“Smokey, this is not ‘Nam. This is [bankruptcy]. There are rules.”
– Walter Sobchak, The Big Lebowski
Does technical noncompliance with the Bankruptcy Rules and the official proof of claim form warrant disallowance of a claim, or does that approach simply put form over substance? Do you think the answer is clear? Think again. It turns out that courts are divided on whether noncompliance with the stated requirements of the Bankruptcy Rules and the official proof of claim form can, alone, warrant disallowance of claims. Or is it all just a tempest in a teapot? Let’s see, shall we?
In In re Tatro
, the chapter 7 debtor was formerly a licensed stock broker and investment advisor (with the emphasis on “formerly”). After Tatro commenced his chapter 7 case, a group of over one hundred claimants (all represented by a single law firm) filed 102 separate, but substantially identical, proofs of claim. Each of the proofs of claim attached a one-page rider stating that the documents evidencing the claimant’s investments and losses thereon were too “voluminous” to attach and to “[p]lease advise if something specific is needed.”
Enter Bankruptcy Rule 3001, which provides: