J. PAUL OETKEN, District Judge.
Plaintiff ResCap Liquidating Trust ("ResCap") filed this adversary proceeding against Mortgage Investors Group, Inc. ("MIG Inc.") in the Bankruptcy Court in the Southern District of New York on May 13, 2014. Rescap Liquidating Trust v. Mortg. Inv'r Grp., Inc. et al, No. 14ap-2004, ECF No. 1 (Bankr. S.D.N.Y.). On January 9, 2015, ResCap filed an Amended Complaint, which added Mortgage Investors Group, a general partnership ("MIG Partnership"), and American Real Estate Corporation ("AREC"), as defendants. Id. at ECF No. 36. MIG Partnership now moves to withdraw the reference to the bankruptcy court and to transfer venue to the United States District Court for the District of Minnesota. (Dkt. No. 1.) For the reasons that follow, the motion to withdraw the reference and the motion to transfer are denied.
ResCap is the successor to Residential Funding Company, LLC ("RFC"), a limited liability company that specialized in the purchase and resale of mortgage loans. Prior to 2012, RFC bought mortgage loans from a number of mortgage originators, including MIG Inc. RFC then resold the loans to whole-loan purchasers or pooled them with other loans for sale into residential mortgage-backed security trusts.
After many of the loans defaulted, RFC and fifty affiliates filed Chapter 11 bankruptcy petitions in the Bankruptcy Court for the Southern District of New York. In re Residential Capital LLC, No. 12-bk-12020, ECF No. 1 (Bankr. S.D.N.Y.). Judge Glenn has jointly administered those bankruptcy cases since May 14, 2012. Id. On December 11, 2013, Judge Glenn confirmed a Global Settlement and a Chapter 11 liquidation plan, which established ResCap as successor to RFC. Id. at ECF No. 6065.
Two days after Judge Glenn approved the Global Settlement, ResCap filed a breach of contract and indemnification suit against MIG Inc. in the United States District Court for the District of Minnesota.
Since May 2014, Judge Glenn has adjudicated this action in coordination with several similar suits involving RFC's mortgage loan contracts. See In re ResCap Liquidating Trust Mortg. Purchase Litig., No. 14-ap-7900 (Bankr. S.D.N.Y.). Defendants in a number of those cases have moved to withdraw the reference to the bankruptcy court. E.g., Residential Funding Co. LLC v. Greenpoint Mortg. Funding Inc., No 14-cv-5452, ECF No. 1 (S.D.N.Y. July 18, 2014); ResCap Liquidating Trust v. Primary Capital Advisors LLC, No. 14-cv-5224, ECF No. 1 (S.D.N.Y. July 14, 2014); ResCap Liquidating Trust v. RBC Mortg. Co., No. 14-cv-4457, ECF.No. 1 (S.D.N.Y. June 19, 2014). Judges Abrams, Castel, and Daniels have each denied these motions. Residential Funding Co. LLC v. UBS Real Estate Sec. Inc., No 14-cv-03039, 2015 WL 1062264 (S.D.N.Y. Mar. 6, 2015); Residential Funding Co. v. Suntrust Mortg., Inc. (In re Residential Capital, LLC), No. 14-cv-6015, 2015 WL 739829 (S.D.N.Y. Feb. 20, 2015); Residential Funding Co. v. Greenpoint Mortg. Funding, Inc. (In re Residential Capital, LLC), No. 14-cv-5452, 519 B.R. 593 (S.D.N.Y. 2014). But see ResCap Liquidation Trust v. First Mariner Bank, No. 14-cv-5064, ECF No. 25 (S.D.N.Y. Jan. 8, 2015).
As a result, three cases involving RFC's loan contracts remain before Judge Glenn, who has consolidated motion practice and established a brisk case management plan.
District courts have jurisdiction over "all civil proceedings arising under title 11, or arising in or related to cases under title 11" of the Bankruptcy Code. 28 U.S.C. § 1334(b). District courts may refer such proceedings to the bankruptcy courts for adjudication. Id. § 157(a). Once a matter is referred, bankruptcy courts have authority to enter final judgments in matters that are "core" to the bankruptcy proceeding.
Cases referred to bankruptcy court may be withdrawn for cause. 28 U.S.C. § 157(d). Under Second Circuit precedent, district courts evaluating motions to withdraw a reference to bankruptcy court undertake a two-part inquiry. See Orion Pictures Corp. v. Showtime Networks Inc. (In re Orion Pictures Corp.), 4 F.3d 1095, 1101 (2d Cir. 1993). Courts first consider whether the claim at issue is "core" to the bankruptcy proceeding. Id. In general, "[a] proceeding that involves rights created by bankruptcy law, or that could arise only in a bankruptcy case, is a core proceeding." DeWitt Rehab. & Nursing Ctr., Inc. v. Columbia Cas. Co., 464 B.R. 587, 591 (S.D.N.Y. 2012) (citing MBNA Am. Bank, N.A. v. Hill, 436 F.3d 104, 108-09 (2d Cir. 2006)). The conclusion that a matter is "non-core" supports but does not require withdrawal. Id. at 593 ("While the non-core nature of [Plaintiff's] claims weighs in favor of withdrawing the reference from the bankruptcy court, the core/non-core determination does not end the inquiry.").
After making the "core/non-core" determination, courts then weigh whether withdrawal is prudent. Orion, 4 F.3d at 1101. Relevant factors include the "efficient use of judicial resources, delay and costs to the parties, uniformity of bankruptcy administration, [and] the prevention of forum shopping." Id. Ultimately, the guiding concern in the Orion inquiry is efficient and uniform judicial administration.
MIG Partnership asserts that this action is non-core and that the Orion factors necessitate withdrawal of the reference.
However, the remaining Orion factors support denial of the motion to withdraw. Concerns about forum shopping and uniform bankruptcy administration favor neither party given that ResCap's contract claims are already split between jurisdictions and both parties have sought to litigate in a favorable forum. In terms of efficiency, the Court finds persuasive the analysis by Judges Abrams, Castel, and Daniels in nearly identical ResCap cases. See UBS Real Estate, 2015 WL 1062264, at *4-6; Suntrust, 2015 WL 739829, at *7-8; Greenpoint, 519 B.R. at 603-06. In February 2015, Judge Abrams concluded that keeping ResCap's contract claims in bankruptcy court "conserves judicial resources and promotes judicial economy." Suntrust, 2015 WL 739829, at *8. In March, Judge Daniels noted that Judge Glenn "has great expertise over the facts" and has established a case management plan that "negates th[e] delay and . . . costs" associated with non-final adjudication in bankruptcy court. UBS Real Estate, 2015 WL 1062264, at *4-5. These considerations are amplified today, more than six months further into Judge Glenn's administration of the ResCap cases.
Having considered each of the Orion factors, the Court determines that this non-core claim should remain before Judge Glenn. Accordingly, the motion to withdraw the reference to the bankruptcy court is DENIED. Because the motion to withdraw is denied, the motion to transfer is also DENIED without prejudice. See Adelphia Commc'ns Corp. v. Thomson, Inc., No. 10-cv-4464, 2010 WL 3000169, at *5 (S.D.N.Y. July 22, 2010) ("Because the Court declines to withdraw the reference to the Bankruptcy Court, it also denies [the] motion to transfer the case."); McHale v. Citibank, N.A., No. 09-cv-6064, 2009 WL 2599749, at *8 (S.D.N.Y. Aug. 24, 2009) ("Because I decline to withdraw the reference to the bankruptcy court, I also deny [the] motion to transfer the case. . . .").
The Clerk of Court is instructed to close the motion at Docket Number 1 and to close this matter.
SO ORDERED.