Foster et al v. Nextres, LLC

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
IN THE MATTER OF: 	: 	CASE NUMBERS
:
DANIEL D. FOSTER, 	: 	BANKRUPTCY CASE
: 	25-58797-LRC
Debtor. 	:
:
:
DANIEL D FOSTER 	: 	ADVERSARY PROCEEDING
: 	NO. 25-05194-LRC
Plaintiff, 	:
:
v. 	:
:
DREAM LOUD MUSIC GROUP, LLC, :
NEXTRES LLC, PACIFIC LAW 	:
GROUP, ROB KOSAKOSKI, LISA A. 	:
FRANK, JOHN DOES 1-10, 	: 	IN PROCEEDINGS UNDER
: 	CHAPTER 7 OF THE
Defendants. 	: 	BANKRUPTCY CODE
ORDER
On August 4, 2025 (the “Petition Date”), Daniel D. Foster (“Plaintiff”) filed a
_______________________________________________________________
IT IS ORDERED as set forth below:
_____________________________________
Lisa Ritchey Craig
U.S. Bankruptcy Court Judge
Date: June 29, 2026
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voluntary petition (the “Petition”) under Chapter 13 of the Bankruptcy Code (Case
Number 25-58797-LRC, the “Bankruptcy Case”). 	At Plaintiff’s request, the Court
converted the Bankruptcy Case to Chapter 11 on October 10, 2025. 	See Bankruptcy Case,
Doc. 	49. 	On 	October 	6, 	2025, 	Plaintiff 	filed 	a 	complaint 	against 	Nextres, 	LLC
(“Nextres”) (Doc. 1, the “Complaint”). 	After Nextres filed a motion to dismiss the
Complaint and a Motion to Stay Discovery and Pretrial Deadlines (Doc. 6, the “Motion to
Stay”), Plaintiff amended the Complaint (Doc. 7, the “Amended Complaint”) to add
several additional defendants. 	The Court denied the first motion to dismiss as moot
because the Complaint had been superseded by the Amended Complaint. 	See Doc. 11.
On November 13, 2025, Sherry Everett filed a motion to intervene as a plaintiff (Doc. 9,
the “Motion to Intervene”). 	Plaintiff supports the Motion to Intervene (Doc. 16), and
Nextres opposes it (Doc. 25). 	On December 4, 2025, Nextres filed a motion to dismiss the
Amended Complaint (Doc. 17, the “Motion to Dismiss”), and Plaintiff opposes dismissal
(Doc. 34).1
The Amended Complaint contains the following counts: (1) request for declaratory
judgment as to the validity of a foreclosure sale conducted by Nextres regarding certain
real property (the “Property”) that Plaintiff contends became property of his bankruptcy
estate upon the filing of the Petition; (2) a request for damages under § 362(k) of the
Bankruptcy Code due to Nextres’ willful violation of the automatic stay; (3) avoidance and
1 As to the counts of the Amended Complaint that the Court dismisses herein, these matters constitute core
proceedings, over which this Court has subject matter jurisdiction. 	See 28 U.S.C. §§ 1334; 157(a); 157(b)(2)(A), (H).
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recovery of the transfer of the Property as an unauthorized postpetition transfer under §§
549, 550, and 551; (4) avoidance and recovery of Nextres’ interest in the Property as a
secret lien under the “strong arm” powers of the Bankruptcy Code (§§ 544(a)(3)); (5)
avoidance and recovery of the transfer of the Property as a constructively fraudulent
transfer under §§ 548, 544, and 550 of the Bankruptcy Code; (6) cancellation of a forged
and void instrument under O.C.G.A. § 23-2-60 and 23-3-40; (7) wrongful foreclosure; (8)
slander of title; (9) fraud and civil conspiracy arising from actions allegedly taken on or
before August 15, 2023; (10) negligence, notary misconduct, and negligent supervision
arising from actions allegedly taken on or before August 15, 2023; (11) equitable
subordination under § 510(c) of any claim filed by Nextres; (12) objection to any claim
filed by Nextres; (13) preliminary injunctive relief against Nextres;2 and (14) a request for
accounting, unjust enrichment, imposition of a constructive trust, and disgorgement. 	For
the reasons that follow, the Court will grant the Motion to Dismiss in part; hold in abeyance
Plaintiff’s claim for damages for a stay violation; and defer ruling on the Motion to
Intervene and the remainder of the Motion to Dismiss to allow the parties an opportunity to
show cause why the Court should not abstain from hearing the remainder of the Amended
Complaint.
Facts and Procedural History
On January 15, 2026, at Plaintiff’s request, the Court converted the Bankruptcy
2 The Court has already considered and denied Plaintiff’s request in Count 13 for a preliminary injunction against
Nextres. 	See Bankruptcy Case, Doc. 151.
