Doe v. Roman Catholic Church of the Archdiocese of New Orleans

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

A.A. DOE, CIVIL ACTION

Plaintiff

VERSUS NO. 21-215

c/w 21-1238

THE ROMAN CATHOLIC CHURCH OF THE SECTION: “E” (1)

ARCHDIOCESE OF NEW ORLEANS, ET AL.,

Defendants

Applies to: Both Cases

ORDER AND REASONS

Before the Court is a Motion to Dismiss and for Remand, filed by A. A. Doe.1 Father

John Asare-Dankwah (“Asare”) filed an opposition to the motion.2 A. A. Doe filed a reply.3

Also pending before the Court is a Motion to Stay Defamation Action, filed by A. A.

Doe.4 Asare filed an opposition to the motion.5 A. A. Doe filed a reply.6

BACKGROUND

On May 1, 2020, The Roman Catholic Church for the Archdiocese of New Orleans

(“the Archdiocese”) filed a voluntary petition for bankruptcy under chapter 11 of the

Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of

Louisiana.7 The Bankruptcy Court established a March 1, 2021, deadline for filing sexual

abuse proofs of claim.8

1 R. Doc. 28.

2 R. Doc. 35.

3 R. Doc. 43.

4 R. Doc. 29.

5 R. Doc. 36.

6 R. Doc. 45.

7 In re The Roman Catholic Church for the Archdiocese of New Orleans, No. 20-10846, R. Doc. 1 (Bankr.

E.D. La.).

8 Id. at R. Doc. 427.

On January 27, 2021, A. A. Doe filed suit in the Civil District Court for the Parish

of Orleans against Asare, the Archdiocese, Archdiocese of New Orleans Indemnity, Inc.,

and Blessed Trinity Catholic Church.9 A. A. Doe alleged that, when he was ten years old,

he was raped by Asare while Asare was acting in his capacity as a Catholic priest serving

in the Blessed Trinity Catholic Church Parish and “operating under the authority,

supervision, and direction of the Archdiocese.”10

On February 2, 2021, the Archdiocese removed A. A. Doe’s state court suit to this

Court pursuant to 28 U.S.C. §§ 1334 and 1452(a).11 That same day, in the chapter 11 case,

the Archdiocese filed a motion for relief for willful violation of the automatic stay against

A. A. Doe’s lawyers, alleging the filing of A. A. Doe’s state court lawsuit was a willful

violation of the bankruptcy stay.12 On February 22, 2021, pursuant to an agreement

reached between the Archdiocese and A.A. Doe’s lawyers, the Bankruptcy Court ordered

that, in full satisfaction of the Archdiocese’s motion for relief for willful violation of the

automatic stay, A. A. Doe’s counsel will voluntarily dismiss the claims in the A. A. Doe

removed lawsuit “against all parties affected by the automatic stay without prejudice.”13

On March 1, 2021, this Court ordered the removed lawsuit stayed and

administratively closed “pending the resolution of the Archdiocese’s bankruptcy

proceedings.”14 On March 24, 2021, A. A. Doe filed a motion in the removed lawsuit,

seeking leave to file an amended complaint “in order to dismiss, without prejudice, the

9 A. A. Doe v. The Roman Catholic Church of the Archdiocese of New Orleans, et al., No. 21-803, Civil

District Court for the Parish of Orleans, State of Louisiana.

10 Id.

11 R. Doc. 1. A. A. Doe’s state court petition is attached to the notice of removal, at R. Doc. 1-1.

12 In re The Roman Catholic Church for the Archdiocese of New Orleans, No. 20-10846, R. Doc. 740 (Bankr.

E.D. La.).

13 Id. at R. Doc. 756.

14 R. Doc. 7.

Roman Catholic Archdiocese of New Orleans, Blessed Trinity Catholic Church Parish and

Archdiocese of New Orleans Indemnity, Inc. as a parties defendant.”15 This Court granted

A. A. Doe’s motion, ordering the dismissal of the Archdiocese, Blessed Trinity Catholic

Church Parish and Archdiocese of New Orleans Indemnity, Inc.16 This Court also granted

A. A. Doe leave to file an amended complaint.17 A. A. Doe’s amended complaint in the

removed lawsuit names Asare and Catholic Mutual Relief Society as Defendants.18

A. A. Doe filed a Proof of Claim in the Archdiocese’s chapter 11 case.19 On May 3,

2021, Asare instituted an adversary proceeding20 in the Archdiocese bankruptcy case by

filing a complaint for damages against A.A. Doe, which included an objection to the proof

of claim. Asare brought claims against A. A. Doe for defamation, false light invasion of

privacy, and intentional infliction of emotional distress.21

On June 24, 2021, A. A. Doe filed an answer to Asare’s complaint in the adversary

proceeding.22 On that same day, A. A. Doe filed a Motion to Withdraw the Reference,

arguing Asare’s adversary complaint should be withdrawn from the bankruptcy court and

decided by this Court because Asare’s claims are for “personal injury torts” under 28

U.S.C. § 157(b)(5).23 A. A. Doe further argued Asare’s claims should be consolidated with

the removed lawsuit currently pending before this Court.24

15 R. Doc. 8.

16 R. Doc. 9.

17 Id.

18 R. Doc. 10.

19 In his motion to withdraw the reference, (In Re: The Roman Catholic Church for the Archdiocese New

Orleans, No. 21-1238, R. Doc. 1 (E.D. La.)), A. A. Doe represents that he has filed a proof of claim. This

proof of claim, along with all other sexual assault proofs of claim, has not been made available to the public.

20 Asare-Dankwah v. A. A. Doe, No. 21-1016 R. Doc. 1, (Bankr. E.D. La.).

21 Id.

22 Id. at R. Doc. 20.

23 In Re: The Roman Catholic Church for the Archdiocese New Orleans, No. 21-1238, R. Doc. 1 (E.D. La.).

See also Asare-Dankwah v. A. A. Doe, No. 21-1016 R. Doc. 21, (Bankr. E.D. La.). A. A. Doe’s motion to

withdraw the reference was filed in the bankruptcy court and referred to this Court for disposition under

Local Rule 83.4.3.

24 In Re: The Roman Catholic Church for the Archdiocese New Orleans, No. 21-1238, R. Doc. 1 (E. D. La.).

On August 25, 2021, the Court issued an Order and Reasons withdrawing Asare’s

adversary complaint from the bankruptcy system.25 The Court found that withdrawal of

the reference was mandatory under 28 U.S.C. § 157(b)(5) because “Asare’s claims are

based on personal injury torts” arising under Louisiana tort law, and his claims “do not

sound in finance, business contract or property.”26

On August 25, 2021, the Court lifted the stay and administratively opened A. A.

Doe’s removed lawsuit.27 On that same date, the Court consolidated Asare’s withdrawn

adversary complaint with A. A. Doe’s removed lawsuit.28 On September 22, 2021, a

motion for dismissal of Defendant Catholic Mutual Relief Society, without prejudice, was

filed by A. A. Doe.29 On September 23, 2021, the Court granted the motion and dismissed

Catholic Mutual Relief Society as a defendant without prejudice.30 The sole remaining

parties in these consolidated actions are A. A. Doe and Asare.

On September 29, 2021, the Court held a telephone preliminary conference with

the parties.31 During the September 29, 2021 conference, the Court ordered the parties to

send a joint letter to the Court addressing any outstanding issues that needed to be

discussed, and set a telephone status conference for Tuesday, October 26, 2021.32

On October 1, 2021, the Court issued an Order33 requiring the parties to submit

briefing on the following three issues: whether Asare is a party in interest for purposes of

25 Id. at R. Doc. 7.

26 Id. at p. 8.

27 R. Doc. 13.

28 R. Doc. 14. The instant action is comprised of these two consolidated actions.

29 R. Doc. 19.

30 R. Doc. 20.

31 R. Doc. 24.

32 Id.

33 R. Doc. 25.

Federal Rule of Bankruptcy Procedure 3007(b);34 whether Asare’s objection to A. A. Doe’s

proof of claim is combined with a demand for relief of a kind specified in Federal Rule of

Bankruptcy Procedure 7001;35 and whether the debtor in Bankruptcy Case No. 20-10846

was given notice of Asare’s objection to A. A. Doe’s proof of claim.36 On October 15, 2021,

Asare filed his memorandum37 in response to the Court’s October 1, 2021 Order. In his

memorandum, Asare contends he is a party in interest; that his adversary complaint

combines an objection to A. A. Doe’s proof of claim with claims that properly form the

basis of an adversary proceeding under Rule 7001; and that he provided the Debtor with

notice of his adversary complaint and the claim objection included therein by notice of

electronic filing and via a conversation call between Asare’s counsel and debtor’s

counsel.38 On October 22, 2021, A. A. Doe filed his memorandum39 in response to the

Court’s October 1, 2021 Order. In his memorandum, A. A. Doe contends Asare is not a

party in interest; that Asare’s objection is not combined with any demand for relief as

specified under Rule 7001, but that, even if Rule 7001 does apply, Asare’s objection was

not properly filed in the bankruptcy or properly served under Rule 3007; and that “factual

support is lacking as to whether the debtor was put on notice of the objection.”40 In

addition, Asare filed a reply memorandum41 to respond to and address the issues raised

by A. A. Doe in his memorandum.

