9:30 AM

8:13-10726


Gonzalo Gonzalez


Chapter 13

Adv#: 8:19-01207 Gonzalez v. Shell Point Activities Association


#1.00 STATUS CONFERENCE RE: Complaint


Docket 1

*** VACATED *** REASON: OFF CALENDAR: Notice of Voluntary Dismissal of an Adversary Proceeding That Does Not Involve Claims Under 11 U.S.C. §727 filed 11/21/2019 and 11/25/2019; No Answer Filed

Courtroom Deputy:

OFF CALENDAR: Notice of Voluntary Dismissal of an Adversary Proceeding That Does Not Involve Claims Under 11 U.S.C. §727 filed 11/21/2019 and 11/25/2019; No Answer Filed - td (11/25/2019)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Gonzalo Gonzalez Represented By Craig K Streed Sundee M Teeple Cynthia L Gibson Daniel Cabrera

Defendant(s):

Shell Point Activities Association Pro Se

Plaintiff(s):

Gonzalo Gonzalez Represented By Daniel Cabrera

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

9:30 AM

8:17-14077


Team Business Solutions, Inc.


Chapter 7

Adv#: 8:18-01141 Richard A Marshack v. SNCR California, Inc., et al


#2.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint for: 1.

Declaratory Relief (Successor Liability); 2. Intentional Fraudulent Transfer; 3. Constructive Fraudulent Transfer; 4. Preservation of Avoided Transfer; 5. Turnover of Assets; 6. Breach of Fiduciary Duty; 7. Misappropriation of Trade Secrets; 8. Unjust Enrichment (Another Summons Issued 12/6/10)


FR: 2-12-19; 3-12-19; 4-4-19; 4-16-19; 6-20-19; 8-22-19; 11-7-19


Docket 55

*** VACATED *** REASON: CONTINUED TO 4/2/2020 AT 9:30 A.M.,

Per Order Entered 1/3/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Notice of Voluntary Dismissal of Adversary Proceeding

Against Kirk Nelson Only filed 1/7/2019, Document # 72 - td (1/9/2019)


CONTINUED: Status Conference Continued to 4/2/2020 at 9:30 a.m., Per Order Entered 1/3/2020 (XX) - td (1/3/2020)

Tentative Ruling:


June 20, 2019


Joint status report not filed by June 13, 2019 pursuant to this court's order entered 4/25/19. Impose sanctions in the amount of $100 against each party for the failure to do so.


Note: Appearances at this hearing are required.


August 22, 2019


Joint status report not filed by August 8, 2019 pursuant to this court's order entered June 17, 2019. Impose sanctions in the amount of $100 against each

9:30 AM

CONT...


Team Business Solutions, Inc.


Chapter 7

party's attorney for the failure to do so.


Note: Appearances at this hearing are required.

Party Information

Debtor(s):

Team Business Solutions, Inc. Represented By

J Scott Williams

Defendant(s):

SNCR California, Inc., Represented By Michael G Spector

John Creamer Pro Se

Kirk Nelson Pro Se

Plaintiff(s):

Richard A Marshack Represented By Thomas J Eastmond Robert P Goe

Trustee(s):

Richard A Marshack (TR) Represented By Thomas J Eastmond Robert P Goe

9:30 AM

8:17-14406


Kirk M. Nelson


Chapter 7

Adv#: 8:19-01016 Marshack v. Nelson


#3.00 CON'TD STATUS CONFERENCE RE: Complaint: 1. To Determine Non- Dischargeability Of Debt Pursuant to 11 U.S.C. Section 523(a)(3)(B)


FR: 4-11-19; 5-30-19; 9-12-19; 11-7-19


Docket 1

*** VACATED *** REASON: CONTINUED TO 4/2/2020 AT 9:30 A.M.,

Per Order Entered 1/3/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 4/2/2020 at 9:30 a.m., Per

Order Entered 1/3/2020 (XX) - td (1/3/2020)

Tentative Ruling:


April 11, 2019


Continue Status Conference to May 30, 2019 at 10:30 a.m., same date/time as hearing on Defendants' motion to dismiss. Joint status report not required. (XX)


Note: Appearances at this hearing are not required.


May 30, 2019


No tentative ruling -- trail matter to the 2:00pm calendar

Party Information

Debtor(s):

Kirk M. Nelson Represented By

J Scott Williams

Defendant(s):

Kirk M Nelson Pro Se

9:30 AM

CONT...


Kirk M. Nelson


Chapter 7

Plaintiff(s):

Richard A Marshack Represented By Robert P Goe

Thomas J Eastmond

Trustee(s):

Weneta M Kosmala (TR) Pro Se

9:30 AM

8:19-13770


Dove Real Estate & Association Management LLC


Chapter 11

Adv#: 8:19-01204 Dove Real Estate & Association Management, LLC v. Macarthur Village


#4.00 STATUS CONFERENCE RE: Complaint for Determination of Validity, Priority, or Extent of Lien and Declaratory Judgment Thereon


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Continue status conference to February 6, 2020 at 2:00 p.m., same date/time as Defendant's pending motion for summary judgment; updated joint status report not required.


Note: Appearances at this hearing are not required.

Party Information

Debtor(s):

Dove Real Estate & Association Represented By Daniel J Weintraub

Crystle Jane Lindsey

Defendant(s):

Macarthur Village Homeowners Pro Se

Plaintiff(s):

Dove Real Estate & Association Represented By James R Selth

9:30 AM

8:19-13858


Bruce Elieff


Chapter 11

Adv#: 8:19-01205 Elieff et al v. Kurtin


#5.00 STATUS CONFERENCE RE: Complaint for Mandatory Subordination Pursuant to 11 U.S.C. §510(b) and Avoidance and Recovery of Preferential and Fraudulent Transfers


Docket 1

*** VACATED *** REASON: OFF CALENDAR: Another Summons Issued 11/15/2019; New Status Conference Set for 1/30/2020 at 9:30 a.m. (xx)

Courtroom Deputy:

OFF CALENDAR: Another Summons Issued 11/15/2019; New Status Conference Set for 1/30/2020 at 9:30 a.m. (xx) - td (11/15/2019)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

Defendant(s):

Todd Kurtin Pro Se

Plaintiff(s):

Bruce Elieff Represented By

Paul J Couchot

Morse Properties, LLC Represented By Paul J Couchot

4627 Camden, LLC Represented By Paul J Couchot

10:00 AM

8:18-11262


Jean A Butler-Boren


Chapter 13


#6.00 CON'TD Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


AJAX MORTGAGE LOAN TRUST 2018-G VS.

DEBTOR


FR: 12-5-19; 12-19-19


Docket 66


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


December 5, 2019


Movant to advise the court whether Debtor is current in light of documents attached to the Opposition filed on Nov. 21, 2019. If additional time is needed, the parties may obtain a continuance by requesting the same during the calendar roll-call just prior to the hearing. Available continued hearing dates: Dec. 19, 2019 or January 9, 2020 at 10:00 a.m.


December 19, 2019


The parties are to advise the court re the status of this matter.


January 9, 2020


The parties are to advise the court re the status of this matter.

10:00 AM

CONT...


Debtor(s):


Jean A Butler-Boren


Party Information


Chapter 13

Jean A Butler-Boren Represented By Thomas J Polis

Movant(s):

Ajax Mortgage Loan Trust 2018-G, Represented By

Joshua L Scheer Reilly D Wilkinson

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-13858


Bruce Elieff


Chapter 11


#7.00 Hearing RE: Motion for relief from automatic stay [ACTION IN NON-BANKRUPTCY FORUM]


JACQUELINE MILLER VS.

DEBTOR


Docket 126


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant relief from stay for the reasons set forth in the Motion and the Reply under 362(d)(1), except as to the First and Second Causes of Action as to Debtor Bruce Elieff, which is denied. Grant Motion in all other respects.


The court is denying relief from stay to prosecute the First Cause of Action (Breach of Oral Agreement and the Second Cause of Action (Breach of Implied Contract) as such claims are dischargeable as to individual debtor Bruce Elieff.


Overrule Debtor's objections as otherwise unpersuasive.

Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

Movant(s):

Courtesy NEF Represented By

10:00 AM

CONT...


Bruce Elieff


Lewis R Landau Sharon Oh-Kubisch Philip E Strok

Rafael R Garcia-Salgado Gary A Pemberton

Greg P Campbell Jeffrey W Broker Caroline A Sayers David L Prince Eric M Heller James Denison Najah J Shariff


Chapter 11

Courtesy NEF Represented By Julian K Bach

Christopher D Beatty James Denison

10:00 AM

8:19-13881


Tamara A Bailey


Chapter 7


#8.00 Hearing RE: Motion for relief from automatic stay [ACTION IN NON-BANKRUPTCY FORUM]


STEVE HOWARD AND CREMACH TECH, INC. VS.

DEBTOR


Docket 23


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant the Motion with the limitations set forth in the Motion and Reply pleadings. Overrule objection of Debtor as unpersuasive.

Party Information

Debtor(s):

Tamara A Bailey Represented By William R Cumming

Movant(s):

Steve Howard Represented By Michael J Buley

Cremach Tech, Inc. Represented By Michael J Buley

10:00 AM

CONT...

Trustee(s):


Tamara A Bailey


Chapter 7

Richard A Marshack (TR) Pro Se

10:00 AM

8:19-13951


Rudy H. Soto


Chapter 7


#9.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] A-L FINANCIAL CORP.

VS.


DEBTOR


Docket 11


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Rudy H. Soto Represented By

Daniel King

Movant(s):

A-L Financial Corporation Represented By Lincoln D Gardner

10:00 AM

CONT...

Trustee(s):


Rudy H. Soto


Chapter 7

Thomas H Casey (TR) Pro Se

10:00 AM

8:19-14073


Greenplanet Broadbord Inc.


Chapter 7


#10.00 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


BENJAMIN P. LUCAS, ET AL. VS.

DEBTOR FR: 12-5-19

Docket 14


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Continue hearing to January 30, 2020 at 10:00 a.m. to allow Movant to correct service issue


Service issue: Though Debtor has retained counsel (Dana Douglas Esq) as of November 21, 2019, the Motion has not been served on such counsel as required by LBR 4001-1(c)(1)(C)(i).


Tentative ruling for 1/30/20 hearing: Grant motion with 4001(a)(3) waiver under both 362(d)(1) (cause shown -- lack of proof of insurance) and 362(d)(2) (no equity in the property per Debtor's own schedule D and property not necessary for reorganization -- there is no reorganization in chapter 7 cases).


