United States District Court, D. Connecticut
N. Chatigny United States District Judge
debtor Sheri Speer, proceeding pro se, seeks review
of a bankruptcy court order granting a motion by the Chapter
7 Trustee, Thomas Boscarino, to approve a compromise and
settlement of claims between the estate and McCarthy Burgess
and Wolff, a law firm (“McCarthy Burgess”). The
issue on appeal is whether the Bankruptcy Court abused its
discretion in approving the proposed compromise. See In
re 47-49 Charles St., Inc., 209 B.R. 618, 620 (S.D.N.Y.
1997) (“A bankruptcy court's decision to approve a
settlement should not be overturned unless it is manifestly
erroneous and a clear abuse of discretion.”). I assume
the parties' familiarity with the underlying facts and
procedural history of this case, which I reference only as
necessary to explain my decision.
Speer argues that the Bankruptcy Court's findings of fact
and conclusions of law are insufficient. In addition, she
contends that Mr. Boscarino is not disinterested, which
should have raised a “red flag” regarding the
propriety of this compromise. I find both contentions to be
determine whether a settlement under Federal Rule of
Bankruptcy Procedure 9019 is reasonable, courts consider a
number of factors. In re Iridium Operating LLC, 478
F.3d 452, 462 (2d Cir. 2007). These include “(1) the
balance between the litigation's possibility of success
and the settlement's future benefits; (2) the likelihood
of complex and protracted litigation, ‘with its
attendant expense, inconvenience, and delay, ' including
the difficulty in collecting on the judgment; (3) ‘the
paramount interests of the creditors, ' including each
affected class's relative benefits ‘and the degree
to which creditors either do not object to or affirmatively
support the proposed settlement'; (4) whether other
parties in interest support the settlement; (5) the
‘competency and experience of counsel' supporting,
and ‘[t]he experience and knowledge of the bankruptcy
court judge' reviewing, the settlement; (6) ‘the
nature and breadth of releases to be obtained by officers and
directors'; and (7) ‘the extent to which the
settlement is the product of arm's length
bargaining.'” Id. (quoting In re
WorldCom, Inc., 347 B.R. 123, 137 (Bankr. S.D.N.Y.
2006)). “In weighing these factors, a bankruptcy court
need not decide the numerous questions of law and fact raised
by the settlement, rather, it need only ‘canvass the
issues and see whether the settlement falls below the lowest
point in the range of reasonableness.'” In re
Strawbridge, No. 11 Civ. 6759(PAE), 2012 WL 701031, at
*6 (S.D.N.Y. Mar. 6, 2012) (quoting Guippone v. BH
S & B Holdings, LLC, No. 09 Civ. 01029(CM), 2011
WL 5148650, at *5 (S.D.N.Y. Oct. 28, 2011)); see also In
re WorldCom, 347 B.R. at 137 (“It is not necessary
for the bankruptcy court to conduct a ‘mini trial'
on the issue.”).
the Bankruptcy Court conducted a hearing regarding the
proposed settlement at which Mr. Boscarino and counsel for
McCarthy Burgess presented their views. Mr. Boscarino stated
that he had reviewed the pleadings and other filings in Ms.
Speer's case against McCarthy Burgess in Connecticut
Superior Court, described the nature of the case, and stated
that a nonsuit had been granted in favor of McCarthy Burgess.
Mr. Boscarino stated that Ms. Speer had not provided him with
any evidence to support the claim in the underlying suit and
that he was not otherwise aware of any such evidence. Mr.
Boscarino then described the nature of the compromise: In
exchange for a release by the estate of any claim against
McCarthy Burgess, the firm would (1) pay the estate $1, 750
in cash, (2) withdraw a proof of claim in the amount of
$391.45, and (3) waive any other claims it had against the
estate. Mr. Boscarino acknowledged that Ms. Speer had filed
an offer of compromise in Connecticut Superior Court valuing
her claims at $3, 700 but stated that he believed this
settlement was in the best interest of the estate's
creditors. Counsel for McCarthy Burgess also spoke briefly,
stating that he viewed the settlement as more than fair given
the Superior Court's entry of a non-suit in his
client's favor. Ms. Speer did not attend the hearing or
otherwise provide any reason for the Bankruptcy Court to
discount the statements made during the
hearing. After considering all of the information
presented, the Bankruptcy Court approved the compromise.
Bankruptcy Court did not explicitly weigh the various factors
set out in In re Iridium Operating. But the
information presented to the Court provided sufficient
grounds to approve the compromise in accordance with the
relevant factors. Ms. Speer has provided no basis on which to
conclude that the Bankruptcy Court abused its discretion in
approving the compromise.
the decision of the Bankruptcy Court is affirmed. The Clerk
is directed to close this appeal.
 Ms. Speer argues that the Bankruptcy
Court should have been particularly vigilant because Mr.
Boscarino is not disinterested. However, aside from Ms.
Speer's speculation, the Bankruptcy Court was presented
with no evidence that Mr. Boscarino had a conflict of
interest or was otherwise ...