34 Federal Rule of Bankruptcy Procedure 3007(b) states that “[a] party in interest shall not include a

demand for relief of a kind specified in Rule 7001 in an objection to the allowance of a claim, but may

include the objection in an adversary proceeding.”

35 Federal Rule of Bankruptcy Procedure 7001 provides a list of ten types of actions denominated as

adversary proceedings.

36 As previously mentioned herein, the debtor in Bankruptcy Case No. 20-10846 is The Roman Catholic

Church for the Archdiocese of New Orleans.

37 R. Doc. 26.

38 Id.

39 R. Doc. 30.

40 Id. at p. 10.

41 R. Doc. 38.

On October 26, 2021, the Court held a telephone status conference.42 During the

conference, “[t]he parties agree[d] that Asare’s objection to A. A. Doe’s proof of claim,

included in the complaint in the adversary action, is before this Court.”43

LAW AND ANALYSIS

In his motion to dismiss and for remand, A. A. Doe argues this matter “should be

dismissed and remanded based on 28 U.S.C. § 1447(c) and Federal Rule of Civil Procedure

12(h)(3) as there is no subject matter jurisdiction.”44 A. A. Doe argues, alternatively, this

matter should be remanded for the following “non-exclusive” reasons: (1) the mandatory

abstention doctrine requires remand; (2) alternatively, the permissive abstention

doctrine strongly favors remand; and (3) equity requires remand.45

In his opposition to A. A. Doe’s motion to dismiss and for remand, Asare argues

the Court should deny A. A. Doe’s motion because the Court has subject matter

jurisdiction over this proceeding, because mandatory abstention is inapplicable, and

because the permissive abstention and equitable remand factors weigh against

remanding this action.46

“The power to stay proceedings is incidental to the power inherent in every court

to control the disposition of the cases on its docket with economy of time and effort for

itself, for counsel, and for litigants.”47 The party requesting a stay bears the burden of

showing that the circumstances justify an exercise of that discretion.48 In his motion to

stay, A. A. Doe argues Asare’s counterclaims for defamation, intentional infliction of

42 R. Doc. 32.

43 Id.

44 R. Doc. 28-1 at p. 1.

45 Id.

46 R. Doc. 35 at p. 1.

47 Landis v. N. Am. Co., 299 U.S. 248, 254–55, (1936); see also Clinton v. Jones, 520 U.S. 681, 706 (1997).

48 See Nken v. Holder, 556 U.S. 418 (2009).

emotional distress, and false light invasion of privacy should be stayed pending resolution

of A.A. Doe’s sexual abuse claims pursuant to the Court’s inherent authority to control its

docket.49 A. A. Doe argues Louisiana courts consistently apply the rule that a defamation

action based on allegations made in a judicial proceeding cannot be brought until the

underlying judicial proceeding is terminated.50 In his opposition, Asare argues his the

Court should not stay his counterclaims because his counterclaims are not based upon

statements made in a judicial proceeding.51

I. The Court has subject matter jurisdiction.

Federal courts are courts of limited subject matter jurisdiction, and they possess

only the power authorized by the Constitution and by statute.52 Under 28 U.S.C. § 1441, a

defendant may remove an action from state court to federal court if the plaintiff could

have originally brought the action in federal court.53 Section 1452 explicitly provides for

removal of claims related to bankruptcy, stating that “[a] party may remove any claim or

cause of action in a civil action,” to federal court if the court “has jurisdiction of such claim

or cause of action under section 1334 of this title.”54 28 U.S.C. § 1334 establishes the

bankruptcy jurisdiction of the federal district courts by providing, in pertinent part:

(b) Except as provided in subsection (e)(2), and notwithstanding any Act of

Congress that confers exclusive jurisdiction on a court or courts other than

the district courts, the district courts shall have original but not exclusive

jurisdiction of all civil proceedings arising under title 11, or arising in or

related to cases under title 11.55

49 R. Doc. 29.

50 See R. Doc. 29-1.

51 R. Doc. 36.

52 See Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).

53 See 28 U.S.C. § 1441.

54 28 U.S.C. § 1452(a).

55 28 U.S.C. § 1334(a), (b).

To determine whether jurisdiction exists under § 1334(b), “‘it is necessary only to

determine whether a matter is at least “related to” the bankruptcy.’”56 A civil proceeding

is related to a bankruptcy case if (1) the outcome could alter the rights, liabilities, options,

or freedom of action (either positively or negatively) of the debtor; and (2) it could have

some impact on the estate being administered in bankruptcy.57

A. A. Doe argues his petition was removed from state court by the Archdiocese

under 28 U.S.C. §§ 1334 and 1452(a), and that these statutes are the sole basis of federal

jurisdiction over this case.58 A.A. Doe acknowledges there was subject matter jurisdiction

under § 1334(b) at the time of removal because “there were defendants that were part of

the Archdiocese Bankruptcy – the Archdiocese, the local Parish[,] Holy Trinity, and the

Archdiocese Indemnity Corporation,” but argues those defendants have since been

dismissed, and the only remaining parties are A. A. Doe and Asare.59 As a result, A. A. Doe

argues this Court no longer has subject matter jurisdiction under § 1334(b) because the

matter is no longer related to bankruptcy.

Asare argues subject matter jurisdiction is evaluated at the time of removal, and

“that, at the very least, Doe’s claims, at the time of removal, would have diminished the

bankruptcy estate and thus related to the bankruptcy,” pursuant to § 1334(b).60 Asare

further argues that, “regardless of when subject matter jurisdiction is judged,” subject

matter jurisdiction exists under § 1334(b) because the claims before this court are related

to the bankruptcy proceeding.61 Specifically, Asare argues dismissal of A. A. Doe’s claims

56 In re Bass, 171 F.3d 1016, 1022 (5th Cir. 1999) (quoting Walker v. Cadle Co. (In re Walker), 51 F.3d 562,

569 (5th Cir.1995)).

57 See In re Bass, 171 F.3d 1016, 1022 (5th Cir. 1999).

58 R. Doc. 28-1 at p. 3.

59 Id. at pp. 3–4.

60 R. Doc. 35 at p. 5; id. at n.21.

61 R. Doc. 35 at p. 5.

against him in this case would result in the rejection of A. A. Doe’s proof of claim in the

bankruptcy, which could conceivably have an effect on the bankruptcy.62

In the Notice of Removal filed by the Archdiocese on February 1, 2021, the

Archdiocese averred as follows:

12. The State Court Action is related to the Archdiocese’s Chapter 11 Case

and therefore, is removable under 28 U.S.C. § 1452(a) because, inter alia:

• In the Petition, Plaintiff asserts claims to recover monetary

damages from the Archdiocese. Specifically, the Petition seeks

damages based upon actions or omissions allegedly committed by

the Archdiocese and its officers, employees, agents, or other related

parties. Any recovery of such damages would necessarily diminish

the Archdiocese’s estate.

• The Archdiocese and certain non-debtor co-defendants named in

the Petition, who are alleged to be agents and/or employees of the

Archdiocese, share an identity of interest such that a claim against

the non-debtor co-defendants is, in effect, a claim against the

Archdiocese’s estate. . . .