Objection of creditor Tariq Ahmad is overruled. Neither the Local Bankruptcy Rules or the Federal Rules of Bankruptcy Procedure require service of the

10:00 AM

CONT...


Greenplanet Broadbord Inc.


Chapter 7

Motion on creditors of the estate in chapter 7 cases. Further, Mr. Ahmad's opposition states no substantive ground for denial of the Motion.


Note: If the parties accept the foregoing tentative ruling, appearances at today's hearing are not required and Movant shall serve notice of the continued hearing date/time.

Party Information

Debtor(s):

Greenplanet Broadbord Inc. Pro Se

Movant(s):

Benjamin P. Lucas, a Sole Represented By Edward T Weber

Trustee(s):

Richard A Marshack (TR) Pro Se

10:00 AM

8:19-14133


Juan Valentin Echevarria


Chapter 7


#11.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] TOYOTA MOTOR CREDIT CORPORATION

VS.


DEBTOR


Docket 8


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Juan Valentin Echevarria Represented By Nancy Hanna

Movant(s):

Toyota Motor Credit Corporation Represented By

Austin P Nagel

10:00 AM

CONT...

Trustee(s):


Juan Valentin Echevarria


Chapter 7

Karen S Naylor (TR) Pro Se

10:00 AM

8:19-14288


Danielle Marie Hetland


Chapter 7


#12.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] ACAR LEASING LTD

VS.


DEBTOR


Docket 14


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Danielle Marie Hetland Represented By Timothy McFarlin

Movant(s):

ACAR Leasing LTD d/b/a GM Represented By Sheryl K Ith

Trustee(s):

Weneta M Kosmala (TR) Pro Se

10:00 AM

CONT...


Danielle Marie Hetland


Chapter 7

10:00 AM

8:19-14397


Delfina Ruiz


Chapter 7


#13.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] FORD MOTOR CREDIT COMPANY LLC

VS.


DEBTOR


Docket 9


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Delfina Ruiz Pro Se

Movant(s):

Ford Motor Credit Company LLC Represented By

Sheryl K Ith

Trustee(s):

Richard A Marshack (TR) Pro Se

10:00 AM

8:19-14444


Michael Albert Copeman


Chapter 7


#14.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] BRIDGECREST CREDIT COMPANY, LLC

VS.


DEBTOR


Docket 10


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Michael Albert Copeman Represented By Brian J Soo-Hoo

Movant(s):

Bridgecrest Credit Company, LLC Represented By

Kristin A Zilberstein

Trustee(s):

Thomas H Casey (TR) Pro Se

10:00 AM

CONT...


Michael Albert Copeman


Chapter 7

10:00 AM

8:19-14542


Audrey Romona Lei Hufnagel


Chapter 7


#15.00 Hearing RE: Motion for relief from the automatic stay [UNLAWFUL DETAINER] OASIS-CALIFORNIA INC.

VS.


DEBTOR


Docket 9

*** VACATED *** REASON: OFF CALENDAR: Notice of Withdrawal of Motion, filed 1/8/2020

Courtroom Deputy:

OFF CALENDAR: Notice of Withdrawal of Motion, filed 1/8/2020 - td (1/8/2020)

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Audrey Romona Lei Hufnagel Represented By Michael Jones

Movant(s):

Oasis-California, Inc. dba Camden Represented By

Scott Andrews

10:00 AM

CONT...

Trustee(s):


Audrey Romona Lei Hufnagel


Chapter 7

Jeffrey I Golden (TR) Pro Se

10:00 AM

8:19-14614


Delecia A Holt


Chapter 7


#16.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] FINANCIAL SERVICES VEHICLE TRUST

VS.


DEBTOR


Docket 14


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Delecia A Holt Pro Se

Movant(s):

Financial Services Vehicle Trust Represented By

Cheryl A Skigin

Trustee(s):

Thomas H Casey (TR) Pro Se

10:00 AM

8:19-14614


Delecia A Holt


Chapter 7


#17.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] DAIMLER TRUST

VS.


DEBTOR


Docket 16


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Delecia A Holt Pro Se

Movant(s):

Daimler Trust Represented By

Sheryl K Ith

Trustee(s):

Thomas H Casey (TR) Pro Se

10:00 AM

8:19-14682


Michael E. Silbermann


Chapter 13


#18.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] JOHN DEERE CONSTRUCTION & FORESTRY COMPANY

VS.


DEBTOR


Docket 12


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver; deny request for extraordinary relief (Relief Request #s 7, 8, 9, 10) due to insufficient evidence in support thereof.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Michael E. Silbermann Represented By Joseph C Rosenblit

Movant(s):

THE DUNNING LAW FIRM APC Represented By

James MacLeod

10:00 AM

CONT...

Trustee(s):


Michael E. Silbermann


Chapter 13

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-14701


Lynda Patrice Chatman


Chapter 7


#19.00 Hearing RE: Motion for relief from the automatic stay [UNLAWFUL DETAINER] MARY CHEN AND HAI CHEN TRUSTEE'S OF THE CHEN FAMILY TRUST VS.

DEBTOR


Docket 11


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant with 4001(a)(3) waiver under 362(d)(1) and (2); deny request for extraordinary relief under 362(d)(4) due to insufficient evidence in support thereof.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Lynda Patrice Chatman Pro Se

Movant(s):

Mary Chen and Hai Chen Trustee's Represented By

Robert A Krasney

10:00 AM

CONT...

Trustee(s):


Lynda Patrice Chatman


Chapter 7

Jeffrey I Golden (TR) Pro Se

10:00 AM

8:19-13676


Morteza Hamidi


Chapter 13


#19.10 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] BANK OF AMERICA, N.A.

VS.


DEBTOR


Docket 24

*** VACATED *** REASON: OFF CALENDAR: Order of Dismissal Arising From Chapter 13 Confirmation Hearing Entered 12/26/2019

Courtroom Deputy:

OFF CALENDAR: Order of Dismissal Arising From Chapter 13 Confirmation Hearing Entered 12/26/2019 - td (12/26/2019)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Morteza Hamidi Pro Se

Movant(s):

Bank of America, N.A. Represented By Darlene C Vigil

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:30 AM

8:14-10918


Robert Boyajian


Chapter 11


#20.00 Hearing RE: Fourth and Final Application for Compensation and Reimbursement of Costs


[THE LAW OFFICES OF MICHAEL G. SPECTOR, ATTORNEYS FOR THE REORGANIZED DEBTOR]


Docket 618


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Approve fees and expenses as requested.


Note: This matter appears to be uncontested. Accordingly, no court appearance by Applicant is required. Should an opposition party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Applicant will be so notified.


Party Information

Debtor(s):

Robert Boyajian Represented By Michael G Spector Vicki L Schennum Jessica G McKinlay

10:30 AM

8:14-10918


Robert Boyajian


Chapter 11


#21.00 Hearing RE: Motion for Final Decree (Federal Rule of Bankruptcy Procedure 3022) and Request to Take Post-Confirmation Status Conference Off Calendar


Docket 620


Courtroom Deputy:

SPECIAL NOTE: Notice to Pay Court Costs Issued 4/26/2019; Amount Due

$350.00 - td (12/19/2019). Re-billing Notice to Pay Court Costs Due Sent 12/26/2019; Total Amount Due: $350.00 - td (12/26/2019)

Tentative Ruling:


January 9, 2020 (Updated)


Grant motion.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required if Movant accepts the foregoing tentative ruling and condition therein. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Robert Boyajian Represented By Michael G Spector Vicki L Schennum Jessica G McKinlay

10:30 AM

8:17-13051


Scott David Carlton


Chapter 7


#22.00 Hearing RE: First Interim Application for Allowance of Fees and Costs


[MARSHACK HAYS LLP AS GENERAL COUNSEL FOR CHAPTER 7 TRUSTEE, JEFFREY I. GOLDEN]


Docket 152


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Approve interim fees and expenses as requested.


Note: This matter appears to be uncontested. Accordingly, no court appearance by Applicant is required. Should an opposition party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Applicant will be so notified.

Party Information

Debtor(s):

Scott David Carlton Represented By Bruce V Rorty

Trustee(s):

Jeffrey I Golden (TR) Represented By

D Edward Hays Laila Masud

10:30 AM

8:18-14284


Paula Gilbert-Bonnaire


Chapter 7

Adv#: 8:19-01035 SJO Investments, LLC v. Gilbert-Bonnaire


#23.00 CONT'D Hearing RE: Defendant's Motion for Leave to File a Late Motion for Attorney Fees and Request for Attorneys Fees in the Amount of $6,667.00


FR: 12-12-19


Docket 22


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Deny motion.


Basis for Tentative Ruling:


The motion should be denied in its entirety for the following reasons:


  1. Rule 54(d)(2)(B) of the Federal Rules of Civil Procedure (FRCP) allows a party to file a motion for an award of attorneys but expressly provides that the motion must "specify the judgment and the statute, rule, or other grounds entitling the movant to the award". Rule 54(d)(2)(B)(ii). Thus, Rule 54(d) does not, itself, create a legal basis for the award of attorneys but rather provides the procedure for seeking fees should a specific statute, rule or judgment so provide.


  2. The Ninth Circuit, whose decisions are binding on this court, has observed that


    "The requirement under Rule 54(d)(2) of an independent source of authority for an award of attorneys' fees gives effect to the “American Rule” that each party must bear its own attorneys' fees in the absence of a

    10:30 AM

    CONT...


    Paula Gilbert-Bonnaire

    rule, statute or contract authorizing such an award." (emphasis added)


    Chapter 7


    MRO Communications v. Am. Tel. & Tel., 197 F.3d 1276, 1280-81 (9th Cir. 1999).


  3. In this matter, there is no judgment of this court awarding attorneys fees to Debtor and Debtor has cited no statute or rule providing for an award of attorneys fees.


  4. Even if this court were to construe the motion as one under 11 U.S.C. 523(d), an award of attorneys fees would still not be appropriate under the circumstances presented here. Section 523(d) provides as follows:


    "If a creditor requests a determination of dischargeability of a consumer debt under subsection (a)(2) of this section, and such debt is discharged, the court shall grant judgment in favor of the debtor for the costs of, and a reasonable attorney's fee for, the proceeding if the court finds that the position of the creditor was not substantially justified, except that the court shall not award such costs and fees if special circumstances would make the award unjust." (emphasis added)


  5. To avoid a fee award under 523(d), a creditor must show that it had a reasonable basis in law or fact to file the complaint, i.e., substantial justification, or otherwise demonstrate the existence of special circumstances. In re Duplante, 215 B.R. 444, 449 (9th Cir. BAP 1997). The court may review the complaint, Debtor's schedules and other evidence submitted in connection with the 523(d) motion and opposition thereto to determine whether the creditor was substantially justified in filing the complaint. Id.


