of the parties.” Kelly v. Medical Life Ins. Co., 509 N.E.2d 411, 413, 31 Ohio St. 3d 130 (Ohio 1987). “The intent of the parties to a contract is presumed to reside in the language they chose to employ in the agreement.” Id. “[C]ommon words appearing in a written instrument are to be given their plain and ordinary meaning unless manifest absurdity results or unless some other meaning is clearly intended from the face or overall contents of the instrument.” Alexander v. Buckeye Pipe Line Co., 374 N.E.2d 146, 150, 53 Ohio St. 2d 241 (Ohio 1978). “[W]here the terms of a contract are clear and unambiguous, extrinsic evidence may not be used as an aid in interpretation.” Whitley v. Canton City Sch. Dist. Bd. of Educ., 528 N.E.2d 167, 168, 38 Ohio St. 3d 300 (Ohio 1988); see also Kelly, 509 N.E.2d at 413 (“A court will resort to extrinsic evidence in its effort to give effect to the parties’ intention only where the language is unclear or ambiguous, or where the circumstances surrounding the agreement invest the language of the contract with a special meaning”). Thus, “[w]hen the language of a written contract is clear, a court may look no further than the writing itself to find the intent of the parties.” Transtar Elec. v. A.E.M. Elec. Servs. Corp., 16 N.E.3d 645, 648, 140 Ohio St. 3d 193 (Ohio 2014). Additionally, “where the terms in an existing contract are clear and unambiguous, … [a] court cannot in effect create a new contract by finding an intent not expressed in the clear language employed by the parties.” Alexander, 374 N.E.2d at 150. 9 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2180/2 o0f 2009:2P1A:1G6EIDD#e:s8c0M6ain Document Page 10 of 20 As shown above, the parties expressly agreed to “[f]ull mutual releases (no carve outs).” Tagnetics concedes that “[t]he scope of the release to which the parties agreed is clear and unambiguous,” and, in fact, all of the parties agree that the terms in the settlement agreement are unambiguous. (Doc. 12 at PAGEID # 487, 495-96.) The Court likewise agrees and determines that the terms are clear and unambiguous. The interpretation of an unambiguous contract is a matter of law. Nationwide Mut. Fire Ins. Co. v. Guman Bros. Farm, 652 N.E.2d 684, 686, 73 Ohio St. 3d 107 (Ohio 1995) (“If a contract is clear and unambiguous, then its interpretation is a matter of law and there is no issue of fact to be determined”); see also Latina v. Woodpath Dev. Co., 567 N.E.2d 262, 264, 57 Ohio St. 3d 212 (Ohio 1990) (the construction of written contracts is a matter of law). In assessing the plain and ordinary meaning of the terms, Tagnetics acknowledges that courts in Ohio have defined “mutual” to mean “[c]ommon to both parties” or “reciprocal.” (Doc. 12 at PAGEID # 493 (citing Metalworking Machinery Co., Inc. v. Fabco, Inc., 477 N.E.2d 634, 637, 17 Ohio App. 3d 91 (Ohio Ct. App. 1984) (quoting Black’s Law Dictio nary (5th Ed. 1979)).) Additionally, Black’s Law Dictionary defines “mutual release” as “[a] simultaneous exchange of releases of legal claims held by two or more parties against each other.” B lack’s Law Dictionary (11th Ed. 2019) (defining “mutual release” under the definition of “release”). In context, it is clear that the words “full” and “(no carve outs)” are used to clarify that there are no exceptions to the “mutual releases,” i.e., to the “simultaneous exchange of releases of legal claims held by [Tagnetics and the Petitioning Creditors] against each other.” Bla ck’s Law Dictionary (11th Ed. 2019) (definition of “mutual release”); Alexander, 374 N.E.2d at 150 (in interpreting a contract, courts read terms in conjunction with their surrounding terms). 