Free Letter - District Court of Delaware - Delaware

Case 1:07-cv-0O640—G|\/|S—|\/IPT Document 92 Filed 03/20/2008 Page 1 of 2
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March 20, 2008
BY ELECTRONIC FILING
The Honorable Gregory M. Sleet
United States District Court for the District of Delaware
J. Caleb Boggs Federal Building
844 N. King Street
Room 2124, Lockbox 19
Wilmington, Delaware 1980i
Re: New Century Mortgage Corp. v. Great Northern Ins. Co., C. A. N0.
07-640 GMS
Dear Chief Judge Sleet:
As banicruptcy counsel to the Plaintiff, I write in connection with the Court’s
March 19, 2008 Order (the ‘“Order’°) adrninistratively closing this case due to the automatic stay
of ll USC. § 362(at). For the reasons set i:`orth below, Plaintiff respectfully requests that this
case be re—opened and, to the extent necessary, that the Court consider this to be a motion for
reconsideration ofthe Order.
My partner Mr. Shandler and i apologize to the Court for the lack of clarity in our
prior letter to the Court following the transfer of this matter from the United States District Court
for the Northern District of Illinois (D.I. 90). What might not have been apparent from that letter
was that the Debtor is the Plaintiff in this case, not the Defendant, and is seeking an affirmative
recovery from the insurance company defendant for failure to defend and/or indemnify. The
automatic stay of § 362(a) does not stay this case because it only “operates as a stay...of...(l)
the commencement or continuation...of a _jt1dicia1...action or proceeding against the Debtor. . .".
Thus, it only applies where the debtor is the defendant, not where it is the Plaintiff g, g,,g,,
Assoc. of St. Croix Condo. Owners v. St. Croix Hotel Corp., 682 F.2d 446, 448 (3d Cir. 1982)
("Section 362 by its terms only stays proceedings against the debtor. The statute does not
address actions brought by the debtor which would inure to the benefit of the bankruptcy
estate.")
at.r1-mars;-1

Case 1:07-cv-0O640—Gl\/|S—l\/IPT Document 92 Filed 03/20/2008 Page 2 of 2
The Honorable Gregory l\/lr Sleet
March 20, 2008
Page 2
Additionally, because the Debtors are moving towards attempting to contirm a
plan of liquidation (Judge Carey entered an order approving the Debtors’ disclosure statement on
Tuesday), the Debtors seeks to liquidate the proceeds, if any, from this litigation for the benefit
of their creditors as soon as possible. To that end, we respectfully request that the Court
schedule a Rule 16 conference at its earliest convenience and assign this case to mediation before
one of the Magistrate Judges,
Respectfully submi
Russell C, Silberglied (#3462)
RCS/lain
cc: Clerk of the Court (by electronic tiling)
Chad Shandier, Esq,
Stephen Casarino, Esq,
ttrri-zzctvsz-1

Case 1:07-cv-00640-GMS-MPT

Document 92

Filed 03/20/2008

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Case 1:07-cv-00640-GMS-MPT

Document 92

Filed 03/20/2008

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