  1. In this case, the totality of the circumstances clearly indicate Plaintiff was substantially justified in filing the complaint based upon the following:


    1. The nondischargeability complaint alleges that Debtor entered into a contract for the sale of her real property at 8211 Mary Circle, Huntington Beach, CA ("Property") to Plaintiff on or about Dec. 13, 2017. A copy of the Contract for

      10:30 AM

      CONT...


      Paula Gilbert-Bonnaire


      Chapter 7

      the Sale & Purchase of Real Estate (SJO Contract) memorializing the agreement is attached to the Complaint as Exhibit A.


    2. The complaint alleges that Debtor also entered into agreements to sell the Property to two other purchases in 2017. The Opposition to the Motion filed by creditor SJO Investments includes as Exhibit C to the Declaration of Jon Enochs a sale and purchase agreement between Debtor and Mobile Agency California LLC for the Property on or about Dec. 11, 2017, just two days prior to the signing of the SJO Contract. Finally, Debtor's Schedule E/F lists Marc Afzal of Buy Every Home as an unsecured creditor concerning a claim relating to "contract for sale of home" in 2017.


    3. Though the date of the execution of the sale contract with Marc Afzal is unknown, SJO has demonstrated, at least on a prima facie basis, that Debtor entered into at least two different contracts for the sale of the same property to two different purchasers -- SJO and Mobile Agency-- during the same time frame. Whether or not Debtor has a logical explanation for signing two sale agreements simultaneously when she knew or should have known she could only deliver title to one, is irrelevant to the issue of whether SJO was justified in commencing an action for nondischargeability based on fraud.


    4. The complaint satisfies the pleading standards of FRCP 8 and FRCP 9 and alleges all of the required elements of fraud with particularity (false representation or statement regarding intent/ability to sell the Property to SJO, knowledge of the falsity of the representation or statement, made with intent to deceive, which representation SJO justifiably relied on to its financial detriment.


    5. The complaint was voluntarily dismissed pursuant to an oral stipulation for dismissal made at the September 5, 2019 hearing on Debtor's motion for a protective order.


    6. Debtor argues that she is a "prevailing party" within the meaning of Local Bankruptcy Rule 7054-1(b)(2) which provides that "the defendant is the prevailing party when the proceeding is terminated by court-ordered dismissal or judgment in favor of defendant on the entire complaint." (emphasis added). However, this court did not order the dismissal of the adversary and entered no

      10:30 AM

      CONT...


      Paula Gilbert-Bonnaire


      Chapter 7

      judgment in favor of Debtor. Again, the parties stipulated to dismissal on the record. Accordingly, Debtor is not the prevailing party under 7054-1(b)(2).


    7. SJO indicates in its Opposition that it only agreed to dismiss the complaint because the Property had been foreclosed on and Debtor did not appear to have any assets from which SJO could collect on its claim.


    8. Based upon the agreement of the parties on the record to dismissal of the adversary proceeding, the adequately pled complaint, and reasons given by Plaintiff SJO for agreeing to dismiss the proceeding, the court finds there is no prevailing party.


  2. In light of all of the foregoing, Debtor is not entitled to any attorneys fees from SJO under Rule 54(d) because a) she has stated no independent legal basis for attorneys fees and b) even if the court treats the Motion as one under 523(d), SJO was substantially justified in filing the complaint and, therefore, fees are not allowable under 523(d).


  3. Debtor also appears to be seeking disgorgement of fees she paid to her former attorney, Andrew Smyth (Smyth). She claims she paid Smyth $7,162 for legal representation in this adversary proceeding and $995.00 in the state court unlawful detainer action and that she is entitled to reimbursement from Smyth for "throwing her under the bus" in the state court matter. First, Debtor's own evidence demonstrates that she did not pay $7,162 for representation in this adversary proceeding. Exhibit A to the Motion dating back to at least September 1, 2018 through April 2019 and includes fees relating to services provide for state court matters as well as the bankruptcy filing itself. This court has no jurisdiction over the fees paid in connection with the state court matter. This adversary proceeding was not filed until March 4, 2019. Therefore, any fees incurred prior to March 4, 2019 could not have related to this adversary proceeding. The check dated April 1, 2019 attached to as an exhibit to the Motion has a notation indicating it is for both "federal/state attorneys fees." Second, Debtors Statement of Financial Affairs at Part 7 indicates that she paid $1500 for bankruptcy representation in the main bankruptcy case, No. 18-14284. Smyth's Rule 2016 Statement also indicates that $1500 was paid for representation in the main bankruptcy case and that such fees did not include representation in an

10:30 AM

CONT...


Paula Gilbert-Bonnaire


Chapter 7

adversary proceeding. $1500 for chapter 7 representation (preparation of petition, appearance at 341a meetings) is reasonable in this District. Third, Smyth indicates that only $350 was charged in this adversary proceeding for the filing of an answer to the complaint. See Smyth Opposition at p. 3. Finally, Smyth's reference to $1,050.00 in fees to prepare a motion to set aside a default in an adversary proceeding was in the prior bankruptcy case, No. 18-11236, not this adversary proceeding in the present bankruptcy case. The bottom line: There is no basis for ordering the disgorgement of $1500 for the filing the bankruptcy petition (which successfully resulted in the entry of a discharge order) or the

$350 for filing an answer to the complaint in this adversary proceeding. All other fees are beyond the jurisdiction of this court in the current bankruptcy case and adversary proceeding.



Party Information

Debtor(s):

Paula Gilbert-Bonnaire Represented By

Andrew Edward Smyth

Defendant(s):

Paula Gilbert-Bonnaire Pro Se

Plaintiff(s):

SJO Investments, LLC Represented By Jon Alan Enochs

Trustee(s):

Thomas H Casey (TR) Pro Se

10:30 AM

8:19-13858


Bruce Elieff


Chapter 11


#24.00 CON'TD Hearing RE: Application of The Debtor and Debtor-In-Possession for Authority to Employ Force Ten Partners, LLC as Financial Advisor Effective as of The Petition Date [Affects Bruce Elieff]


FR: 12-5-19


Docket 43


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


December 5, 2019


Potential Service Issue: LBR 2014-1(b)(2)(1) requires that employment applications be served on the 20 Largest Unsecured Creditors. The court could not determine from the proof of service re this application that such creditors were served. If not, the hearing on this application will be continued to January 9, 2020 at 10:30 a.m.


If service is determined to be correct, grant the application, including the

Knudsen provisions and overrule all objections to the same.


January 9, 2020.


Continue hearing one final time to February 6, 2020 at 10:30 a.m.


The omnibus notice [docket #149] which is intended to correct the notice issue raised by the court in its December 5, 2019 tentative ruling does not comply with LBR 2014-1(b)(3)(B), (C), (D) and (E).


Debtors will be allowed one final opportunity to properly serve the notice of the Applications. Debtors' counsel shall not charge Debtors for the preparation of the notice reflected as docket #149.

10:30 AM

CONT...


Debtor(s):


Bruce Elieff


Party Information


Chapter 11

Bruce Elieff Represented By

Paul J Couchot

10:30 AM

8:19-13858


Bruce Elieff


Chapter 11


#25.00 CON'TD Hearing RE: Debtor's Motion for Order Authorizing Employment of Couchot Law, LLP, as Debtors General Insolvency Counsel [Affects All Debtors]


FR: 12-5-19


Docket 44


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

December 5, 2019


Potential Service Issue: LBR 2014-1(b)(2)(1) requires that employment applications be served on the 20 Largest Unsecured Creditors. The court could not determine from the proof of service re this application that such creditors were served. If not, the hearing on this application will be continued to January 9, 2020 at 10:30 a.m.


If service is determined to be correct, grant the application, including the Knudsen provisions and overrule all objections to the same. However, applicant must file quarterly fee applications commencing at the end of the first quarter 2020.


January 9, 2020.


Continue hearing one final time to February 6, 2020 at 10:30 a.m.


The omnibus notice [docket #149] which is intended to correct the notice issue raised by the court in its December 5, 2019 tentative ruling does not comply with LBR 2014-1(b)(3)(B), (C), (D) and (E).


Debtors will be allowed one final opportunity to properly serve the notice of the

10:30 AM

CONT...


Bruce Elieff


Chapter 11

Applications. Debtors' counsel shall not charge Debtors for the preparation of the notice reflected as docket #149.

Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

10:30 AM

8:19-13858


Bruce Elieff


Chapter 11


#26.00 CON'TD Hearing RE: Motion in Debtors' Chapter 11 Cases for Order Authorizing Debtor in Possession to Employ Professional Real Estate Broker Timothy Tamura [Affects 4627 Camden, LLC]


FR: 12-5-19


Docket 49


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

December 5, 2019


Potential Service Issue: LBR 2014-1(b)(2)(1) requires that employment applications be served on the 20 Largest Unsecured Creditors. The court could not determine from the proof of service re this application that such creditors were served. If not, the hearing on this application will be continued to January 9, 2020 at 10:30 a.m.


If service is determined to be correct, grant the application, without the conditions of weekly reports requested by objecting creditor -- the court finds such a request unnecessarily burdensome.


January 9, 2020.


Continue hearing one final time to February 6, 2020 at 10:30 a.m.


The omnibus notice [docket #149] which is intended to correct the notice issue raised by the court in its December 5, 2019 tentative ruling does not comply with LBR 2014-1(b)(3)(B), (C), (D) and (E).


Debtors will be allowed one final opportunity to properly serve the notice of the Applications. Debtors' counsel shall not charge Debtors for the preparation of the notice reflected as docket #149.

10:30 AM

CONT...


Debtor(s):


Bruce Elieff


Party Information


Chapter 11

Bruce Elieff Represented By

Paul J Couchot

10:30 AM

8:19-13858


Bruce Elieff


Chapter 11


#27.00 CONT'D Hearing RE: Motion in Debtors' Chapter 11 Cases For Order Authorizing Debtor in Possession to Employ Professional Real Estate Broker Timothy Tamura [Affects Bruce Elieff]


FR: 12-5-19; 12-19-19


Docket 50

*** VACATED *** REASON: CONTINUED TO 1/30/2020 AT 10:30 A.M.,

Per Order Entered 1/8/2020 (XX) Courtroom Deputy:

CONTINUED: Hearing Continued to 1/30/2020 at 10:30 a.m., Per Order

Entered 1/8/2020 (XX) - td (1/8/2020)

Tentative Ruling:

January 9, 2020.