• The claims and allegations in the Petition against the non-debtor

co-defendants are inextricably intertwined with the claims and

allegations against the Archdiocese such that the entire State Court

Action is “related to” the Archdiocese’s Chapter 11 Case. The claims

and allegations in the Petition arise out of a common nucleus of

operative facts and raise substantially similar questions of law. As

one consequence, the Archdiocese may be compelled to participate

in the litigation, notwithstanding the automatic stay, to protect its

own interests. Moreover, the continuation of the State Court Action,

even if stayed against the Archdiocese, would likely require the

Archdiocese or its employees to expend time and resources in

responding to discovery requests and participating in depositions.

13. Accordingly, the entire State Court Action—and not just the claims

against the Archdiocese—is appropriately removed.63

As previously mentioned, at this time, the Archdiocese, its insurer, the local parish

church, and Catholic Mutual Relief Society of America are no longer defendants in this

62 R. Doc. 35 at p. 6.

63 R. Doc. 1 at ¶¶ 12–13.

action. The only remaining parties are A. A. Doe and Asare. The question is whether the

Court continues to have subject matter jurisdiction under § 1334(b).

In general, federal district courts must judge their jurisdiction based on the status

of the case at the time of removal.64 The Fifth Circuit has expressly held that the time-of-

filing- rule applies to § 1334(b).65 In Double Eagle Energy Servsices, L.L.C. v. MarkWest

Utica EMG, L.L.C., the Fifth Circuit addressed the question of “what happens if a lawsuit,

when filed, is related to a bankruptcy, but then something happens that dissolves the

bankruptcy connection.”66 The Fifth Circuit held that the time-of-filing rule applies to

bankruptcy jurisdiction and that “the related-to-bankruptcy jurisdiction that existed at

the outset of this case never went away.”67 Accordingly, this Court examines its subject

matter jurisdiction based on a snapshot taken at the time of removal from state court.68

The parties agree that, at the time of removal, this case was related to the

Archdiocese’s chapter 11 case.69 If A. A. Doe had prevailed on his state law tort claims

against the Archdiocese, the Archdiocese’s estate being administered in the chapter 11

case would have been diminished, and the Archdiocese’s rights and liabilities would have

been altered.70 Furthermore, as to A. A. Doe’s claims against Asare, these claims also were

related to the Archdiocese’s chapter 11 case at the time of removal. In his complaint, A. A.

64 See Jones v. Petty–Ray Geophysical, Geosource, Inc., 954 F.2d 1061 (5th Cir.1992), cert. denied 506 U.S.

867, 113 S.Ct. 193, 121 L.Ed.2d 136 (1992).

65 Double Eagle Energy Servs., L.L.C. v. MarkWest Utica EMG, L.L.C., 936 F.3d 260, 263 (5th Cir. 2019).

66 Id.

67 Id.

68 See Bristol-Myers Squibb Co. v. Safety Nat. Cas. Corp., 43 F. Supp. 2d 734, 743 (E.D. Tex. 1999).

69 As mentioned above, a proceeding is related to a bankruptcy case if (1) the outcome could alter the rights,

liabilities, options, or freedom of action (either positively or negatively) of the debtor; and (2) it could have

some impact on the estate being administered in bankruptcy. See In re Bass, 171 F.3d 1016, 1022 (5th Cir.

1999).

70 See, e.g., Jones v. JCC Holding Co., 2001 U.S. Dist. LEXIS 7043, *7 (holding that subject matter

jurisdiction existed under § 1334 because the plaintiff asserted” claims directly against two of the [chapter

11] debtors, and thus whether or not the claims succeed will directly impact the estate being administered

in bankruptcy.”)

Doe alleges Asare was, at all relevant times, “operating under the authority, supervision,

and direction of the Archdiocese,” and was employed by the Archdiocese.71 Thus, a

determination of Asare’s liability could conceivably have had an effect on the

Archdiocese’s estate, as A. A. Doe alleged the Archdiocese was responsible for the actions

of Asare. The Court agrees this proceeding was related to the Archdiocese’s chapter 11

case at the time of removal.

The time of filing rule provides that “subject matter jurisdiction is determined

when a federal court’s jurisdiction is first invoked.”72 In this case, the Court’s jurisdiction

was first invoked when the Archdiocese filed its Notice of Removal, and related to

jurisdiction indisputably existed at that time. Therefore, under the time of filing rule, the

related to jurisdiction “that existed at the outset of the case never went away.”73 The

dismissal of the Archdiocese, its insurer, and the local parish church does not divest the

Court of subject matter jurisdiction under 28 U.S.C. § 1334(b).

II. Asare is not a party in interest with standing to object to A. A. Doe’s

proof of claim; Asare’s objection is overruled.

Asare argues he is a party in interest under the Bankruptcy Code because he “has

a significant financial interest in the outcome of A. A. Doe’s proof of claim in the

bankruptcy case.”74 Specifically, Asare argues that

as a result of [A. A.] Doe’s claims in the Removed Matter and filing of his

proof of claim, the Debtor [the Archdiocese] removed Fr. Asare from his

position as pastor, and his provision of housing was withdrawn. Without

being able to object to [A. A.] Doe’s proof of claim, Fr. Asare faces continued

professional and financial losses due to his removal. Accordingly, an order

from the bankruptcy court regarding [A. A. Doe’s proof of] claim would

diminish [Asare’s] property, increase his burdens, and impair his rights.75

71 See R. Doc. 1-1; see also R. Doc. 10.

72 Id. at 263.

73 See id. at 263–64.

74 R. Doc. 26 at p. 4.

75 Id. at pp. 4–5.

A. A. Doe argues Asare is not a party in interest under the Bankruptcy Code because Asare

does not have a pecuniary interest that is directly affected by the bankruptcy proceeding,

and because Asare does not have an interest in the property to be administered and

distributed in the bankruptcy.76 A. A. Doe further argues Asare “does not have a direct

financial stake in the outcome of the case before the Bankruptcy court, and [Asare’s]

pecuniary interest is too remote.”77

Section 1109(b) of the Bankruptcy Code provides that “[a] party in interest,

including the debtor, the trustee, a creditors' committee, an equity security holders'

committee, a creditor, an equity security holder, or any indenture trustee, may raise and

may appear and be heard on any issue in a case under this chapter [11].”78 Only “[a] party

in interest has standing to object to a proof of claim.”79 Although the term “party in

interest” appears more than thirty times in the Bankruptcy Code, the term is not defined

in the Bankruptcy Code or in the Bankruptcy Rules. Furthermore, it is well recognized

that the list in § 1109(b) is illustrative, not exclusive.80 A party in interest “is generally

understood to include all persons whose pecuniary interests are directly affected by the

bankruptcy proceedings.”81 A party does not have standing to raise objections “that relate

solely to others, or that go to issues that do not directly and adversely affect them

76 R. Doc. 30 at p. 6.

77 Id. at p. 5.

78 11 U.S.C. § 1109(b).

79 Matter of Xenon Anesthesia of Texas, P.L.L.C., 698 F. App'x 793, 794 (5th Cir. 2017) (unpublished) (per

curiam).

80 See In re Amatex Corp., 755 F.2d 1034, 1042 (3d Cir. 1985); see also In re Plaisance, 619 B.R. 148 (Bankr.

W.D. La. 2020).

81 In re E.S. Bankest, 321 B.R. 590, 594 (Bankr. S.D. Fla. 2005) (citing In re Alpex Computer Corp., 71 F.3d

353, 356 (10th Cir. 1995)).

pecuniarily.”82 “[C]ourts must determine on a case by case basis whether the prospective

party in interest has a sufficient stake in the proceeding so as to require representation.”83

Asare does not fall within any of the listed categories in § 1109(b) as he is not the

debtor, a creditor, an equity security holder, a creditor’s committee, an equity security

holders’ committee, or a trustee. In In re Alpha Natural Resources, Inc., the court

addressed whether parties not falling into any of the listed categories of § 1109(b) could

otherwise be classified as parties in interest.84 In that case, the debtors, a coal mining

company and its subsidiaries, after filing voluntary petitions for relief under title 11, filed

a motion in the bankruptcy court for approval of a compromise between the debtors and

the state environmental agency.85 The Sierra Club and other environmental nonprofit

groups (“the Environmental Parties”) filed an objection to the motion for approval of the

compromise on the grounds that the compromise violated state and federal laws.86 The

debtors challenged the objection on the ground that the environmental parties lacked

standing to object.87 The court first stated that, “[a]s the Environmental Parties plainly do

not fall into any of the specific categories listed in § 1109(b) of the Bankruptcy Code, they

must rely for purposes of standing on being categorized generally as a “party in interest”

in order to be heard in this chapter 11 proceeding.88 The court held the Environmental

Parties were not parties in interest under § 1109(b) because they did not have any

pecuniary interest that would be directly affected by the bankruptcy proceeding, and that

82 In re Plaisance, 619 B.R. at 155 (quoting In re Simplot, No. 06-00002-TLM, 2007 WL 2479664, at *10

(Bankr. D. Idaho Aug. 28, 2007)).

