ORDER GRANTING MOTION TO COMPROMISE CONTROVERSY

ERIK P. KIMBALL, Bankruptcy Judge.

This matter came before the Court for hearing on December 7, 2016 upon the Motion to Approve Stipulation to Compromise Controversy Between Chapter 7 Trustee, Michael R. Bakst and the Estate of Raymond P. Niro and Niro Law, Ltd. [ECF No. 265] (the "Motion to Compromise") filed by Michael R. Bakst, Esq. (the "Trustee"), the Debtor's Amended Objection to Motion to Approve Stipulation to Compromise Controversy Between Chapter 7 Trustee, Michael R. Bakst and the Estate of Raymond P. Niro and Niro Law, Ltd. [ECF No. 276] (as supplemented by ECF No. 302, referenced below, the "Objection") filed by Michelle Metzler (the "Debtor"), and Niro's Response To Debtor's Amended Objection To Motion To Compromise Controversy Between Chapter 7 Trustee, Michael R. Bakst And The Estate Of Raymond P. Niro And Niro Law, Ltd. [ECF No. 289] filed by Dean D. Niro, in his capacity as personal representative of the estate of Raymond P. Niro and as the authorized representative of Niro Law, Ltd. (together, "Niro").

After the hearing, at the Court's request, the parties submitted the Supplemental Memorandum of Law in Support of Debtor's Amended Objection to Motion to Approve Stipulation to Compromise Controversy Between Chapter 7 Trustee, Michael R. Bakst and the Estate of Raymond P. Niro and Niro Law, Ltd. [ECF No. 302] and Niro's Memorandum of Law in Support of the Motion to Compromise Controversy Between Chapter 7 Trustee, Michael R. Bakst and the Estate of Raymond P. Niro and Niro Law, Ltd. [ECF No. 304].

On February 9, 2016, the Debtor filed her voluntary petition for relief under chapter 11 of Title 11 of the United States Code. On April 10, 2016, the Debtor filed against Niro the Motion for Protective Order and/or Motion to Enforce the Automatic Stay [ECF No. 29] and, on May 26, 2016, the Debtor filed against Niro the Debtor's Motion for the Imposition of Sanctions and an Award of Damages, Punitive Damages, Attorneys' Fees and Costs Against Raymond P. Niro for Willfully Violating the Automatic Stay [ECF No. 105] (collectively, the "Stay Violation Motions"). In the Stay Violation Motions, the Debtor sought relief against Niro under section1 362(k). Section 362(k) provides that an "individual" injured by a willful violation of the automatic stay is entitled to actual damages and, in appropriate circumstances, punitive damages.

On June 10, 2016, the Court converted the above-captioned bankruptcy case from chapter 11 to chapter 7. ECF No. 149. The Trustee was appointed on June 14, 2016. ECF No. 157.

In the Motion to Compromise, in exchange for Niro delivering a 3-carat yellow diamond ring and other valuable consideration to the Trustee for the benefit of the bankruptcy estate, the Trustee seeks, among other things, to withdraw the Stay Violation Motions. The Debtor objects to the Motion to Compromise to the extent that the Trustee seeks to release Niro from any liability in connection with the Stay Violation Motions. The Debtor argues that the Trustee is not an "individual" with authority to pursue a claim under section 362(k) and, therefore, lacks the authority to settle such claims. For the reasons stated below, the Court overrules the Debtor's Objection.

While the Debtor's case was pending under chapter 11, the Debtor presented claims under section 362(k) for willful violation of the stay. The Debtor obviously had statutory authority to bring those claims as she is an "individual" for purposes of section 362(k). Such claims were included in property of the estate in the Debtor's chapter 11 case. 11 U.S.C. §§ 541(a)(1) and 1115(a)(1) (property of the estate in a chapter 11 case of an individual includes property acquired by the debtor after commencement of the case and prior to dismissal, closure or conversion of the case). The Debtor's claims under section 362(k) and, if the Debtor recovered on such claims, the proceeds of such claims, were property of the bankruptcy estate subject to administration in the chapter 11 case. When the Debtor's case was converted to chapter 7, her claims under section 362(k) remained property of the estate. 11 U.S.C. §§ 541(a)(7) and 1115(a)(1).