Continue hearing one final time to February 6, 2020 at 10:30 a.m.


The omnibus notice [docket #149] does not comply with LBR 2014-1(b)(3)(B), (C), (D) and (E).


Debtors will be allowed one final opportunity to properly serve the notice of the Applications. Debtors' counsel shall not charge Debtors for the preparation of the notice reflected as docket #149.

Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

10:30 AM

8:19-13858


Bruce Elieff


Chapter 11


#28.00 CON'TD Hearing RE: Motion in Debtors' Chapter 11 Cases For Order Authorizing Debtor in Possession to Employ Professional Real Estate Broker Carol Trapani [Affects Morse Properties, LLC]


FR: 12-5-19


Docket 60


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

December 5, 2019


Potential Service Issue: LBR 2014-1(b)(2)(1) requires that employment applications be served on the 20 Largest Unsecured Creditors. The court could not determine from the proof of service re this application that such creditors were served. If not, the hearing on this application will be continued to January 9, 2020 at 10:30 a.m.


If service is determined to be correct, grant the application, modified by the terms set forth in Debtor's reply.


January 9, 2020.


Continue hearing one final time to February 6, 2020 at 10:30 a.m.


The omnibus notice [docket #149] which is intended to correct the notice issue raised by the court in its December 5, 2019 tentative ruling does not comply with LBR 2014-1(b)(3)(B), (C), (D) and (E).


Debtors will be allowed one final opportunity to properly serve the notice of the Applications. Debtors' counsel shall not charge Debtors for the preparation of the notice reflected as docket #149.

10:30 AM

CONT...


Debtor(s):


Bruce Elieff


Party Information


Chapter 11

Bruce Elieff Represented By

Paul J Couchot

10:30 AM

8:19-13881


Tamara A Bailey


Chapter 7


#29.00 Hearing RE: Motion of Steve Howard and Cremach Tech, Inc. to Extend Deadline to File Complaint to Determine Dischargeability of Debt Under 11 U.S.C. Sections 523 and 727


Docket 26


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Grant extension to and including March 11, 2020. No further extensions will be granted absent exigent circumstances.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required if Movant accepts the tentative ruling. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Tamara A Bailey Represented By William R Cumming

Trustee(s):

Richard A Marshack (TR) Pro Se

10:30 AM

8:19-14310


Gateway Business Complex LLC


Chapter 11


#30.00 CON'TD Hearing RE: Emergency Motion for Entry of an Order Pursuant to Bankruptcy Code Sections 105 and 543, Compelling Turnover of "Property of the Estate" in the Possession, Custody, or Control of Richardson C. Griswold, The Receiver Appointed by The California Superior Court in Riverside in the Case of The City of Banning V. Gateway Business Complex LLC Et Alia, Case No.

RIC1700904 (RE: Motion for Turnover)

(Set Per Order Enered 11/1/42019) FR: 11-21-19

Docket 12


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


November 21, 2019


This matter remains under review by the court; a tentative ruling may be posted at any time prior to the hearing.


January 9, 2020


Deny Motion.


The City of Banning's response to the State Court Receiver's Status Report ("City's Response") presents circumstances concerning the subject properties that are jawdropping. The old adage "a picture is worth a thousand words" has particular resonance here. Without a doubt, the properties are a clear and present danger and nuisance to the City of Banning and its citizens. Debtor claims it can do better than the court-appointed receiver but offers no concrete evidence to support such a fantastic position. A loan of $150,000 is a

10:30 AM

CONT...


Gateway Business Complex LLC


Chapter 11

breathtakingly anemic response to such grave circumstances. In short, Debtor has presented nothing in its response to the receiver's report that persuades this court that turnover of the properties is appropriate.

Party Information

Debtor(s):

Gateway Business Complex LLC Represented By

Jonathan Seligmann Shenson

10:30 AM

8:19-14310


Gateway Business Complex LLC


Chapter 11


#31.00 STATUS CONFERENCE Hearing on Status of Chapter 11 Case; and (2) Requiring Report on Status of Chapter 11 Case


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


No tentative ruling -- disposition will depend on outcome of matter #30 on today's calendar.

Party Information

Debtor(s):

Gateway Business Complex LLC Represented By

Jonathan Seligmann Shenson

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01015 Speier v. SunCal Management LLC et al


#32.00 CONT'D Hearing RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management, LLC was an Insider of the Debtor


FR: 10-10-19


Docket 417


Courtroom Deputy:

Tentative Ruling:


November 7, 2019


The status conference will be continued to January 30, 2020 at 9:30 a.m.; joint status report must be filed by January 16, 2020. (XX)


January 30, 2020


Discovery Cut-off Date: June 30, 2020

Deadline to Attend Mediation: Aug. 31, 2020

Pretrial Conference Date: Oct. 8, 2020 at 9:30 a.m. Deadline to File Joint Pretrial Stipulation: Sept. 24, 2020


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiffs shall serve/lodge a scheduling order consistent with the same.

9:30 AM

CONT...


Donald Woo Lee


Chapter 7


Party Information

Debtor(s):

Donald Woo Lee Represented By

Robert B Rosenstein

Defendant(s):

American Edge Medical Co. Represented By Marc C Forsythe

Turko United LLC Pro Se

Nath Investments Inc. Represented By Marc C Forsythe

My Imaging Center Inc. Represented By Marc C Forsythe

Medical Imaging Rentals, Inc. Represented By Marc C Forsythe

My Imaging Center LLC Pro Se

Lake Elsinore Diagnostics Inc. Pro Se

Temecula Diagnostic Center Inc. Pro Se

Anke Ciling Pro Se

Sammy Ciling Pro Se

Fallbrook Diagnostics Inc. Pro Se

Joint Debtor(s):

Linda Bae Lee Represented By

Robert B Rosenstein

9:30 AM

CONT...


Donald Woo Lee


Chapter 7

Plaintiff(s):

Prime Partners Medical Group, Inc. Represented By

Norma Ann Dawson Robert B Rosenstein

Donald Woo Lee Represented By

Norma Ann Dawson Robert B Rosenstein

Linda Bae Lee Represented By

Norma Ann Dawson Robert B Rosenstein

Trustee(s):

Richard A Marshack (TR) Represented By Kyra E Andrassy David Wood

Matthew Grimshaw Nathan F Smith Arturo M Cisneros Norma Ann Dawson Robert S Lawrence Caroline Djang Brett Ramsaur

9:30 AM

8:16-12895


29 Prime, Inc.


Chapter 7

Adv#: 8:17-01226 Marshack v. Wallace et al


#2.00 CON'TD PRE-TRIAL CONFERENCE RE: First Amended Complaint for: (1) Breach of Fiduciary Duty - Derivative; (2) Constructive Trust (As to Defendant Russell Wallace Only)


(Advanced from 6-14-18)

FR: 6-7-18; 7-19-18; 12-20-18; 5-2-19; 5-7-19; 8-22-19; 11-7-19; 12-12-19


Docket 47


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


July 19, 2018


The following discovery schedule applies to Plaintiff and Defendant Haleh Fardi:


Discovery Cut-off Date: Oct. 19, 2018

Deadline to Attend Mediation: Nov. 16, 2018

Pretrial Conference Date: Dec. 20, 2018 at 9:30

a.m. (XX)

Deadline to Lodge Joint Pretrial Stipulation: Dec. 6, 2018


Deadline for Plaintiff to move for entry of default judgments as to non-answering

defendants: Sept. 21, 2018


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7

May 7, 2019


Court's Comments re the Joint Pretrial Stipulation:


  1. A demand for jury trial has been made. Each party is required indicate whether they consent or do not consent to the jury trial being conducted in this court. Absent 100% consent by all parties, the jury trial must be held in District Court. Statements re consent or nonconsent to this court conducting the jury trial must be filed with the court by May 21, 2019.


  2. The facts to which Defendant Russell Wallace admitted to in his answer should be reflected in the Admitted Facts Section of the Stipulation.


  3. Re Section (c)(1) of the Issues of Law, why must a determination be made at trial re whether Mr. Redman and Mr. Martin breached their fiduciary duties to 29 Prime when defaults have been entered against both gentlemen?


  4. Why isn't Ms. Fardi ready for trial? The reason(s) should have been set forth in the Stipuation.


  5. Any motions in limine need to be filed no later than June 18, 2019 and scheduled for hearing no later than July 16, 2019.


Note: Appearances at this hearing are required.


August 22, 2019


Comments re the Joint Pretrial Stipulation filed 8/16/19:


  1. Who has signed off on the JPS. No signatures for either of the remaining defendants, Russell Wallace or Haleh Fardi. Did either of them participate in the preparation of this JPS?


  2. The JPS is supposed to include a section on all admitted facts that require no proof. So, why does that section include the statement that Ms. Fardi "disputes" the admitted facts? That would make them NOT admitted. Which

    9:30 AM

    CONT...


    29 Prime, Inc.


    Chapter 7

    facts does she actually dispute?


  3. Why does the admitted facts section include Nos. 13, 18 - 48 which all appear to be DISPUTED FACTS????


  4. Why does (f) state that plaintiff "intends to file a motion in limine" when such a motion was already filed as of August 16, 2019, the date the JPS was submitted?


Special Note: If at all possible, the court would like for the trustee, Richard Marshack to participate in this hearing.


Note: Appearances at this hearing are required.


November 7, 2019


Continue the Pretrial Conference to December 12, 2019 at 9:30 a.m. The court shall issue an Order to Show Cause Why This Adversary Proceeding Should Not Be Dismissed Due to the Inability of Plaintiff to Properly Prosecute This Adversary Proceeding. The OSC hearing shall take place on Dec. 12, 2019 at 9:30 a.m. (XX)


Plaintiff's counsel has failed to timely comply with a strict order of this court re the service of an amended joint pretrial stipulation -- once again causing further delay and confusion for the defendants. The apologies offered are shallow and of no moment. The pretrial conference has previously been continued twice due to counsel's inability to present a proper, coherent and timely pretrial stipulation. Enough is enough.


December 12, 2019


Take matter off calendar in light of tentative ruling for Calendar #2 dismissing adversary proceeding.

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7

January 30, 2020


The court is inclined to approve the pretrial statement filed January 9, 2020 (docket #157) on the following conditions:


  1. A Final Pretrial Statement is filed within 7 days of the hearing that a) deletes the words "And Order" from the caption (a separate order approving the Stipulation must be lodged); and b) deletes the "Status of the Parties" and related chart as such is beyond the scope of LBR 7016-1(b) and clutters up what should be a straightforward statement.