83 In re Amatex Corp., 755 F.2d 1034, 1042 (3d Cir. 1985) (citing In re Penn-Dixie Industries, Inc., 9 B.R.

941, 943 n. 7 (Bankr. S.D. N.Y. 1981)).

84 In re Alpha Nat. Res. Inc., 544 B.R. 848 (Bankr. E.D. Va. 2016).

85 Id. at 850–51.

86 Id. at 851.

87 Id. at 854.

88 Id. at 855.

“[a] remote pecuniary interest will not suffice for standing.89 In reaching its conclusion

that the pecuniary interest, if any, of the Environmental Parties was “too remote” to confer

standing to object, the Alpha Natural court cited to In re C.P. Hall Co.90

In In re C.P. Hall Co., the Seventh Circuit Court of Appeals addressed the question

whether a nonparty to a bankruptcy proceeding should be entitled to intervene in the

proceeding.91 The debtor in that case was a former distributor of asbestos and asbestos

containing products who filed a petition for bankruptcy after tens of thousands of

asbestos-related claims were filed against it.92 The debtor had $10 million remaining in

insurance coverage from one of its insurers, Integrity Insurance, also bankrupt, but there

was a question whether the Integrity policy covered the loss for which the debtor was

seeking indemnity under the policy.93 The debtor and Integrity reached a settlement for

$4.125 million, and the bankruptcy judge approved the settlement.94 Columbia Casualty

Company, an excess insurer of the debtor’s asbestos liabilities, which was not a creditor

of the debtor, objected to the settlement because it was concerned that the settlement

between the debtor and Integrity would increase the likelihood that it would have to honor

its secondary-coverage obligation.95 The bankruptcy judge refused to consider Columbia’s

objection on the ground that Columbia had no right to object, and the district court

affirmed on appeal.96 Columbia then appealed to the Seventh Circuit. The appellate court

explained that while the list of parties in interest in § 1109(b) is not exhaustive, it “does

89 Id. at 856.

90 In re C.P. Hall Co., 750 F.3d 659 (7th Cir. 2014).

91 Id.

92 Id. at 660.

93 Id.

94 Id.

95 Id.

96 Id.

suggest that such a party is someone who has a legally recognized interest in the debtor’s

assets, namely the debtor (or the trustee in bankruptcy, if as in this case there is a trustee)

and the creditors.”97 The court concluded that, because Columbia was not a creditor,

debtor, or trustee, but was merely “a firm that may suffer collateral damage from a ruling

in a bankruptcy proceeding,” Columbia’s pecuniary interest was too remote to entitle it to

object.98

Asare relies on the case of In re Lundahl.99 In that case, the debtor filed a voluntary

chapter 13 petition on January 31, 2003.100 The debtor filed her statements and schedules

on January 31, 2003, and Eli Lilly was not listed as a creditor by the debtor on such

schedule or mailing matrix, even though Eli Lilly had an outstanding judgment against

the debtor.101 Eight months after the original petition was filed, and after the claims bar

date, the debtor filed an amended Schedule B, which stated “SET OFF OR INVALID

CLAIMS” and then listed $50,000 as a void judgment as to Eli Lilly, asserting she had a

set-off claim against Eli Lilly.102 The debtor also instituted an adversarial proceeding

against Eli Lilly in connection with her chapter 13 case.103 When the debtor moved for

confirmation of her chapter 13 plan, Eli Lilly objected, and the debtor argued Eli Lilly

lacked standing to object because it did not file a timely proof of claim.104 The court

explained that, as a direct result of debtor’s failure to list Eli Lilly as a creditor in her

statements and schedules, Eli Lilly did not receive notice of the bankruptcy in time to file

97 Id. at 661.

98 Id.

99 In re Lundahl, 307 B.R. 233, 240 (Bankr. D. Utah 2003).

100 Id. at 236.

101 Id. at 237.

102 Id. at 238, 239.

103 Id. at 238.

104 Id. at 239.

a proof of claim.105 The court concluded that Eli Lilly, a judgment creditor of the debtor,

was a party in interest with the potential to be substantially financially impacted, given

the debtor’s filing of an adversary proceeding against it.106 In reaching its conclusion, the

court relied an opinion from the United States Bankruptcy Appellate Panel of the Tenth

Circuit, which explained that

[w]hile some courts have interpreted the phrase [party in interest] to

exclude a Chapter 13 creditor who did not hold an allowed claim, we do not

agree with the Debtor's extrapolation that a party in interest is limited solely

to creditors. Section 1109(b), although not applicable in Chapter 13,

provides guidance in determining who is a party in interest. The phrase is

generally understood to include all persons whose pecuniary interests are

directly affected by the bankruptcy proceedings. . . . We extend this

definition to include anyone who has an interest in the property to be

administered and distributed under the Chapter 13 plan.107

Asare’s reliance on In re Lundahl is misplaced as Asare is not similarly situated to

Eli Lilly. Eli Lilly was a judgment creditor of the debtor, and its pecuniary interest was

directly affected by the bankruptcy proceeding. The debtor instituted an adversary

proceeding against Eli Lilly, arguing that there was “$50,000 as a void judgment as to Eli

Lilly,” based on a claim of set off.108 Asare is not a judgment creditor of the Archdiocese,

and the Archdoicese has not instituted an adversary proceeding against him.

Instead, Asare is similarly situated to the environmental parties in Alpha Natural

Resources and to the excess insurer in Hall. Any pecuniary interest Asare might have in

the outcome of A. A. Doe’s proof of claim in the Archdiocese’s title 11 case is indirect and

remote. Asare essentially argues that, because the Archdiocese responded to the sexual

assault allegation on which A. A. Doe’s proof of claim is based by removing Asare from his

105 Id.

106 Id. at 240–41.

107 Id. at 240–41 (quoting In re Davis, 239 B.R. 573, 579 (B.A.P. 10th Cir. 1999)).

108 The debtor in that case was pro se.

position as pastor and withdrawing his housing provision, Asare has a direct financial

stake in the outcome of A. A. Doe’s proof of claim. Asare has no direct financial stake in

the Archdiocese’s estate, he has filed no proof of claim in the Archdiocese’s bankruptcy,

he will not be responsible for payment on A. A. Doe’s proof of claim if the proof of claim

is allowed, and allowance of the proof of claim will not directly affect Asare in any way.

Asare is not a party in interest; rather, he is merely an individual who believes he may

suffer collateral damage from a ruling allowing A. A. Doe’s proof of claim. Any

hypothetical damage Asare may suffer will not result directly from a ruling allowing A. A.

Doe’s proof of claim.

Asare is not a party in interest and does not have standing to object to A. A. Doe’s

proof of claim. Asare’s objection is overruled.109

III. Mandatory abstention is inapplicable to this case.

A. A. Doe argues that, in the event this civil case is related to the Archdiocese’s

chapter 11 case, this civil case is subject to abstention and remand.110 Asare argues

mandatory abstention is inapplicable in this case because A. A. Doe’s lawsuit was filed

after the Archdiocese’s filed its voluntary petition in bankruptcy, and because there is

currently no state court action pending.111

Title 28 U.S.C. § 1334(c)(2) governs mandatory abstention. Section 1334(c)(2)

states that:

Upon timely motion of a party in a proceeding based upon a State law claim

or State law cause of action, related to a case under title 11 but not arising

under title 11 or arising in a case under title 11, with respect to which an

action could not have been commenced in a court of the United States

109 As mentioned above, the parties agreed Asare’s claim objection was withdrawn to this Court when the

Court issued its Order and Reasons withdrawing the reference of Asare’s adversary complaint, and so this

Court may rule on the claim objection. See R. Doc. 32.