10 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2181/2 o0f 2009:2P1A:1G6EIDD#e:s8c0M7ain Document Page 11 of 20 Therefore, the Court determines that the parties’ settlement agreement does not include or apply to individuals or entities related to the parties, such as parent companies, subsidiaries, affiliates, officers, directors, heirs, or personal representatives. “If the parties had intended” to expand the scope of the mutual releases to also include such individuals or entities then “they could have easily so stated” in the settlement agreement (the July 26 email exchanges), but they did not. Alexander, 374 N.E.2d at 150. Some other meaning is not “clearly intended from the face or overall contents of the settlement agreement,” and this construction of the phrase does not result in “manifest absurdity.” Alexander, 374 N.E.2d at 150. In fact, the district court in NRRM, LLC v. Mepco Fin. Corp., Case No. 10 C 4642, 2015 U.S. Dist. LEXIS 39058, 2015 WL 150 WL 1501897 (N.D. Ill. Mar. 27, 2015) was faced with the essentially same issue presented here and came to the same conclusion. Like this case, in NRRM, one party (Mepco) moved to enforce its settlement with another party (NRRM). The district court explained: NRRM argues that the fourth material term it offered—'[m]utual releases’— included not only NRRM’s and Mepco’s releasing of claims against each other, but also [third-party] Choice’s releasing its claims against NRRM. Not so, says Mepco: ‘When two parties agree to enter into a mutual release, they agree to release their claims against one another, without regard for claims that may be held by a third party. That is the objective and uniformly understood meaning of the term mutual release.’ … The court agrees that Mepco’s is indeed the common and generally accepted definition of ‘mutual release.’ See Black’s Law Dictionary 1480 (10th ed. 2014) (defining ‘mutual release’ as ‘[a] simultaneous exchange of releases of legal claims held by two or more parties against each other.’) (emphasis added); id. at 1178 (defining ‘mutual’ as ‘directed by each toward the other or others; reciprocal,’ and ‘reciprocally given, received, or exchanged’) … Accordingly, the settlement agreement is not contingent on [third-party] Choice’s releasing its claims against NRRM, because the generally accepted meaning of ‘mutual release’ does not include releases by third parties. 11 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2182/2 o0f 2009:2P1A:1G6EIDD#e:s8c0M8ain Document Page 12 of 20 NRRM, 2015 U.S. Dist. LEXIS 39058 at *20-22 (emphasis in original). Tagnetics makes a number of arguments in support of its position. However, the Court initially notes a fundamental problem: Tagnetics routinely refers to the draft agreement titled “Settlement and Mutual General Release Agreement” (Doc. 12-2) that it submitted to the Petitioning Creditors on August 14, 2019 as the “Settlement Agreement.” Although it is apparent that Tagnetics wishes that draft document was the parties’ actual settlement agreement, it is not. (See Doc. 12 at PAGEID # 483-84, 490; Doc. 12-2; Doc. 12-4.) And, Tagnetics concedes that it is not—as it must, given that the Petitioning Creditors never signed that draft document and specifically objected to it. (Id.) Some of Tagnetics’ arguments on appeal flow from its flawed understanding of the parties’ agreement. Tagnetics’ first main argument is that “[i]t is common practice to include in any full release of a business entity a release of the entity’s parent companies, subsidiaries, and affiliates (as well as other related individuals, including, but not limited to, officers and directors)” and that “it is understood that a general release encompasses such entities/individuals that are related to the business entity that is a party to a settlement.” (Doc. 12 at PAGEID # 487.) In support of this argument, Tagnetics cites a series of cases from Florida and one federal case from Vermont. However, the settlement agreement here does not state that contains a “general release,” and the issue presented arises under Ohio law—not Florida or Vermont.3 3 The cited Florida and Vermont cases are distinguishable for other reasons as well. For example, Bd. of Trs. of Fla. Atl. Univ. v. Bowman, 853 So. 2d 507 (Fla. Ct. App. 2003) involved a motion for attorneys’ fees due to an alleged rejection of a settlement proposal in light of a Florida state statute and rule of civil procedure. Additionally, the settlement proposal expressly included a “General