Estate of Soad Wattar v. HORACE FOX, JR., Trustee-Appellee. Appeal from the United States District Court for…

United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted April 13, 2023*
Decided April 21, 2023
Before
FRANK H. EASTERBROOK, Circuit Judge
DIANE P. WOOD, Circuit Judge
THOMAS L. KIRSCH II, Circuit Judge
No. 17-1615
ESTATE OF SOAD WATTAR, et al.,
Intervenors-Appellants,
v.
HORACE FOX, JR.,
Trustee-Appellee.
Appeal from the United States District
Court for the Northern District of Illinois,
Eastern Division.
No. 16-cv-4699
Robert M. Dow, Jr.,
Judge.
____________________________________________________________________________
No. 18-2197
IN RE: RICHARD SHARIF,
Debtor.
APPEAL OF: MAURICE SALEM
Appeal from the United States District
Court for the Northern District of Illinois,
Eastern Division.
* We have agreed to decide these cases without oral argument because the briefs
and the record adequately present the facts and legal arguments, and oral argument
would not significantly aid the court. F ED. R. A PP . P. 34(a)(2)(C).
NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with F ED. R. APP . P. 32.1

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Nos. 17-1615, 18-2197 & 22-2826 Page 2
No. 17-cv-1500
Robert M. Dow, Jr.,
Judge.
___________________________________________________________________________
No. 22-2826
HAIFA SHARIFEH,
Intervenor-Appellant,
v.
HORACE FOX, JR.,
Trustee-Appellee.
Appeal from the United States District
Court for the Northern District of Illinois,
Eastern Division.
No. 18-cv-8508
Martha M. Pacold,
Judge.
O R D E R
In 2010, the United States Bankruptcy Court for the Northern District of Illinois
ruled that all assets held by the Soad Wattar Revocable Living Trust —including the
Wattar family home—were part of the bankruptcy estate of Richard Sharif. Sharif was
the son of Soad Wattar, now deceased, and as the sole trustee of the Wattar trust had
full control of its assets. Haifa and Ragda Sharifeh—Richard’s sisters—soon began
attempting to demonstrate their ownership of trust assets to keep those assets out of
their brother’s bankruptcy estate. At issue in these appeals are the bankruptcy court’s
rulings on three motions: (1) Haifa’s 2015 motion to vacate the decision that all trust
assets belonged to the bankruptcy estate; (2) the sisters’ joint 2016 motion for leave to
sue the Chapter 7 trustee of Richard’s bankruptcy for purported due-process violations;
and (3) Ragda’s 2016 motion seeking both reimbursement of money she allegedly spent
on the family home and the proceeds from Wattar’s life insurance policy, which had
been ruled an asset of the trust and therefore part of the bankruptcy estate. The
bankruptcy court denied all three motions and sanctioned the sisters and Maurice
Salem, who was then their attorney. Each ruling was affirmed on appeal to the district
court. We are no more persuaded by the appellants’ arguments, to the extent they
develop any, than the judges who have already rejected them, and so we affirm.
Richard Sharif filed for Chapter 7 bankruptcy in 2009. At the time, he was the
sole trustee of his mother Soad Wattar’s living trust. (His sisters would later argue that