110 R. Doc. 28-1 at p. 6.

111 R. Doc. 35 at p. 7.

absent jurisdiction under this section, the district court shall abstain from

hearing such proceeding if an action is commenced, and can be timely

adjudicated, in a State forum of appropriate jurisdiction.112

The Fifth Circuit has held that district courts must abstain from hearing bankruptcy

proceedings under § 1334(c)(2) when (1) the state law claim has “no independent basis

for federal jurisdiction, other than § 1334(b); (2) the claim is a non-core proceeding, i.e.,

it is related [to] a case under title 11; (3) an action has been commenced in state court;

and (4) the action could be adjudicated timely in state court.”113 In addition, the motion

requesting abstention under § 1334(c)(2) must be “timely.”114

The first two factors are clearly met. First, this case involves only claims brought

under Louisiana state law, and both parties are Louisiana residents. Thus, bankruptcy

jurisdiction is the only basis for federal subject matter jurisdiction over this case. Second,

the parties agree, and the Court concurs, that although the claims involved in this case are

related to a bankruptcy case, the claims are not proceedings arising under title 11, nor are

they proceedings arising in a title 11 case.115 Because these claims are related to a

bankruptcy, and are not proceedings arising under title 11 or in a title 11 case, these

proceedings are non-core.116

112 28 U.S.C. § 1334(c)(2).

113 In re TXNB Internal Case, 483 F.3d 292, 300 (5th Cir. 2007) (citing Schuster v. Mims (In re Rupp &

Bowman), 109 F.3d 237, 239 (5th Cir.1997)).

114 See 28 U.S.C. § 1334(c)(2).

115 Under 28 U.S.C. § 1334(b), federal district courts have “original but not exclusive jurisdiction” over three

distinct categories of civil proceedings: (i) civil proceedings arising under title 11; (ii) civil proceedings

arising in a case under title 11; and (iii) civil proceedings that are related to a bankruptcy case. 28 U.S.C. §

1334(b). A civil proceeding arises under title 11 if it “involve[s] a cause of action created or determined by a

statutory provision of title 11.” Wood v. Wood (In re Wood), 825 F.2d 90, 96 (5th Cir. 1987). Civil

proceedings arising in a title 11 case are “those that are not based on any right expressly created by [title 11,

but nevertheless would have no existence outside of the bankruptcy.” Id. at 97. These first two categories of

civil proceedings “are statutorily defined as ‘core’ proceedings under 28 U.S.C.§ 157(b).” In re Dune Energy,

Inc., 575 B.R. 716, 723 (Bankr. W.D. Tex. 2017). The third category of civil proceedings—those related to a

case under title 11—is the broadest category, and proceedings within this category are often called “non-

core” proceedings. See generally id.

116 Asare’s arguments that his claim objection renders this a core proceeding are moot as his claim objection

has been overruled because Asare is not a party in interest.

With respect to the timeliness of the motion for mandatory abstention, neither the

statutory text of § 1334(c)(2), nor the Federal Rules of Bankruptcy Procedure or the local

bankruptcy rules, provide guidance on what constitutes a timely motion. Neither of the

parties, in their briefing, substantively address whether this motion was timely filed; A.

A. Doe, for his part, merely concludes the motion was timely filed, while Asare does not

address the timeliness factor. The Archdiocese filed its Notice of Removal on February 2,

2021, and the instant motion was filed on October 21, 2021. As outlined above, the

procedural background of this consolidated action is complex. The removed lawsuit filed

by A. A. Doe was stayed on March 3, 2021. On March 29, 2021, the Archdiocese, its

insurer, and the local parish were dismissed. On August 25, 2021, the Court withdrew the

reference of Asare’s adversary complaint, lifted the stay in the removed lawsuit, and

consolidated the adversary action with the removed lawsuit. The timeliness question in

this case focuses on whether the motion, filed eight weeks after the reference was

withdrawn and the stay was lifted, was timely. In Verges v. Verges, a separate section of

this Court concluded that a motion to remand requesting mandatory abstention, filed

within 30 days of removal, was timely.117 The Court concludes that, in light of the complex

history of this case, the motion was timely filed.

The third criterion for mandatory abstention is not met in this case. Although A.

A. Doe’s lawsuit was commenced in state court,118 it was not commenced in state court

prior to the filing of the Archdiocese’s chapter 11 petition. The Archdiocese filed a

voluntary petition for bankruptcy under chapter 11 on May 1, 2020.119 On January 27,

117 Verges v. Verges, No. CIV.A. 03-3533, 2004 WL 1375304, at *2 (E.D. La. June 17, 2004).

118 See J.T. Thorpe Co. v. Am. Motorists, No. CIV.A. H-02-4598, 2003 WL 23323005, at *2 n.3 (S.D. Tex.

June 9, 2003).

119 In re The Roman Catholic Church for the Archdiocese of New Orleans, No. 20-10846, R. Doc. 1 (Bankr.

E.D. La.).

2021, A. A. Doe filed his complaint in the Civil District Court for the Parish of Orleans.120

To meet the third criterion, the cause of action must have been commenced prior to the

filing of the petition commencing the title 11 case.121

In In re Freeway Foods of Greensboro, Inc., the United States Bankruptcy Court

for the Middle District of North Carolina aptly addressed the question of whether, for the

mandatory abstention provision to apply, the action must be filed prior to the bankruptcy

petition.122 The court explained as follows:

A leading treatise states that “many courts have held that for the statute to

be applicable, the cause of action must have been commenced prior to the

filing of the petition commencing the title 11 case.” 1 Collier on Bankruptcy,

¶ 3.05[2] (Alan N. Resnick & Henry J. Sommer eds., 16th ed.); see also

Container Transport, Inc. v. Scott Paper Co. (In re Container Transport,

Inc.), 86 B.R. 804, 805–07 (E.D.Pa.1988) (holding that “an action [must]

be pending in a state court forum at the time that a proceeding is initiated

in the bankruptcy court in order for a party to successfully invoke

mandatory abstention”); Ram Constr. Co. v. Port Authority of Allegheny

County, 49 B.R. 363, 367 (W.D.Pa.1985) (holding that section 1334(c)(2)

was not applicable since an action had not been commenced in state court);

Taxel v. Commercebank (In re World Fin. Servs. Center, Inc.), 64 B.R. 980,

989 (Bankr.S.D.Cal.1986) (“Mandatory abstention does not apply to the

instant case in that there is no pending state court action.”); Braucher v.

Cont'l Ill. Nat'l Bank & Trust Co. of Chicago (In re Illinois–California

Express, Inc.), 50 B.R. 232 (Bankr.D.Colo.1985) (holding that a “proceeding

in the state court forum [must have] been commenced” for mandatory

abstention to apply); Excelite Corp. v. Custom Vanities, Inc. (In re Excelite

Corp.), 49 B.R. 923, 925 (Bankr.N.D.Ga.1985) (holding that mandatory

abstention was not applicable when there was no state court action

pending); contra Midgard Corp. v. Kennedy (In re Midgard Corp.), 204 B.R.

764, 778 (10th Cir. BAP 1997) (finding that the majority position “reads a

requirement into the statute which plainly does not exist”); World Solar

Corp. v. Steinbaum (In re World Solar Corp.), 81 B.R. 603, 610

(Bankr.S.D.Cal.1988) (holding that “a pending state court action is not a

prerequisite for mandatory abstention” so long as the “action can be filed

on a timely basis in a state court of appropriate jurisdiction”).

120 A. A. Doe v. The Roman Catholic Church of the Archdiocese of New Orleans, et al., No. 21-803, Civil

District Court for the Parish of Orleans, State of Louisiana.

121 Jones v. JCC Holding Co., 2001 U.S. Dist. LEXIS 7043, *11.

122 In re Freeway Foods of Greensboro, Inc., 449 B.R. 860 (Bankr. M.D.N.C. 2011).

The clear majority of cases supports the position that the cause of action

must be pending in state court prior to the bankruptcy *878 for mandatory

abstention to apply. See HH1, LLC v. Lo'r Decks at Calico Jacks, LLC, Adv.

No. 10–2004, 2010 WL 1009235, at *4 (Bankr.M.D.N.C. Mar.18, 2010)

(“the fifth requirement under section 1334(c)(2) is that there must be an

action commenced in state court”); In re Ackerman, Herbst & Pliskow,

M.D., P.A., 221 B.R. 568, 569 (Bankr.S.D.Fla.1998) (“like the majority of

courts that have considered this issue, this Court finds that some type of

‘proceeding’ must be pending for mandatory abstention to apply”); TTS,

Inc. v. Stackfleth (In re Total Technical Servs., Inc.), 142 B.R. 96

(Bankr.D.Del.1992) (“Mandatory abstention does not apply, however,

because an action has not previously been commenced in a State forum, as

§ 1334(c)(2) requires.”).

