Don Murphy, Lorraine Dille Williams, Robert Nichols Flint Dille, & Team Angry Filmworks, Inc. v. Bernstein (In re Dille Family Trust)

Citation: 598 B.R. 179Docket: Bankr No. 17-24771-JAD

Court: United States Bankruptcy Court, W.D. Pennsylvania; February 20, 2019; Us Bankruptcy; United States Bankruptcy Court

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The Court, presided over by Judge Jeffery A. Deller, is addressing an Expedited Joint Motion to Dismiss the Chapter 11 Case for Cause, filed by Don Murphy, Lorraine Dille Williams, Robert Nichols Flint Dille, and Team Angry Filmworks, Inc. The movants argue that the Dille Family Trust is not a "business trust," rendering it ineligible for bankruptcy under 11 U.S.C. § 109(d). In opposition, objections have been filed by Chapter 11 Trustee Robert S. Bernstein, non-bankruptcy trustee Louise A. Geer, the Dille Family Trust, and the Nowlan Family Trust, asserting that the Dille Family Trust qualifies as a "business trust" and is therefore eligible for relief.

The Motion to Dismiss is classified as a core proceeding, giving the Court jurisdiction to issue a final judgment. The Court ultimately concludes that the Dille Family Trust does not qualify as a "business trust" and orders the dismissal of the bankruptcy case.

The case background indicates extensive litigation involving the Dille Family Trust, which filed for Chapter 11 relief on November 28, 2017, amid ongoing disputes in various courts, including trademark issues. Opponents in the bankruptcy case argue that the filing was a litigation tactic to delay non-bankruptcy proceedings. The Dille Family Trust claims ownership of intellectual property rights related to the character "Buck Rogers," originally appearing in the novella "Armageddon 2419 A.D." The dispute regarding the character's creation involves conflicting assertions between the Dille family and Nowlan's estate, which had previously assigned rights related to "Buck Rogers" to Dille in 1942.

Intellectual property rights related to "Buck Rogers" have been transferred among members of the Dille family, including Robert C. Dille, son of John F. Dille. On August 16, 1979, the Dille Family Trust was established, and it is alleged that the "Buck Rogers" trademark and related rights were assigned to the Trust on that date, with additional copyright assignments occurring about a year later. Although not fully detailed, various other assignments to the Trust are acknowledged. In 2011, certain "Buck Rogers" trademark registrations were canceled, yet the Dille Family Trust claimed continued usage in commerce, asserting it filed applications with the USPTO in 2009.

In January 2008, the Nowlan Family Trust sought registration of the "Buck Rogers" mark based on intent to use, leading to opposition from the Dille Family Trust. The Trademark Trial and Appeal Board overruled this opposition in 2015, citing the Dille Family Trust's inability to demonstrate a proprietary interest in the mark. The Dille Family Trust subsequently sued the Nowlan Family Trust in Pennsylvania federal court to challenge this decision.

Meanwhile, Team Angry Filmworks, Inc., a film production company owned by Don Murphy, filed a lawsuit against the Dille Family Trust and its trustee, Louise A. Geer, in California, claiming that "Buck Rogers" and the work "Armageddon 2419 A.D." entered the public domain in the U.S. in 1956 and worldwide in 2010. The lawsuit also alleges that the Dille Family Trust's counsel made threats regarding copyright infringement. Team Angry Filmworks seeks a declaration that these works are in the public domain, allowing for their use in commercial ventures and film productions. The case was later transferred to the Western District of Pennsylvania due to the location of the Dille Family Trust's trustee.

In the Western District litigation, injunctive relief was sought to prevent the Dille Family Trust and Ms. Geer from interfering with Team Angry Filmworks' use of the "Buck Rogers" and "Armageddon 2419 A.D." intellectual property. The Dille Family Trust was involved in litigation against the Nowlan Family Trust in the Eastern District, with a trial scheduled for February 5, 2018. Concurrently, the case against Team Angry Filmworks moved past the pleadings stage to discovery, but mediation efforts failed. The Dille Family Trust's ability to fund legal fees dwindled as Lorraine Dille Williams, a beneficiary, ceased providing financial support due to alleged irregularities involving Ms. Geer and Mr. Herman's firm. Consequently, the Dille Family Trust filed for Chapter 11 relief on November 28, 2017, which resulted in a stay of all litigation. Following the bankruptcy filing, the Dille Family Trust sought to auction its intellectual property rights, facing opposition from the Nowlan Family Trust and Team Angry Filmworks, who claimed rights to the property. Team Angry Filmworks moved to dismiss the bankruptcy case as a bad faith filing, arguing that the trust lacked business operations and was not a "business trust," thus ineligible for Chapter 11 relief. They also sought relief from the automatic stay to pursue the Western District lawsuit. The Nowlan Family Trust supported this motion. The Dille Family Trust subsequently filed a Chapter 11 Plan to liquidate its intellectual property, prompting a hearing where various parties raised issues regarding the trust's eligibility and the good faith of the bankruptcy filing. No decisions were made on the motions for relief from stay or dismissal, as factual questions remained unresolved.