  2. Counsel for Plaintiff appears at the hearing and advises the court of the basis for motion to strike Defendant Wallace's answer at this late stage.


The court's usual trial procedure is to required direct testimony by declarations (filed 30 days before by Plaintiff and 21 days before by Defendant) with adverse and rebuttal testimony being presented live. All declarants must be present for cross examination. Plaintiff's counsel to advise the court if Plaintiff would prefer all live direct testimony instead of by declaration. See this court's Trial Procedures on the court's website.


Note: Appearance at this hearing is required.

Party Information

Debtor(s):

29 Prime, Inc. Represented By

Richard L Barnett

Defendant(s):

Russell B. Wallace Pro Se

Tony Redman Pro Se

Jason Martin Pro Se

Local Zoom, Inc. Pro Se

OC Listing, Inc. Pro Se

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7

Sky Motorsports, Inc. Pro Se

Haleh Fardi Pro Se

1Network.Com Pro Se

Plaintiff(s):

Richard A. Marshack Represented By

Rosemary Amezcua-Moll

Trustee(s):

Richard A Marshack (TR) Represented By Caroline Djang

Rosemary Amezcua-Moll

9:30 AM

8:17-10423


Chad Paul Delannoy


Chapter 7

Adv#: 8:17-01073 Woodlawn Colonial, L P v. Delannoy


#3.00 CON'TD STATUS CONFERENCE RE: Complaint for Determination of Non- Dischargeability of Debt


FR: 7-27-17; 9-21-17, 4-12-18; 5-31-18; 7-19-18; 9-20-18; 12-6-18; 3-21-19;

5-9-19; 6-18-19; 9-19-19; 11-21-19


Docket 1

*** VACATED *** REASON: CONTINUED TO 4/2/2020 AT 9:30 A.M.,

Per Order Entered 1/24/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Order Granting Plaintiff Woodlawn Colonial, L.P.'s

Motion (1) to Dismiss Plaintiff's First & Second Claims for Relief; & (2) for Entry of Judgment on Plaintiff's Third Claim for Relief Entered 9/6/2019; Non-Dischargeable Judgment Entered 9/6/2019. Remaining Issue is Defendant's Counterclaim fld 6/12/17, dkt #7 - td (9/6/2019)


CONTINUED: Status Conference Continued to 4/2/2020 at 9:30 a.m., Per Order Entered 1/24/2020 (XX) - td (1/24/2020)

Tentative Ruling:


July 27, 2017


No tentative ruling -- the disposition of the status conference will depend upon the outcome of Plaintiff's motion for stay of the adversary proceeding, which set on today's 10:30am calendar.


September 21, 2017


Impose sanctions against counsel for Plaintiff in the amount of $100 for failure to file joint status report as required by LBR 7016-1.


Discovery Cut-off Date: Jan. 18, 2018

9:30 AM

CONT...


Chad Paul Delannoy


Chapter 7

Deadline to File Pretrial Motions: Feb. 1, 2018

Reserved hearing date re Pretrial Motions: Mar. 8, 2018 at 2:00 p.m. (xx) Pretrial Conference: Apr. 12, 2018 at 9:30 a.m. (XX)

Deadline to File Pretrial Stipulation Mar. 29, 2018


Special Note: Defendant's counterclaim may be moot in light of the sale of the truck by the Trustee.


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


July 19, 2018


In light of pending appeal, continue status conference to September 20, 2018 at 9:30 a.m., updated status report must be filed by September 13, 2018. (XX)


Note: Appearances at this hearing are not required.


September 20, 2018


Continue status conference to December 6, 2018 at 9:30 a.m.; updated status report must be filed by November 29, 2018. (XX)


Note: Appearances at today's hearing are not required; Plaintiff to serve notice of the continued hearing date/time.


December 6, 2018


Continue status conference to March 21, 2019 at 9:30 a.m.; updated joint status report must be filed by March 7, 2019 (XX)


Note: Appearances at today's hearing are not required; Plaintiff to serve notice of the continued hearing date/time.

9:30 AM

CONT...


Chad Paul Delannoy


Chapter 7


March 21, 2019


Continue status conference to May 9, 2019 at 2:00 p.m., same date/time as hearing on Plaintiff's motion for summary judgment; updated status report not required. (XX)


Note: Appearances at the March 21, 2019 status conference are not required.


Party Information

Debtor(s):

Chad Paul Delannoy Represented By Robert P Goe Charity J Miller

Defendant(s):

Chad Paul Delannoy Pro Se

Plaintiff(s):

Woodlawn Colonial, L P Represented By Howard M Bidna

Trustee(s):

Thomas H Casey (TR) Pro Se

9:30 AM

8:17-10706


John Jean Bral


Chapter 11

Adv#: 8:17-01071 Bral v. Beitler


#4.00 CONT'D STATUS CONFERENCE Hearing RE: Motion for Summary Judgment on Debtor's First Amended Complaint Against Barry Beitler for: (1) Avoidance of Preference Pursuant to 11 U.S.C. Section 547; (2) Avoidance of Unperfected Liens Pursuant to 11 U.S.C. Section 544(A); (3) Recovery of Avoided Transfers Pursuant to 11 U.S.C. Section 550; and (4) Disallowance of Claims Pursuant to 11 U.S.C. Section 502


FR: 9-20-18; 3-21-19; 8-15-19


Docket 27


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


September 20, 2018


Continue status conference to March 21, 2019 at 9:30 a.m.; updated status report to be filed by March 7, 2019 (XX)


March 21, 2019


Continuue status conference to August 15, 2019 at 9:30 a.m.; updated joint status report to be filed by August 1, 2019. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at the March 21, 2019 hearing are not required.


August 15, 2019


Continue status conference to January 30, 2020 at 9:30 a.m.; updated status

9:30 AM

CONT...


John Jean Bral


Chapter 11

report must be filed by January 16, 2020. (XX)


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.


January 30, 2020


Continue status conference to May 21, 2020 at 9:30 a.m.; updated joint status report must be filed by May 7, 2020.


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.


Party Information

Debtor(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman William N Lobel Babak Samini Dean A Ziehl

Defendant(s):

Barry Beitler Represented By

Krikor J Meshefejian

Plaintiff(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman

9:30 AM

CONT...


John Jean Bral


William N Lobel


Chapter 11

9:30 AM

8:17-10706


John Jean Bral


Chapter 11

Adv#: 8:17-01071 Bral v. Beitler


#5.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint Against Barry Beitler for: (1) Avoidance of Preference Pursuant to 11 U.S.C. §547: (2) Avoidance of Unperfected Liens Pursuant to 11 U.S.C. §544(A); (3) Recovery of Avoided Transfers Pursuant to 11 U.S.C. §550; and (4) Disallowance of Claims Pursuant to 11 U.S.C. §502


FR: 9-20-18; 3-21-19; 8-15-19


Docket 20


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

September 20, 2018


Continue status conference to March 21, 2019 at 9:30 a.m.; updated status report to be filed by March 7, 2019 (XX)


March 21, 2019


Continuue status conference to August 15, 2019 at 9:30 a.m.; updated joint status report to be filed by August 1, 2019. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at the March 21, 2019 hearing are not required.


August 15, 2019


Continue status conference to January 30, 2020 at 9:30 a.m.; updated status report must be filed by January 16, 2020. (XX)

9:30 AM

CONT...


John Jean Bral


Chapter 11

Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.


January 30, 2020


Continue status conference to May 21, 2020 at 9:30 a.m.; updated joint status report must be filed by May 7, 2020.


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.



Party Information

Debtor(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman William N Lobel Babak Samini Dean A Ziehl

Defendant(s):

Barry Beitler Represented By

Krikor J Meshefejian

Plaintiff(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman William N Lobel

9:30 AM

8:17-10706


John Jean Bral


Chapter 11

Adv#: 8:17-01092 Beitler v. Bral


#6.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint to Determine Non-dischargeability of Debt under Bankruptcy Code Section 523


FR: 9-20-18; 3-21-19; 8-15-19


Docket 35


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

September 20, 2018


Continue status conference to March 21, 2019 at 9:30 a.m.; updated status report to be filed by March 7, 2019 (XX)


March 21, 2019


Continuue status conference to August 15, 2019 at 9:30 a.m.; updated joint status report to be filed by August 1, 2019. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at the March 21, 2019 hearing are not required.


August 15, 2019


Continue status conference to January 30, 2020 at 9:30 a.m.; updated status report must be filed by January 16, 2020. (XX)


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.

9:30 AM

CONT...


John Jean Bral


Chapter 11


January 30, 2020


Continue status conference to May 21, 2020 at 9:30 a.m.; updated joint status report must be filed by May 7, 2020.


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.


Party Information

Debtor(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman William N Lobel Babak Samini Dean A Ziehl

Defendant(s):

John Jean Bral Represented By William N Lobel Beth Gaschen Alan J Friedman

Plaintiff(s):

Barry Beitler Represented By

Krikor J Meshefejian Gary E Klausner

9:30 AM

8:17-10706


John Jean Bral


Chapter 11

Adv#: 8:17-01094 Beitler & Associates, Inc. dba Beitler Commercial v. Bral


#7.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint to Determine Non-dischargeability of Debt Under Bankruptcy Code Section 523


FR: 9-20-18; 3-21-19; 8-15-19


Docket 35


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

September 20, 2018


Continue status conference to March 21, 2019 at 9:30 a.m.; updated status report to be filed by March 7, 2019 (XX)


March 21, 2019


Continue status conference to August 15, 2019 at 9:30 a.m.; updated joint status report to be filed by August 1, 2019. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at the March 21, 2019 hearing are not required.


August 15, 2019


Continue status conference to January 30, 2020 at 9:30 a.m.; updated status report must be filed by January 16, 2020. (XX)


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.

9:30 AM

CONT...


John Jean Bral


Chapter 11


January 30, 2020


Continue status conference to May 21, 2020 at 9:30 a.m.; updated joint status report must be filed by May 7, 2020.


Note: Appearances at this hearing are not required; Plaintiff to serve notice of the continued date/time.


