Robert M Lane

In re
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF WYOMING
ROBERT M. LANE
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Case No. 	11-20398
Chapter 7
Debtor.
OPINION ON TRUSTEE'S MOTION FOR CONTEMPT SANCTIONS
AGAINST ROBERT M. LANE
On November 4, 2014, the Trustee's Motion for Contempt Sanctions Against
Robert M. Lane and Robert Lane's ("Debtor") objection carne before the court for an
evidentiary hearing. Gary Barney, ("Trustee") was represented by John Smiley of
Lindquist & Vennurn, L.L.P and Debtor appeared, pro se. At the conclusion of the
hearing, the court took the matter under advisement. Having reviewed the record,
testimony and other evidence and applicable law, the court is prepared to rule.
Trustee requests that the Court impose monetary sanctions in the amount of
$12,000.00 against Debtor for the multiple motions that Debtor has filed contrary to the
Debtor Settlement Agreement and this court's orders. Trustee also requests that the court
order "additional fees as a civil contempt sanction for each and every pleading that the
Debtor files without standing in this case going forward" and restrict Debtor's ability to
file pleadings prose without leave of the court.
Debtor argues that the Debtor Settlement Agreement provides that Debtor has
standing to enforce the settlement agreement, justifying his actions. Debtor alleges that
his actions have been to help with the administration of the estate and his intentions are
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pure. Alternately, if the court finds that Debtor is in contempt, it must consider his
financial condition upon making any award. Debtor asserts, as the person with the best
knowledge of his financial condition, he lacks the ability to pay any monetary penalty and
any requirement to post a bond to file future pleadings denies him the right to due process
and his right to legal access.
Findings of Fact
As stated many times previously, Debtor filed his bankruptcy petition and
schedules on April 19, 20 11. Trustee retained Lindquist & Vennum to represent him for
the purpose of investigating and litigating numerous contested matters and adversary
proceedings involving Debtor and related entities identified as Boulder Investment Trust
and Colleen Lane as its trustee and in her individual capacity; Riverbend Ranch Trust I
and Matthew W. Lane as its trustee and in his individual capacity; Windriver Corp. of
WY, LLC and Patricia E. Lane as its manager and in her individual capacity; Penobscot
Enterprises, Inc.; Penobscot Enterprises, Inc. Defined Benefit Pension Plan a/k/a/
Penobscot Enterprises Defined Benefit Trust and Timothy Lane as its purported trustee
and in his individual capacity; DFWU, LLC, Tipperary, LLC and Patricia A. Lane. Two
years after Debtor's bankruptcy case was filed, the above-listed related entities entered
into the settlement agreement known as the Family Settlement Agreement.' 	The filing of
the Family Settlement Agreement initiated a flurry of filings by creditors and the Debtor.
1 Motion for Approval of Settlement Agreement, Dkt. No. 199.
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Debtor opposed the approval of the Family Settlement Agreement. Trustee and the
various creditors negotiated settlement agreements resolving opposition to the Family
Settlement Agreement. Debtor opposed these settlement agreements. 	On April4, 2013,
the court held hearings, which during the course of the day, the parties began discussions
of a "global settlement." Thereafter, on Apri119, 2013, the Motion to Approve
Compromise under Rule 9019 Between the Trustee and the Debtor, commonly known as
the Debtor Settlement Agreement was filed. 	The court approved the Debtor Settlement
Agreement and the Family Settlement Agreement on June 20, 2013. As the Trustee has
repeatedly stated and testified at hearings, the Debtor Settlement Agreement was intended
to resolve the disputes between the Debtor and his bankruptcy estate, allowing Debtor to
retain assets or receive them as consideration for ceasing future litigation and allow the
Trustee to efficiently administer the case, garner the estate assets, reduce the assets to
cash and pay creditors.
Discussion
A bankruptcy court has the power to hold a party in civil contempt and award
sanction under§ lOS( a). The goal of a civil contempt proceeding is to coerce the
contemnor into complying with the court's order and to remedy the contemnor's
noncompliance. To establish contempt, the movant must show: (1) the existence of a
valid decree of which the alleged contemnor had actual or constructive knowledge; (2)
that the decree was in the movant's favor; (3) that the alleged contemnor by its conduct
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violated the terms of the decree, and had knowledge (at least constructive) of such
violations; and (4) that the movant suffered harm as a result.