The minority position is inconsistent with the legislative history and the

plain language of the statute. As Collier notes, “a forebear of section

1334(c)(2) referred to a state court action that ‘has been or will be timely

instituted.’ ” The currently applicable statute uses different language, with

no reference to an action that “will be timely instituted.” This fact strongly

suggests that the viewpoint espoused in World Solar Corp. is incorrect. See

1 Collier on Bankruptcy, ¶ 3.05[2], n. 17 (Alan N. Resnick & Henry J.

Sommer eds., 16th ed.). The minority view is further weakened by the plain

language of the statute, which states that the court shall abstain “if an action

is commenced ... in a State forum of appropriate jurisdiction.” 28 U.S.C. §

1334(c)(2) (emphasis added); see also Flores Rivera v. Telemundo Group,

133 B.R. 674, 676 (D.P.R.1991) (holding that World Solar Corp. was

contrary to the clear language of § 1334(c)(2)); In re Boughton, 49 B.R. 312,

315 (Bankr.N.D.Ill.1985) (“Coronet suggests that the cited language means

‘is commenced or can be commenced ... in a State forum.’ That is not,

however, the import of the language used.”). The minority position

essentially rewrites the statute. Thus, the better view is that a case must be

pending in state court prior to bankruptcy for mandatory abstention to

apply.123

This Court finds the reasoning employed in In re Freeway Foods convincing. The

majority view, requiring that a case be pending in state court prior to bankruptcy for

mandatory abstention to apply, is the better view.

Finally, with respect to the fourth factor, which asks whether the plaintiff’s claims

are capable of timely adjudication in state court, A. A. Doe has not produced any evidence

123 Id. at 877–78.

or offered any argument on this point. Instead, A. A. Doe merely states, in conclusory

fashion, that “the case can be timely adjudicated in state court.”124 Bankruptcy courts

within the Fifth Circuit have noted that “[a] naked assertion that the matter can be timely

adjudicated in the state court, without more is insufficient to satisfy the requirement [of

mandatory abstention].”125 The Court concludes Plaintiff has failed to meet his burden to

show that his claims can be timely adjudicated in state court.126

Having concluded the prerequisites to mandatory abstention under § 1334(c)(2)

are not met, the Court finds mandatory abstention is not required in this case.

IV. The Court will not remand this case under the doctrines of permissive

abstention and equitable remand.

Finally, A. A. Doe asks the Court to exercise its discretion to remand this case under

the doctrines of equitable remand and permissive abstention. A. A. Doe argues the

permissive abstention and equitable remand factors weigh in favor of remanding this case

to state court, while Asare argues the factors weigh against remand.

Permissive abstention is governed by § 1334(c)(1), which provides that

Except with respect to a case under chapter 15 of title 11, nothing 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 11.127

Equitable remand of bankruptcy matters is provided for under § 1452(b). Section 1452(b)

provides the court to which a lawsuit has been removed based on jurisdiction under §

124 R. Doc. 28-1 at p. 9.

125 J.T. Thorpe Co. v. Am. Motorists, No. CIV.A. H-02-4598, 2003 WL 23323005, at *3 (S.D. Tex. June 9,

2003); WRT Creditors Liquidation Tr. v. C.I.B.C. Oppenheimer Corp., 75 F. Supp. 2d 596, 605–06 (S.D.

Tex. 1999).

126 Doe v. Archdiocese of New Orleans Indem., Inc., No. CV 20-1338, 2020 WL 4593443, at *3 (E.D. La.

Aug. 11, 2020) (stating that “district courts usually require evidence such as scheduling orders and a

discovery plan to prove the state court is ready to timely adjudicate claims.”)

127 28 U.S.C. § 1334(c)(1).

1334 “may remand such claim or cause of action on any equitable ground.”128 “[T]he

factors governing permissive abstention and equitable remand are nearly identical.”129

“Because the analysis is so similar, courts that grant remand often employ equitable

remand in 28 U.S.C. § 1452(b), which allows a court to remand “on any equitable ground”

claims removed under § 1452(a).”130 Therefore, the Court need not undertake separate

analyses to determine whether permissive abstention or equitable remand is appropriate;

the doctrines are properly addressed with one analysis.

The “general rule is that a federal court must accept the jurisdiction granted it,”

and permissive abstention and equitable remand are warranted “only on very rare

occasions.”131 In determining whether permissive abstention and equitable remand are

appropriate, the analysis starts with the presumption in favor of “exercising jurisdiction

over [the] lawsuit and not abstaining in favor of the state court,”132 with the balance

“heavily weighted in favor of the exercise of jurisdiction.”133 “The proposition that

bankruptcy courts have broad discretion on whether to abstain comes from both the plain

language of [§ 1334(c)(1)] and the Fifth Circuit's decision in Wood v. Wood.”134 A court’s

128 Id. § 1452(b).

129 Doe v. Archdiocese, 2020 WL 4593443, at *3-(E.D. La. Aug. 11, 2020).

130 Id.

131 In re Viking Offshore (USA) Inc., 405 B.R. 434, 440 (Bankr. S.D. Tex. 2008) (citing Colorado River

Water Conservation Dist. v. United States, 424 U.S. 800 (1976)).

132 Pettus Props. v. VFC Partners 8, LLC (In re Pettus Props.), 2012 Bankr. LEXIS 1181, *10 (citing Walter

v. Freeway Foods, Inc. (In re Freeway Foods of Greensboro, Inc.), 449 B.R. 860, 879 (Bankr. M.D.N.C.

2011) ("This Court begins with the understanding that a federal court must accept the jurisdiction granted

it, and only in rare occasions is discretionary abstention warranted.")).

133 In re Schlotzsky's, Inc., 351 B.R. 430, 435 (Bankr. W.D. Tex. 2006) (quoting Murphy v. Uncle Ben's, Inc.,

168 F.3d 734 (5th Cir.1999)).

134 Houston Baseball Partners LLC v. Comcast Corp. (In re Houston Reg'l Sports Network, L.P.), 514 B.R.

211, 218 (explaining that§ 1334(c)(1) is a “broadly-worded statute allowing federal courts to decline to

exercise jurisdiction "in the interest of justice, or in the interest of comity with State courts or respect for

State law,” and that, “[i]n Wood, the Fifth Circuit noted that the discretionary abstention provision of §

1334(c)(1) helps prevent the broad language of § 1334(b) from bringing into federal court matters which

should be left to state courts to decide.”).

decision whether or not to permissively abstain is reviewed for abuse of discretion.135 The

burden of proving that permissive abstention or equitable remand is appropriate lies with

the party seeking abstention or remand.136

In a recent lawsuit involving claims of sexual abuse against the Archdiocese and/or

its affiliates, a separate section of this Court aptly summarized the law governing

equitable remand and permissive abstention, listing relevant factors such as the

convenience of the forum, the presence of non-debtor parties, considerations of comity,

and whether the case should be tried as a whole in state court.137 Many of those factors,

however, are not applicable because of the posture of this case, as all parties to this action

are non-debtors and all claims the parties have brought against one another are currently

before the Court.

Other factors that do apply are neutral.138 First, the convenience of the forum factor

is neutral, because both this Court and the state court in which A. A. Doe filed his petition

are seated in New Orleans, Louisiana, and are equally convenient. Second, the bifurcation

135 In re Schlotzsky's, Inc., 351 B.R. at 434.

136 Pettus Props, 2012 Bankr. LEXIS 1181 at *9 (“The burden of proving the grounds for permissive

abstention or equitable remand of the Lawsuit rests with Plaintiffs.”)

137 Doe v. Archdiocese, 2020 WL 4593443, at *3-4 (E.D. La. Aug. 11, 2020) (internal quotation marks

omitted) (listing twelve factors to be considered). See In re Houston Reg'l Sports Network, L.P., 514 B.R.

211, 215 (Bankr. S.D. Tex. 2014) (listing fourteen factors courts consider in “deciding whether to abstain or

remand.”).

138 In opining on the appropriateness of courts relying on multi-factor tests to decide permissive abstention

and equitable remand questions, the court in In re Schlotzsky's, Inc. explained that

[w]hile helpful, [such multi-factor tests] are by their very nature, not dispositive.

