New Bankruptcy Opinion: IN RE SUNLAND, INC. – Bankr. Court, D. New Mexico, 2015

In re: SUNLAND, INC., a New Mexico Corporation, EIN XX-XXXXXXX, Debtor.

No. 13-13301-t7.

United States Bankruptcy Court, D. New Mexico.

August 10, 2015.


DAVID T. THUMA, Bankruptcy Judge.

This matter came before the Court upon Chapter 7 Trustee Clarke C. Coll’s (the “Trustee”) Motion to Abandon Debtor’s Records filed on July 7, 2015 as Doc. No. 829 (the “Motion”). The Court, having reviewed the Motion, and being sufficiently advised, FINDS:

A. The Court has jurisdiction to consider this matter pursuant to 28 U.S.C. §§ 157(b) and 1334(a), and Miscellaneous Order No. 84-0324 filed in the United States District Court for the District of New Mexico on March 19, 1992. This is a core proceeding pursuant to 28 U.S.C. §157(b)(2)(B). Venue is proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409.

B. Sunland, Inc. (“Debtor”) filed its petition for relief under Chapter 7 of Title 11 of the United States Code on October 9, 2013 (the “Petition Date”).

C. The Trustee was appointed and is Chapter 7 trustee in this case and continues to serve in that capacity.

D. The Motion requested an order authorizing the Trustee to abandon all records of the Debtor, which consist of: (1) paper records that are currently being stored at Southside Storage, 325 W. 18th Street, Portales, NM 88130 (the “Paper Records”); (2) digital records (the “Digital Records”) that are stored electronically and are accessible on a dedicated computer server owned by the estate (the “Server”); and (3) digital records that are stored electronically under the control of Holland & Knight, the Trustee’s special counsel (the “H&K Records”). Together, the Paper Records, Digital Records, and H&K Records are referred to as the “Records.”

E. The Records are the subject of a subpoena (the “Subpoena”) for production of documents issued by the United States District Court for the District of New Mexico in connection with an ongoing, prepetition investigation by the Food and Drug Administration (the “FDA”).

F. In the Motion, Trustee asserts that the Records and Server are burdensome, of inconsequential value to the Estate and should be abandoned.

G. Notice of the Motion (the “Notice”), specifying a 21-day objection period, was served in accordance with the Bankruptcy Code and Rules on July 7, 2015 to the persons on the limited mailing list in this case maintained by the Clerk of Court, and was sufficient. The deadline to object to the Motion expired on July 31, 2015, including 3 days added pursuant to Bankruptcy Rule 9006(f).

H. The Notice was appropriate under the circumstances.

I. No objections to the Motion were filed, timely or otherwise.

J. The Motion is well taken and should be granted.


1. The Motion is well taken and the relief requested in the Motion is hereby granted.

2. The Trustee is hereby authorized to abandon the Records and the Server to the Debtor, as they are and where they are.

3. As of the date of this Order, the Records are no longer property of the Estate.

4. As of the date of this Order, the Trustee is no longer the custodian of the Records, is no longer responsible for storing or preserving the Records, and is no longer responsible for responding to the Subpoena.


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