6 ABR 265 UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ALASKA

In re:	Case No. 99-32845
	Chapter 11
PACSERVE CORPORATION dba Raven Shipping Pacific, Pacserve Wholesale,
Debtor.

CHARLOTTE L. DAVIS,	Bancap No. 99-6055
Plaintiff,	Adversary No. WA99-32845-001-DMD
v.
AMERICAN FAST FREIGHT, INC.,
Defendant.

MEMORANDUM REGARDING REMAND

Pacserve Corporation, dba Raven Shipping Pacific (Raven), filed its chapter 11 petition on April 5, 1999, in Tacoma, Washington. Raven leased a warehouse from plaintiff Charlotte Davis in Anchorage. Raven installed cooler and freezer components in Davis's property. American Fast Freight, Inc. (AFF) bought most of the debtor's assets, including the cooler and freezer components. The bankruptcy court approved the sale, subject to Davis's landlord rights. AFF rejected the Davis lease and removed the cooler and freezer components to a new location. Davis sued AFF in Alaska state superior court on August 12, 1999, seeking damages for removal of the components. AFF removed the action from state court to this court and moved to change venue to the Western District of Washington. Davis moved for remand and abstention.

6 ABR 267 AFF contends this court must rule on its motion for change of venue prior to considering plaintiff's motion to remand or abstain. There is authority for its position.⁽¹⁾ The cases cited by AFF consider the "home" court, where the bankruptcy is pending, to be in the best position to determine remand issues. One court has recognized that individual courts have discretion to decide which motions they will determine first.⁽²⁾ It went on to change venue and left the issue of abstention for the district where the bankruptcy case was pending. Other courts have ruled either directly or indirectly that remand or abstention issues should be heard prior to a motion for change of venue.⁽³⁾ The rationale behind hearing remand and abstention issues first was well put by a Delaware District Court. "[A]s a logical and practical matter, courts should determine whether any bankruptcy court should have a proceeding before deciding which bankruptcy court should have it."⁽⁴⁾ I prefer this rationale, and will follow it in this case.

Under 28 U.S.C. § 1452(b), a court may remand a claim or cause of action on any equitable ground. Factors to be considered include:

1. Whether judicial resources will be duplicated;
2. What is the most economical use of judicial resources;
3. What will be the effect of remand on the administration of the bankruptcy estate;
6 ABR 267 4. Whether questions of state law, which are better addressed by a state court, are involved;
5. Whether considerations of comity exist;
6. The degree of prejudice, if any, to the involuntarily removed parties;
7. Whether the possibility of an inconsistent result is lessened by remand; and
8. The expertise of the court where [the] action originated.⁽⁵⁾

Applying these factors here, I conclude that remand is appropriate. Judicial resources will be duplicated by retention of this case in a bankruptcy court. Alaska Superior Court Judge Eric Sanders is familiar with the case and knowledgeable with the history of the dispute. He has conducted hearings and issued orders in the state court proceeding. To continue the matter in either this court or a Washington bankruptcy court would needlessly duplicate judicial resources. Maintaining the case in Alaska state court is the most economical use of judicial resources.

Additionally, remand of this case will be beneficial to the administration of the Pacserve bankruptcy estate both now and in the future. In its current posture, the Davis lawsuit will have no impact on the administration of the bankruptcy estate because neither Raven or Pacserve are parties. The Pacserve chapter 11 resulted in the immediate sale of all of the debtor's hard assets. Pacserve is no longer an operating entity. All that remains to be done in Pacserve's bankruptcy proceeding is the collection of claims and receivables held by the estate and the distribution of any funds collected, either in a chapter 11 liquidating plan or by a trustee in chapter 7. Assuming a third party complaint against Raven and Pacserve was permitted to be filed in the Davis suit in the future, resolution of the dispute 6 ABR 268 by the state court would aide in the administration of the Pacserve estate. The disputed state law controversies would be promptly determined by a judge with expertise in Alaska law, and their quick liquidation would streamline the claims resolution and distribution process in Pacserve's bankruptcy case, if there are any significant assets to administer.

Remand would ensure that questions of state law, which are best addressed by a state court judge, would be addressed by such a judge. Considerations of comity also favor remand here. Charlotte Davis would be prejudiced if this case is not remanded, because she would be required to start over again in prosecution of her case with a new judge. The possibility of an inconsistent result is neither lessened nor increased by remand, as there is no other pending action dealing with the issues raised in the Davis suit. Further, any state court decision as to Pacserve or Raven would have res judicata effect in Pacserve's bankruptcy case. As noted above, this would actually streamline the claims resolution and distribution process in Pacserve's bankruptcy case. Finally, the Alaska state superior court has expertise in Alaska lease disputes. Neither this court nor the bankruptcy court for the Western District of Washington has such expertise.

Conclusion

Charlotte Davis's motion to remand will be granted. Her motion for abstention is redundant and moot at this point, and will be denied. AFF's motion for change of venue will also be denied.

DATED: December 6, 1999.
	BY THE COURT
	DONALD MacDONALD IV
	United States Bankruptcy Judge

N O T E S:

6 ABR 266 1. Thomas v. Lorch, Wedlo, Inc. (In re Wedlo), 212 B.R. 678, 679 (Bankr. M.D. Ala. 1996); Kinney Sys., Inc., v. Intermet Realty Partnership (In re Convent Guardian Corp.), 75 B.R. 346 (Bankr. E.D. Pa. 1987).

6 ABR 266 2. Alliant Health Management Services, Inc. v. Vital Link Private Duty Lodi, Inc. (In re Vital Link Lodi, Inc.), 240 B.R. 15, 21 (Bankr. W.D. Mo. 1999).

6 ABR 266 3. Maryland Cas. Co. v. Aselco, Inc., 223 B.R. 217 (D. Kan. 1998); Bowen Corp., Inc. v. Sec. Pac. Bank of Idaho, (In re Bowen Corp.), 150 B.R. 777 (Bankr. D. Idaho 1993); Couri v. Fisher (In re J.C.C. Capital Corp.), 147 B.R. 349 (Bankr. S.D.N.Y. 1992); Lonestar Industries, Inc. v. Liberty Mut. Ins., 131 B.R. 269, 272 (D. Delaware 1991).

6 ABR 266 4. Lonestar, 131 B.R. at 273 (emphasis in original, citations omitted).

6 ABR 267 5. Coleman v. First Family Fin. Serv., Inc. (In re Coleman), 200 B.R. 403, 406 (Bankr. S.D. Ala. 1996) (citations omitted).