Release” that specifically provided for a release of related individuals/entities who were not parties to the lawsuit. As another example, Over & Under Piping Contrs., Inc. v. Vt. Gas Sys., Case No. 2:15-cv-169, 2019 U.S. Dist. LEXIS 807, 2019 WL 77044 (D. Vt. Jan. 2, 2019) involved whether the parties had entered into an oral settlement agreement; the court ordered one party to execute a general release that included the other party’s employees and agents based on evidence that counsel for both parties understood that their releases would be broad general releases that are commonplace in Vermont legal practice. 12 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2183/2 o0f 2009:2P1A:1G6EIDD#e:s8c0M9ain Document Page 13 of 20 Tagnetics says that it “has found no authority in Ohio or the Sixth Circuit that has addressed the issue before this Court regarding the scope of the releases.” (Doc. 12 at PAGEID # 488.) The Court likewise has not found an Ohio case (or federal case applying Ohio law) that specifically deals with the interpretation of the phrase used in the settlement agreement. However, as shown above, Ohio caselaw does provide applicable principles for this Court to make its determination on this issue. And, the NRRM case discussed above is more analogous than any of the cases cited by Tagnetics. Moreover, while it is true that extrinsic evidence of a general custom or trade usage is permitted “to show that the parties to a written agreement employed terms having a special meaning within a certain geographic location or a particular trade or industry,” such extrinsic evidence “cannot vary the terms of an express contract.” Alexander, 374 N.E.2d at 151. As the Ohio Supreme Court determined was the case in Alexander, this Court determines that the cited caselaw from two states that are not Ohio and the (arguably self-serving) testimony from Tagnetics’ own counsel about his personal experience in drafting settlement agreements “does not evince a custom or usage so widespread” in the context of forming settlement agreements “as to support a valid presumption that the parties, having knowledge of the special usage, must have intended” a more expansive meaning for the mutual releases when they employed the phrase ‘[f]ull mutual releases (no carve outs)’ in the settlement agreement.4 Id. 4 Tagnetics argues that the Bankruptcy Court disregarded its counsel’s “unrebutted testimony, which was improper and in error,” concerning how he personally could not recall a single instance where a settlement involving a business entity did not include a release of related individuals/entities. (Doc. 12 at PAGEID # 489.) In support of this argument, Tagnetics cites an Ohio appellate court opinion that addressed its standard of review of an Ohio trial court’s decision. As an initial matter, there is no support for the assertion that the Bankruptcy Court ignored this testimony. In fact, the October 25 Order and transcript of the October 25 Oral Decision indicate otherwise. (See Doc. 2-21; see also 7-3 at PAGEID # 376 (the Bankruptcy Court’s judge presided over the October 18 hearing, at which testimony was presented and “[i]n reaching its determinations the [Bankruptcy] Court considered the demeanor and credibility of the witnesses who testified … [including] Stephen Stern, counsel for Tagnetics”); id. at 13 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2184/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M0ain Document Page 14 of 20 A number of Tagnetics’ other arguments involve consideration of extrinsic evidence. Tagnetics points to language in the draft agreement that its counsel sent to the Petitioning Creditors on August 14, 2019, subsequent to the parties’ settlement agreement (the July 26 email exchanges). Ohio law shows that a subsequent draft document is not to be considered for purposes of determining the issue presented here. Whitley, 528 N.E.2d at 168 (given that the terms of the parties’ contract were clear and unambiguous, extrinsic evidence—namely, a prior practice and the language in a proposed bargaining agreement—could not be used as an aid in interpreting the contract). Thus, Tagnetics is wrong when it argues that “[t]he scope of the release Tagnetics proposed to give to the [] Petitioning Creditors also bears consideration.” (Doc. 12 at PAGEID # 491.) Similarly, Tagnetics argues that one of the three Petitioning Creditors—on behalf of an entity (Kayser Ventures, Ltd.)