JOHN E. WAITES, Bankruptcy Judge.
This matter comes before the Court on the motion of the defendant Charleston County, a political subdivision of South Carolina ("County"), asking this Court to issue an order pursuant to 28 U.S.C. § 1334(c) abstaining from considering the above-captioned matter ("Motion"). Debtor and plaintiff Chicora Life Center, LC ("Debtor"), filed an objection to the Motion. Both parties briefed the issues, and a hearing was held at which counsel presented arguments. After a review of the pleadings and consideration of the arguments, the Court denies the relief requested by the County and makes the following findings of fact and conclusions of law.
1. Debtor filed a voluntary petition under Chapter 11 of the Bankruptcy Code on May 16, 2016 ("Main Case"). Debtor's primary asset is a 400,000 square foot facility located in North Charleston, South Carolina (the "Center"). Debtor's Chapter 11 Plan ("Plan") was confirmed by Order of the Court entered January 10, 2017.
2. On May 17, 2016, Debtor filed the above-captioned adversary proceeding against the County. In the Complaint,
3. The County answered the Complaint,
The Answer also contains a demand for a jury trial on all claims between the parties, and a statement that the County does not consent to the entry of final orders or judgments by this Court.
4. It is apparent from the Disclosure Statement, the confirmed Plan, and other matters of record, that the outcome of this adversary proceeding has a direct impact on the value of the Center and on Debtor's reorganization plan.
5. The parties have been engaged in discovery since August 2016. Counsel for the parties advised the Court that regardless of the forum in which the case is ultimately tried, the parties intended to be diligent in their prosecution of this matter. Pursuant to the Consent Amended Scheduling Order entered on January 5, 2017, discovery concludes on March 31, 2017, and the parties' proposed pre-trial order is due May 19, 2017.
5. On January 20, 2017, Debtor moved for summary judgment. A hearing on this motion is scheduled for March 1, 2017. As of the date of this Order, the time for the County to respond has not expired.
The County asks the Court to abstain from hearing this matter pursuant to 28 U.S.C. § 1334(c)(1), which provides:
28 U.S.C. § 1334(c)(1).
The Supreme Court has directed federal courts to narrowly construe requests for discretionary abstention, and to abstain in favor of a state court's adjudication of a matter only in "exceptional circumstances," when to abstain "would clearly serve an important countervailing interest." Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 813 (1976) (citing County of Allegheny v. Frank Mashuda Co., 360 U.S. 185, 188-89 (1959)).
When considering a request for discretionary abstention, this Court has specifically adopted the factors proposed in In re Republic Reader's Serv., Inc., 81 B.R. 422, 429 (Bankr. S.D. Tex. 1987):
Id.; accord Dunes Hotel Assocs. v. Hyatt Corp. (In re Dunes Hotel Assocs.), 1996 WL 33340785, at *6-8 (Bankr. D.S.C. July 11, 1996) (applying the Republic Reader's factors when deciding whether to abstain). As the moving party, the County bears the burden of proving that discretionary abstention is warranted under the facts of this case. See Hough v. Margulies (In re Margulies), 476 B.R. 393, 402 (Bankr. S.D.N.Y. 2012) ("The movant bears the burden of establishing that permissive abstention is warranted.").
After a review of the record in the adversary proceeding and in the Main Case, the Court finds that many of the Republic Reader's factors are significant to the Court's determination that it should not abstain in this matter. First, at issue in this adversary proceeding is whether the County or Debtor breached the Lease, and a determination of the prevailing party's remedies and damages. The Lease was not only one of the most valuable assets of the bankruptcy estate, but enforcement of the Lease is the cornerstone of the confirmed Plan and Debtor's reorganization. Thus, the success of the confirmed Plan is integrally tied to the outcome of this adversary proceeding. Conversely, if Debtor does not prevail, the County will hold a significant judgment against Debtor that must be paid pursuant to the confirmed Plan.
While it is true that a determination of the parties' rights and obligations under the Lease is based in state law, this Court is routinely asked to determine parties' rights under state law. See, e.g., In re Infinity Business Group, Inc., C/A No. 10-06335-jw, slip op. (Bankr. D.S.C. June 22, 2011) (determining whether claims brought in state court litigation were property of the debtor's estate); Newman v. Ducane, (In re Ducane Gas Grills, Inc.), 320 B.R. 324 (Bankr. D.S.C. 2004) (adjudication of claims for conversion, specific performance, and breach of contract). The legal issues in this case are familiar to the Court, (contract interpretation, commercial landlord tenant law, and the calculation of damages), and none of the issues present either difficult or unsettled issues of state law.
In addition, this Court has before it all of the necessary parties to expeditiously determine the issues raised in the Complaint and Answer. It is undisputed that there are no related proceedings pending in any other court. The parties have been engaged in discovery since at least August 2016 and the matter appears to be moving quickly towards a conclusion — much more rapidly than it would if the Court abstained and the action was refiled in state court. To commence litigation of this matter in state court would result in substantial delay and disruption for all parties. See Republic Reader's, 81 B.R. at 426. The fact that Debtor has moved for summary judgment prior to the close of discovery indicates to the Court that there may be considerable evidence ready and available to adjudicate this matter, whether in a summary fashion or after a trial in the near term.