In this case, the Trustee established the elements of contempt. Debtor agreed to
the terms of the Debtor Settlement Agreement and has been present at hearings when the
terms of the agreement were discussed. The terms of the Debtor Settlement Agreement
reflect that Debtor waived his standing in certain matters in the Trustee's favor. 	Debtor
violated the terms of the order approving the Debtor Settlement Agreement numerous
times which the court has stated in several orders and/or opinions. The Trustee has
incurred harm as a result of Debtor's violation of the order, as Trustee and his counsel
have had to address Debtor's numerous pleadings rather than pursue assets of the estate
and incurring unnecessary expenses to the bankruptcy estate.
The court finds Debtor violated the order approving the Debtor Settlement
Agreement by filing ( 1) Status Report on Proposed Settlement Agreement Between
Trustee Gary Barney and Dr. Galo Tan and Request to Reject Settlement (Dkt. #391); (2)
Opposition to Proposed Sale of Coins (Dkt. # 409); (3) Debtor's Objection to Trustee's
Counsel's Excessive Fee Request (Dkt. # 479]; (4) Debtor's Opposition to Proposed Sale
of Art (Dkt. No. 589]; (5) Debtor's Opposition to Trustee's Motion to Strike Debtor's
Opposition to Proposed Sale of Art [Dkt. # 655]; and, (6) Debtor's Response to Trustee's
Motion for Turnover of California Assets [Dkt # 601]. In conclusion, this court finds
Debtor in contempt.
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Sanctions
Trustee requests monetary sanctions to reimburse the bankruptcy estate for the
costs of addressing the numerous pleadings which this court has found violates this
court's order approving the Debtor Settlement Agreement. The testimony presented
shows that the bankruptcy estate incurred more fees than requested. Trustee requests a
monetary judgment in the amount of$12,000.00. The court's review ofthe record,
reflects that this amount is reasonable and shall order Debtor to reimburse the bankruptcy
estate in the amount of$12,000.00.
Debtor argues that even if he is found to be in contempt, the court cannot assess
monetary sanctions against him, as he does not have the financial ability to pay. Debtor
testified that he has no income, is unable to find work and is living in a motel. Taking
Debtor's financial condition into consideration, the court orders that the Trustee shall not
proceed to collect on this amount, but deduct it from any surplus distribution to the
Debtor at the conclusion of the administration of this estate; may collect it from any
further undisclosed assets that are recovered; or, if no surplus funds are available, not
proceed to collect from the Debtor, until the Trustee has recovered all assets on behalf of
the bankruptcy estate.
Trustee requests the court establish a procedure to restrict Debtor's ability to file
pleadings pro se without leave of the court.
Debtor is a frequent litigant, in this court, in the appeals court, Wyoming state
courts and California State court. This litigation arises from the California court's
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determinations regarding Debtor's divorce, child support and related matters and the
Debtor's bankruptcy case. Trustee disclosed to the court the numerous pleadings in his
responses to Debtor's pleadings. Debtor argues that he is not attempting to be
objectionable or obstructive, but to "help" the Trustee in the administration of the
bankruptcy estate. The court finds the Debtor's testimony to be incredulous. Debtor's
actions are not "helpful" but instead are Debtor's continuing actions to control the
administration and outcome of this bankruptcy estate.
The United States Bankruptcy Court for the District of Utah addressed a similar
debtor, establishing filing restrictions on all future pleadings, which were upheld by the
Tenth Circuit Bankruptcy Appellate Panel. 2 This court adopts and modifies those filing
restrictions with regard to future pleadings filed by Debtor.
Debtor shall be required to include a statement under penalty of perjury in all
future pleadings containing the following infonnation:
(a) the legal basis for the pleading;
(b) the specific factual basis for the pleading, excluding the benign generalities of
past pleadings;
(c) a statement that the legal or factual arguments raised by the pleading are not
frivolous or made in bad faith; that to the best of debtor's knowledge, they are warranted
by existing case law; that the intent of the pleading is not improper and not intended to
delay or cause a needless increase in costs or violate any order of this court, specifically
the Debtor Settlement Agreement;
The court shall review all future pleadings, and any noncompliance of the above
2 In re Armstrong, 309 B.R. 799 (10 1h Cir. BAP, 2004).
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requirements by the Debtor shall result in the pleading being immediately denied or
dismissed.
In conclusion, this court finds that Debtor to be in contempt of its orders and shall
order the monetary and filing restrictions as stated above.
This opinion constitutes the Court's findings of fact and conclusions oflaw. A
separate order shall be entered pursuant to Fed. R. Bankr. P. 9021.
DATED this~?:> day of December, 2014.
Service to:
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John Smiley
Robert Lane
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