An August 21, 2018 trial was scheduled regarding motions for relief from stay and case dismissal. The Court allowed pre-trial discovery, during which the Dille Family Trust failed to comply with requests, prompting motions to compel against the debtor. A July 25, 2018 hearing revealed willful non-compliance and significant issues within the Chapter 11 case, leading the Court to appoint a Chapter 11 Trustee instead of dismissing the case. Key findings included: 

1. The Chapter 11 case was not progressing toward reorganization.
2. The debtor had no business operations or meaningful income and was liquidating.
3. Administrative expenses were incurred without liquid assets to cover them.
4. The debtor's monthly financial reports did not reflect incurred professional fees.
5. The automatic stay was invoked primarily to avoid a trial regarding the debtor's intellectual property interests.
6. The debtor replaced non-bankruptcy litigation costs with bankruptcy-related litigation costs questioning its eligibility and good faith.
7. The debtor obstructed lawful discovery requests from parties challenging its bankruptcy status and provided evasive affidavits.
8. The debtor ignored court directives for document production and offered no valid excuses for these failures.
9. Claims that inadequate discovery responses were unimportant were dismissed, as the debtor, being a fiduciary, had a duty to respond adequately.
10. The debtor had no liquid assets to pay sanctions for discovery failures and did not convince the Court that it would cease its non-compliance.
11. There were disputes over intellectual property rights, with improper attempts to pursue a "free and clear" sale without Court approval.
12. The debtor listed various assets for sale online without prior Court consent.
13. The debtor consulted an attorney with potential conflicts of interest, who was not retained by a court order.
14. Additionally, it was noted that beneficiaries of the debtor trust were deadlocked, with one 50% beneficiary lacking notice or consent to the bankruptcy filing.

The appointment of a Chapter 11 Trustee is justified by clear and convincing evidence of "cause" as outlined in 11 U.S.C. 1104(a)(1) and (a)(2), particularly in light of the ongoing acrimony and extensive litigation in the case. The Court considered the debtor's proposal for an examiner instead of a trustee but determined that the costs would be similar, and an examiner would only delay proceedings without the necessary management powers to advance the case. Key stakeholders support the trustee's appointment, believing it could facilitate settlement for all parties involved. Consequently, an Order was issued for the U.S. Trustee to appoint a Chapter 11 Trustee, resulting in Robert S. Bernstein's appointment, who has performed his duties in line with fiduciary responsibilities.

Despite this appointment, motions to dismiss and for relief from stay continued on the Court's calendar for August 21, 2018. On that date, a tentative agreement was reached between the Chapter 11 Trustee and Team Angry Filmworks, leading to the withdrawal of their motions and the proposal of a Chapter 11 Plan funded by the intellectual property's development. The Nowlan Family Trust was granted relief to proceed with litigation in the Eastern District. The Chapter 11 Trustee later sought court approval for the Team Angry deal under Fed.R.Bankr. 9019, which faced opposition from the Nowlan Family Trust, Ms. Geer, Mr. Herman, and others. Geer and Herman submitted a competing plan that would allow them to control the monetization of "Buck Rogers" intellectual property. 

During a November 27, 2018 hearing, the Chapter 11 Trustee opted to abandon the Team Angry proposal in favor of a joint plan from the Nowlan Family Trust, Geer, and Herman, which was deemed more beneficial for creditors, offering $500,000 to the bankruptcy estate, equating to approximately fifty cents on the dollar for creditors. It was noted that trust beneficiaries, Ms. Williams and Mr. Dille, would receive nothing under this new proposal.

