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Bankruptcy Keyed to Epstein 6th Ed.
Wellness International Network, Ltd. v. Sharif
Citation:
135 S. Ct. 1932 (2015)Facts
Wellness International Network obtained a judgment against Sharif for over $650,000 in attorney’s fees after Sharif repeatedly ignored discovery requests in earlier litigation. When Sharif filed for Chapter 7 bankruptcy, he claimed that assets worth over $5 million were owned by the Soad Wattar Living Trust rather than by him personally. Wellness filed an adversary proceeding in the Bankruptcy Court, seeking in part a declaratory judgment that the trust was Sharif’s alter ego and its assets should be considered part of his bankruptcy estate. In his answer, Sharif admitted the proceeding was a “core proceeding.” After Sharif failed to comply with discovery obligations regarding the trust, the Bankruptcy Court entered a default judgment against him, declaring the trust assets were property of his bankruptcy estate. While Sharif’s appeal was pending, the Supreme Court decided Stern v. Marshall, but Sharif did not raise a Stern objection until after briefing closed. The District Court deemed the objection untimely, and the Seventh Circuit reversed, holding that Stern objections implicate structural interests that cannot be waived.
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