Vision Bank v. Freeman et al

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF OKLAHOMA
GRAYSEN ALLEN FREEMAN 	Case No. 25-80831-PRT
BLAKLYN RYANE FREEMEN, 	Chapter 7
Debtors.
VISION BANK,
Plaintiff
v. 	Adversary Case No. 24-08026-PRT
GRAYSEN ALLEN FREEMAN and
BLAKLYN RYANE FREEMEN,
Defendants.
ORDER DENYING DEFENDANTS’ MOTION TO DISMISS AND
GRANTING PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT
The Plaintiff filed this adversary case pursuant to 11 U.S.C. § 523(a)(2)(A), 523(a)(2)(B)
and 523(a)(6) to except from discharge its state court judgment against the Defendants. There are
two pending motions before the Court: the Defendants Motion to Dismiss (ECF No. 11) and the
Plaintiff’s Motion for Partial Summary Judgment as to its first Cause of Action pursuant to 11
U.S.C. § 523(a)(2)(A). (ECF No.14). After reviewing the record and applicable legal authorities,
________________________________________________________________
Dated: June 23, 2026
The following is ORDERED:
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 1 of 11

the Court finds that the Defendants’ Motion to Dismiss should be denied, and that the Plaintiff is
entitled to summary judgment as to the first Cause of Action of its Complaint.
I. 	Jurisdiction
This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1334(b), and venue is
proper pursuant to 28 U.S.C. § 1409. Reference to the Court of this matter is proper pursuant to 28
U.S.C. § 157(a). This is a core proceeding as contemplated by 28 U.S.C. § 157(b)(2)(I).
II. 	The Defendants’ Motion to Dismiss
The debt the Plaintiff Vision Bank seeks to except from discharge arises from a loan
given by the Plaintiff to Defendant Graysen Freeman for $20,324.00. The Defendants state that
the Plaintiff obtained a default judgment against them as well as Graysen’s mother, Jennifer
Marie Freeman, in Pontotoc County, Oklahoma for $19,521.35. After the Plaintiff filed this
adversary case and the Defendants filed their answer, the Defendants allege that Jennifer
Freeman paid the Plaintiff $20,000.00 in satisfaction of the judgment against her. The
Defendants filed a Motion to Dismiss this adversary case on the grounds that the debt which is
the subject of Plaintiff’s Complaint has been paid. They do not cite a procedural rule as the basis
for dismissal.
The Court construes the Defendants’ argument to be that Jennifer Freeman’s $20,000.00
payment renders this action moot as this Court can no longer grant any effectual relief. The
Court rejects that argument.1 As the Plaintiff has noted, and as is alleged in its Complaint, its
1 A case that ceases to present a “live controversy with respect to which the court can give
meaningful relief” is moot. See In re Jain, 626 B.R. 336, 341 (Bankr. D.N.M. 2021) citing
Ethredge v. Hail, 996 F.2d 1173, 1175 (11th Cir. 1993). Courts do not have jurisdiction over
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 2 of 11

debt is more than $20,000.00 since its judgment includes interest and attorney fees. Moreover,
the Plaintiff is seeking a determination of the dischargeability of the debt regarding these
Defendants on multiple grounds. Therefore, the $20,000.00 payment by a non-party does not end
this case, and the Defendants’ Motion to Dismiss based on mootness is denied.
III. 	The Plaintiff’s Motion for Partial Summary Judgment
The Plaintiff seeks partial summary judgment as to its first cause of action which seeks a
determination that its default judgment against the Defendants is nondischargeable under
§ 523(a)(2)(A) as a debt obtained by false pretenses, false representation or actual fraud. The
Defendants oppose this Motion and argue that the Plaintiff’s claim of attorney fees and costs is
not recoverable in a § 523(a) action.
A. Summary Judgment Standard
Summary judgment is appropriate when “the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). “An issue is ‘genuine’ if there is sufficient evidence on each side so that a rational
trier of fact could resolve the issue either way.” Adler v. Wal–Mart Stores, Inc., 144 F.3d 664,
670 (10th Cir. 1998).
This Court’s Local Rule 7056-1 contains specific requirements regarding the content and
organization of a motion for summary judgment. The motion shall include a brief in support that
contains a concise statement of material facts as to which movant contends no
genuine issue exists. Each fact shall be stated in a separately numbered paragraph
and shall refer with particularity to those portions of the affidavits, discovery
materials, pleadings, or other parts of the record before the Court upon which the
moot cases. Citizens for Responsible Gov't State Political Action Comm. v. Davidson, 236 F.3d
1174, 1181–82 (10th Cir. 2000).
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 3 of 11