Team Angry Filmworks and Don Murphy, along with Ms. Williams and Mr. Flint Dille, expressed their discontent during a November 27, 2018 hearing, where Team Angry’s motion to dismiss was orally renewed. The Chapter 11 Trustee was directed to file an amended plan, with the hearing underscoring that debtor eligibility remained a crucial issue for plan confirmation. On December 11, 2018, Team Angry Filmworks and the Dille family filed an expedited Motion to Dismiss, challenging the debtor's eligibility based on the assertion that the Dille Family Trust is not a "business trust," and reasserting claims of "bad faith" against Ms. Geer and Mr. Herman related to their representation of the trust and the bankruptcy case. 

During a January 7, 2019 hearing, beneficiaries expressed a loss of confidence in their legal representation, prompting the Court to seek supplemental briefs, which were completed by February 5, 2019. The Chapter 11 Trustee subsequently filed several motions, including proposals to convert the case to a Chapter 7 liquidation, sell assets, and establish bid procedures, arguing that a reorganization was unfeasible due to ongoing litigation costs. The proposed asset sale, with a current offering price of $300,000, would not satisfy the claims of unsecured creditors, whose claims exceed $4.8 million, and would primarily benefit administrative expense creditors, including the Trustee’s fees exceeding $143,000.

Team Angry Filmworks, Don Murphy, and the Dille family objected to the Trustee's motions, arguing they were attempts to prolong litigation over the Motion to Dismiss. Ultimately, the Court determined that the Dille Family Trust is ineligible for bankruptcy, rendering further discussion of the other issues unnecessary.

The burden of proof for establishing eligibility for bankruptcy relief lies with the party filing the petition, which in this case is the Dille Family Trust. However, due to the appointment of a Chapter 11 Trustee, the court shifts the burden of proof to the Trustee, who advocates for the debtor's eligibility. This is supported by precedent indicating that an entity acts through its agents. Additionally, since both the Chapter 11 Trustee and the non-bankruptcy trustee, Louise Geer, are advocating for the Dille Family Trust's debtor status, they both share the burden of proof.

Under 11 U.S.C. § 109(d), only "a person" may be a debtor under Chapter 11, with "person" defined to include individuals, partnerships, and corporations, which can encompass business trusts. Courts have established that only valid "business trusts" qualify for bankruptcy relief, while ordinary non-business trusts do not. Historical context indicates that earlier bankruptcy laws included trusts with transferrable certificates, but the current Bankruptcy Code's definition excludes non-business trusts from being considered "persons" eligible for bankruptcy. The legislative history confirms that only business trusts qualify for this status under the current code.

The term "entity" in the Bankruptcy Code encompasses "trusts," but not all entities qualify as debtors. According to 11 U.S.C. § 109(d), only "persons" can be debtors, and the only type of trust recognized as a "person" is a "business trust." A traditional trust is defined as a fiduciary relationship, whereas a business trust is viewed as an unincorporated business entity. Historically, business trusts originated in eighteenth-century England as a response to stringent corporate incorporation laws, leading to the formation of voluntary associations. The English Bubble Act of 1719 aimed to restrict such associations, but its repeal in 1825 allowed for their growth. Massachusetts was pivotal in the development of business trusts, as it permitted incorporation without special legislative approval. A business trust involves property being conveyed to a trustee for the benefit of certificate holders, as defined by a trust instrument. However, case law lacks a uniform standard for defining a valid business trust in bankruptcy eligibility, with some cases debating whether the determination relies on state law or is a federal question. This Court asserts that bankruptcy eligibility should be governed by federal law to maintain consistency across states.

A court emphasized that allowing different states to have varying eligibility for bankruptcy relief contradicts Congress's intention for uniformity in bankruptcy laws as outlined in Article I, Section 8, Clause 4 of the Constitution. This principle is reinforced by the Supreme Court's ruling in Field v. Mans, which stated that when Congress uses a legal term with established meaning in the Bankruptcy Code, it aims to incorporate the common law rather than the law of any single state. While state law can indicate a settlor's intent regarding whether a trust qualifies as a "business trust," defining "business trust" remains complex and inconsistent across courts. Most courts refer to the trust instrument for clarity, but various methods exist to determine a trust's classification. The Third Circuit has not yet ruled on this issue in the context of debtor eligibility but has distinguished between business trusts and traditional trusts for diversity jurisdiction. Traditional trusts serve as fiduciary relationships, while business trusts are formed for profit-driven commercial activities. Conversely, the Sixth Circuit applies a "primary purpose" test, asserting that business trusts are intended for business activities, whereas nonbusiness trusts aim to protect the trust assets.

