Kupfer

Kupfer v. Salma (In re Kupfer)

Good Law
2014 WL 4244019·526 B.R. 812·2014 U.S. Dist. LEXIS 119309
United States District Court, Northern District of CaliforniaAugust 26, 2014Case No. 14-cv-00668-WHOCalifornia4,019 words

Opinion

Lead Opinion

Orrick, J.

ORDER AFFIRMING BANKRUPTCY COURT’S ORDER

Re: Dkt. No.

INTRODUCTION

This bankruptcy appeal raises the question of the extent to which attorney’s fees and costs awarded against the Debtors, Konstantin and Margarita Kupfer, in a pre-petition arbitration proceeding that established the Debtors’ obligation to Creditors for the breach of two leases are subject to the Bankruptcy Code’s cap on claims by creditors for damages resulting from the termination of a lease. 1 The Hon. Dennis Montali of the United States Bankruptcy Court determined that the fees and costs are not capped. I agree— the fees and costs are collateral damages. The order of the Bankruptcy Court is AFFIRMED.

BACKGROUND

The facts of this case are not in dispute. The Debtors were tenants of the Creditors under two separate commercial leases for property located at 1375-1395 Burlingame Avenue, Burlingame, California. Excerpts of Record (“E.R.”), Dkt. No. 7-1, 35. The Debtors defaulted on each lease at different times prior to their bankruptcy petition. E.R. 39-41.

I. PRE-PETITION

A. Suite 106

The Debtors — at that time, the tenants — entered a 10-year lease for Suite 106 in March 2008. E.R. 35. They took…

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