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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-13117
Non-Argument Calendar
________________________
D.C. Docket No. 6:17-cv-00214-PGB,
Bkcy No. 3:14-bkc-00158-JAF
In re: SCHONFELD, INC.,
(a foreign proceeding),
Debtor.
_______________________________________________________________
LINK & ASSOCIATES, INC.,
Plaintiff-Appellant,
versus
DARLENE IVANY,
BACKCOVE COMPANY, et al.,
Defendants-Appellees.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(March 23, 2020)
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Before JORDAN, LUCK, and HULL, Circuit Judges.
PER CURIAM:
In this bankruptcy appeal, Link & Associates, Inc., as trustee and foreign
representative for the bankruptcy estate of Howard Paul Ivany, challenges the order
of the bankruptcy court, later affirmed by the district court, dismissing its claim for
relief under the doctrine of forum non conveniens. After review, we affirm.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
In 2012, Howard Ivany’s creditors filed a petition for bankruptcy in the
Ontario Superior Court of Justice. The Canadian court entered an order deeming
Howard Ivany bankrupt. The Canadian court then initiated insolvency proceedings,
appointing Schonfeld, Inc. as the corporate trustee and Robert Link of Link &
Associates as the individual trustee.1
Schonfeld learned that Howard Ivany had assets in Florida. Acting upon this
information, it filed a petition in the Middle District of Florida, seeking recognition
of the Canadian insolvency proceedings as a “foreign main proceeding” under
chapter 15 of the U.S. Bankruptcy Code, which the bankruptcy court granted. The
recognition order entrusted to Schonfeld, as the foreign representative, the
administration or realization of Howard Ivany’s assets within the territorial
1
For ease of reading, we’ll refer to Link & Associates, Inc. as “Link” and to Robert Link
as “Robert Link.”
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jurisdiction of the United States. Link later replaced Schonfeld as the corporate
trustee and foreign representative. Link then sought to uncover Howard Ivany’s
assets in Florida.
Link determined that Howard Ivany, either individually or through his
ownership interest in Mi Lee, Inc., transferred a substantial part of his assets in
Florida to his wife, Darlene Ivany, and Backcove Company. Specifically, during the
four-year period prior to the petition, Howard Ivany transferred money and assets
valued at $172,000 to Darlene Ivany. Howard Ivany also transferred his thirty-
percent stake in Mi Lee, Inc., a Florida-based real estate investment company, to
Darlene Ivany. Darlene Ivany is Mi Lee’s registered agent and director. Howard
Ivany was the company’s officer, director, managing agent, and control person.
Howard Ivany also transferred money and assets valued at $505,000 to Backcove
Company and transferred $379,000 of his interest in eight properties, through his
ownership interest in Mi Lee, to Backcove. Backcove is a Florida corporation with
its principal place of business in Florida. Darlene Ivany was Backcove’s officer,
director, managing agent, and control person.
Claiming that these transfers were fraudulent, Link filed an adversary
complaint against the defendants, Darlene Ivany, Mi Lee, and Backcove, in the
bankruptcy court for the Middle District of Florida seeking, among other things, to
recover the transferred assets under chapter 726, Florida Statutes.
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The defendants moved to dismiss the complaint on the basis of forum non
conveniens. The bankruptcy court granted the motion, finding that (1) Canada was
an adequate and available alternative forum, (2) private and public interest factors
weighed in favor of dismissal, and (3) Link could reinstate its suit in Canada without
undue inconvenience or prejudice. Link then moved for reconsideration, which the
bankruptcy court denied. So Link appealed to the district court. The district court
affirmed, substantially deferring to the bankruptcy court’s findings. This second
appeal follows.
STANDARD OF REVIEW
“In appeals from bankruptcy judgments, this Court functions ‘[a]s the second
court of review.’” Schlein v. Mills (In re Schlein),
8 F.3d 745, 747 (11th Cir. 1993)
(quoting Equitable Life Assurance Soc. v. Sublett (In re Sublett),
895 F.2d 1381,
1384 (11th Cir. 1990)). We review a bankruptcy court’s dismissal order under the
doctrine of forum non conveniens for an abuse of discretion. See Aldana v. Del
Monte Fresh Produce N.A., Inc.,
578 F.3d 1283, 1288 (11th Cir. 2009). “A
bankruptcy court abuses its discretion when it ‘applies the wrong principle of law or
makes clearly erroneous findings of fact.’” Kulakowski v. Walton (In re
Kulakowski),
735 F.3d 1296, 1299 (11th Cir. 2013) (quoting Piazza v. Nueterra
Healthcare Physical Therapy, LLC (In re Piazza),
719 F.3d 1253, 1271 (11th Cir.
2013)).