The Sixth Circuit established a test for determining whether a trust qualifies as a "business trust," emphasizing that trusts created primarily for commercial activities benefiting investors are classified as such, while those intended only to preserve assets for beneficiaries are not. The Second Circuit has outlined several factors to evaluate a trust's status as a business trust, including whether it has corporate attributes, whether it was created for business purposes, engages in business-like activities, transacts for investor benefit, and possesses a profit motive. The evaluation is fact-specific, focused on trust documents and overall circumstances rather than solely on business engagement. 

Additionally, the Eastern District of Pennsylvania employs a four-part test, assessing if the trust's main goal is business activity, if investors contribute capital expecting returns, compliance with state law, and the transferability of beneficial interests. The Eastern District of Missouri utilizes a "totality of circumstances" approach, recognizing that business trusts share characteristics with corporations, such as being formed for business purposes, having trustees hold property, centralized management, continuity despite changes in beneficial ownership, interest transferability, and limited liability.

Overall, the determination of a valid "business trust" hinges on two essential elements: the trust's creation for profit-driven business activities and its possession of corporate-like attributes.

A trust qualifies as a business trust if it meets two specific criteria. If either characteristic is absent, it cannot be classified as a business trust and is thus ineligible for Chapter 11 bankruptcy relief under 11 U.S.C. 109(d). The Dille Family Trust is examined to determine if it was established for business profit or merely to preserve property for beneficiaries. The language of the trust documents indicates that its purpose is estate planning and preservation for family beneficiaries, which is supported by the title of the trust and the identity of the settlors as beneficiaries.

The trust is explicitly labeled as a family trust, and its provisions clarify that it aims to benefit the settlors and their children. As such, it does not qualify for bankruptcy relief since family trusts are excluded from such treatment. Additionally, the trust's powers are defined under California Probate Code, indicating it aligns with traditional trusts rather than business trusts. California law distinguishes between ordinary trusts and business trusts, with the former being subject to probate law and oversight. 

Although objections claim that the trust's provisions grant the trustee extensive business powers, such as managing businesses and property transactions, these attributes do not inherently categorize the trust as a business trust. Many ordinary trusts include similar powers without changing their classification.

In the case of In re Eagle Tr., the court determined that a trust was not classified as a business trust despite the trustee being authorized to engage in lawful business activities. Similarly, in In re Skaife Irrevocable Tr., despite the trust holding patents and trademarks and granting the trustee powers to manage and distribute trust property, it was also not deemed a business trust. The Dille Family Trust is characterized primarily as an estate planning tool aimed at preserving the trust assets for the settlors and their children, Lorraine Dille Williams and Robert Nichols Flint Dille. Key provisions in the trust document empower the trustee to manage and preserve trust assets, as outlined in Sections 4.A., 5.F., and 6.A. These sections emphasize the trustee's roles in asset management, preservation, and distribution of income and principal. Additional provisions highlight the trust's estate planning nature, including stipulations for the distribution of the trust fund upon the death of the first settlor, management of deceased spouses' expenses, and payments to the surviving spouse. An amendment dated January 5, 1982, further reinforces the trust's purpose by updating provisions in light of changes to federal estate tax law, specifically designed to leverage the marital deduction to reduce estate taxes. The amendment also details the distribution of the trust fund upon the death of the settlor and the rights of the surviving spouse, confirming the trust's focus on succession planning and asset protection.

The Amendment instructs that the trustee must prioritize the Surviving Spouse's interests over those of the remaindermen. The court determines that the Dille Family Trust is an ordinary trust, not a business trust, due to a lack of evidence from the Chapter 11 Trustee or Ms. Geer suggesting otherwise. Lorraine Dille Williams acknowledged the trust's purpose as an estate planning tool, and attorney Dennis Fox confirmed it was a revocable, living trust, but their statements are considered hearsay and not admissible as evidence. Furthermore, a 2012 tax return for the trust did not classify it as a small business trust, and no explanations were provided for why it did not file using corporate tax return forms if it were a business trust. The Dille Family Trust's classification as an ordinary trust is supported by Ms. Geer's prior assertion in a California District Court that the trust lacks the capacity to sue and does not have independent legal existence, indicating jurisdiction lies with the trustee personally.