Party Information

Debtor(s):

John Jean Bral Represented By Beth Gaschen Alan J Friedman William N Lobel Babak Samini Dean A Ziehl

Defendant(s):

John Jean Bral Represented By William N Lobel Beth Gaschen Alan J Friedman

Plaintiff(s):

Beitler & Associates, Inc. dba Beitler Represented By

Krikor J Meshefejian Gary E Klausner

9:30 AM

8:17-13780


Maria H. Helton-Rehburg


Chapter 7

Adv#: 8:18-01049 Rehburg v. Helton-Rehburg


#8.00 STATUS CONFERENCE RE: Complaint to: 1) Determine Non-Dischargeability of Debt 11 USC Sections 523(a)(2)(A), 523(a)(4) and 523(a)(6), and 2) Deny Discharge of Debtor Under 11 USC Sections 727(a)(2)(A), 727(a)(3), and 727(a) (4)(A)


FR: 6-21-18; 1-31-19; 5-2-19; 5-7-19; 8-8-19; 11-21-19


Docket 1

*** VACATED *** REASON: CONTINUED TO 4/2/2020 AT 9:30 A.M.,

Per Order Entered 1/22/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 4/2/2020 at 9:30 a.m., Per

Order Entered 1/22/2020 (XX) - td (1/22/2020)

Tentative Ruling:


June 21, 2018


Discovery Cut-off Date: Nov. 1, 2018

Deadline to Attend Mediation: Jan. 11, 2019

Pretrial Conference Date: Jan. 31, 2019 at 9:30 a.m.

(XX)

Deadline to Lodge Joint Pretrial Stipulation: Jan. 17, 2019


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


November 21, 2019


Impose sanctions in the amount of $100 each against counsel for Plaintiff and

9:30 AM

CONT...


Maria H. Helton-Rehburg


Chapter 7

counsel for Defendant for failure to timely file a pretrial stipulation. Appearances at today's hearing are required.


Party Information

Debtor(s):

Maria H. Helton-Rehburg Represented By Christopher P Walker

Defendant(s):

Maria H. Helton-Rehburg Pro Se

Plaintiff(s):

Lisa M. Rehburg Represented By Bradley D Blakeley

Trustee(s):

Weneta M Kosmala (TR) Pro Se

9:30 AM

8:17-14535


Prime Metals U.S.A., Inc.


Chapter 7

Adv#: 8:19-01213 Marshack v. An et al


#9.00 STATUS CONFERENCE RE: Complaint for: 1. Avoidance and Recover of Constructive Fraudulent Transfers; 2. Avoidance and Recovery of Property of the Bankruptcy Estate; 3. Avoidance of Preferential Transfers; and 4. Recovery of Avoided Transfers


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 30, 2020


Joint status report not timely filed.* Parties must appear and advise the court re the status of this matter.


* The Stipulation and Order [docket #s 5 & 6] only extended the answer date -- did not include an extension of the deadline to file a status report.


Note: Appearances at the hearing are required.

Party Information

Debtor(s):

Prime Metals U.S.A., Inc. Represented By Steven Werth

Defendant(s):

Minho An Pro Se

Byungwhan Chung Pro Se

Plaintiff(s):

Richard A Marshack Represented By

9:30 AM

CONT...


Trustee(s):


Prime Metals U.S.A., Inc.


Ronald S Goe Robert P Goe Ryan S Riddles


Chapter 7

Richard A Marshack (TR) Represented By

D Edward Hays Laila Masud David M Goodrich Robert P Goe

9:30 AM

8:18-10548


Lenore LuAnn Albert-Sheridan


Chapter 7

Adv#: 8:18-01071 Albert-Sheridan v. Education Credit Management Corporation et al


#10.00 PRE-TRIAL CONFERENCE RE: Complaint seeking declaration that private student loan is dischargeable because not a qualified education loan and/or the loan is dischargeable due to undue hardship


FR: 7-10-18; 12-20-18; 1-31-19; 3-21-19; 6-20-19; 11-21-19


Docket 1

*** VACATED *** REASON: CONTINUED TO 3/19/2020 AT 9:30 A.M.,

Per Order Entered 1/10/220 (XX) Courtroom Deputy:

CONTINUED: Pre-trial Conference Continued to 3/19/2020 at 9:30 a.m.,

Per Order Entered 1/10/2020 (XX) - td (1/10/2020)

Tentative Ruling:


July 10, 2018


Discovery Cut-off Date:

10/15/18

Deadline to Attend Mandatory Mediation:

11/16/18

Pretrial Conference Date:

12/20/18 at 9:30 a.m. (XX)

Deadline to Lodge Joint Pretrial Stipulation:

11/13/18


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


March 21, 2019


This matter will be trailed to today's 10:30 a.m. calendar.


June 20, 2019

9:30 AM

CONT...


Lenore LuAnn Albert-Sheridan


Chapter 7


Discovery Cut-off Date: Sept. 30, 2019

Pretrial Conference Date: Nov. 21, 2019 at 9:30 a.m. (XX)

Deadline to File Joint Pretrial Stipulation: Nov. 7, 2019


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.



Party Information

Debtor(s):

Lenore LuAnn Albert-Sheridan Pro Se

Defendant(s):

Education Credit Management Represented By Scott A Schiff

The Education Resources Institute Pro Se

Plaintiff(s):

Lenore LuAnn Albert-Sheridan Pro Se

Trustee(s):

Jeffrey I Golden (TR) Pro Se

9:30 AM

8:19-10275


Michael J Duff


Chapter 7

Adv#: 8:19-01084 Constantin et al v. Duff


#11.00 PRE-TRIAL CONFERENCE RE: Complaint to Deny Debtor's Discharge FR: 8-1-19

Docket 1

*** VACATED *** REASON: CONTINUED TO 2/20/2020 AT 9:30 A.M.,

Per Order Entered 12/12/2019 (XX) Courtroom Deputy:

CONTINUED: Pre-trial Conference Continued to 2/20/2020 at 9:30 a.m.,

Per Order Entered 12/12/2019 (XX) - td (12/12/2019)

Tentative Ruling:


August 1, 2019


Discovery Cut-off Date: Nov. 4, 2019

Deadline to Attend Mediation: Dec. 20, 2019

Pretrial Conference Date: Jan. 30, 2020 at 9:30 a.m. (XX)

Deadline to Lodge Joint Pretrial Stipulation: Jan. 16, 2020


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


Party Information

Debtor(s):

Michael J Duff Pro Se

Defendant(s):

Michael J. Duff Pro Se

9:30 AM

CONT...


Michael J Duff


Chapter 7

Plaintiff(s):

Holly Constantin Represented By Alan W Forsley

Michael Constantin Represented By Alan W Forsley

Trustee(s):

Richard A Marshack (TR) Pro Se

9:30 AM

8:19-10996


Raju Gobindlal Shewa


Chapter 7

Adv#: 8:19-01126 American Outdoor Gears, LLC v. Shewa


#12.00 PRE-TRIAL CONFERENCE RE: Complaint to Determine Nondischargeability of Debt. 1. False Pretenses, False Representations, or Actual Fraud 11 U.S.C. Section 523(a)(2); 2. Willful and Malicious Injury 11 U.S.C. Section 523(a)(6); and 3. Non-Dischargeability of Debt Pursuant to 11 U.S.C. Section 727(a)(2)(a) (5)


FR: 9-19-19


Docket 1

*** VACATED *** REASON: OFF CALENDAR: Order Approving Stipulation and Dismissing Adversary Proceeding Entered 11/20/2019

Courtroom Deputy:

OFF CALENDAR: Order Approving Stipulation and Dismissing Adversary Proceeding Entered 11/20/2019 - td (11/20/2019)

Tentative Ruling:


September 19, 2019


Discovery Cut-off Date: Oct. 31, 2019

Deadline to Attend Mediation: Dec. 20, 2019

Pretrial Conference Date: Jan. 30, 2020 at 9:30 a.m. (XX)

Deadline to File Joint Pretrial Stipulation: Jan. 16, 2020


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


Party Information

Debtor(s):

Raju Gobindlal Shewa Represented By

9:30 AM

CONT...


Raju Gobindlal Shewa


Leonard M Shulman


Chapter 7

Defendant(s):

Raju Gobinal Shewa Pro Se

Plaintiff(s):

American Outdoor Gears, LLC Represented By Michael A Ortiz

Trustee(s):

Jeffrey I Golden (TR) Pro Se

9:30 AM

8:19-13858


Bruce Elieff


Chapter 11

Adv#: 8:19-01205 Elieff et al v. Kurtin


#13.00 STATUS CONFERENCE RE: First Amended Complaint for Mandatory Subordination Pursuant to 11 U.S.C. §510(b) and Avoidance and Recovery of Preferential and Fraudulent Transfers


Docket 5

*** VACATED *** REASON: OFF CALENDAR: Another Summons Issued 12/11/2019; New Status Conference Set for 3/5/2020 at 9:30 a.m. (xx)

Courtroom Deputy:

OFF CALENDAR: Another Summons Issued 12/11/2019; New Status Conference Set for 3/5/2020 at 9:30 a.m. (xx) - td (12/11/2019)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

Defendant(s):

Todd Kurtin Pro Se

Plaintiff(s):

Bruce Elieff Represented By

Paul J Couchot

Morse Properties, LLC Represented By Paul J Couchot

4627 Camden, LLC Represented By Paul J Couchot

10:00 AM

8:19-10247


Loren Tramontano and Monique Chevalier


Chapter 13


#14.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


U.S. BANK N.A.


VS.


DEBTORS


Docket 34

*** VACATED *** REASON: CONTINUED TO 3/19/2020 AT 10:00 A.M.,

Per Order Entered 1/13/2020 (XX) Courtroom Deputy:

CONTINUED: Hearing Continued to 3/19/2020 at 10:00 a.m., Per Order

Entered 1/13/2020 (XX) - td (1/13/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Loren Tramontano Represented By Paul Y Lee

Joint Debtor(s):

Monique Chevalier Represented By Paul Y Lee

Movant(s):

U.S. Bank National Association, as Represented By

Robert P Zahradka

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-14100


Sandra Irene Farias


Chapter 7


#15.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] TOYOTA MOTOR CREDIT CORPORATION

VS.


DEBTOR


Docket 11


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 30, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Sandra Irene Farias Represented By Marlin Branstetter

Movant(s):

Toyota Motor Credit Corporation Represented By

Austin P Nagel

10:00 AM

CONT...

Trustee(s):


Sandra Irene Farias


Chapter 7

Richard A Marshack (TR) Pro Se

10:00 AM

8:19-14150


Brandi Bagley


Chapter 7


#16.00 Hearing RE: Motion for relief from the automatic stay [UNLAWFUL DETAINER] LEANN BENVENUTI, AN INDIVIDUAL

VS.


DEBTOR


Docket 29


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 30, 2020


Grant with 4001(a)(3) waiver and annulment.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Brandi Bagley Represented By Omid J Shirazi

Movant(s):

Leann Benvenuti Represented By Richard Sontag

Trustee(s):

Thomas H Casey (TR) Pro Se

10:00 AM

CONT...