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Nos. 17-1615, 18-2197 & 22-2826 Page 3
a 2007 trust amendment had made Ragda the sole trustee, but that led nowhere.) When
Wattar died in March 2010, Richard produced a will that named him executor and
provided for all Wattar’s assets to pass into the trust. In June 2010, in a creditor’s
adversary proceeding against Richard, the bankruptcy court ruled that the trust’s assets
were part of the bankruptcy estate because Richard had sole control and treated them
like his personal property. On the motion of the Chapter 7 bankruptcy trustee, Horace
Fox, the bankruptcy court then ordered the trust assets to be turned over to the
bankruptcy estate. (The parties refer to this as the turnover order.)
While Richard appealed this ruling, see Wellness Int'l Network, Ltd. v. Sharif, 727
F.3d 751 (7th Cir. 2013), rev’d, 575 U.S. 665 (2015), Haifa and Ragda sought control of
trust assets, first in state court, unsuccessfully, and then as intervenors in Richard’s
bankruptcy case. By the bankruptcy court’s count, at least ten rulings between 2010 and
2015 addressed who owned the trust assets, including our 2015 affirmance—on remand
from the Supreme Court of the United States—of the bankruptcy court’s initial decision
that the trust and Richard were alter egos. See Wellness Int’l Network, Ltd. v. Sharif,
617 F. Appx. 589, 591 (7th Cir. 2015).
These rulings also included the bankruptcy court’s denial of Haifa’s 2015 motion
on behalf of her mother’s estate to vacate the turnover order. See F ED. R. C IV. P. 60(b)(4).
When the trustee opposed the motion, Haifa attached to her reply brief a theretofore-
unknown second will. Dated April 28, 2007—two days after the will Richard had
produced five years earlier—it purported to name Haifa the executor of their mother’s
estate. Haifa argued that the turnover order was invalid because only with notice to the
true executor could the court dispose of the Wattar estate’s assets, and she was not
notified.
The bankruptcy court denied Haifa’s motion after finding that Haifa had
received notice of the proceedings, that the second will was forged, that even if it were
genuine Haifa still lacked interest in the disputed assets—which were property of the
trust no matter who the will’s executor was—and that, in any event, laches barred her
claim because she had unreasonably delayed pursuing it. The court also determined
that Haifa’s testimony that she had not received notice of the bankruptcy proceedings
or turnover order was not credible. The district court (Judge Pacold) affirmed.
In 2016, the sisters requested leave of the bankruptcy court to sue Fox, the
Chapter 7 bankruptcy trustee, and his attorney, for violating their rights by moving for
the transfer of trust assets to Richard’s bankruptcy estate. Advance permission from the

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bankruptcy court is required to sue a trustee for actions taken in that capacity. See
Matter of Linton, 136 F.3d 544, 545 (7th Cir. 1998). The sisters, now represented by Salem,
identified their prospective suit as a Fifth Amendment due-process claim under Bivens
v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388 (1971). At the
same time, Ragda moved for funds from the bankruptcy estate to reimburse her for
mortgage and tax payments she says she made on the family home between 2010 and
2015. She also asserted that she was the proper beneficiary of Wattar’s life insurance
policy and was owed the proceeds because they were exempt from bankruptcy under
Illinois law. See 735 ILCS 5/12-1001(f).
The bankruptcy court denied the sisters leave to sue after concluding that they
failed to make the required initial showing that their claims had some foundation. The
one-page motion trailed off midsentence, and the attached complaint sought to sue Fox
and his attorney under Bivens based on a dubious assertion that they were “federal
agents.” As for Ragda’s motion, the bankruptcy court concluded that she cited no
statutory or contractual basis for recouping her alleged expenditures on the home—
which, Ragda conceded, were voluntary. Further, the bankruptcy exemption she
invoked for the insurance proceeds did not apply both because it is for dependents of
the insured, which Ragda was not, and because only debtors can invoke exemptions.
The bankruptcy court then ordered Salem, Ragda, and Haifa to show cause why
they should not be sanctioned. After receiving their responses and holding a hearing,
the bankruptcy court concluded that their 2016 motions violated Federal Rule of
Bankruptcy Procedure 9011 because they lacked a basis in law or evidence. The court
further concluded that the motions had been filed “to harass the bankruptcy trustee,
cause unnecessary delay and . . . increase the cost of litigation,” and had indeed
increased the bankruptcy estate’s litigation expenses. After reviewing in detail the
history of the decade-plus bankruptcy litigation and the sisters’ attempts to siphon off
assets controlled by Richard (and his other creditors), the court further determined that
Salem, Ragda, and Haifa displayed “repeated disregard for the facts and the law” and
that “[t]ime and again, [they] have shown a complete disregard for the judicial system,
making blatant attempts to circumvent it.” As a result, the court issued sanctions: it
barred Salem, Ragda, and Haifa from any further filings in the bankruptcy case and
fined Salem $20,000. On appeal, the district court (Judge Dow) affirmed the denial of
the motions and imposition of sanctions.
These events resulted in three separate appeals to this court. We initially
consolidated the appeals of the rulings on the 2016 motions and sanctions, while Haifa’s

