In re Brown (11-07001)

In an adversary proceeding seeking to determine nondischargeability of a debt, the Court granted in part and denied in part the wife-defendant's motion to dismiss complaint and granted the plaintiffs' motion to amend complaint. The Court granted the motion to dismiss the fraud allegation because the allegation did not meet the particularity requirement of Federal Rule of Civil Procedure 9 (made applicable to adversary proceedings through Bankruptcy Rule 7009); the Court denied the motion to dismiss the embezzlement, larceny, and willful and malicious injury allegations because taking the allegations at face value and construing all reasonable inferences in favor of the plaintiffs, the complaint properly alleged all three. The Court granted the plaintiffs' motion to amend because the plaintiffs had not done anything justifying denial, and refusing to grant leave to amend without reason is an abuse of discretion.

Thursday, August 4, 2011