Summary Calendar IN THE MATTER OF: UNITED STATES BRASS CORP. Debtor - - - - - - - -… v. the Brass Trust

* 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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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.
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 08-40452
Summary Calendar
IN THE MATTER OF: UNITED STATES BRASS CORP.
Debtor
- - - - - - - - - -
HG-CV-TA-ERD LLP; ROCKDALE MOTEL CORP.
Appellants
v.
THE BRASS TRUST
Appellee
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 4:07-CV-243
Before WIENER, STEWART, and CLEMENT, Circuit Judges.
PER CURIAM:*
The instant adversary proceeding from the Chapter 11 bankruptcy of the
Debtor, United States Brass Corp., was dismissed by the bankruptcy court on
United States Court of Appeals
Fifth Circuit
F I L E D
October 7, 2008
Charles R. Fulbruge III
Clerk

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No. 08-40452
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summary judgment, which dismissal was affirmed by the district court on
appeal. Like the district court, we affirm the judgment of the bankruptcy court
that dismissed with prejudice the claims advanced by Appellants in their
adversary proceeding.
Reduced to its essentials, Appellants voluntarily elected to pursue their
claims against the Debtor under the Alternative Dispute Resolution (ADR)
provisions of the plan of reorganization. The ADR provisions that Appellants
elected to pursue provide for binding arbitration. The provision that lies at the
heart of this matter specifies that claims against the Debtor related to plumbing
issues are recoverable in arbitration only to the extent that they are supported
by competent evidence of actual, out-of-pocket costs and expenses incurred by
claimants in repair or replacement of defective materials manufactured and
supplied by the Debtor. In the face of that clear and unambiguous provision,
Appellants inexplicably sought recovery not on the basis of invoices, bills,
payments, or the like actually expended, but on the basis of old expert estimates
of costs and expenses that would be incurred if Appellants had proceeded to
cause such work to be done.
The arbitrator correctly focused on this anomaly in the Appellants’ case,
i.e., electing binding arbitration that could only be successful if the Appellants
had submitted evidence of actual payments for repair and replacement, knowing
all the while that there had been no such expenditures incurred for which
evidence was available. In a ruling that impresses us as obvious, the arbitrator
dismissed the claims of Appellants, but bent over backwards to accommodate
Appellants by making the dismissal without prejudice and allowing them an
opportunity (despite its obvious impossibility) to come back with evidence of
actual payments made to repair or replace the defective materials and
installations.

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No. 08-40452
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That the arbitrator happened to use the term “jurisdictional” in loose
reference to the limitations to which Appellants voluntarily submitted in electing
binding arbitration under the ADR provision referred to above, does not make
the ruling of the arbitrator turn on lack of subject matter jurisdiction, as counsel
for Appellants erroneously and unprofessionally insists. On the contrary, the
ruling of the arbitrator is, in all respects, a ruling on the merits, and one with
which we agree.
Moreover, when the Appellants attempted to obtain a second bite at the
apple by filing the adversary proceeding that is the subject of this appeal, the
bankruptcy court properly dismissed that untoward effort and favored
Appellants with a lengthy, complete, and absolutely correct Memorandum
Opinion. On appeal to the district court of the ruling of the bankruptcy court
confirming the Arbitration Order and dismissing with prejudice the claims
asserted by Appellants in the adversary proceeding, the district court needed few
words to affirm the bankruptcy court. We too affirm the rulings and judgment
of the bankruptcy court in its entirety and caution counsel for Appellants not to
repeat their misrepresentations by referring to the basis of the award of the
arbitrator as dismissal for lack of subject matter jurisdiction, which it clearly
was not. Like the district court before us, we AFFIRM the Bankruptcy Court’s
March 30, 2007 Order Granting Partial Summary Judgment and Confirming the
Arbitration Award.

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