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appeal of the denial of her motion to vacate proceeded in parallel. Because they spring
from the same bankruptcy case and rest on a common factual background, we now
consolidate all three appeals for disposition. We note that Salem has been suspended
from the practice of law and, because he is proceeding pro se, can represent only
himself. Nevertheless, in their joint brief Haifa and Ragda adopt Salem’s appellate
arguments about their 2016 motions and sanctions. See F ED. R. APP . P. 28(i).
On appeal, Haifa challenges the denial of her 2015 motion to vacate the turnover
of trust assets, she and Ragda challenge the denial of their 2016 motions, and the sisters
and Salem all challenge the sanctions. Each of the challenged rulings pertains to a
discrete matter within the overarching bankruptcy that the bankruptcy court disposed
of definitively, and therefore, the district court and this court can properly exercise
jurisdiction over the appeals. 28 U.S.C. § 158(a), (d)(1); Ritzen Grp., Inc. v. Jackson
Masonry, LLC, 140 S. Ct. 582, 586–87 (2020). We review the bankruptcy court’s findings
of fact for clear error and the legal conclusions of both the bankruptcy court and district
court de novo, with special deference to the bankruptcy court’s assessment of
credibility. In re Dimas, 14 F.4th 634, 639–40, 642 (7th Cir. 2021). We may affirm on any
basis supported by the record, as long as it was raised below and the appellants had the
opportunity to contest it. McHenry County v. Raoul, 44 F.4th 581, 588 (7th Cir. 2022); In re
Airadigm Commc'ns, Inc., 616 F.3d 642, 652 (7th Cir. 2010) (bankruptcy appeal).
I. Haifa’s 2015 Motion to Vacate the Turnover of Trust Assets
Haifa contends that the turnover order must be vacated because after the
bankruptcy court’s ruling she obtained a newer copy of the second will—this one
certified by a Syrian court—that proves its veracity. She repeats her argument that her
mother’s estate was not bound by the turnover order because she—as purported
executor—never received notice.
Though Haifa primarily challenges the bankruptcy court’s finding that the
second will is a forgery, we can resolve her appeal without wading into her contrary
assertions. Even if Haifa were really the executor, she simply waited too long to stand
on the estate’s rights. In the bankruptcy and district courts, Fox raised the equitable
defense of laches, which cuts off the right to sue when the plaintiff has inexcusably
delayed bringing suit, and that delay harmed the defendant. See Teamsters & Emps.
Welfare Tr. v. Gorman Bros. Ready Mix, 283 F.3d 877, 880 (7th Cir. 2002). Haifa does not
meaningfully dispute Fox’s assertion that the delay was prejudicial to the bankruptcy

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Nos. 17-1615, 18-2197 & 22-2826 Page 6
estate, nor could she: if the second will controls, Fox has been allocating assets
improperly for years. We therefore focus on whether the delay is excusable.
Haifa’s explanation for her years-long delay in producing and seeking to enforce
the second will is unconvincing. She first argues that she lacked notice of the
bankruptcy proceedings or turnover order. But even if, despite being a creditor, she was
not served with filings or copies of rulings, we see no error in the bankruptcy court’s
determination that Haifa had actual notice. Among other things, Haifa and Ragda filed
a state-court complaint in July 2010 that discussed the bankruptcy and the alter-ego
order. And Haifa gives us no reason not to defer to the bankruptcy court’s assessment—
based on inconsistent statements in other proceedings and her participation in the state-
court litigation—that Haifa’s testimony about when she learned of things was not
credible. Dimas, 14 F.4th at 642.
Haifa next argues that she could not act until 2015 because the Supreme Court
was considering a decision of this court, which, according to Haifa had “vacated” the
turnover order in Richard’s appeal. Our decision, Haifa says, meant that the probate
estate was “winning the trust” back from the bankruptcy estate, and she had to wait for
her brother’s Supreme Court appeal to conclude. That was not the nature of Richard’s
appeal, however. In any case, we issued our decision in August 2013, meaning that
Haifa had three years before then to challenge the turnover order; she purports to have
been aware of the second will from the time it was executed in 2007 and does not
explain why she did not invoke it as soon as her brother began to act as executor.
Further, Haifa’s assertion is simply that she was the executor, who was entitled to
notice—she has never disputed that even under her version of the will, her mother’s
assets passed directly to the trust, which Haifa has never controlled. Thus her reasons
for waiting are muddled at best and do not outweigh the prejudice to the bankruptcy
estate.
The district court gave other reasons, including collateral estoppel, for rejecting
Haifa’s attempt to invalidate the turnover order. Though we do not take issue with
those reasons, we find it most straightforward to affirm based on Haifa’s inexcusable
delay in trying to upset the foundation of the bankruptcy proceedings.
II. The 2016 Motions
Next, the appellants assert that the district court applied the wrong standard in
reviewing the bankruptcy court’s denial of the sisters’ motion for leave to sue Fox. They

