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IN RE ORMAND BEACH ASSOCIATES L.P.

No. 3:00-CV-2111(JBA). Bankruptcy No. 94-21524.

278 B.R. 307 (2002)

In re ORMAND BEACH ASSOCIATES LIMITED PARTNERSHIP, Debtor. Citation Mortgage, Limited, Citation Mortgage Corporation and Terrence Russell, Appellants, v. Ormand Beach Associates Limited Partnership, Appellee.

United States District Court, D. Connecticut.

May 24, 2002.

Attorney(s) appearing for the Case

Robert A. White, Robert E. Kaelin, Murtha Cullina LLP, Hartford, CT, for appellant.

Ira H. Goldman, Shipman & Goodwin, Hartford, CT, Leighton Aiken, Dana M. Campbell, Owens, Clary & Aiken, Dallas, TX, for appellee.

Patricia Beary, U.S. Trustee Office, New Haven, CT, trustee.

ARTERTON, District Judge.

This is an appeal from the United States Bankruptcy Court for the District of Connecticut of a final order imposing $73,463.45 in sanctions against appellants. For the reasons set out below, the Court reverses the Bankruptcy Court's imposition of sanctions.

I. Factual Background

A. Events Giving Rise to the Sanctions

Citation Mortgage Co. ("Citation") held a mortgage on the Ormand Beach Retirement Center...

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