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DISCUSSION
Forum non conveniens is a discretionary tool that permits a court to dismiss a
civil action when an alternative forum is better suited to adjudicate the dispute––
even where venue is proper and jurisdiction exists. See Gulf Oil Corp. v. Gilbert,
330 U.S. 501, 507 (1947). For the doctrine to apply, a defendant must demonstrate
that “(1) an adequate alternative forum is available, (2) the public and private factors
weigh in favor of dismissal, and (3) the plaintiff can reinstate [its] suit in the
alternative forum without undue inconvenience or prejudice.” Tazoe v. Airbus
S.A.S.,
631 F.3d 1321, 1330 (11th Cir. 2011); see also Piper Aircraft Co. v. Reyno,
454 U.S. 235, 257 (1981).
Link makes four arguments on appeal: (1) the bankruptcy court erred in
finding that Canada was an adequate alternative forum; (2) the bankruptcy court and
district court erred in failing to consider, as two private interest factors, that it would
be easier to compel the attendance of witnesses in Florida and that the parties had
undergone substantial discovery in Florida; (3) the bankruptcy court and district
court erred in failing to consider, as two public interest factors, that this was a chapter
15 cross-border proceeding and that a Canadian court would have to undergo a
choice-of-law analysis in determining if Florida law applied to Link’s claims; and
(4) the district court erred in making improper independent factual findings. We
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agree with the district court that the bankruptcy court did not abuse its discretion in
dismissing the suit based on forum non conveniens.
Adequacy of the Canadian Forum
Link argues that the bankruptcy court erred in finding that Canada was an
adequate alternative forum because the defendants in their motion to dismiss never
established that it was. We disagree.
The Supreme Court in Piper Aircraft stated that the adequate and available
alternative forum prong is “[o]rdinarily . . . satisfied when the defendant is ‘amenable
to process’ in the other
jurisdiction.” 454 U.S. at 254 n.22. Here, as stated in the
bankruptcy court’s order, the defendants became amenable to process in Canada
when they consented to Link bringing this action in Canada and to the Canadian
court’s jurisdiction over them. Because the defendants were amenable to process in
Canada, we agree with the bankruptcy court that the defendants had sufficiently
proven that Canada was an adequate alternative forum. See Satz v. McDonnell,
244
F.3d 1279, 1283 (11th Cir. 2001) (finding that an alternative forum was adequate in
part because “the district court conditioned its order of dismissal on [the defendant]
consenting to any Argentine judgment against it”); see also Republic of Pan. v. BCCI
Holdings (Luxembourg) S.A.,
119 F.3d 935, 951 (11th Cir. 1997) (“Generally, a
defendant satisfies the [adequate and available alternative forum] prong of the
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analysis by showing that it is ‘amenable to process in the other jurisdiction.’”
(quoting Piper
Aircraft, 454 U.S. at 254 n.22)).
The Private Interest Factors
Link next contends that the bankruptcy court and district court erroneously
failed to consider, as to two private interest factors, that: (1) it would be easier to
compel the attendance of witnesses in Florida; and (2) the parties had undergone
substantial discovery in Florida. The record says otherwise.
As to Link’s argument concerning witnesses, the record is unrefuted that
many of the witnesses, especially the most critical ones, are in Canada. See
Aldana,
578 F.3d at 1293-94 (concluding that the dismissal for forum non conveniens was
warranted where most witnesses were in Guatemala). Link, in its initial disclosures,
revealed the names and addresses of nine witnesses whom it believed would be
necessary for trial. These witnesses included Robert Link, Darlene Ivany, Howard
Ivany, family members of Darlene and Howard Ivany, and the designated
representatives of Backcove and Mi Lee. All of these material witnesses are either
permanent Canadian residents or have a strong affiliation with Canada. For
example, Darlene Ivany is a permanent resident of Canada. And although Backcove
and Mi Lee are Florida corporations, Darlene Ivany is the sole officer, director, and
managing agent for Backcove and the managing agent and director for Mi Lee. We
agree with the district court that given the location of material witnesses, the
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bankruptcy court did not abuse its discretion in finding that this private factor weighs
in favor of dismissal.