movant relies.
A brief in response to a motion for summary judgment
shall begin with a section stating, by paragraph number, each of the movant’s
facts to which the non-movant contends a genuine issue exists, and shall refer
with particularity to those portions of affidavits, discovery materials, pleadings,
and other relevant parts of the record before the Court upon which the non-
movant relies to dispute the movant’s fact. All properly supported material facts
set forth in the movant’s statement shall be deemed admitted for the purpose of
summary judgment unless specifically controverted by a statement of the non-
movant that is supported by evidentiary material.
The Plaintiff’s Motion complies with Rule 56 and Local Rule 7056-1 as it includes a
numbered list of material facts to which it believes there is no genuine issue. The Defendants’
Response also includes a numbered list of undisputed material facts but does not specifically
identify which of the Plaintiff’s facts they believe present a genuine issue as required by Local
Rule 7056-1. Neither party included affidavits or discovery materials in support of their
positions.
B. Findings of Fact
Based on the Motion, Response and Reply, the Court makes the following findings of
material facts which were not controverted by the Defendants:
1. 	On July 3, 2024, Defendant Graysen Allen Freeman executed a Commercial Promissory
Note (the “Loan”) in favor of Plaintiff for $20,324.00.
2. 	On the same date and pursuant to the same transaction, Graysen Freeman made,
executed, and delivered to Plaintiff the Commercial Security Agreement (the “Security
Agreement”) by which Plaintiff was granted a security interest in Defendants’ 2017
Chevrolet Silverado, VIN # 3GCUKSEC9HG253318 (the “Truck”).
3. 	The Defendants agreed to pledge the Truck as collateral for the Loan to Plaintiff.
4. 	Defendants defaulted on the Loan due to their failure to make payments, thereby
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 4 of 11

accelerating the Loan.
5. 	Defendants did not surrender the Truck to Plaintiff.
6. 	Instead, Defendant Graysen Freeman sold the Truck to Cavendars Auto Sales &
Leasing for $17,000.00. Freeman did not pay all the proceeds from the sale to Plaintiff.
7. 	The maturity date for the Loan is July 5, 2029.
8. 	On June 17, 2025, the Plaintiff filed suit against the Defendants in the District Court of
Pontotoc County, Oklahoma, Case No. CJ-2025-131. The Plaintiff also named Jennifer
Marie Freeman, Graysen Freeman’s mother, as a co-Defendant in this case.
9. 	The Defendants and Jennifer Freeman failed to file a timely answer in the Pontotoc
County case. On July 24, 2025, a Journal Entry of Judgment was entered in favor of the
Plaintiff and against the Defendants and Jennifer Freeman granting the Plaintiff a
default judgment in the amount of $19,521.35, plus interest at the rate of 13.50% per
annum from May 5, 2025.
10. The Defendants filed a chapter 7 bankruptcy case on September 8, 2025, in this Court.
11. The Plaintiff filed its Complaint commencing this adversary case on December 1, 2025,
seeking to except the judgment debt from discharge pursuant to 11 U.S.C.
§ 523(a)(2)(A), 523(a)(2)(B) and 523(a)(6).
12. The Defendants filed their Answer to Plaintiff’s Complaint on December 17, 2025.
13. Paragraph 32 of the Plaintiff’s Complaint states: “Defendants should not be granted
dischargeability as to the debt owed to Plaintiff pursuant to 11 U.S.C. § 523(a)(2)(A)”:
14. The Defendants’ Answer to Paragraph 32 of the Complaint states: “Defendants admit
the material allegations contained in paragraph 32.”
15. On March 3, 2026, Jennifer Freeman paid the Plaintiff the sum of $20,000.00 in
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 5 of 11

satisfaction of the default judgment entered against her in the Pontotoc County Case.
To the extent the Conclusions of Law contain any items that should more appropriately
be considered Findings of Fact, they are incorporated herein by this reference.
C. Conclusions of Law
1. 	Admission in the Defendants’ Answer
The Plaintiff argues that the Defendants’ Answer to paragraph 32 of its Complaint and
their admission of certain material facts establish nondischargeability pursuant to § 523(a)(2)(A).
It cites paragraph 32 of the Complaint which states: “Therefore, pursuant to 11 U.S.C.
§ 523(a)(2)(A), Defendants should not be granted dischargeability as to the debt owed to
Plaintiff.” The Defendants’ Answer to this paragraph states: “Defendants admit the material
allegations contained in paragraph 32.” The Plaintiff believes this is a binding judicial admission
that concedes the ultimate legal conclusion and relief it seeks, and that this admission entitles it
to summary judgment. The Plaintiff also argues that the Defendants’ Response offers further
support for its entitlement to summary judgment. The Response admits that Graysen Freeman
executed the Loan and Security Agreement, pledged the Truck as collateral for the loan,
defaulted on the Loan, and sold the Plaintiff’s collateral without remitting the proceeds to the
Plaintiff, and thus establishes the basic elements of a § 523(a)(2)(A) cause of action.
The Defendants respond that paragraph 32 is essentially a legal conclusion based on the
preceding factual allegations in paragraphs 22 through 31 set forth to establish a claim for relief
pursuant to § 523(a)(2)(A). Their Answer specifically denied each factual allegation set forth in
paragraphs 22 through 31, therefore they argue their admission in paragraph 32 is just an
acknowledgement of the statutory authority the Plaintiff relies upon, not an admission of its
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 6 of 11