Brandi Bagley


Chapter 7

10:00 AM

8:19-14798


Linda L Rock


Chapter 13


#17.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] WILMINGTON SAVINGS FUND SOCIETY, FSB

VS.


DEBTOR


Docket 11

*** VACATED *** REASON: OFF CALENDAR: Order Dismissing Case for Failure to File Schedules, Statements, and/or Pan Entered 1/21/2020

Courtroom Deputy:

OFF CALENDAR: Order Dismissing Case for Failure to File Schedules, Statements, and/or Pan Entered 1/21/2020 - td (1/24/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Linda L Rock Pro Se

Movant(s):

Wilmington Savings Fund Society, Represented By

Austin P Nagel

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-14858


Pedro Carrillo-Garcia and Ana Rosa Elias De Carrillo


Chapter 7


#18.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] FORD MOTOR CREDIT COMPANY LLC

VS.


DEBTORS


Docket 10


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 30, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Pedro Carrillo-Garcia Represented By

Michael H Colmenares

Joint Debtor(s):

Ana Rosa Elias De Carrillo Represented By

Michael H Colmenares

Movant(s):

Ford Motor Credit Company LLC Represented By

10:00 AM

CONT...


Trustee(s):


Pedro Carrillo-Garcia and Ana Rosa Elias De Carrillo

Sheryl K Ith


Chapter 7

Thomas H Casey (TR) Pro Se

10:00 AM

8:19-14073


Greenplanet Broadbord Inc.


Chapter 7


#18.10 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


BENJAMIN P. LUCAS, ET AL. VS.

DEBTOR


FR: 12-5-19; 1-9-20


Docket 14


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


Continue hearing to January 30, 2020 at 10:00 a.m. to allow Movant to correct service issue (XX)


Service issue: Though Debtor has retained counsel (Dana Douglas Esq) as of November 21, 2019, the Motion has not been served on such counsel as required by LBR 4001-1(c)(1)(C)(i).


Tentative ruling for 1/30/20 hearing: Grant motion with 4001(a)(3) waiver under both 362(d)(1) (cause shown -- lack of proof of insurance) and 362(d)

(2) (no equity in the property per Debtor's own schedule D and property not necessary for reorganization -- there is no reorganization in chapter 7 cases).


Objection of creditor Tariq Ahmad is overruled. Neither the Local Bankruptcy Rules or the Federal Rules of Bankruptcy Procedure require service of the Motion on creditors of the estate in chapter 7 cases. Further, Mr. Ahmad's

10:00 AM

CONT...


Greenplanet Broadbord Inc.


Chapter 7

opposition states no substantive ground for denial of the Motion.


Note: If the parties accept the foregoing tentative ruling, appearances at today's hearing are not required and Movant shall serve notice of the continued hearing date/time.


January 30, 2020


Deny motion without prejudice -- service to Debtor's attorney remains defective.


No further continuances. Hearing was continued to allow service to Debtor's attorney. Debtor's attorney was not served at either the correct street address or the email address indicated on the Substitution of Attorney filed 11/21/19.

Party Information

Debtor(s):

Greenplanet Broadbord Inc. Pro Se

Movant(s):

Benjamin P. Lucas, a Sole Represented By Edward T Weber

Trustee(s):

Richard A Marshack (TR) Pro Se

10:00 AM

8:20-10002


Jeffrey J. Axton


Chapter 13


#19.00 Hearing RE: Motion in Individual Case for Order Imposing a Stay or Continuing the Automatic Stay as the Court Deems Appropriate


Docket 8


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 30, 2020


Grant motion, except that the stay will terminate on May 4, 2020 if the lump sum plan payment of $65,000 is not paid by such date.


Basis for Tentative Ruling


Comparing Debtor's Schedule I in the prior case with Schedule I in the current case, Debtor's monthly income has actually decreased significantly.

Accordingly, the offer of an early lump sum plan payment is the critical factor supporting the assertion of changed circumstances and good faith.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required if Movant accepts the foregoing tentative ruling. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Jeffrey J. Axton Represented By Michael D Franco

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

CONT...


Jeffrey J. Axton


Chapter 13

10:00 AM

8:18-13487


Shahid Jamil


Chapter 13


#19.10 CON'TD Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


AJAX MORTGAGE LOAN TRUST 2019-A VS.

DEBTOR FR: 1-16-20

Docket 45

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 1/22/2020

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 1/22/2020 - td (1/29/2020)

Tentative Ruling:


January 16, 2020


Grant with 4001(a)(3) waiver and co-debtor relief.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Shahid Jamil Represented By

Brian J Soo-Hoo

10:00 AM

CONT...

Movant(s):


Shahid Jamil


Chapter 13

Ajax Mortgage Loan Trust 2019-A, Represented By

Joshua L Scheer Reilly D Wilkinson

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:30 AM

8:10-14723


Susan Doan


Chapter 7


#20.00 Hearing RE: Application by Chapter 7 Trustee to Employ Investors' Property Services as Property Manager and Pay Management Expenses


Docket 82


Courtroom Deputy:


Debtor(s):


Party Information

Prime Metals U.S.A., Inc. Represented By Steven Werth

Defendant(s):

Hyundai Steel Company Pro Se

Plaintiff(s):

Richard A Marshack Represented By Ronald S Hodges Robert P Goe Ryan S Riddles

Trustee(s):

Richard A Marshack (TR) Represented By

2:00 PM

CONT...


Prime Metals U.S.A., Inc.


D Edward Hays Laila Masud David M Goodrich Robert P Goe


Chapter 7

9:30 AM

8:16-12895


29 Prime, Inc.


Chapter 7

Adv#: 8:17-01226 Marshack v. Wallace et al


#1.00 CON'TD PRE-TRIAL CONFERENCE RE: First Amended Complaint for: (1) Breach of Fiduciary Duty - Derivative; (2) Constructive Trust (As to Defendant Russell Wallace Only)


(Advanced from 6-14-18)

FR: 6-7-18; 7-19-18; 12-20-18; 5-2-19; 5-7-19; 8-22-19; 11-7-19; 12-12-19;

1-30-20


Docket 47


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


July 19, 2018


The following discovery schedule applies to Plaintiff and Defendant Haleh Fardi:


Discovery Cut-off Date: Oct. 19, 2018

Deadline to Attend Mediation: Nov. 16, 2018

Pretrial Conference Date: Dec. 20, 2018 at 9:30

a.m. (XX)

Deadline to Lodge Joint Pretrial Stipulation: Dec. 6, 2018


Deadline for Plaintiff to move for entry of default judgments as to non-answering

defendants: Sept. 21, 2018


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7


May 7, 2019


Court's Comments re the Joint Pretrial Stipulation:


  1. A demand for jury trial has been made. Each party is required indicate whether they consent or do not consent to the jury trial being conducted in this court. Absent 100% consent by all parties, the jury trial must be held in District Court. Statements re consent or nonconsent to this court conducting the jury trial must be filed with the court by May 21, 2019.


  2. The facts to which Defendant Russell Wallace admitted to in his answer should be reflected in the Admitted Facts Section of the Stipulation.


  3. Re Section (c)(1) of the Issues of Law, why must a determination be made at trial re whether Mr. Redman and Mr. Martin breached their fiduciary duties to 29 Prime when defaults have been entered against both gentlemen?


  4. Why isn't Ms. Fardi ready for trial? The reason(s) should have been set forth in the Stipuation.


  5. Any motions in limine need to be filed no later than June 18, 2019 and scheduled for hearing no later than July 16, 2019.


Note: Appearances at this hearing are required.


August 22, 2019


Comments re the Joint Pretrial Stipulation filed 8/16/19:


  1. Who has signed off on the JPS. No signatures for either of the remaining defendants, Russell Wallace or Haleh Fardi. Did either of them participate in the preparation of this JPS?


  2. The JPS is supposed to include a section on all admitted facts that require no proof. So, why does that section include the statement that Ms. Fardi

    9:30 AM

    CONT...


    29 Prime, Inc.


    Chapter 7

    "disputes" the admitted facts? That would make them NOT admitted. Which facts does she actually dispute?


  3. Why does the admitted facts section include Nos. 13, 18 - 48 which all appear to be DISPUTED FACTS????


  4. Why does (f) state that plaintiff "intends to file a motion in limine" when such a motion was already filed as of August 16, 2019, the date the JPS was submitted?


Special Note: If at all possible, the court would like for the trustee, Richard Marshack to participate in this hearing.


Note: Appearances at this hearing are required.


November 7, 2019


Continue the Pretrial Conference to December 12, 2019 at 9:30 a.m. The court shall issue an Order to Show Cause Why This Adversary Proceeding Should Not Be Dismissed Due to the Inability of Plaintiff to Properly Prosecute This Adversary Proceeding. The OSC hearing shall take place on Dec. 12, 2019 at 9:30 a.m. (XX)


Plaintiff's counsel has failed to timely comply with a strict order of this court re the service of an amended joint pretrial stipulation -- once again causing further delay and confusion for the defendants. The apologies offered are shallow and of no moment. The pretrial conference has previously been continued twice due to counsel's inability to present a proper, coherent and timely pretrial stipulation. Enough is enough.


December 12, 2019


Take matter off calendar in light of tentative ruling for Calendar #2 dismissing adversary proceeding.

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7


January 30, 2020


The court is inclined to approve the pretrial statement filed January 9, 2020 (docket #157) on the following conditions:


  1. A Final Pretrial Statement is filed within 7 days of the hearing that a) deletes the words "And Order" from the caption (a separate order approving the Stipulation must be lodged); and b) deletes the "Status of the Parties" and related chart as such is beyond the scope of LBR 7016-1(b) and clutters up what should be a straightforward statement.


  2. Counsel for Plaintiff appears at the hearing and advises the court of the basis for motion to strike Defendant Wallace's answer at this late stage.


The court's usual trial procedure is to required direct testimony by declarations (filed 30 days before by Plaintiff and 21 days before by Defendant) with adverse and rebuttal testimony being presented live. All declarants must be present for cross examination. Plaintiff's counsel to advise the court if Plaintiff would prefer all live direct testimony instead of by declaration. See this court's Trial Procedures on the court's website.


Note: Appearance at this hearing is required.


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7

Approve the unilateral "Final Pretrial Statement" filed 3/26/20 [docket #162]. Trial Dates: October 28, 2020 and October 29, 2020 at 9:00 a.m. Plaintiff must serve a copy of this court's trial procedures on the remaining defendant, Mr. Wallace, no later than September 28, 2020.