As to Link’s argument concerning the substantial discovery conducted in
Florida, the only discovery conducted in this adversary proceeding was the initial
required disclosures, as the bankruptcy court stayed discovery pending the outcome
of the motion to dismiss. 2 See Fed. R. Civ. P. 26(a). A cursory review of the docket
demonstrates that hardly any discovery had been conducted. See
Aldana, 578 F.3d
at 1297 (determining that the private interest factors weighed in favor of dismissal
in part because discovery “ha[d] been relatively limited”). In sharp contrast, Howard
Ivany’s bankruptcy case has been pending for three years in a Canadian court. We
agree with the district court that given the minimal amount of discovery the parties
had undergone in the Middle District of Florida, the bankruptcy court did not abuse
its discretion in finding that this private factor weighs in favor of dismissal.
The Public Interest Factors
Link next argues that the bankruptcy court and district court erroneously failed
to consider, as two public interest factors, that: (1) this was a chapter 15 cross-border
proceeding; and (2) a Canadian court would have to undergo a choice-of-law
2
Link framed this issue as a public interest factor. But we have analyzed amount of
discovery conducted in a case as a private interest factor. See
Aldana, 578 F.3d at 1297.
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analysis in determining if Florida law applied to Link’s claims. Both arguments are
contradicted by the record.
As to Link’s argument concerning chapter 15, the district court and the
bankruptcy court considered the underlying policies of a chapter 15 cross-border
proceeding in their rulings. In its reconsideration order, the bankruptcy court
considered the policy reasons for a chapter 15 cross-border proceeding, but found
that “such consideration would not have changed [its] ruling.” The district court,
agreeing with the bankruptcy court, determined that, because the underlying
proceedings occurred in Canada, Canada had a stronger interest in hearing this
matter before its courts.
Link also contends that the bankruptcy court and district court wrongfully
assumed that a Canadian court would apply Florida law to Link’s claims. But Link
argued in its response to the motion to dismiss “that all of its claims arise under
Florida law” and that “[a]ll claims are based upon Florida law and no Canadian law
is implicated or relevant.” The bankruptcy court found that a Canadian court would
apply Florida law because, as Link conceded, the claims arose exclusively under
Florida law. No choice-of-law analysis was required.
The District Court’s “Factual Findings”
Finally, Link argues that the district court, acting in its appellate capacity,
improperly made certain independent factual findings. Link points to two comments
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the district court made in its decision: (1) “many of the necessary witnesses––
including all of the parties to this appeal and the underlying bankruptcy––are located
in Canada”; and (2) Link has “filed suit in Canada.”
While, in a bankruptcy appeal, a district court cannot make independent
factual findings, see Fed. Land Bank of Jackson v. Cornelison (In re Cornelison),
901 F.2d 1073, 1075 (11th Cir. 1990) (noting that in a bankruptcy appeal “[n]either
the district court (which functions in an appellate capacity in a bankruptcy appeal)
nor this Court may make independent factual findings”), the district court in this case
did not make any such findings. As to the comment about witnesses, the bankruptcy
court found that “the three defendants in this adversary proceeding are Mrs. Ivany,
a Canadian citizen, and two Florida corporations for both of whom Mrs. Ivany is the
alleged registered agent and director and for one of whom (Backcove) Mrs. Ivany
was the alleged officer, director, managing agent, control person, and alter ego. . . .
Additionally and importantly [Link] itself is located in Canada.” The district court,
in its own words, merely recited the bankruptcy court’s findings that many of the
necessary witnesses are in Canada. As to the district court’s comment that Link has
“filed suit in Canada,” the court merely repeated Link’s appellate brief, which stated
that Link “file[d] a proceeding in Canada in accordance with the Dismissal Order.”
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CONCLUSION
For these reasons, we, in line with the district court, affirm the bankruptcy
court’s decision to dismiss the case based on forum non conveniens.
AFFIRMED.
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