entitlement to relief. However, in answering similar allegations in paragraphs 42 and 51
regarding the Plaintiff’s second and third causes of action, the Court notes that the Defendants’
Answer denied the material allegations in those paragraphs.2 Moreover, their Statement of
Undisputed Material Facts in their Response the Motion for Partial Summary Judgment now
admits allegations that they previously denied in their Answer. They admit that Graysen Freeman
executed the Loan and Security Agreement pledging the Truck as collateral, admit that they
defaulted on the Loan, sold the Truck and failed to remit the proceeds to the Plaintiff.3 They
offer an explanation as to why these actions were taken but they no longer deny the essential
facts as alleged by the Plaintiff.
“A pleading should inform the court and parties of the facts in issue so that the court may
declare the law and the parties may know what to meet with their proof.” Mitchell v. Wright, 154
F.2d 924 (5th Cir. 1946). Fed. R. Civ. P. 8(b)(6), made applicable to this case by Fed. R. Bankr.
P. 7008, states: “An allegation — other than one relating to the amount of damages — is
admitted if a responsive pleading is required and the allegation is not denied.” Judicial
admissions are “formal, deliberate declarations which a party or his attorney makes in a judicial
2 Regarding the Second Cause of Action for false statement in writing, § 523(a)(2)(B), paragraph
42 of the Complaint states: “Therefore, the resulting debt from the Defendants’ material breach
and use of false statement in writing should not be discharged within Defendants’ bankruptcy.”
The Defendants’ answer to this paragraph states: “Defendants deny the material allegations
contained in paragraph 42.” Paragraph 51 regarding the Third Cause of Action for willful and
malicious injury, § 523(a)(6), states: “The resulting debt from the Defendants’ willful and
malicious injury to Plaintiff’s security interest should not be dischargeable pursuant to 11 U.S.C.
§ 523(a)(6).” The Defendants’ answered this paragraph: “Defendants deny the material
allegations contained in paragraph 51.”
3 The Defendants note that they disclosed this sale in their Statement of Financial Affairs in their
bankruptcy petition. However, their Answer specifically denied the Plaintiff’s allegation that
they sold the Truck and did not pay the proceeds to the Plaintiff. ECF No. 4, ¶17.
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 7 of 11

proceeding for the purpose of dispensing with proof of formal matters or of facts about which
there is no real dispute.” U.S. Energy Corp. v. Nukem, Inc., 400 F.3d 822, 833 n.4 (10th Cir.
2005). Statements in briefs may also be treated as judicial admissions at the court’s discretion.
Id.
The Defendants knew how to deny the allegations in the Complaint, even those they
believe simply recited a legal conclusion. They chose not to deny paragraph 32 of the First Cause
of Action. The Court finds this is an admission that the Plaintiff is entitled to a judgment of
nondischargeability as to its First Cause of Action. Furthermore, the Defendants now admit to
certain supporting allegations in the Complaint which they previously denied. They admit that
Graysen Freeman executed the Loan and Security Agreement, pledged the Truck as collateral for
the Loan, defaulted on the Loan, and sold the Plaintiff’s collateral without remitting the proceeds
to the Plaintiff. Therefore, the Court concludes that they should be bound by their admission that
they should not be granted a discharge of the debt owed pursuant to § 523(a)(2)(A).
The Court also finds that the Defendants have failed to adequately dispute the Plaintiff’s
judgment of nondischargeability as to Blaklyn Freeman. They jointly admitted that the debt was
reduced to judgment against both Defendants. They jointly admitted that the debt should not be
discharged. They offered no evidentiary material in support of their claim that Blaklyn
Freeman’s judgment debt should be discharged as is required by Local Rule 7056-1. Therefore,
the Court finds that the Plaintiff should be granted summary judgment against Defendants
Graysen Freeman and Blaklyn Freeman on its first cause of action pursuant to § 523(a)(2)(A).
2. 	Request for Attorney Fees and Costs
Based on the information before it, the Court is unable to determine whether adversary-
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 8 of 11

