TRUSTEE

Issues

In 1992, ConAgra Foods, Inc. (“ConAgra”) sued Americold Logistics, LLC and its parent company, Americold Realty Trust (collectively, “Americold”), in Kansas state court to recover damages for goods destroyed by fire in an Americold storage facility. See ConAgra Foods, Inc. v. Americold Logistics, LLC, No. 13-2064-JWL, 2013 WL 5530274, *3 (D. Kan. Oct. 4, 2013). Americold removed the action to federal court on the basis of diversity jurisdiction, and received summary judgment. ConAgra appealed. Although the parties did not raise the question, the U.S. Court of Appeals for the Tenth Circuit determined Americold Realty Trust—a real estate investment trust (“REIT”) with potential beneficiaries in many states—had not shown it was completely diverse from ConAgra. Accordingly, the court did not have jurisdiction to hear the case. See ConAgra Foods, Inc. v. Americold Logistics, LLC, 776 F. 3d 1175, 1175–80 (10th Cir. 2015). The Supreme Court will decide how to determine the citizenship of a trust for purposes of diversity jurisdiction. Americold maintains that the citizenship of a trust should be based on the citizenship of its trustees, not its beneficiaries. See Brief for Petitioners, Americold Logistics, LLC, et al. at 12. ConAgra contends that a court should consider a trust to be a citizen of every state in which any of the trust’s members, shareholders, or beneficiaries is a citizen. See Brief for Respondents at 18. The Court’s resolution of this case will impact the jurisdictional status of REITs and how courts determine the citizenship of trusts. See Brief of Amicus Curiae National Association of Real Estate Investment Trusts (“NAREIT”), in Support of Reversal at 5; Brief of Amicus Curiae Winston Wen-Young Wong, in Support of Petitioner at 34

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Robert Marrama sought to convert his Chapter 7 bankruptcy case to a Chapter 13 after meeting the requirements for Chapter 13. The bankruptcy court denied Marrama’s motion to convert based on Marrama’s prior bad faith conduct in failing to report in his bankruptcy schedules the value of a tax refund and vacation home. The Bankruptcy Appellate Panel and Court of Appeals for the First Circuit affirmed. In this case, the Supreme Court will determine whether courts have discretion to deny conversions based on an evaluation of the debtor’s conduct. The decision will hinge on the statutory language and legislative history of the Bankruptcy Code. While this issue may be limited to filings that occurred before Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, it will give the court the opportunity to clarify the scope of the good faith requirement in bankruptcy proceedings and the amount of discretion afforded to bankruptcy judges.

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