—previously signed a settlement agreement that contains the more expansive release language that is found in the draft document. (See Docs. 12-2 and 12-6.) That settlement agreement was between Tagnetics, two entities, and one individual (none of the Petitioning Creditors). Thus, it is not the settlement agreement at issue, and the parties to that settlement agreement are not the same. Once again, Ohio law provides that “[w]here the terms of a contract are clear and unambiguous, extrinsic evidence may not be used as an aid in interpretation.” Whitley, 528 N.E.2d at 168; Transtar Elec., 16 N.E.3d at 648 (“[w]hen the language of a written contract is clear, a court may look no further than the writing itself to find PAGEID # 390 (“At the evidentiary hearing Stern stated that releasing affiliates of a company was common in these types of agreements”).) Additionally, later in its brief, Tagnetics essentially concedes the irrelevance of the testimony to the issue presented on interpreting clear and unambiguous terms in an agreement. (See Doc. 12 at PAGEID # 494 (making this same argument in the context of an alternative scenario that assumes, arguendo, that the Bankruptcy Court “meant to find the phrase ‘full mutual releases (no carve outs)’ ambiguous”).) 14 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2185/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M1ain Document Page 15 of 20 the intent of the parties”); see also Kelly, 509 N.E.2d at 413 (“A court will resort to extrinsic evidence in its effort to give effect to the parties’ intention only where the language is unclear or ambiguous, or where the circumstances surrounding the agreement invest the language of the contract with a special meaning”).5 Given that the terms of the settlement agreement are clear and unambiguous, the Court does not consider such extrinsic evidence for purposes of this issue. Similar too is Tagnetics’ argument that the Petitioning Creditors conceded that the scope of the release applied to related parties in a statement they made by email on August 19, 2019 concerning language in the draft settlement agreement (therefore, after the July 26 email exchanges that formed the settlement agreement). As an initial matter, the Court does not find the Petitioning Creditors’ statement to be a concession regarding the scope of the phrase “[f]ull mutual releases (no carve outs).” More fundamentally, once again, the Court does not consider such extrinsic evidence for purposes of this issue. Whitley, 528 N.E.2d at 168. The Court notes that if the parties want to enter into a subsequent agreement or amendment to the settlement agreement, then they may do so, but that is not the issue on appeal. Tagnetics also makes what turns out to be a strawman argument. It argues that the Petitioning Creditors understood the phrase “full mutual releases (no carve outs)” to mean that any exposure they may have from Tagnetics would be extinguished, but that they would not be providing Tagnetics a reciprocal release. (See Doc. 12 at PAGEID # 491-93.) In addition to the fact that such alleged subjective intent is not to be considered (Transtar Elec., 16 N.E.3d at 648), the allegation is unsupported. And, as set forth in the “Background” section above, the Bankruptcy Court’s decision does not align with that alleged understanding by Petitioning 5 As shown above, the Court determines that the circumstances surrounding the parties’ settlement agreement here do not “invest the language of the contract with a special meaning.” Kelly, 509 N.E.2d at 413. 