Mechanical applications of such tests to rule on equitable issues that are heavily fact-

specific are often doomed to produce incorrect outcomes. The various tests offered by these

opinions must be viewed in the larger context of the task presented—to arrive at the

equitable application of the permissive abstention doctrine, as appropriately applied in the

bankruptcy context. Or, more simply, we must avoid losing the forest for the trees. See

Murphy v. Uncle Ben's, Inc., 168 F.3d 734 (5th Cir.1999) (“[t]he decision whether to

surrender jurisdiction because of parallel state court litigation does not rest on a

‘mechanical checklist’ of [abstention] factors, but on a ‘careful balancing’ of them, ‘as they

apply in a given case, with the balance heavily weighted in favor of the exercise of

jurisdiction.’”)

351 B.R. 430, 434–35 (Bankr. W.D. Tex. 2006).

of the civil action factor is neutral because the case will be tried as a whole, whether in

this Court or in state court. The comity factor is neutral because, even though “[t]hese are

solely state law causes of action between non-debtors . . . there are no novel issues that

present a countervailing state interest.”139 The factor which examines whether the state

court would be better able to handle issues of state law than this Court also is neutral.

While both A. A. Doe’s claims and Asare’s claims are based on state law, the claims do not

raise complex or unresolved questions of state law but, instead, are run-of-the-mill state

tort law claims.140 This Court, sitting in diversity, is frequently tasked with applying the

tort law of the state of Louisiana, and the Court is well equipped to do so here. Finally, the

right to a jury trial factor also is neutral because a jury trial can be held in either forum.

A. A. Doe argues the Court should exercise its discretion to permissively abstain

from hearing and equitably remand this case because of the interest in judicial economy

and because of prejudice to him if the case remains in this Court. He relies on Jackson v.

Johnson & Johnson.141 In Jackson, the district court found that equitable considerations

favored remand, because

Another consideration, prejudice to the involuntarily removed party (here,

the plaintiff) also heavily favors remand. Ms. Jackson filed this case over a

year ago, and discovery is underway. To now remove this case to federal

court would impose significant disruption on Ms. Jackson (or her heirs, if

she has died) and delay resolution of her claims by months or potentially

years. Relatedly, the interest of judicial economy supports remand because

the state court has already considered these state law claims for over one

year – including during a hearing on the defendants' declinatory exceptions

on October 19, 2018. The re-litigation of plaintiff's Louisiana-based claims

139 Houston Baseball Partners LLC v. Comcast Corp. (In re Houston Reg'l Sports Network, L.P.), 514 B.R.

211, 217.

140 See, e.g., Pettus Props. v. VFC Partners 8, LLC (In re Pettus Props.), 2012 Bankr. LEXIS 1181, *11; Walter

v. Freeway Foods, Inc. (In re Freeway Foods of Greensboro, Inc.), 449 B.R. 860, 880-1 (Bankr. M.D.N.C.

2011) Ardan Dev. Corp. v. Touhey, 424 B.R. 730, 737 (Bankr. E.D.N.C. 2010).

141 No. CV 19-9983, 2019 WL 2537837 (E.D. La. June 20, 2019).

in federal court would needlessly duplicate judicial resources that have

already been committed to this case.142

Jackson is readily distinguishable from this case. With respect to prejudice, the plaintiff

in Jackson filed her state court petition on March 19, 2018, and the defendant’s notice of

removal was filed over a year later on May 1, 2019.143 In this case, A. A. Doe filed his

petition in state court on January 27, 2021,144 and the Archdiocese filed its Notice of

Removal less than a week later on February 2, 2021.145 Thus, refusing to remand A. A.

Doe’s case to state court would not “impose significant disruption” on him, and would not

“delay resolution of [his] claims.” Given that this lawsuit has been pending in this Court

for over a year, and that the lawsuit was only pending in state court for a mere six days,

remanding the case at this stage of the litigation will likely delay resolution of A. A. Doe’s

claims. With respect to judicial economy, because the plaintiff’s claims in Jackson had

been pending in state court for over a year before the notice of removal was filed, removal

of that case ran the risk of needlessly duplicating judicial resources.146 By contrast, in this

case, judicial economy is better served if this Court declines to remand. As mentioned,

this case has been pending in this Court for over a year, and the Court has ruled on several

motions and developed some familiarity with the claims and defenses involved in this

action. Were the Court to remand the case at this stage, judicial resources would be

“needlessly duplicate[d].”

142 Id. at *3.

143 Id. at *1.

144 See R. Doc. 1-1.

145 R. Doc. 1.

146 Jackson, 2019 WL 2537837 at *3.

Asare argues remanding this lawsuit to state court will have a negative effect on

the efficient administration of the Archdiocese’s bankruptcy estate. Specifically, Asare

argues

Here, the effect of central administration weigh (sic) heavily in favor of

maintaining jurisdiction and against remand. This Court presently has

pending more than “thirty-five similar cases” involving child sexual abuse

claims by clergy members working for Debtor. . . . If remanded, Debtor may

be forced to respond to duplicative discovery in multiplicity of forums, and

different courts would be deciding different issues of law and fact.147

The Court agrees with Asare that efficient administration of the Archdiocese’s bankruptcy

estate favors declining to remand this action to state court.

The Court finds that Plaintiff has failed to carry his burden of proving that

permissive abstention and/or equitable remand are appropriate in this case.

V. Pursuant to the Court’s inherent authority to control its own docket, A.

A. Doe’s motion for stay of Asare’s defamation action is denied.

A. A. Doe urges the Court, pursuant to its inherent authority to control its docket,

to stay Asare’s defamation counterclaims on the grounds that “a defamation action cannot

be maintained unless and until the resolution of the claims that gave rise to the alleged

defamatory action.”148 A. A. Doe argues Louisiana courts follow the rule that a cause of

action for defamation, based on statements made in pleadings filed in a judicial

proceeding, does not arise until after the termination of the proceeding in which the

alleged defamatory statements were made.149 Plaintiff cites Ballex v. Naccri, an opinion

from the Louisiana Fourth Circuit Court of Appeal, for the contention that “Louisiana

courts have consistently held that an action for defamation arising out of allegations made

147 R. Doc. 35 at p. 10.

148 R. Doc. 29-1 at p. 1.

149 Id. at pp. 3–6.

in judicial proceedings and against a party to those proceedings cannot be brought until

those proceedings are terminated.”150

In his opposition, Asare argues his counterclaims are “brought on the basis of false

statements made by [A. A.] Doe outside of criminal or judicial proceedings,” and that his

counterclaims “pertain only to false statements made [by A. A. Doe] to parishioners.”151

Asare concedes that, under Louisiana jurisprudence, defamation claims based on

statements made within a judicial proceeding cannot proceed until the termination of

such judicial proceeding because “these claims are premature and do not arise until the

termination of the proceeding in which the allegedly false statements were made.”152

Asare contends, however, that because he does not bring any defamation claims based on

statements made by A. A. Doe within a judicial proceeding, his counterclaims are not

premature.153 Asare argues, because his counterclaims are based on statements made

outside of a judicial proceeding, they are not premature.154

In his reply memorandum, A. A. Doe disputes that Asare’s claims are based solely

upon statements made by A. A. Doe to parishioners, and argues Asare’s counterclaims are

actually based upon statements made by A. A. Doe within the context of this lawsuit.155

A. A. Doe argues the timeline of events belies Asare’s contention his claims are based on

statements to parishioners.156 Specifically, A. A. Doe points out that “it was only after the

lawsuit was filed by A.A. Doe that any professional action was taken against Asare-

Dankwah by the Archdiocese – January 27, 2021 the date of the lawsuit and removal from

150 Id. at p. 3 (quoting Ballex v. Naccari, 95-57 (La. App. 4 Cir. 6/7/95); 657 So. 2d 511, 512).

151 R. Doc. 36 at pp. 2–3.

152 Id. at p. 3.

153 Id.

154 Id. at pp. 3–4.

155 R. Doc. 45 at p. 2.

156 Id. at pp. 2–3.

ministry.”157 A. A. Doe also argues a public statement made by the Archdiocese, whereby

the Archdiocese asserted it had no notice of the sexual assault allegation against Asare

prior to the filing of A. A. Doe’s lawsuit, further undermines Asare’s contention that his

claims do not arise out of allegations made by A. A. Doe in judicial proceedings.158 A. A.

