I wanted to share with you that just yesterday, the Ninth Circuit Court of Appeals overturned the Bankruptcy Appellate Panel and held that a debt owed by a parent to the Orange County Probation Department as the result of the involuntary incarceration of the parent’s minor child is not in the nature of support, and therefore is a dischargeable debt.
The BAP had previously held that the debt was “in the nature of support” and therefore was a Domestic Support Obligation that was nondischargeable under 101(14A) and 523(a)(5). The Ninth Circuit reversed, saying, amont other things, that BAPCPA changed who could be creditors, not what type of debts were covered by 523(a)(5), and this debt does not fit within the state’s family support infrastructure. This is an incredible win for our client, but also a win for other debtors in Orange County who were being pursued by Probation for similar debts.
Nice article about Judge Alex Kozinski. 9th Circuit Appellate opening briefs are limited to 14,000 words. I can’t imagine preparing a brief that is longer than that, and filing it the day it’s due along with a motion for permission to exceed the limits. Apparently it happens a lot. This is a nice little article in the LA Times today. Kozinski says he won’t read the additional 14 pages.
I am told that bankruptcy appeals have been going 56% to the district court and 46% to the BAP. Judge Jury thinks that one reason for that might be that the BAP is perceived to be more casual about granting extensions of time to file briefs than the district court. I doubt that myself. She also commented to me that district court rulings are appealed to the 9th Circuit more than BAP rulings.
My own guess re why the district court is higher is that non-bankruptcy lawyers think that the BAP will “hometown” them or “rubber-stamp” the ruling of their buddy. But I have also heard people say that district court judges rubber-stamp the bankruptcy court since they don’t know anything about bankruptcy anyway. Both of those views are silly. I suppose that there is the lazy judge here or there that rubber-stamps stuff but my perception is that judges try to get it right.
Judge Laura Taylor made a great comment at a program I attended – that if the party is pretty sure that the case is going to go to the 9th Circuit no matter what, the appeal should go to the BAP. She said, rightly so, that the BAP will understand the issue a little better and will “set it up” for the 9th Circuit. ”We will see where this is going and try to explain that to the 9th Circuit for the parties.” Good point.
There was some serious discussion at one of the programs at the 9th Circuit Judicial Conference about Sunnyslope, more in the area of equitable mootness than in property valuation issues. Someone reminded us that a confirmed plan in a corporate chapter 11 cannot be modified after it has been substantially consummated. In Sunnyslope, everyone involved in the case agreed that the plan was substantially consummated. The opinion says, ”the plan as approved by the bankruptcy court was substantially consummated, as all parties acknowledge.” So it must be “unraveled,” – pitched out. The court (the two person majority) concluded, “As a result, the plan of reorganization confirmed by the bankruptcy court and affirmed by the district court must be set aside.” So I guess it will not be modified, the parties will simply start over four years later. Read more…
Instead of delving into the actual facts of In re Marriage of Walker, I will use similar facts as they will be easier to understand. You can find the actual case here.
House is worth $350,000 with a $150,000 1st priority lien. In a divorce proceeding, a judge will order the sale of the property with proceeds split evenly. Assuming no cost of sale, taxes, etc., this would mean husband is paid $100,000 and wife is paid $100,000.
The result should not be different if there was an intervening bankruptcy, or should it!?
I wrote a three part article here which explained California law as it applied to a retailer’s ability to surcharge for the use of credit cards. The second part discussed the loopholes embedded into the law and discussed why the law is actually bad for consumers and retailers alike. In the final part, it discussed the legality of the law in light of a similar law being struck down by Federal Courts in New York. Read more…
I found the following case very interesting because based on my limited experience, litigators tend to take a deny everything and admit nothing approach. But as the litigators here found out, this can be a dangerous game.
This is a quick summary based on the California Court of Appeals decision in TIMOTHY GRACE et al. vs. LEVIK MANSOURIAN et al. which was published on September 15, 2015. You can find the case here.
Defendants were served with requests for admissions seeking admissions on negligence, causation, and damages. Plaintiffs asked defendants to admit defendant failed to stop at the red light and that the failure was negligent, the actual and legal cause of the accident, etc. Read more…
This is a summary of Sierra Managed Asset Plan, LLC, vs. Hale which was published by the California Court of Appeals on August 20, 2015. You can find the case here.
Consumer opened a credit card account with Citibank, N.A. He accumulated an unpaid balance of $10,138.41. Through a series of assignments, Sierra acquired Citibank’s rights as creditor. Sierra sought to enforce those rights through a lawsuit. Consumer did not deny the account, but he testified that he did not recall any of the details of the purchases on or the accrued balance of the account.
To prove that the defendant owed the money, Sierra had its agent testify and attach exhibits which substantiated the assignments leading to Sierra’s acquisition of rights as creditor on the account in question, the account agreement, and the account statements reflecting all of the charges culminating in the unpaid balance due. The account statements reflect purchases by a “David C. Hale,” with a listed address the same as that acknowledged by appellant at trial.
Consumer objected to receipt of the credit account exhibits attached to Sierra’s agent’s declaration on a variety of grounds, including hearsay and the lack of any foundation which would support their admission under the business records exception. (Evid. Code, § 1271.)
The Appellate Court agreed with Consumer, finding that the testimony did not provide substantial evidence of the foundation necessary for admission of the records pursuant to the business records exception to the hearsay rule.
The Digital Millennium Copyright Act provides a potent mechanism for copyright owners to demand that certain copyrighted materials be taken off of websites. This is because online services providers are given immunity from liability as long as they “expeditiously” remove content after receiving notification from a copyright holder that the
content is infringing.
The idea behind giving service providers immunity is rooted in the idea that if all the service provider is dong is allowing people to post content, then the content poster, and not the provider, should be liable for the copyright violation. That makes sense. Service providers like YouTube would go out of business if they were held liable for all the copyrighted videos posted on there.
The BAP Oral Argument is tomorrow at Roybal at 1 pm. (Not Friday).
This is from the BAP calendar.
OFFICE OF THE CLERK U. S. BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT
REVISED CALENDAR FOR: Thursday, October 22, 2015 Read more…