15 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2186/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M2ain Document Page 16 of 20 Creditors anyway; it determined that there were reciprocal releases between Petitioning Creditors and Tagnetics. (Doc. 2-21; Doc. 7-3 at PAGEID # 390-393.) Moreover, on appeal, the Petitioning Creditors do not challenge the Bankruptcy Court’s decision and state that they accept it and believe it was a fair ruling. Finally, Tagnetics makes several arguments where it “assum[es] arguendo that the Bankruptcy Court meant to find the phrase ‘full mutual releases (no carve outs)’ ambiguous.” (Doc 12 at PAGEID # 494.) However, the Bankruptcy Court did not find the phrase ambiguous (and Tagnetics cites nothing to indicate otherwise). Thus, those arguments are irrelevant. Tagnetics concedes that the phrase is not ambiguous, and, as shown above, this Court determines that the phrase is not ambiguous and makes its analysis accordingly. Therefore, the Court comes to the same conclusion as the Bankruptcy Court: the scope of the release in the parties’ settlement agreement does not include individuals/entities that are related to the parties, such as parent companies, subsidiaries, affiliates, officers, directors, heirs, and personal representatives. (2) Meeting of the Minds For the second issue on appeal, Tagnetics argues that “there can be no meeting of the minds between Tagnetics and the … Petitioning Creditors if the phrase ‘full mutual releases (no carve outs)’ is found to exclude the parties’ related individuals/entities….” (Doc. 12 at PAGEID # 499.) This Court disagrees. Under Ohio law, “[e]ssential elements of a contract include an offer, acceptance, contractual capacity, consideration (the bargained for legal benefit and/or detriment), a manifestation of mutual assent and legality of object and of consideration.” Williams v. Ormsby, 16 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2187/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M3ain Document Page 17 of 20 966 N.E.2d 255, 258, 131 Ohio St. 3d 427 (Ohio 2012). A party seeking to prove the existence of a contract “must show the elements of mutual assent (generally, offer and acceptance) and consideration,” that there was a “meeting of the minds,” and “that the contract was definite as to its essential terms.” Nilavar v. Osborn, 711 N.E.2d 726, 732, 127 Ohio App. 3d 1 (Ohio Ct. App. 1998). Regarding the last requirement (concerning definiteness of essential terms), the Ohio Supreme Court has held that the terms of an agreement need to be “reasonably certain and clear” and has acknowledged that “all agreements have some degree of indefiniteness and some degree of uncertainty.” Kostelnik v. Helper, 770 N.E.2d 58, 61, 96 Ohio St. 3d 1 (Ohio 2002). “In order for a meeting of the minds to occur, both parties to an agreement must mutually assent to the substance of the exchange,” with “a definite offer on one side and an acceptance on the other.” Turoczy Bonding Co. v. Mitchell, 118 N.E.3d 439, 444, 2018-Ohio-3173 (Ohio Ct. App. 2018). “Ohio law does not require contracting parties to share a subjective meeting of the mind to establish a valid contract; otherwise, no matter how clearly the parties wrote their contract, one party could escape its requirements simply by contending that it did not understand them at the time.” 216 Jamaica Ave., LLC v. S&R Playhouse Realty Co., 540 F.3d 433, 440 (6th Cir. 2008). “What it does require is that the terms of the agreement establish an objective meeting of the mind, which is to say that the contract was clear and unambiguous.” Id. And, “expressions of assent are generally sufficient to show a meeting of the minds.” Nilavar, 711 N.E.2d at 733 (courts consider “only objective manifestations of intent,” and “[s]ecretly held, unexpressed intent is not relevant to whether a contract is formed”); see also 216 Jamaica Ave., 540 F.3d at 441 (where the relevant terms of the agreement are clear and unambiguous, a party is not permitted to introduce extrinsic evidence of its intent in entering into the agreement). 