In Re: Xacur

* District Judge of the Northern District of Texas, sitting by
designation.
** Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
United States Court of Appeals
Fifth Circuit
F I L E D
November 17, 2004
Charles R. Fulbruge III
Clerk
UNITED STATES COURT OF APPEALS
FIFTH CIRCUIT
___________________
No. 03-21104
___________________
In the Matter of:
JACOBO XACUR, FELIPE XACUR, and JOSE MARIA XACUR,
Debtors,
JOSE MARIA XACUR,
Appellant,
versus
W. STEVE SMITH, TRUSTEE,
Appellee.
Appeal from the United States District Court
for the Southern District of Texas
Nos. H-03-1590
H-03-1591
H-03-1592
Before BARKSDALE and PICKERING, Circuit Judges, and LYNN,* District
Judge.
PER CURIAM:**

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Jose Maria Xacur contests an order (1) holding him in civil
contempt for failing to comply with a bankruptcy court’s
preliminary injunction and (2) imposing sanctions. AFFIRMED.
I.
Jose Maria Xacur is a Mexican national who, with his brothers,
reputedly owns and controls several multi-million dollar
corporations in Mexico. Xacur is a large shareholder of several
companies which, taken together, are described as “the Procter and
Gamble of Mexico”. (When deposed in 1997, Xacur acknowledged
owning a substantial stake in several companies: a 30% share in
Hidrogenadora Nacional, S.A. de C.V.; a 30% share in Proteneinas y
Aceites del Bajo; and, together with his wife, a 50% share in
Rangel Development, Inc. In addition, evidence obtained from a
suspension of payments proceeding in Mexico indicated that Xacur
owned 239 shares of Series A stock and 4,700,898 shares of Series
B stock in Promotor Hinsa, S.A. de C.V. He also held 2,998 shares
of Series A stock and 2,985,286 of Series B stock in Detergentes y
Jabones Sasil.)
On 18 September 1996, a group of Xacur’s creditors placed
Xacur and two of his brothers into involuntary Chapter 7
bankruptcy. W. Steve Smith was appointed interim trustee for the
bankruptcy estate (the Trustee).
On 12 September 1997, the Trustee commenced an adversary
proceeding against Xacur, seeking to compel, inter alia: (1) the
filing of bankruptcy schedules and a statement of affairs; and (2)

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the surrender and turnover of certain assets, including substantial
realty and personalty, as well as stock certificates of several
companies controlled by Xacur and his family. That same day, the
bankruptcy court entered a temporary restraining order, requiring
Xacur, inter alia, to turn over to the Trustee all stock
certificates and other evidence of ownership in Xacur’s companies.
On 24 September 1997, the bankruptcy court entered a preliminary
injunction requiring Xacur, within 15 days, to turn over the stock
certificates he owned and to file bankruptcy schedules and a
statement of affairs.
Xacur failed to comply. On 19 August 1999, the Trustee moved
for civil contempt against Xacur, seeking money sanctions, Xacur’s
incarceration, and attorney’s fees. Xacur obtained several
continuances of the hearing on the Trustee’s motion. During that
period, Xacur asserted generally that he could not comply with the
preliminary injunction because: it would subject him to criminal
liability for violating Mexican court orders; and a bankruptcy
discharge would not be recognized by Xacur’s Mexican creditors
without obtaining an express agreement in which the creditors
agreed to recognize the discharge.
On 9 December 1999, after Xacur obtained new counsel, the
bankruptcy court was advised that Xacur and the Trustee were
attempting to resolve the impasse. Consequently, the bankruptcy
court removed the contempt motion from the court’s calendar. In

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the months that followed, the Trustee and Xacur attempted to
resolve Xacur’s concerns.
On 8 September 2000, however, the Trustee requested that the
contempt motion be restored to the bankruptcy court’s calendar. A
hearing was held on 16 July 2001, at which both sides presented
evidence. On 11 October 2001, the bankruptcy court entered an
order finding Xacur in contempt of court for failing to comply with
the preliminary injunction, imposed a sanction of $5,000 for each
day that Xacur failed to comply, and awarded attorney’s fees in the
amount of $158,626.50.
On 22 October 2001, pursuant to Bankruptcy Rule 9020, Xacur
filed objections to the contempt order. At that time, Rule 9020
provided in relevant part:
The [contempt] order shall be effective 10
days after service of the order and shall have
the same force and effect as an order of
contempt entered by the district court,
unless, within the 10 day period, the entity
named therein serves and files objections
prepared in the manner provided in Rule
9033(b). If timely objections are filed, the
order shall be reviewed as provided in Rule
9033.
FED. R. BANKR. P. 9020(c) (prior to 1 Dec. 2001 effective date of
amendment). Rule 9033(d) provides:
The district judge shall make a de novo review
upon the record or, after additional evidence,
of any portion of the bankruptcy judge’s
findings of fact or conclusions of law to