The Central District of California transferred the civil action concerning the Dille Family Trust to the Western District of Pennsylvania, aligning with Ms. Geer's position that the trust should be classified as an ordinary trust rather than a business trust. Although the trust has occasionally licensed "Buck Rogers" intellectual property, the record lacks clarity on the extent of these activities. Ms. Geer references documentation from Flint Dille to support claims of significant business activity; however, the document is largely hearsay and undermines her position by indicating that many potential deals fell through due to the trustee's incompetence or other agendas. Ms. Geer's 2012 tax returns show no net income, as all royalties were consumed by trustee expenses, and she admitted under oath that the trust's gross revenue was "none" at the start of the bankruptcy case. Monthly operating reports submitted during the bankruptcy similarly reveal virtually no revenue or employees associated with the trust. This sparse evidence leads to the conclusion that neither Ms. Geer nor the Chapter 11 Trustee has met the burden of proof necessary to classify the trust as a business trust. Citing the Second Circuit's ruling in Eastern Airlines, the court emphasizes that mere business-like activities do not automatically categorize a trust as a business trust. The court also notes the importance of examining trust documents to determine eligibility for bankruptcy relief, referencing the Skaife Irrevocable Trust case, which involved a trust formed for the benefit of children with broad discretionary powers granted to the trustee.

The court determined that the primary objective of the Dille Family Trust is to safeguard assets for the comfort and support of its beneficiaries, rather than conducting business for profit, thus ruling it does not qualify as a "business trust" under 11 U.S.C. § 101(9), § 101(41), and § 109(d). The findings highlighted that the trust lacks the characteristics of a corporate entity and is classified as an ordinary trust. Notably, the distinction between traditional and business trusts is that traditional trusts facilitate donative transfers, whereas business trusts engage in bargained-for exchanges, a distinction supported by the Third Circuit. The Chapter 11 Trustee and Ms. Geer failed to present evidence that the Dille Family Trust arose from a bargained-for exchange. Additionally, attributes of a business trust, such as being formed by a group of investors expecting returns on their investments, were absent, as the trust was created by Mr. and Mrs. Dille for their family's benefit. The trust explicitly prohibits the alienation or transfer of beneficiary interests, further indicating it does not possess the indicia of corporateness identified in prior case law, including continuity of business and transferability of interests.

The Dille Family Trust ceases to exist after the death of both the settlors and beneficiaries, as stipulated in the trust document, which mandates that the trust's principal be distributed to entitled beneficiaries twenty-one years following the death of the last survivor. This provision indicates that the trust is not a "business trust," leading to the conclusion that the bankruptcy case must be dismissed due to the trust's ineligibility for bankruptcy relief. While the Chapter 11 Trustee has performed commendably, the court cannot grant eligibility contrary to the Bankruptcy Code. The court also considered whether any claims of waiver regarding the trust's ineligibility could be raised; however, it found that the necessary elements of waiver were not present. The Third Circuit defines waiver as an intentional relinquishment of a known right, which was not demonstrated by the parties involved in this case. Therefore, the motion to dismiss the case stands.

Parties previously withdrew their motion to dismiss based on a settlement with the Chapter 11 Trustee, which was later revoked. The withdrawal was understood to be "without prejudice," allowing Team Angry Filmworks and Mr. Murphy to re-file the motion if the settlement was not approved. This indicates an intent to retain the right to renew the motion until the settlement process was completed, which ultimately did not occur. Consequently, the application of equitable estoppel is inappropriate, as there was no inducement or promise preventing the renewal of the motion. The Chapter 11 Trustee was aware of this arrangement and received what was agreed upon.

The court also addressed standing issues raised by the Chapter 11 Trustee and other objectors. Lorraine Dille Williams and Robert Nichols Flint Dille, as beneficiaries of the Dille Family Trust, have interests that may be impaired by the current bankruptcy proceedings. The Dille Family Trust holds undisputed claims totaling $363,409.57, while Team Angry Filmworks and Mr. Dille have filed claims of $166,491.70 and $3,950,000, respectively. Despite any disputes surrounding these claims, they remain valid under the Bankruptcy Code. Therefore, challenges to standing are overruled, as the financial interests of three of the four movants are directly affected by the outcome of the case, in accordance with 11 U.S.C. § 1109(b). The court concludes that this case presents a complex narrative.

The appointment of a Chapter 11 Trustee was intended to facilitate a consensual resolution of litigation among the parties involved. However, the Dille Family Trust's ineligibility for bankruptcy relief has led the Court to dismiss the case with prejudice, as outlined in the contemporaneously issued Memorandum Opinion. The dismissal invalidates all pending motions related to the case, rendering them moot. 