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Case to Chapter 7. 	See Bankruptcy Case, Doc. 134. 	Kathleen Steil (the “Trustee”) was
appointed as the Chapter 7 trustee, and the Trustee held and concluded the Chapter 7
meeting of creditors on February 23, 2026. 	Plaintiff did not respond to the Motion to Stay
and, accordingly, the Court deemed it unopposed and entered an order staying discovery
and all deadlines in this case to provide the Trustee an opportunity to investigate the claims
contained in the Amended Complaint. (Doc. 36, the “Stay Order”). 	Since that time, the
Trustee has abandoned the claims and reported that there are no assets of the bankruptcy
estate to liquidate and that there will be no distribution to Plaintiff’s creditors.3
Conclusions of Law
The Motion to Dismiss seeks dismissal of the Amended Complaint pursuant to
Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure, made applicable to
this adversary proceeding by Rule 7012 of the Federal Rules of Bankruptcy Procedure.
Nextres argues that Plaintiff does not have standing to bring his claims and that the
Amended Complaint fails to state a claim upon which relief may be granted.
When considering whether to dismiss a complaint under Rule 12(b)(6), the Court
must accept as true all factual allegations set forth in the complaint and, on the basis of
those facts, determine whether the plaintiff is entitled to the relief requested. The Court
must also draw all reasonable inferences in the light most favorable to the non-moving
party. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 554-56 (2007); Daewoo Motor
3 On February 5, 2026, the Trustee filed a Notice of Proposed Abandonment regarding the claims raised by Plaintiff in
the Adversary Proceeding, and no objections were filed to the Notice. 	Bankruptcy Case, Doc. 155.
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America Inc. v. General Motors Corp., 459 F.3d 1249, 1271 (11th Cir. 2007); Hill v. White,
321 F.3d 1334, 1335 (11th Cir. 2003); Grossman v. Nationsbank, Nat’l Ass’s, 225 F.3d
1228, 1231 (11th Cir. 2000); Bryant v. Avado Brands, Inc., 187 F.3d 1271, 1273, n.1 (11th
Cir. 1999).
The complaint must contain “sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’ A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” 	Ashcroft v. Iqbal, 556 U.S. 662, 678, 129
S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009). 	Whether a complaint states a claim must be
considered in relation to Rule 8(a), made applicable to this matter by Rule 7008 of the
Federal Rules of Bankruptcy Procedure, which requires a pleading contain a “short and
plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P.
8(a)(2). This standard “does not require ‘detailed factual allegations,’ but it demands more
than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at
678 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929
(2007)).
The Court agrees with Nextres that many of the counts of the Amended Complaint
fail to state a claim and should be dismissed.4 	First, as Plaintiff is a Chapter 7 debtor
4 The Court has taken the facts from the allegations of the Amended Complaint. See generally Intravisual
Inc. v. Fujitsu Microelectronics Am. Inc., 2011 WL 1004873, at *5 (E.D. Tex. Mar. 18, 2011) (holding that
“allegations pled on ‘information and belief’ should be reviewed in the same way as all factual allegations
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without statutory authority to seek avoidance of any prepetition transfers, Counts 3, 4, and
5 fail to state a claim. 	See 11 U.S.C. § 544(a) (stating that the trustee has certain powers to
avoid secret liens); § 544(b) (stating that the trustee may avoid fraudulent transfers by
debtor that debtor’s creditors could have avoided under applicable nonbankruptcy law); §
548 (stating that the trustee may avoid fraudulent transfers by the debtor); § 549 (stating
that the trustee may avoid postpetition transfers of estate property). 	Second, the Amended
Complaint fails to state a claim that Nextres’ foreclosure of the Property violated the
automatic stay, as the Court has already ruled that the automatic stay did not arise as to the
Property, and the Amended Complaint otherwise alleges no facts that would support
Plaintiff’s argument that Nextres violated § 362(a) of the Bankruptcy Code. 	The Court’s
ruling regarding the existence of the automatic stay, however, is on appeal. 	See
Bankruptcy Case, Doc. 21 (the “Automatic Stay Order”), Doc. 26. 	Accordingly, the
Court will not dismiss Count 2 unless and until the appeal has been resolved in Nextres’
favor.
Additionally, as the Bankruptcy Case is now a no-asset Chapter 7 case, the Court
will not be called upon to resolve the amount of any claims in the case, and, more
importantly, Nextres has not filed a claim. 	Accordingly, Counts 11 and 12 will be
dismissed as moot.
in a Complaint” such that, the “mere fact that allegations begin with the statement ‘on information and
belief’ will not automatically render them insufficient”). 	Where appropriate, the Court has taken judicial
notice of the docket.