17 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2188/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M4ain Document Page 18 of 20 Finally, “[t]he existence of a valid agreement is not diminished by the fact that the parties have yet to memorialize the agreement.” RE/MAX Int’l, Inc. v. Realty One, Inc., 271 F.3d 633, 646 (6th Cir. 2001). Courts may look to objective acts of the parties to determine whether an agreement has been reached. Id. Here, Tagnetics concedes that the July 26, 2019 email exchange contains the key terms of the parties’ agreement. (Doc. 12 at PAGEID # 476.) Both sides agreed on those key terms— Tagnetics offered them and the Petitioning Creditors accepted them—and the agreement includes bargained for consideration. Williams, 966 N.E.2d at 258; Turoczy Bonding, 118 N.E.3d at 444 (despite the fact that the parties contemplated a future memorialized agreement, their email communications established a valid settlement agreement and did not expressly state that the agreement would only become binding after it was formally executed). The content of the emails exchanged on July 26 between the parties demonstrate that they reached an agreement on the terms in those emails. Id.; RE/MAX, Int’l, 271 F.3d at 646. The Court determines that the settlement agreement—as evidenced in the exchange of emails between the parties on July 26, 2019—is clear and unambiguous, contains and was definite as to its essential terms, and establishes an objective meeting of the mind (including on the release term at issue). Turoczy Bonding, 118 N.E.3d at 444; Nilavar, 711 N.E.2d at 333; 216 Jamaica Ave, 540 F.3d at 440. In support of its argument that prior history and the settlement negotiations demonstrates that there was no meeting of the minds, Tagnetics cites to two Ohio appellate court cases that are readily distinguishable from this case: Beechwood Villa Apartments v. Nord Bitumi U.S., Inc., Case No. CA89-08-073, 1990 Ohio App. LEXIS 1561, 1990 WL 50003 (Ohio Ct. App. Apr. 23, 1990)—which is unpublished—and Wilson v. Pride, 2019-Ohio-3513, 2019 Ohio App. LEXIS 18 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2189/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M5ain Document Page 19 of 20 3610, 2019 WL 4134011 (Ohio Ct. App. 2019). Both of those cases involved an alleged oral settlement agreement that was never reduced to writing. Additionally, in Beechwood Villa Apartments, the trial court had relied on an affidavit in finding that the parties’ oral agreement was enforceable, but that affidavit was unclear concerning a key term. Beechwood Village Apartments, 1990 Ohio App. LEXIS 1561, at *4-5. In Wilson, the parties were still negotiating a key term when one attorney emailed the court claiming that the parties had agreed on a settlement and, approximately 20 minutes later upon receiving that email, opposing counsel phoned the court to inform it that the parties actually had not reached a settlement. Wilson, 2019 Ohio App. LEXIS 3610, at *2-3, 15-16. Much of Tagnetics’ argument on the second issue relies on its unfounded assertion that the Bankruptcy Court reformed the language of the settlement agreement. However, that is incorrect; if anything, Tagnetics is the one that is attempting to reform the settlement agreement. Tagnetics has a fundamental misunderstanding of what the Bankruptcy Court did. The Bankruptcy Court determined that the parties formed a settlement agreement on July 26, 2019 through their email exchanges on that date, and it enforced that agreement based on what was written (which everyone agrees were unambiguous terms). (See Doc. 2-21; Doc. 7-3 at PAGEID # 386, 388, 392.) Tagnetics’ related arguments concerning mutual mistake in the context of the Bankruptcy Court allegedly reforming the settlement agreement’s terms are inapplicable. IV. CONCLUSION The Bankruptcy Court’s October 25, 2019 “Order Granting in Part Tagnetics’ Motion to Enforce Settlement Agreement (Doc. 101) and Ordering Other Matters” is AFFIRMED. The release in the parties’ settlement agreement does not extend to, or include, related third parties 19 CasCea3se:1:93-:b1k9–3c0v8-0202363D-oTcM1R80DocF#il:e1d60F4/il2e7d/:2004/2E7n/2te0rePdag0e4:/2280/2 o0f 2009:2P1A:1G6EIDD#e:s8c1M6ain Document Page 20 of 20 (related individuals/entities). Also, the parties’ settlement agreement—formed by an exchange of emails between the parties on July 26, 2019—is enforceable and does not suffer from a lack of a meeting of the minds. This case is TERMINATED on the docket of this Court. DONE and ORDERED in Dayton, Ohio, this Monday, April 27, 2020. s/Thomas M. Rose THOMAS M. ROSE UNITED STATES DISTRICT JUDGE 20 The post Tagnetics, Inc. Order appeared first on Chris Wesner Law Office.

