In re Gail

On March 12, 2015, in Beckley, WV, there appeared David Bissett, on behalf of the United States Trustee, Robert Johns, Chapter 7 Trustee, and Paul Roop, Special Counsel for the bankruptcy estate, to consider the United States Trustee's Motion to Reconsider Order Granting Trustee's Motion for Order Addressing Confidentiality Agreement and Objection to Motion to Compromise. The United States Trustee objected to the Chapter 7 Trustee's motion to address confidentiality and motion to compromise based on the request to seal the terms of the proposed settlement with World's Foremost Bank as being contrary to the requirements of Section 107 of the Bankruptcy Code.

The proposed settlement is the result of litigation involving a consumer protection claim asserted by the bankruptcy estate. The Chapter 7 trustee has not asserted any ground under Section 107 to seal the terms of the proposed settlement and has requested guidance on the treatment of the proposed settlement as the terms contain a confidentiality clause. By motion filed on January 7, 2015, the Trustee requested authority to seal the terms of the settlement. By order entered on January 21, 2015, the Court granted the Trustee's motion to hold such settlement under seal. On January 22, 2015, the Trustee filed a motion to compromise requesting that the Court approve the terms of the aforementioned settlement without disclosing the terms of the settlement. The United States Trustee objects to the aforementioned motions and order as being contrary to the requirements of Section 107 of the Bankruptcy Code, which requires public disclosure of documents filed with the Bankruptcy Court except in limited circumstances.

Based on the record and the arguments of the parties, the Court finds that the Trustee has not asserted any grounds under Section 107 of the Bankruptcy Code that permit the Court to seal the terms of the proposed settlement. Further, the proposed settlement is for a consumer protection cause of action that would not fall within the exceptions outlined under Section 107 such as would constitute a trade secret, confidential research or for the protection of a person. Accordingly, it is

ORDERED that the order entered on January 21, 2015, granting the motion to address confidentiality is withdrawn and such motion is DENIED. It is further,

ORDERED that the motion to compromise is DENIED without prejudice. It is further,

ORDERED that any future motion to approve a consumer protection compromise shall be open for public review and contain the terms of the settlement. ENTERED: MAR 27 2015

/s/_________

JUDGE
Prepared by /s/ Dawid L. Biooett
David L. Bissett (WV Bar No. 6013)
Trial Attorney, Office of U.S. Trustee
United States Courthouse, Room 2025
300 Virginia Street, East
Charleston, WV 25301
(304) 347-3400