The Court granted the Expedited Joint Motion to Dismiss filed by Don Murphy and others. The dismissal is based on the determination that the Dille Family Trust cannot be classified as a "debtor" under 11 U.S.C. § 109. Despite the dismissal, prior orders approving the fees and expenses for the Chapter 11 Trustee and associated parties remain in effect. 

All pending motions, including objections and motions to dismiss or convert the bankruptcy case, are denied as moot, and any scheduled hearings for these motions are canceled. Thus, the case concludes without further proceedings regarding the identified pending motions.

Armageddon 2419 A.D. involves litigation between the Dille Family Trust, Don Murphy, and Team Angry Filmworks, with key opinions documented in Team Angry Filmworks v. Geer (2016) by former Chief U.S. District Judge Joy Flowers Conti, and related proceedings regarding the Nowlan Family Trust in Dille Family Tr. v. Nowlan Family Tr. (2015, 2017) by Trademark Trial Board and U.S. District Court Judge Wendy Beetlestone. The court takes judicial notice of the allegations and findings from these cases, including those in the Third Amended Complaint at Team Angry Filmworks, Inc. v. Louise A. Geer, where beneficiaries Robert Nichols Flint Dille and Lorraine Dille Williams assert that Geer and Herman's actions violate fiduciary duties concerning intellectual property rights. The Memorandum Opinion clarifies that it does not adjudicate the merits of these claims. Additionally, the Chapter 11 Trustee and court-appointed mediator previously sought to reduce their administrative fees to judgment against the Dille Family Trust, which the court granted on February 15, 2019, noting these judgments survive the bankruptcy dismissal per 11 U.S.C. 349. The response from Team Angry Filmworks and Mr. Murphy reflects dissatisfaction with the delay in the Motion to Dismiss decision, although the court explains that additional briefing extended the decisional period, and implies that they waived the 15-day timeframe by delaying their dismissal request.

The Motion to Dismiss is viewed as a continuation of a prior motion that was voluntarily shelved by Team Angry and Mr. Murphy. The Chapter 11 Trustee has filed several motions related to the relief requested in the Motion to Dismiss, thus extending the deadline for a decision. The Court is tasked with determining whether the Dille Family Trust qualifies as a "debtor" under Section 109 of the Bankruptcy Code, distinguishing this from the Butner v. United States case, which pertains to non-bankruptcy property rights and is not applicable here. The Court notes that the determination of what constitutes a "business trust" under federal common law is complex, with significant overlap in standards. The citizenship of a trust for diversity jurisdiction depends on whether it is classified as a traditional trust or a business trust. The Dille Family Trust, created in 1979 under California law, is characterized as a "living" or "inter-vivos" trust, with the settlors retaining certain revocation powers. Although the trust's situs was moved to Illinois in 1989, there is a lack of evidence to indicate that the settlors intended the creation of anything other than an ordinary trust. The Nowlan Family Trust supports the request for debtor eligibility but similarly has not provided evidence regarding the settlors' intentions at the trust's inception.

Parties involved in the litigation consented to the Court's judicial notice of records from this and other district court cases. Team Angry Filmworks and Mr. Murphy submitted account ledgers and bank statements indicating alleged economic activities, including licensing fees collection and borrowing from Ms. Williams for legal expenses related to copyright and trademark litigation. The Dille Family Trust reported approximately $62,000 in gross revenue for 2012, primarily used for professional fees and payments to Ms. Geer. The Court clarifies that the citation to Koenig should not imply that state law governs debtor eligibility in bankruptcy, as this is a federal law matter. However, California state law is consistent with federal common law regarding the issue. The Court also notes that the Pennsylvania Commonwealth Court case of Kosco v. Com. is not applicable, as the Dille Family Trust is established under California law and aims to protect the trust res for its settlors and beneficiaries. Furthermore, the Dille Family Trust lacks characteristics of a business trust, such as transferable interests and perpetual life. The trust includes a "spendthrift" provision, which many courts have ruled disqualifies family and spendthrift trusts from being considered business trusts under the Bankruptcy Code. Allegations from the Nowlan Family Trust claiming that Team Angry and Mr. Murphy's original motion to dismiss was not withdrawn without prejudice are factually incorrect; the Court's August 21, 2018 Order confirms the motions were either withdrawn or denied without prejudice. Additionally, while Team Angry Filmworks and Don Murphy filed claims in the case, Mr. Murphy has not shown standing to prosecute the Motion to Dismiss, as no claim from him appears on the claims register.