Another important factor in the Court's decision is the fact that the parties' claims against each other have a close nexus to the confirmed Plan, which expressly contemplates the continuation of this litigation. No matter who prevails, the outcome of this adversary will directly impact the Plan's implementation. See In re AstroPower Liquidating Tr., 335 B.R. 309, 323-24 (Bankr. D. Del. 2005) (when a confirmed plan specifically describes an action over which the Court had pre-confirmation, related to jurisdiction, and contemplates the prosecution of the claim for the benefit of the estate's creditors, there is a sufficiently close nexus with the bankruptcy case to support the court's post-confirmation jurisdiction). To sever the claims for adjudication in state court would unduly delay the consummation of Debtor's plan.
While the Answer purports to challenge this Court's authority to enter a final order, the County may not have preserved this challenge by filing a motion objecting to this Court's entry of final orders or judgments by the deadline imposed in the subsequent July 27, 2016 Scheduling Order. See Wellness Int'l Network Ltd. v. Shariff, 135 S.Ct. 1932, 1947-48 (2015) (Litigants may consent to the Bankruptcy Court adjudicating Stern claims. Consent may be express, or consent can be implied if the circumstances indicate that the consent was knowing and voluntary. The key inquiry is whether "litigant or counsel was made aware of the need for consent and the right to refuse. . . ."). Even if there remains an issue of final authority, this Court could continue to administer this case through trial and thereafter issue proposed findings of fact and conclusions of law. See Executive Benefits Ins. Agency v. Arkinson, 134 S.Ct. 2165, 2170 (2014) (when presented with a Stern claim, the bankruptcy court issues proposed findings of fact and conclusions of law, which the District Court then reviews de novo.); Moses v. CashCall, Inc., 781 F.3d 63, 70 (4th Cir. 2015) ("[W]hen a bankruptcy court is faced with a claim that is statutorily core but constitutionally non-core—a so-called `Stern claim'—it must treat the claim as if it were statutorily non-core, submitting proposed findings of fact and conclusions of law to the district court for de novo review.") (emphasis original); Vieira v. Vice (In re Legacy Dev. SC Group, LLC), 2016 WL 7324678, at *4 (D.S.C. Dec. 16, 2016) (denying defendants' motion to withdraw the reference because, even though it lacked constitutional authority to issue a final judgment, the bankruptcy court could still submit proposed findings of fact and conclusions of law to the district court).
Furthermore, when it asserted counterclaims in this proceeding seeking damages against Debtor, the County triggered the claims allowance process and appears to have waived its right to a jury trial. See In re Southern Textile Knitters, 236 B.R. 207, 212 (Bankr. D.S.C. 1999) (by filing counterclaims against the plaintiff/trustee, defendants waived their right to a jury trial); see also Langencamp v. Culp, 498 U.S. 42, 44-45 (1990) (The filing of a claim in a bankruptcy case triggers the claims allowance process and subjects the claimant to the bankruptcy court's equitable powers. Once the claims allowance process is triggered, the claimant can no longer demand a right to a trial by jury for any claim, including a claim brought against the claimant by the estate.); Murray v. Richmond Steel & Welding Co. (In re Hudson), 170 B.R. 868, 875 (E.D.N.C. 1994) (defendant who filed a counterclaim seeking payment of pre-petition damages from the bankruptcy estate waived its right to a jury trial not merely by filing a counterclaim, but by filing a counterclaim that sought damages from the estate); Harpole Constr., Inc. v. Medallion Midstream, LLC (In re Harpole Constr., Inc.), 2017 WL 113595, at * 4 (Bankr. D.N.M. Jan. 10, 2017) (a party who files a counterclaim seeking monetary damages from the bankruptcy estate may waive its right to a jury trial even if it has not filed a proof of claim); Bayless v. Crabtree Through Adams, 930 F.2d 32, 1991 WL 50166, at *2 (10th Cir. April 2, 1991) (Even in the absence of a proof of claim, a party who files a counterclaim seeking monetary relief from the estate in an adversary proceeding has invoked the claims allowance process and thereby consented to the jurisdiction of the bankruptcy court and waived its right to a jury trial.); see generally Stern v. Marshall, 564 U.S. 462, 499 (2011) (recognizing the difference between actions that seek to "augment" a bankruptcy estate and those that "seek `a pro rata share of the bankruptcy res,' . . . "[T]he question is whether the action at issue stems from the bankruptcy itself or would necessarily be resolved in the claims allowance process.") (internal citation omitted).
Finally, the Court's docket is not overly burdened by this action. The scope of the issues before this Court is limited and focused — determining whether or not the County's termination of the Lease was proper and thereafter the parties' respective remedies. All of the necessary parties to adjudicate this matter are before this Court, and this Court can address the proceeding in an efficient and timely manner.
For the stated herein, and based on the Republic Reader's factors, the Court declines to abstain in this proceeding at this time.