Doe argues that, considering the issues raised by Asare in his counterclaims, “it is the

better option to stay all of those claims until the resolution of the abuse claim,” filed by

A. A. Doe.159

“Louisiana case law recognizes a qualified privilege that provides parties to

pending litigation the protection from being sued for defamatory statements made during

judicial proceedings.”160 The “jurisprudence of this state has consistently and

unequivocal[l]ly held that an action for libel or slander arising out of allegations or

statements made in a judicial proceeding cannot be brought by a party to the judicial

proceeding until the proceeding is terminated.”161 Until termination of the proceeding in

which the allegedly false statements were made, any defamation claim based upon such

false statements is premature.162 The Court must examine Asare’s counterclaims to

determine whether these rules of prematurity and qualified privilege apply to such claims.

In his counterclaim, Asare alleges as follows:

In December 2020 and January 2021, Defendant falsely stated to

parishioners at St. Peter Claver Catholic Church and Blessed Trinity

157 Id. at p. 3. Attached as an exhibit to A. A. Doe’s reply memorandum is a communication from the

Archdiocese of New Orleans, dated January 27, 2021, which states that “[t]oday the Archdiocese of New

Orleans was informed of a lawsuit alleging abuse of a minor against Fr. John Asare-Dankwah. The

archdiocese had no notice of this allegation or this lawsuit prior to today and has not been served with this

lawsuit. . . . Effective immediately, Archbishop Aymond has removed Fr. Asare from priestly ministry

pending the outcome of the investigation.” See R. Doc. 45-1.

158 R. Doc. 45 at p. 4.

159 Id. at p. 5.

160 Lemke v. Keiser & Auzenne, L.L.C., 2005-893 (La. App. 3 Cir. 2/1/06), 922 So. 2d 690, 692–93 (citing

Union Serv. & Maint. *693 Co., Inc. v. Powell, 393 So.2d 94 (La. 1980) (Watson, J., concurring)).

161 Calvert v. Simon, 311 So. 2d 13, 15 (La. App. 2d Cir. 1975).

162 Id. at 16.

Catholic Church that in January 2008, Fr. Asare raped Defendant, while

Defendant was a minor child attending a church retreat in Montgomery,

Alabama.163

In December 2020 and January 2021, Defendant falsely stated to

parishioners at St. Peter Claver Catholic Church and Blessed Trinity

Catholic Church that in January 2008, Fr. Asare sexually assaulted

Defendant, while Defendant was a minor child attending a church retreat in

Ponchatoula, Louisiana.164

The allegations of the counterclaim reference only the allegedly false statements made by

A. A. Doe to parishioners. Asare’s counterclaim does not reference the allegations of the

state court petition or the amended complaint.

Asare’s counterclaim sets forth three causes of action, denominated as Counts I, II,

and III, for defamation, false light invasion of privacy, and intentional infliction of

emotional distress.165 A. A. Doe argues, in effect, all three causes of action should be stayed

under the rules of prematurity and qualified privilege followed by Louisiana courts. In

Simpson v. Perry in which the Louisiana First Circuit Court of Appeal addressed the issue

of whether a suit for damages for defamation and false light invasion of privacy, based

upon allegations contained in a separate, underlying lawsuit, could be instituted before

the underlying lawsuit was terminated.166 In Simpson, an heir of the decedent filed a

pleading in the succession proceeding challenging the amount of the legal fee sought by

an attorney for his work on the succession.167 Thereafter, and while the succession was

still pending, the attorney sued the heir in a separate lawsuit, seeking damages for

defamation and false light invasion of privacy.168 The sole basis upon which the attorney

163 R. Doc. 33 at ¶ 21.

164 Id. at ¶ 21.

165 See id. at ¶¶ 29–43.

166 Simpson v. Perry, 2003-0116 (La. App. 1 Cir. 7/14/04); 887 So. 2d 14, 15.

167 Id.

168 Id.

sought damages was that statements made in the succession proceeding by the heir

allegedly were defamatory and constituted false light invasion of privacy.169 The court first

recognized that “Louisiana courts have consistently held that an action for defamation

arising out of allegations made in a judicial proceeding and against a party to those

proceedings cannot be brought until those proceedings are terminated.”170 The court then

noted that the analysis applied by Louisiana courts concerning the requirement that “the

underlying proceeding be terminated prior to lodging the claim for defamation is not

limited to actions for defamation.”171 The court found that the analysis was equally

applicable to claims for false light invasion of privacy, explaining that

A claim for false light invasion of privacy arises from publicity that

unreasonably places the plaintiff in a false light before the public. In **4

analyzing a claim for false light invasion of privacy, the three elements to be

considered are a privacy interest, falsity, and unreasonable conduct. . . .

Clearly, the claim for such damages can only be litigated after the litigant

making the statements has been given the opportunity to prove them in the

suit in which they were made and has failed to do so. Therefore, considering

the above jurisprudence and the nature of this cause of action, we conclude

that an action for false light invasion of privacy arising out of allegations

made in a judicial proceeding and against a party to that proceeding cannot

be brought until that proceeding is terminated.172

It is not clear whether the same analysis applies to a claim for intentional infliction of

emotional distress, but, because the Court is not staying the defamation action at this

time, the Court need not resolve this issue.

The justification for staying a defamation action is applicable only when the alleged

defamation is based on statements made in pleadings filed in a judicial proceeding. In

that event, the defamation action does not arise until after the termination of the

169 Id. at 16.

170 Id. (collecting cases).

171 Id.

172 Id.

proceeding in which the alleged defamatory statements were made. In this case, the

allegations in A. A. Doe’s original complaint are based upon events occurring at a Catholic

religious retreat in or near Montgomery, Alabama.173 The allegations forming the basis

of A. A. Doe’s first amended complaint, however, are based only on events occurring at a

Catholic religious retreat in Ponchatoula, Louisiana, and the amended complaint is

devoid of allegations concerning Montgomery, Alabama.174 “An amended complaint

supersedes the original complaint and renders it of no legal effect.”175 A. A. Doe’s amended

complaint is the operative complaint in this lawsuit. As a result, the current allegations

concern only those events occurring in Ponchatoula, Louisiana, and not those occurring

in Montgomery, Alabama. To the extent Asare’s counterclaim is based on events occurring

in Montomery, Alabama, it is clear the rule of prematurity does not apply. To the extent

Asare’s counterclaim is based on events occurring in Ponchatoula, Louisiana, it is less

clear.

In any event, the Court sees no justification for staying this action, and certainly

sees no justification for staying it as to some of the allegations of the counterclaim and

not others. The Court has broad discretion to stay proceedings as an incident to its

inherent power to control its own docket.176 It has not been shown that a stay would

simplify the issues in question or streamline the issues for trial. A. A. Doe has not made

out “a clear case of hardship or inequity in being required to go forward” on Asare’s

173 See R. Doc. 1-1 at p. 3.

174 See R. Doc. 10 at ¶¶ 9–29.

175 King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994) (citing Boelens v. Redman Homes, Inc., 759 F.2d 504,

508 (5th Cir. 1985)).

176 See Clinton v. Jones, 520 U.S. 681 (1997); see also Landis v. North American Co., 299 U.S. 248, 254

(1936).

2d 945 (1997)

counterclaims.!”7 A. A. Doe has not carried his burden of showing that the circumstances

of this case justify staying determination of Asare’s counterclaims. The Court will exercise

its discretion and deny A. A. Doe’s motion to stay as to Asare’s counterclaims regarding

statements about Ponchatoula, Louisiana, and as to statements about Montgomery,

Alabama. The relevant discovery as to all claims involved in this action will be the same

or closely related, and the interests of judicial economy are served by moving forward with

discovery of all claims. At the time of trial, the Court may, if appropriate, sever Asare’s

counterclaims until the determination of Asare’s liability for A. A. Doe’s claims.

CONCLUSION

IT IS ORDERED that Asare’s objection to A. A. Doe’s proof of claim is

OVERRULED.

IT IS FURTHER ORDERED that A. A. Doe’s Motion to Dismiss and For

Remand?”8 is DENIED.

IT IS FURTHER ORDERED that A. A. Doe’s Motion to Stay Defamation

Action!79 is DENIED.

New Orleans, Louisiana, this 3rd day of March, 2022.

UNITED STATES DISfRICT JUDGE

177 See Landis, 299 U.S. at 254-55.

178 R. Doc. 28.

179 R, Doc. 29.

33