WILSON, Circuit Judge:
Appellant Benjamin Atkinson appeals from the district court's affirmance of the bankruptcy court's orders granting Appellee Ernie Haire Ford, Inc.'s (Debtor) motion to modify its Second Amended and Restated Chapter 11 Plan (Second Plan) and confirming the Debtor's Third Amended Plan of Reorganization (Third Plan). Because Atkinson's interest in avoiding liability is not an interest protected or regulated by the Bankruptcy Code, he has failed to satisfy our person aggrieved standard. Accordingly, we affirm.
The Debtor, a licensed Ford dealer operating in Hillsborough County, Florida, filed for Chapter 11 bankruptcy on November 24, 2008. The Debtor's Second Plan was confirmed by the bankruptcy court on October 14, 2009. Among other
Appellant Benjamin Atkinson is a former creditor
The bankruptcy court determined that a modification could occur based on its finding that the Second Plan had not been substantially consummated because the Debtor still controlled a number of assets — valued between two and three million dollars — that were required to be sold under the Second Plan. The Debtor subsequently filed its Third Plan, which modified the Litigation Bar Date to allow the adversary proceedings against Atkinson to go forward. The bankruptcy court confirmed the Third Plan at a hearing on June 5, 2012 and entered an order (Confirmation Order) on June 21, 2012.
On appeal, the district court affirmed the bankruptcy court's grant of the motion to modify and subsequent confirmation of the Third Plan. Atkinson now appeals to this court.
We review questions of law decided by the district court de novo. Westwood Cmty. Two Ass'n v. Barbee (In re Westwood Cmty. Two Ass'n), 293 F.3d 1332, 1334 (11th Cir.2002).
Due to the nature of bankruptcy proceedings, which "often involve numerous
The person aggrieved doctrine limits the right to appeal a bankruptcy court order to "those parties having a direct and substantial interest in the question being appealed." Id. at 1335 (internal quotation marks omitted). We have held that this doctrine defines aggrieved persons as those individuals who are "directly, adversely, and pecuniarily affect[ed]" by a bankruptcy court's order. Id. at 1337-38 "An order will directly, adversely, and pecuniarily affect a person if that order diminishes their property, increases their burdens, or impairs their rights." Id. at 1338.
A number of our sister circuits have held that bankruptcy court orders that merely allow adversary proceedings to move forward do not cause adversary defendants the type of direct harm necessary to satisfy the person aggrieved standard. See Moran v. LTV Steel Co. (In re LTV Steel Co.), 560 F.3d 449, 453 (6th Cir.2009) (holding "that the burden of defending a lawsuit, however onerous or unpleasant, is [not] the sort of direct and immediate harm that makes a party `aggrieved.'"); H.K. Porter Co., 45 F.3d at 743 ("Consistent with the view that appeal from bankruptcy proceedings is denied to marginal parties in bankruptcy proceedings who face potential harm incident to the bankruptcy court's order but are not directly affected, courts have recognized that an order which simply allows a lawsuit to go forward does not necessarily aggrieve the potential defendant...." (citation and internal quotation marks omitted)); In re El San Juan Hotel, 809 F.2d at 155 (holding that an order authorizing a suit to move forward against an adversary defendant did not "diminish [his] property, increase his burdens, or detrimentally affect his rights"). We agree that a party is
Moreover, the Second, Sixth, and Seventh Circuits have recognized that a person is not "aggrieved" when the interests harmed by a court order are not interests the Bankruptcy Code seeks to protect or regulate. See In re LTV Steel Co., 560 F.3d at 454 (noting that the interest of an adversary defendant in avoiding liability is not protected by the Bankruptcy Code); Kabro Assocs. of West Islip, LLC v. Colony Hill Assocs. (In re Colony Hill Assocs.), 111 F.3d 269, 273-74 (2d Cir. 1997) (finding that a party who was not allowed to bid on a debtor's assets at auction could appeal the order approving the transaction because attacks on the inherent fairness of a bankruptcy proceeding are "within the zone of interests which the Bankruptcy Act seeks to protect and to regulate" (internal quotation marks omitted)); In re Harwald Co., 497 F.2d 443, 444 (7th Cir.1974) ("[T]o establish standing as a "person aggrieved" under § 39(c) of the Bankruptcy Act, it is necessary for the plaintiff to show ... that the interest which he seeks to protect ... is an interest which the Bankruptcy Act seeks to protect or regulate."). We agree with this approach and hold that for a person to be aggrieved, the interest they seek to vindicate on appeal must be one that is protected or regulated by the Bankruptcy Code.
