NKL Enterprises v. Oyster Bay Management

U.S. DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
Bankruptcy

New York Law Journal

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Judge Arthur Spatt

The Cold Spring Harbor Property was NKL Enterprises' sole asset. NKL's July 25, 2012, Chapter 11 bankruptcy petition was filed less than an hour before the property's scheduled sale at foreclosure, at which Oyster Bay Management Co. (OBM) made the sole—and thus winning—bid. Bankruptcy court's Aug. 28, 2012, order granted OBM's July 31 motion to vacate the automatic stay, nunc pro tunc, to the July 25 petition date. NKL did not appeal bankruptcy court's Nov. 9, 2012, order dismissing its Chapter 11 case based on its failure to file schedules or financial affairs statements or submit to examination pursuant to Bankruptcy Code §341(a). District court denied NKL's appeal from bankruptcy court's Aug. 28, 2012, order annulling the automatic stay. It agreed with OBM that NKL's present appeal was moot because NKL did not seek a stay of foreclosure pending appeal, and because the court could not fashion effective relief. Because NKL did not attempt to obtain a stay pending appeal of the foreclosure sale, and does not argue that purchaser OBM acted in bad faith when purchasing the Cold Spring Harbor Property, NKL's appeal of the order granting OBM's motion for nunc pro tunc relief from the automatic stay was rendered moot.

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