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Nos. 17-1615, 18-2197 & 22-2826 Page 7
assert that the district court should have reversed because the bankruptcy court failed
to assess whether they made a prima facie case for Fox’s violation of their rights. But
this is not true. The bankruptcy court, in its lengthy order discussing the motion’s
failings, simply made an assessment with which they disagree.
The bankruptcy court correctly concluded that the motion did not make a prima
facie case for a right to relief against Fox. It made no case at all: the motion trails off and
does not present a complete argument. The appellants did not explain then—nor do
they now—why they could sue a Chapter 7 trustee under Bivens. Nor, despite Salem’s
protestations, did the proposed complaint itself; it incorrectly asserts that Fox and his
attorney were “federal agents” who deprived the Wattar estate and Ragda of property
without “notice and a hearing.” But Chapter 7 trustees are not federal officials; they are
private representatives appointed to protect a bankruptcy estate. 11 U.S.C. § 701(a)(1).
The appellants also develop no argument explaining a legal basis for Ragda to
recoup mortgage and tax payments she allegedly made, or to receive the life insurance
proceeds that were payable to the trust as beneficiary (and then transferred to the
bankruptcy estate). The appellants’ challenges to the denial of the 2016 motions are
underdeveloped and unsupported by law and are therefore waived. Puffer v. Allstate
Ins. Co., 675 F.3d 709, 718 (7th Cir. 2012).
III. The Bankruptcy Court’s Sanctions
We review for abuse of discretion the bankruptcy court’s imposition of sanctions
on Ragda, Haifa, and Salem: a bar of further filings in the bankruptcy case plus a
$20,000 fine for Salem. See In re Rinaldi, 778 F.3d 672, 676 (7th Cir. 2015). We find no
such abuse here. Salem principally argues that sanctions were inappropriate because
the motions he filed were not “another attempt to obtain the same relief” sought in
previous motions and were therefore not repetitive. While this may be true in the
narrow sense—no party previously sought to sue the bankruptcy trustee under Bivens—
the bankruptcy court reasonably concluded that these motions represented yet another
refusal to accept the settled issue that the trust assets were part of the bankruptcy estate.
Besides, Salem’s focus on “repetitiveness” misses the point. The bankruptcy
court determined that no argument in the 2016 motions was supported by fact or law
and that the motions were intended to harass the trustee and increase the cost of
litigation. See F ED. R. BANKR . P. 9011(b)(1)–(2). As discussed above, the appellants
present no legal basis for their motions, even as they appeal the rulings. And they do

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not address the bankruptcy court’s finding that those motions were intended to harass
Fox and needlessly increase the cost of litigation. They merely make the bare and
incorrect assertion that the bankruptcy court’s lengthy sanctions order failed to address
certain issues. The burden is on the appellants to tell us why the sanctions were so off-
base that imposing them was an abuse of discretion. They cannot prevail when they fail
to engage with the reasons why the bankruptcy court imposed, and the district court
upheld, the sanctions. See Klein v. O'Brien, 884 F.3d 754, 757 (7th Cir. 2018). We add that
barring these litigants from further filings in the bankruptcy action was a sensible
response to their frivolous attempts to undermine long-settled issues through various
mechanisms.
We have considered appellants’ other arguments—including Salem’s umbrage at
the documentation of his history of litigation misconduct outside of these cases and a
frivolous suggestion that the sanctions chill protected speech—and none has merit.
AFFIRMED

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