Bankruptcy Code2 § 1307(b) has been called an “escape hatch”3 for “bad faith” Chapter 13 filers, facing creditors’ § 1307( c ) motions to convert their cases to Chapter 7. Those debtors assert § 1307(b)’s “absolute right”4 to voluntarily dismiss their case. But, “how can a debtor assert § 1307(b) if they don’t qualify for Chapter 13 relief?” Disqualified from Chapter 13 Access to Chapter 13 relief has specific requirements.5 Failure to satisfy any of these requirements denies debtors Chapter 13 relief.6 Dismissal vs. Conversion A debtor’s § 1307(b) motion to dismiss may be a tactical response to a creditor’s motion to convert a bad faith case7. Courts are divided on whether dismissal is required,8 as opposed to conversion, due to bad faith.9 Thus, § 1307(b)’s reputation as an “escape hatch” which makes “section 1307(c) a dead letter and open up the bankruptcy courts to a myriad of potential abuses.”10 However, for debtors disqualified from Chapter 13, does § 1307(b) even apply? §1307(b)’s Unique Right Debtors’ absolute right to voluntarily dismiss bankruptcy cases is peculiar to §§ 1307(b) and 1208(b). § 1307(b)’s absolute right to voluntary dismissal is derived from the Thirteenth Amendment’s involuntary servitude prohibition.”11 However, 13th Amendment involuntary servitude concerns are “out of place” in conversions to Chapter 7 liquidation cases.12 There is no servitude. You’ve Got to Earn § 1307(b) Bankruptcy relief has rules and requirements.13 If you don’t do what’s required, you don’t get the benefits.14 Chapter 13 has other benefits, not available to non-Chapter 13 Debtors.15 It seems axiomatic that debtors who don’t qualify for Chapter 13 relief, don’t qualify for § 1307(b). Eligibility for § 1307(b) Recently, in In re Cenk,16 a debtor’s § 1307(b) motion to dismiss was granted due to unsubstantiated claims of “bad faith.” Still, considering that debtor’s access to § 1307(b) availability, the court opined: If an ineligible debtor does not have an absolute right to dismiss under section 1307(b), Marrama’s17 reconversion under section 1307(c) would, in fact, be the “end result required by the Code.18 It then asked, “. . . if a debtor’s bad faith preceded the chapter 13 petition or was concurrent with it, . . . is it possible that the debtor would not be “qualified” to be a chapter 13 debtor ab initio and therefore not have an absolute right to dismiss? Ultimately, these are questions for another day.”19 “Another day” may be now. Conversion vs. Bankruptcy Limbo? Not qualifying for Chapter 13 and rejecting chapter 11 leaves disqualified Chapter 13 debtors without a governing chapter. That does not mean bankruptcy limbo. Chapter 7 apparently becomes the “default” chapter, if no others are available or desired.20 What About the Good Guys? Disqualification for Chapter 13 may render § 1307(b) inaccessible to all affected. However, innocent debtors can be protected. Where a debtor’s § 1307(b) right is challenged, the court can hold an evidentiary hearing to determine if disqualifying bad faith exists.21 Conclusion It appears that debtors filing Chapter 13 cases in bad faith do not qualify for Chapter 13 relief. Disqualified for Chapter 13, its privileges, including § 1307(b)’s absolute right to dismissal are unavailable. If other chapters are not available or desired, the case being converted to Chapter 7 seems inevitable. References 1© Wayne Greenwald 2020 2 Bankruptcy Code provisions will be cited as “§ N” N being the cited section’s number 3 In re Molitor, 76 F.3d 218, 220 (8th Cir. 1996). 