related attorney fees should be included in the debt excepted from discharge.4 The Plaintiff
represents, and the Defendants appear to concede, that the Plaintiff was awarded attorney fees in
its default judgment which would be included in the debt that is excepted from discharge in this
adversary case. However, the Defendants argue that attorney fees incurred in this adversary case
should be governed by the American Rule, whereby each party is responsible to pay their own
attorney fees. The Plaintiff argues that its judgment, including pre- and post-judgment interest at
the contractual rate of 13.50% per annum, and all contractual charges incurred thereafter, entitles
it to attorney fees incurred in this adversary case. It also argues that an award of attorney fees has
a contractual and statutory basis that are embedded in the state court judgment.
The Court has not been presented with the Loan or Security Agreement or specific
language therein to determine if there is a contractual basis for attorney fees incurred in this
adversary proceeding. Nor has it been provided with the Default Judgment entered by the state
court which is purported to have awarded attorney fees. It is unknown whether the state court has
assessed the fees and costs. Moreover, the Court does not know the basis of the state court
lawsuit and judgment other than as an action to recover a debt.
The Court finds the analysis of this issue in First American Title Co. v. Smith (In re
Smith), 605 B.R. 538 (Bankr. D. Utah 2019) to be helpful. That case sought pursuant to
4 Both parties discuss In re Gamboa, 2020 WL 5587431 (Bankr. W.D. Okla., Sept. 17, 2020).
The issue in Gamboa was whether the debtor as the prevailing party against the creditor in the
creditor’s § 523(a)(3) action could recover his attorney fees in successfully defending the
adversary case. The creditor had a claim for attorney fees in the underlying state court default
judgment as the prevailing party in that case pursuant to OKLA. S TAT. tit.12, § 936. However, the
creditor did not prevail in his nondischargeability action. The debtor moved for attorney fees as
prevailing party, citing the Oklahoma statute as authority for the award of attorney fees against
the creditor in the adversary case. The bankruptcy court declined to grant that relief as the debtor
could not be said to be the prevailing party under that statute.
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 9 of 11

§ 523(a)(6) to except a judgment debt resulting from a federal district court case. The judgment
debt arose from claims of breach of an employment contract and breach of fiduciary duty, and
included an award of attorney fees under both causes of action. The judgment creditor prevailed
in excepting its judgment (including attorney’s fees awarded) from discharge in bankruptcy. The
issue was whether the creditor could also be awarded and include in a judgment of
nondischargeability its costs and attorney fees incurred as prevailing party in the adversary case.
The bankruptcy court determined that it could not. This was because the attorney fees in the
adversary case were incurred in an action sounding in tort, not an action based on contract. The
creditor argued that the employment agreement it sought to enforce provided for attorney’s fees
to a prevailing party incurred in any action to pursue enforcement of the agreement. The creditor
also cited a Utah statute, similar to OKLA. S TAT. tit.12, § 936, as authority for an award of
attorney fees. The bankruptcy court rejected both grounds as a basis for recovery. The
nondischargeability action was based in tort law whereas the underlying judgment sounded in
contract. Finding no statutory basis in state or bankruptcy law for the award of attorney fees, the
bankruptcy court denied the judgment creditor’s request for attorney fees incurred in the
nondischargeability case.
Similarly, the Plaintiff has prevailed on a nondischargeability action based on tort while
its judgment debt appears to be based on contract. Based on the information before it, the Court
finds that the Plaintiff has not met its burden to establish entitlement to an award of attorney’s
fees for this adversary case. However, the Court will allow the Plaintiff an opportunity to
supplement the record in accordance with the questions raised in this Order. All parties may
submit additional legal authority to the Court should they desire to do so.
IV. 	Order of the Court
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 10 of 11

Based on the Defendants’ admissions, the Court finds that the Plaintiff is entitled to
summary judgment on its First Cause of Action seeking to have its judgment debt excepted from
discharge pursuant to 11 U.S.C. § 523(a)(2)(A). As for the issue of attorney fees, the Court
grants the parties until July 10, 2026 to provide evidentiary support and additional legal authority
for their respective positions.
IT IS HEREBY ORDERED THAT:
The Defendants’ Motion to Dismiss (ECF No. 11) is denied.
The Plaintiff’s Motion for Partial Summary Judgment (ECF No. 14) is granted as to
nondischargeability pursuant to 11 U.S.C § 523(a)(2)(A).
The parties shall have until July 10, 2026 to provide evidentiary support and additional
legal authority for their respective positions as to an award of attorney’s fees and costs and the
amount of debt to be determined nondischargeable.
###
Case 25-08026 Doc 26 Filed 06/23/26 Entered 06/23/26 11:09:13 Desc Main
Document Page 11 of 11