The Debtor argues that because the Trustee is not an "individual" within the meaning of section 362(k), the Trustee does not have the power to pursue the Debtor's claims under section 362(k) and also does not have the power to withdraw or release those claims. There is case law to support the contention that a trustee in a chapter 7 case is not an "individual" with the power to pursue a claim under section 362(k). See, e.g., In re Pace, 67 F.3d 187, 193 (9th Cir. 1995); Henkel v. Lickman (In re Lickman), 297 B.R. 162, 194-96 (Bankr. M.D. Fla. 2003). But each of those decisions involves an attempt by a chapter 7 trustee to pursue a claim under section 362(k) that arose during the chapter 7 case in which the trustee was appointed. That is, in each such case a debtor filed a chapter 7 petition, there was an alleged willful violation of the stay during that case, and the trustee rather than the debtor attempted to prosecute the claim under section 362(k). This is obviously contrary to the text of the statute, as the point of section 362(k) is to provide the debtor, individually, with a right to damages. If a chapter 7 trustee had the power to pursue a section 362(k) claim arising from actions that took place during the subject chapter 7 proceeding, the debtor could obtain no benefit from the statute.

The outcome is different, however, when a debtor's claim under section 362(k) arises in a chapter 11 case, becomes property of the estate in that case, and then the case is converted to chapter 7. Any and all claims held by the Debtor or her bankruptcy estate as of the date of conversion remained property of the estate subject to administration by the Trustee. See 11 U.S.C. §§ 541(a)(7) and 1115(a)(1). In fact, the Debtor is specifically required to surrender "all property of the estate" to the Trustee. 11 U.S.C. § 521(a)(4). The Trustee has the sole power and the obligation under section 704(a)(1), to the exclusion of the Debtor, to "collect and reduce to money the property of the estate for which such trustee serves." The Trustee, and not the Debtor, is the sole representative of the estate and the only party with authority to pursue claims on behalf of the estate. 11 U.S.C. § 323.

It does not matter that, at the time the Debtor's claims under section 362(k) arose, such claims could only be pursued by the Debtor, an "individual" under the statute. Those claims became property of the estate in the Debtor's chapter 11 case, and remained property of the estate upon conversion to chapter 7, subject to pursuit or waiver by the Trustee alone. See In re Klarchek, 2013 Bankr. LEXIS 402 at **5-6 (Bankr. N.D. Ill. 2013) (chapter 7 trustee has standing to pursue claim for willful violation of the automatic stay that arose in case prior to conversion from chapter 11 to chapter 7). There is nothing in the Bankruptcy Code that would cause the Court to rule otherwise.

In support of her Objection, the Debtor points to this Court's prior decision in In re Larkin, 468 B.R. 431 (Bankr. S.D. Fla. 2012). In Larkin, before filing her chapter 7 bankruptcy petition the debtor had been defending a state court foreclosure on her home. In re Larkin, 468 B.R. at 433. The debtor opposed the foreclosure action with a counterclaim and several non-monetary affirmative defenses. Id. The chapter 7 trustee sought to settle all claims between the bankruptcy estate and the foreclosing lender. Id. The proposed settlement included a waiver of the non-monetary defenses the debtor had presented in the state court foreclosure. Id. at 433-34. This Court ruled that the debtor's non-monetary defenses in the state court foreclosure action were not property of the bankruptcy estate and that the chapter 7 trustee did not have the exclusive right to enforce those defenses, and so the proposed settlement was not approved. Id. at 434-36. In contrast, the claims at issue here became property of the bankruptcy estate in the Debtor's chapter 11 case, remain property of the estate after conversion to chapter 7, and are subject to the exclusive control of the Trustee. The Trustee may pursue, abandon, or release those claims as he sees fit, consistent with the other requirements of the Bankruptcy Code and applicable law.

There were no other objections to the proposed settlement. The Court has carefully reviewed the proposed settlement and finds that it meets all requirements for approval under In re Justice Oaks II. Ltd. 898 F.2d 1544 (11th Cir. 1990).

For the forgoing reasons, the Court ORDERS as follows: