Case Summary:
First Weber Group commenced this adversary proceeding to determine the nondischargeability of its claim under 11 U.S.C. § 523(a)(6) for a willful and malicious injury. Its claim arose from a state court judgment for tortious interference of a contract rendered in favor of First Weber. On motion for summary judgment, First Weber argued that the doctrine of issue preclusion precluded the parties from re-litigating the facts previously litigated on its claim for tortious interference of a contract. Denying First Weber’s motion, the Bankruptcy Court held that issue preclusion did not apply because the state court’s finding that the Defendant tortiously interfered with a contract did not support a finding that the Defendant willfully and maliciously intended to injure First Weber. Likewise, the Bankruptcy Court found that an application of issue preclusion in this case would be “fundamentally unfair” to the Defendant in light of the state court’s standard of review and the differences in the evidentiary burdens between the state court claim and First Weber’s claim for nondischargeability.
Statute/Rule References:
11 U.S.C. § 523(a)(6) -- Nondischargeability - Willful and Malicious Injury
Wis. Stat. § 802.08(2)
Key Terms:
Conversion
Evidentiary Burden
Issue Preclusion
Tortious Interference with Contract
Willful and Malicious - Defined