The person aggrieved standard was developed as an answer to the argument that the failure to limit who can appeal a bankruptcy court's order would cause "bankruptcy litigation [to] become mired in endless appeals brought by the myriad of parties who are indirectly affected by every bankruptcy court order." Kane, 843 F.2d at 642. Since the purpose of adopting this heightened standard was to ensure that the goals of bankruptcy were not derailed by a flood of appeals, it only makes sense to exclude appeals from those parties who do not suffer a direct harm to interests the Bankruptcy Code seeks to protect or regulate — that is, appeals that do not further the goals of bankruptcy. Allowing appeals from parties who have suffered only an indirect harm or who hold interests outside the scope of the Bankruptcy Code would defeat the very purpose underlying our person aggrieved standard.
With these principles in mind, we turn to the question of whether Atkinson meets our person aggrieved standard. Atkinson suggests that he is a person aggrieved because the bankruptcy court's order deprived him of an affirmative right granted to him under the Second Plan — the right to enjoin any litigation initiated after passage of the Litigation Bar Date. Under the Second Plan, Atkinson could defend against liability in suits filed after the Litigation Bar Date by turning to the bankruptcy court for an injunction.
Atkinson relies on this right to differentiate himself from the normal adversary defendant. He argues that he has suffered a direct harm because the bankruptcy court's order does more than simply allow litigation to proceed against him. Instead, the order hampered Atkinson's ability to defend against liability by removing
Assuming arguendo that Atkinson has suffered a direct harm as a result of the amended Litigation Bar Date, he is still not a person aggrieved because his interest is not protected or regulated by the Bankruptcy Code. As we noted before, Atkinson withdrew his proof of claim and resigned from the Creditor's Committee. As such, he comes to us merely as an adversary defendant with an interest in avoiding liability; an interest that is antithetical to the goals of bankruptcy. See In re LTV Steel Co., 560 F.3d at 454 (stating that the "interest[] in avoiding liability to the estate ... is diametrically opposed to the primary goal of the Bankruptcy Code in general, which is to minimize the injury to creditors" (citation and internal quotation marks omitted)). Because Atkinson's sole interest is that of an adversary defendant in avoiding liability, he is not a person aggrieved for the purposes of appealing from an order of the bankruptcy court.
Atkinson's reliance on the right to seek an injunction bestowed on him by the Second Plan only serves to highlight that he is not a person aggrieved. Importantly, Atkinson's right originates in the Second Plan, not the Bankruptcy Code. Even if we considered his interest in avoiding litigation by enjoining a lawsuit as different from his interest in avoiding liability, we would not deem Atkinson a person aggrieved because his interest is not protected by the Bankruptcy Code. The purpose of the person aggrieved standard is to prevent bankruptcies from being needlessly prolonged by parties whose interests are not central to the process. Treating Atkinson or other tangentially interested parties as persons aggrieved would completely undermine the rationale behind our standard and bring bankruptcy proceedings to a grinding halt. Accordingly, we affirm.
In its order approving the Second Plan, the bankruptcy court set the definition of "Effective Date" as "the date 10(ten) calendar days following the date upon which this Confirmation Order is signed by this Court." The order was signed October 14, 2009, making the Effective Date October 24, 2009.