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found that they complied with the factors outlined above. Additionally, the bankruptcy court considered the Settlements' effects on public policy but it found that NJ was in the best position to protect its policies. Thus, the bankruptcy court's ruling as to the Settlements is approved.
Facts: Tri-State Financial, LLC ("TSF") and John Hoich ("Hoich") appealed the district court's order binding them to the terms of a settlement agreement formed with North Central Construction, Inc. ("NCC") during the bankruptcy proceedings of Tri-State Ethanol ("TSE"). A confirmation hearing for TSE was set for the same day that a UST's motion to dismiss or convert the case was set (the "Hearing"). The UST's motion prompted settlement (the "Settlement") discussions between representatives of TSF (including Hoich) and NCC (who had filed a proof of claim in the case and whose objection was holding up confirmation). TSF's goal was to purchase NCC's claims against TSE's bankruptcy estate thereby eliminating objections to the plan and allowing the plan to be approved. On the eve of the Hearing, Hoich called a representative of NCC and made TSF's final offer, which NCC accepted. Notably, the Settlement did not make clear who would be providing the funds necessary to fund the Settlement. Shortly before the confirmation hearing, TSF's attorney (Jerrold Strasheim) and its representatives met with NCC's attorney (Ron Hall) and its representatives to discuss the details of the Settlement. Hoich was not present at this meeting or at the Hearing. At the Hearing, Hall laid out the Settlement on the record. The parties stated on the record that it was their understanding that Hoich was personally committed to the deal. No one was ever called to confirm this fact nor was Hoich or Hoich's attorney present at the Hearing to confirm this statement. When the Settlement fell through, NCC moved enforce it in the bankruptcy court; the motion was denied (the bankruptcy court said that it could not force a third party not directly involved in the bankruptcy - TSF - to comply). Then NCC sued Hoich and TSF in federal district court to enforce the Settlement that had been stated on the record of TSE's confirmation hearing. During the trial, the district court ordered TSF's business records be produced, of which the district court took judicial notice. Additionally, after the hearing, the district court discovered a book written by Hoich, of which it also took judicial notice. TSF then filed chapter 11. Therefore the proceeding before the Court of Appeals was only going forward as to Hoich.
Issues: (1) Whether the district court erroneously denied Hoich's motion for recusal and disqualification. (2) Whether the district court erroneously found Hoich was a party to the Settlement. (3) Whether Hoich personally guaranteed the Settlement. (4) Whether the district court improperly took judicial notice of certain of TSF's corporate records and a book written by Hoich that the court uncovered on its own research and after the hearing had occurred.
Rules: (1) "A party must show 'the judge had a disposition 'so extreme as to display a clear inability to render a fair judgment.'' Opinions formed by the judge on the basis of facts introduced or events occurring in the course of the current proceedings, or of prior proceedings, do not constitute a basis for a bias or partiality motion unless they display a deep-seated favoritism or antagonism that would make fair judgment impossible."
(2) Under South Dakota law, "a guaranty is a promise to answer for the debt, default, or miscarriage of another person... except as prescribed by §§ 56-1-5 to 56-1-9, inclusive, a guaranty must be in writing and signed by the guarantor." Certain statutory exceptions exist to the requirement that the guaranty be in writing.