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which specific written objection has been made
in accordance with this rule.
FED. R. BANKR. P. 9033(d).
On 1 December 2001, before the district court reviewed Xacur’s
objections, an amendment to Rule 9020 became effective. The rule
was amended to read: “Rule 9014 governs a motion for an order of
contempt made by the United States trustee or a party in interest”.
FED. R. BANKR. P. 9020. Rule 9014 establishes the general procedures
for contested matters before the bankruptcy court.
The rule-change reflected that, previously, there had been
doubt whether the bankruptcy court possessed authority to hold
parties in civil contempt. See FED. R. BANKR. P. 9020 advisory
committee note to the 2001 amendments. In the 1990s, however, many
circuit courts, including ours, held bankruptcy judges are
authorized by statute to hold parties in civil contempt. See
Placid Refining Co. v. Terrebonne Fuel & Lube, Inc. (Matter of
Terrebonne Fuel & Lube, Inc.), 108 F.3d 609, 613 (5th Cir. 1997)
(bankruptcy court possesses authority to hold civil contempt
proceedings) . Because it was no longer perceived that immediate
review by a district court was required, the rule was changed. See
FED. R. BANKR. P. 9020 advisory committee note to the 2001
amendments. Under the amended rule, a party held in contempt
generally cannot obtain review of the contempt order until after a
final order is entered, at which time the bankruptcy may be

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reviewed by the district court. See FED. R. BANKR. P. 9014; 28
U.S.C. § 158(a)(1).
On 23 September 2002, based on the amendment to Rule 9020, the
district court held it lacked jurisdiction to conduct de novo
review of the contempt order. Therefore, the district court
remanded the matter to the bankruptcy court for final
determination. On 24 September 2002, because Xacur had not
complied with the preliminary injunction, the bankruptcy court
ordered Xacur’s incarceration.
On 1 October 2003, the district court reviewed the contempt
order, the incarceration order, and the award of attorney’s fees,
and affirmed. For that review, the district court applied the
following standards: factual findings were reviewed for clear
error; the injunction and the contempt order, for abuse of
discretion; and conclusions of law, de novo.
II.
At issue is whether the district court improperly dismissed
Xacur’s objections to the bankruptcy court’s finding of contempt
and improperly declined to conduct a de novo review of the
bankruptcy court’s contempt finding. In this regard, Xacur claims
the district court erred by ruling that, under Rule 9020, as
amended on 1 December 2001, it lacked jurisdiction to review
Xacur’s objections to the bankruptcy court’s contempt order. Xacur
maintains the district court improperly applied the amended rule

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retroactively because his objections had been filed before the
amended rule became effective.
The Supreme Court order adopting the 1 December 2001 amendment
to Rule 9020 states that the amended rule “shall govern ... insofar
as just and practicable, [in] all proceedings then pending”. H.R.
Doc. No. 107-60, at 3 (2001), reprinted in 121 S. Ct. 129 (2001).
Because Xacur’s objections to the contempt order were pending when
Rule 9020 was amended, the amended rule should apply to this case
unless it is not “just and practicable” to do so.
In contending it is not proper to apply the amended rule,
Xacur asserts only that he was deprived of a de novo hearing by the
district court, and this deprived him of an important safeguard to
his rights. Xacur makes no contention, however, that, had he
received a de novo hearing, he would have offered any additional
evidence or that there was any other reason why it was not “just
and practicable” to apply the amended rule and not hold the
hearing. Even though the Trustee urged in response that the
contempt finding would withstand de novo review, Xacur did not
reply.
Accordingly, Xacur fails to show improper application of
amended Rule 9020. Therefore, his challenge to the order at issue
fails.

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III.
For the foregoing reasons, the judgment is
AFFIRMED.

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