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Because the remainder of the counts of the Amended Complaint (the “Claims”)
appear to serve no bankruptcy purpose, the Court will direct the parties to show cause why
the Court should not exercise its discretion to abstain from ruling on the Claims. 	The
Trustee has abandoned her interest in Claims, such that any damages recovered would
inure only to Plaintiff’s benefit, and the declaratory relief sought by Plaintiff would not
benefit the bankruptcy estate or impact Plaintiff’s creditors in any way. 	As to the Claims,
this Court has original but not exclusive jurisdiction over all civil proceedings arising
under title 11, or arising in or related to cases under title 11. See 28 U.S.C. § 1334(b); 28
U.S.C. § 157(a).5 	A proceeding “arises under” title 11 if it asserts a right to relief created
by the Bankruptcy Code and a proceeding “arises in” a case under title 11 if it is an
administrative matter that only could occur in a bankruptcy case and would have no
existence outside of bankruptcy. 	A proceeding is “related to” a case under title 11 if it
potentially will have some impact on the bankruptcy case or the bankruptcy estate but does
not invoke a right to relief created by the Bankruptcy Code and could exist outside of
bankruptcy. 	In re Lemco Gypsum, Inc., 910 F.2d 784, 788 (11th Cir. 1990) (citing Pacor,
Inc. v. Higgins, 743 F.2d 984 (3d Cir. 1984)). 	“‘Related to’ jurisdiction ‘is not so broad as
to encompass litigation of claims arising under state law or non bankruptcy Federal law
that will not have an effect on the bankruptcy estate, simply because one of the litigants
5 More accurately stated, this Court exercises the jurisdiction referred to it by the District Court. 	In re Astroturf, LLC,
2017 WL 1194649, at *9 (Bankr. N.D. Ga. Mar. 30, 2017) (“The statement that a bankruptcy court has jurisdiction is
legal shorthand that reflects the routine practice of the district courts to refer all bankruptcy matters to the bankruptcy
courts pursuant to 28 U.S.C. § 157(a) and for the bankruptcy courts to exercise that jurisdiction by entry of final
judgments, orders, and decrees when 28 U.S.C. § 157(b) or (c) authorizes them to do so.”).
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filed a petition in bankruptcy.’” 	In re Harlan, 402 B.R. 703, 711 (Bankr. W.D. Va. 2009)
(quoting Gates v. Didonato (In re Gates), 2004 WL 3237345, at *2 (Bankr. E.D. Va.
2004)).
Notwithstanding the broad jurisdictional grant afforded to this Court under 28
U.S.C. §§ 1334(b) and 157(a), the Court has discretionary authority to abstain from hearing
certain matters and may do so sua sponte. 	28 U.S.C. § 1334(c)(1) (“[N]othing in this
section prevents a district court in the interest of justice, or in the interest of comity with
State courts or respect for State law, from abstaining from hearing a particular proceeding
arising under title 11 or arising in or related to a case under title 11.”); see also In re
AstroTurf, LLC, 2017 WL 3889710, at *24 (Bankr. N.D. Ga. Sept. 5, 2017) (quoting
Carver v. Carver (In re Carver), 954 F.2d 1573 (11th Cir. 1998) (“The court may abstain
upon request of a party or sua sponte.”)).
When deciding whether to abstain, the Court considers the following, nonexclusive
factors: 	“(1) the effect, or lack thereof, on the efficient administration of the bankruptcy
estate if the discretionary abstention is exercised, (2) the extent to which state law issues
predominate over bankruptcy issues, (3) the difficulty or unsettled nature of the applicable
state law, (4) the presence of related proceedings commenced in state court or other
nonbankruptcy courts, (5) the jurisdictional basis, if any, other than § 1334, (6) the degree
of relatedness or remoteness of the proceedings to the main bankruptcy case, (7) the
substance rather than the form of an asserted “core” proceeding, (8) the feasibility of
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severing state law claims from core bankruptcy matters to allow judgments to be entered in
state court with enforcement left to the bankruptcy court, (9) the burden on the bankruptcy
court's docket, (10) the likelihood that the commencement of the proceeding in bankruptcy
court involves forum shopping by one of the parties, (11) the existence of a right to jury
trial, and (12) the presence in the proceeding of non-debtor parties.” In re Queen, 2013 WL
6116864, at *1 (Bankr. N.D. Ga. Nov. 18, 2013) (holding that, where “the issues are
wholly dependent upon matters of non-bankruptcy law and resolution of the adversary
proceeding will not impact the efficient administration of the estate, abstention is
warranted”); see also In re Roman, 2013 WL 6911375, at *4 (Bankr. N.D. Ga. Dec. 12,
2013); In re Blackman, 2017 WL 6033418, at *4 (Bankr. N.D. Ga. Dec. 5, 2017). “What
this means is that a bankruptcy court should abstain from hearing a proceeding that has no
bankruptcy purpose.” 	In re AstroTurf, LLC, 2017 WL 3889710, at *26.