4 See, In re Barbieri, 199 F.3d 616, 619-22 (2d Cir. 1999), Endurance Am. Ins. Co. v. Burbridge, 2019 WL 1535369, at *2-4 (N.D.N.Y.), In re Marinari, 610 B.R. 87, 92 (E.D. Pa. 2019), In re Cenk, 612 B.R. 323, 328-29 (Bankr. W.D. Pa. 2020), In re Bolling, 609 B.R. 454, 456 (Bankr. D. Conn. 2019)(Dismissal with prejudice) 5 Id., 549 U.S. 365, 373-75, 127 S. Ct. 1105, 1111-12, 6 Marrama v. Citizens Bank of Massachusetts, 549 U.S. 365, 372, 373-75, 127 S. Ct. 1105, 1110-12, 166 L. Ed. 2d 956 (2007)(Not satisfying § 109(e)’s requirements and filing petitions in “bad faith” disqualifies debtors from Chapter 13 relief.), In re Wareham, 553 B.R. 875, 880 (Bankr. D. Utah 2016), Matter of Love, 957 F.2d 1350, 1354 (7th Cir. 1992)(“This court has indicated that lack of good faith is sufficient cause for dismissal under Chapter 13”), absence of good faith or presence of bad faith as grounds for dismissal, In re Demeza, 567 B.R. 473, 477 (Bankr. M.D. Pa.), aff’d sub nom. Hackerman v. Demeza, 576 B.R. 472 (M.D. Pa. 2017), In re Erickson, 2004 WL 758175, at *4 (Bankr. C.D. Ill., aff’d sub nom. In re Ericson, 175 F. App’x 58 (7th Cir. 2006) 7 § 1307( c ). 8 In re Bartlett, 2018 WL 3468832, at *5-6 (B.A.P. 9th Cir. July 18, 2018), 9 In re Rosson, 545 F.3d 764, 773-74 (9th Cir. 2008), In re: Donald Hugh Nichols & Jane Ann Nichols, 2020 WL 504745, at *4-5 (Bankr. D. Ariz. Jan. 30, 2020), In re Mattick, 496 B.R. 792, 803 (Bankr. W.D.N.C. 2013)(Not mentioning Marrama). 10 In re Molitor, 76 F.3d at 220. 11 In re Spencer, 137 B.R. 506, 513 (Bankr. N.D. Okla. 1992), In re Gordon, 465 B.R. 683, 699 (Bankr. N.D. Ga. 2012)(Converting Chapter 11 to Chapter 7). 12 In re Gordon, 465 B.R. 699-700 (Bankr. N.D. Ga. 2012) 13 In re Dixon, 2009 WL 151688, at *2 (Bankr. E.D. Pa.), aff’d, 2009 WL 1798819 (E.D. Pa.), In re Norley, 2010 WL 9449238, at *4 (Bankr. E.D. Pa.), In re Miller, 371 B.R. 509, 517 (Bankr. D. Utah 2007), rev’d, 383 B.R. 767 (B.A.P. 10th Cir. 2008)(Privilege of bankruptcy accompanied by duties), In re Pinnacle Land Grp., LLC, 2018 WL 4348051, at *10 (Bankr. W.D. Pa. Sept. 10, 2018). 14 In re Dixon, 2009 WL 151688, at *3, See also fn. 6, denying Chapter 13 relief to petitioners who do no qualify for Chapter 13. 15 See, Matter of Avis, 3 B.R. 205, 207 (Bankr. S.D. Ohio 1980)(Co-debtor stay), In re Maxton, 2018 WL 2246573, at *2 (Bankr. D. Mass. May 16, 2018)(§ 101[30]), In re Saric, 2013 WL 6536752, at *6 (Bankr. N.D.N.Y.) (Lien stripping), In re Mele, 501 B.R. 357, 368 (B.A.P. 9th Cir. 2013), In re Tollstrup, 2018 WL 1384378, at *3 (Bankr. D. Or.)(Enhanced disclosure) Mar. 16, 2018). 16 612 B.R. 323, 329 (Bankr. W.D. Pa. 2020). 17 549 U.S. 365, 127 S.Ct. 1105, 166 L.Ed.2d 956 (2007). 18 Id., citing, Law v. Siegel, 571 U.S. 415, 426, 134 S. Ct. 1188, 1197, 188 L. Ed. 2d 146 (2014). 19 Id. 20 The Chandler Act of 1938 and prior amendments to the Bankruptcy Act of 1898 (the “Act’) created separate bankruptcy chapters. The Act had only one form of debt relief. A debtor was adjudicated a “bankrupt,” Act §§ 1(2), 18(d), and a trustee was appointed at the first meeting of creditors, Act § 44, to administer the estate, Act § 22. Debtors could propose a “composition” (predecessor plans of reorganization) subject to creditor and court approval, to avoid being a bankrupt. Act § 12. Structurally and historically, an individual’s blind filing of a bankruptcy petition, absent Chapters 11, 12 and 13, is a liquidation: Chapter 7. Accordingly, disqualified Chapter 13 petitioners, lacking or rejecting access to dismissal or Chapters 11 and 12, become Chapter 7 cases. 21 408 B.R. at 572. The post Closing a Bad Faith Filer’s “Escape”(1) appeared first on Wayne Greenwald, P.C..

Filing for bankruptcy can be a scary process for many people. This is especially true for those who have never been part of one of these incredibly complex processes. Many people may worry they will lose everything they worked so hard to get, such as their employment. This fear stems from the belief their employers […] The post Will My Employer Find Out if I File Bankruptcy in Pennsylvania? appeared first on .