Applying the above factors to the Claims, permissive abstention appears warranted.
The Trustee has abandoned the Claims, and Plaintiff’s goal in the Amended Complaint
appears 	to 	be 	the 	recovery 	of 	the 	Property 	that 	was 	foreclosed 	by 	Nextres 	and
compensation from Nextres and other parties for conduct surrounding the financing and
foreclosure of the Property. 	As none of this relief would benefit Plaintiff’s creditors or
impact the administration of the Bankruptcy Case, the Claims are better heard in state
court. Specifically, the Claims rely entirely on Georgia law regarding foreclosure sales,
forged and void instruments, slander of title, fraud and civil conspiracy, negligence, and
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unjust enrichment.
As a court of limited jurisdiction, the Court does not appear to have a jurisdictional
basis, other than 28 U.S.C. § 1334, to consider the Claims. 	See In re Hutcheson Med. Ctr.,
Inc., 2019 WL 1301887, at *7 (Bankr. N.D. Ga. Mar. 19, 2019) (“[A] Georgia plaintiff[]
asserted Georgia tort law claims against Georgia defendants in a Georgia court in a lawsuit
whose result will have no effect whatsoever in the Debtors' bankruptcy case. Such a
lawsuit does not properly belong in the Bankruptcy Court.”). 	Further, Plaintiff has
demanded jury trial, to the extent he would be entitled to one. 	Without consent from
Nextres and the other defendants, this Court could not preside over it. 	See Hutcheson
Med. Ctr., 2019 WL 1301887 at *7 (“A bankruptcy judge cannot conduct a jury trial in the
absence of consent from all parties, 28 U.S.C. § 157(e), and in this Court's view should not
do so even if the parties do consent. A jury trial has not occurred in the bankruptcy court in
this district in the 17 years that this judge has served, and this judge is unaware of any that
occurred in the 27 years that he practiced bankruptcy law in this district before that. In any
event, no currently serving bankruptcy judge in this district has presided over a jury trial.”).
As to whether there are other pending state court proceedings, the parties were
previously litigating issues regarding the Property, and those proceedings may be ongoing.
See Case No. MGCD2025006873 (Magistrate Court of Henry County, Georgia). 	Debtor
is free to pursue the Claims, other than the automatic stay violation claim, in an appropriate
forum. 	“[H]earing these claims would place a burden on this Court, while the outcome of
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the litigation will not bear on the administration of the estate.” 	Roman, 2013 WL
6911375, at *4. 	“On the whole, these factors weigh in favor of permissive abstention and
the remaining factors are either not applicable or neutral.” 	Id. 	The Court, however, will
permit the parties an opportunity to show cause why the Court should not exercise its
discretion to abstain.
Conclusion
For the above reasons,
IT IS ORDERED that the prior stay of this adversary proceeding imposed by the
Stay Order is lifted to the extent necessary for the Court to consider the Motion to Dismiss,
but shall remain in place as to discovery, any case management deadlines, and the Motion
to Intervene, which the Court will continue to defer until the Court determines whether to
abstain from hearing the Claims;
IT IS FURTHER ORDERED that the Motion to Dismiss is GRANTED as to
Counts 12 and 13, which are dismissed as moot, and as to Counts 3, 4, and 5, which are
dismissed because they fail to state a claim upon which relief can be granted;
IT IS FURTHER ORDERED that the Motion to Dismiss, as it pertains to Count 2,
will be held in abeyance until the appeal of the Automatic Stay Order is resolved;
IT IS FURTHER ORDERED that Plaintiff, Nextres, and the remaining defendants
shall have through and including August 7, 2026, within which to show cause, through a
written response, as to why the Court should not abstain from considering the remainder of
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the Amended Complaint.
END OF DOCUMENT
Distribution List
Daniel D Foster
425 Nolan Cherry Circle
McDonough, GA 30252
Daniel D Foster
381 Vicki Lane
Stockbridge, GA 30281
Lisa A Frank
McCalla Raymer Leibert Pierce, LLC
1544 Old Alabama Road
Roswell, GA 30076
Kathleen Steil
Ogier, Rosenfeld & Steil, P.C.
P.O. Box 1547
Decatur, GA 30031
Sherry Everett
381 Vicki Ln
Stockbridge, GA 30281
Dream Loud Music Group LLC
381 Vicki Lane
Stockbridge, GA 30281
Pacific Law Group, LLC
c/o Justin Brooks Pacific
625 Molly Lane, Suite 130
Woodstock, GA 30189
Rob Kosakoski
Rob Kosakoski Law LLC
625 Molly Lane, Suite 130
Woodstock, GA 30189
William Oxford Tate
McCalla Raymer Leibert Pierce, LLP
1544 Old Alabama Road
Roswell, GA 30076
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