All parties are ordered to comply with this court's trial procedures which are available on the court's website at: www.cacb.uscourts.gov. Among other things, the court's trial procedures require that direct testimony, other than adverse or rebuttal, be submitted by written declaration (30 days prior to trial for plaintiffs and 21 days prior to trial for defendants). Requests for waiver of the declaration requirement must be made at the pre-trial conference.


Failure to comply with the trial procedures may result in the imposition of monetary sanctions, dismissal of the adversary proceeding or the entry of a default judgment.


Note: If the parties accept the foregoing tentative ruling, appearances at today's hearing are not required and Plaintiff shall lodge a Pretrial Order consistent with the same within 7 days of today's hearing.

Nonappearance at the hearing will be deemed acceptance of the tentative ruling.


Party Information

Debtor(s):

29 Prime, Inc. Represented By

Richard L Barnett

Defendant(s):

Russell B. Wallace Pro Se

Tony Redman Pro Se

Jason Martin Pro Se

Local Zoom, Inc. Pro Se

OC Listing, Inc. Pro Se

9:30 AM

CONT...


29 Prime, Inc.


Chapter 7

Sky Motorsports, Inc. Pro Se

Haleh Fardi Pro Se

1Network.Com Pro Se

Plaintiff(s):

Richard A. Marshack Represented By

Rosemary Amezcua-Moll

Trustee(s):

Richard A Marshack (TR) Represented By Caroline Djang

Rosemary Amezcua-Moll

9:30 AM

8:18-12003


Jack G. Gaglio


Chapter 7

Adv#: 8:18-01172 Pacific Western Bank v. Gaglio et al


#2.00 CON'TD PRE-TRIAL CONFERENCE RE: Complaint (1) Objecting to Discharge Pursuant to 11 U.S.C. §727(A)(2) and (2) to Determine Debt Non-dischargeable Pursuant to 11 U.S.C. §523(A)(6)


FR: 12-6-18; 12-20-18; 6-20-19; 8-1-19; 10-3-19


Docket 1

*** VACATED *** REASON: STATUS CONFERENCE CONTINUED TO

9/10/2020 AT 9:30 AM, Per Order Entered 4/3/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 9/10/2020 at 9:30 am, Per

Order Entered 4/3/2020 (XX) - td (4/3/2020)

Tentative Ruling:


December 20, 2018


Discovery Cut-off Date: May 3, 2019

Pretrial Conference Date: June 20, 2019 at 9:30

a.m. (XX)

Deadline to Lodge Joint Pretrial Stipulation: June 6, 2019


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


Party Information

Debtor(s):

Jack G. Gaglio Represented By Timothy S Huyck

9:30 AM

CONT...


Jack G. Gaglio


Chapter 7

Defendant(s):

Jack G. Gaglio Pro Se

Laura A. Gaglio Pro Se

Joint Debtor(s):

Laura A. Gaglio Represented By Timothy S Huyck

Plaintiff(s):

Pacific Western Bank Represented By Kenneth Hennesay

Trustee(s):

Karen S Naylor (TR) Pro Se

9:30 AM

8:18-14372


Narendra Mohan


Chapter 7

Adv#: 8:19-01037 Last Chance Funding, Inc. v. Mohan et al


#3.00 PRE-TRIAL CONFERENCE RE: Complaint to Determine the Dischargeability of a Debt and Objection to Discharge of the Debtors


FR: 5-30-19; 10-17-19; 11-19-19


Docket 1


Courtroom Deputy:

SPECIAL NOTE: Order on Request for Dismissal of Claims for Relief Under Section 727 Entered 4/6/2020. Stipulation for Entry of Nondischargeable Judgment filed 3/17/2020; Order Entry of Nondischargeable Judgment RE: Sections 523(a)(4) and 523(a)(6) Not Yet Lodged - td (4/6/2020)

Tentative Ruling:


November 19, 2019


Discovery Cut-off Date: Feb. 28, 2020

Pretrial Conference Date: Apr. 9, 2020 at 9:30 a.m. (XX) Deadline to Lodge Joint Pretrial Stipulation: Mar. 26, 2020

Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice.

9:30 AM

CONT...


Narendra Mohan


Chapter 7

The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Plaintiff must lodge a judgment re nondischargeability (523(a) claims for relief) consistent with the stipulation filed March 17, 2020 [docket #26].


Special Note: Absent the entry of a judgment, this adversary will remain open.


Note: If the parties accept the foregoing tentative ruling, appearances at this hearing are not required. Nonappearance at the hearing will be deemed acceptance of the tentative ruling.



Party Information

Debtor(s):

Narendra Mohan Represented By Harlene Miller

Defendant(s):

Narendra Mohan Pro Se

Anshu Mohan Pro Se

Joint Debtor(s):

Anshu Mohan Represented By Harlene Miller

Plaintiff(s):

Last Chance Funding, Inc. Represented By

9:30 AM

CONT...


Trustee(s):


Narendra Mohan


Robert L Rentto


Chapter 7

Thomas H Casey (TR) Pro Se

10:00 AM

8:15-15096


Darshan Upadhyaya


Chapter 7

Adv#: 8:16-01024 Floorit Financial, Inc. v. Upadhyaya


#4.00 Examination of Third Person Amanda Upadhyaya aka Amanda C. Ramos Upadhyaya Re: Enforcement of Judgment


Docket 20

*** VACATED *** REASON: CONTINUED TO 6/4/2020 at 10:00 a.m.;

Plaintiff's Counsel to Service Notice (Mail is Acceptable) of the Continued Hearing Date/Time by 4/30/2020, Per Hearing Held 4/2/2020 (XX)

Courtroom Deputy:

CONTINUE: Hearing is Continued to 6/4/2020 at 10:00 a.m.; Plaintiff's Counsel to Service Notice (Mail is Acceptable) of the Continued Hearing Date/Time by 4/30/2020, Per Hearing Held 4/2/2020 (XX) - td (4/3/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Darshan Upadhyaya Represented By Amid Bahadori

Defendant(s):

Darshan Upadhyaya Represented By Amid Bahadori

Plaintiff(s):

Floorit Financial, Inc. Represented By

Tom Roddy Normandin James T Jackson

Trustee(s):

Jeffrey I Golden (TR) Represented By Jeremy Faith Nina Z Javan

10:00 AM

CONT...


Darshan Upadhyaya


Meghann A Triplett


Chapter 7

10:00 AM

8:15-11341


Donna Yardley


Chapter 13


#5.00 CON'TD Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


DITECH FINANCIAL LLC VS.

DEBTOR FR: 3-5-20

Docket 56

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) / APO Entered 4/7/2020

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) / APO Entered 4/7/2020 - td (4/7/2020)

Tentative Ruling:


March 5, 2020


Grant with 4001(a)(3) waiver and co-debtor relief.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


April 9, 2020


Continue the hearing to April 30, 2020 at 10:00 a.m. to allow the parties to

10:00 AM

CONT...


Donna Yardley


Chapter 13

memorialize a stipulation regarding an adequate protection order.


Note: If the parties accept this tentative ruling, appearances are not requirred -- the court will interpret the nonappearances as consent to the tentative ruling.


Party Information

Debtor(s):

Donna Yardley Represented By Christine A Kingston

Movant(s):

Ditech Financial LLC Represented By Darlene C Vigil Julian T Cotton

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:18-10450


Jorge D. Muniz and Aida A. Muniz


Chapter 13


#6.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] TOYOTA MOTOR CREDIT CORPORATION

VS.


DEBTORS


Docket 57


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Nonappearance at the hearing will be deemed acceptance of the tentative ruling. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

10:00 AM

CONT...


Debtor(s):


Jorge D. Muniz and Aida A. Muniz

Party Information


Chapter 13

Jorge D. Muniz Represented By Christine A Kingston

Joint Debtor(s):

Aida A. Muniz Represented By Christine A Kingston

Movant(s):

Toyota Lease Trust., as serviced by Represented By

Austin P Nagel

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-11141


Douglas Robert Redding and Dana Marie Redding


Chapter 13


#7.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] US BANK TRUST NA

VS.


DEBTORS


Docket 45


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Continue hearing to April 30, 2020 at 10:00 a.m.; a payment history was not attached to the Motion as Exhibit 5 as represented in the Motion. The payment history must be filed and served no later than April 9, 2020.


Note: If the parties accept the foregoing tentative ruling, appearances at this hearing are not required. Nonappearance by the parties shall be deemed acceptance of the tentative ruling.

Party Information

10:00 AM

CONT...

Debtor(s):


Douglas Robert Redding and Dana Marie Redding


Chapter 13

Douglas Robert Redding Represented By Sunita N Sood

Joint Debtor(s):

Dana Marie Redding Represented By Sunita N Sood

Movant(s):

US Bank Trust NA Represented By

Kristin A Zilberstein Lemuel Bryant Jaquez

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-11419


Mohammad I. Niazi and Parwin Saddozai


Chapter 7


#8.00 Hearing RE: Motion for relief from automatic stay [ACTION IN NON-BANKRUPTCY FORUM]


ORANGE COUNTY BAIL BONDS, INC. VS.

DEBTORS


Docket 69


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Continue hearing to May 7, 2020 at 10:00 a.m. to allow Movant to provide more information regarding the appellate action; supplemental pleading must be filed no later than April 23, 2020.


Basis for Tentative Ruling


Movant has provided insufficient information regarding the appellate matter,

10:00 AM

CONT...


Mohammad I. Niazi and Parwin Saddozai


Chapter 7

e.g., a description of the judgment that is the subject of the appeal, the identity of the third party against whom Movant seeks relief, the basis for Movant's representation that the bankruptcy estate will not be impacted by the litigation, the meaning "the one final rule" doctrine, etc.


Note: If Movant accepts the tentative ruling, appearance at this hearing is not required; Movant shall serve notice of the continued hearing.

Nonappearance at the hearing shall be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Mohammad I. Niazi Represented By Freddie V Vega

Joint Debtor(s):

Parwin Saddozai Represented By Freddie V Vega

Movant(s):

Orange County Bail Bonds, Inc. Represented By Marc C Forsythe

Trustee(s):

Karen S Naylor (TR) Pro Se

10:00 AM

8:19-14614


Delecia A Holt


Chapter 7


#9.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] BMW BANK OF NORTH AMERICA

VS.


DEBTOR


Docket 57

*** VACATED *** REASON: OFF CALENDAR: Voluntary Dismissal of Motion, filed 4/7/2020

Courtroom Deputy:

OFF CALENDAR: Voluntary Dismissal of Motion, filed 4/7/2020 - td (4/7/2020)

Tentative Ruling:


April 9, 2020


Grant with 4001(a)(3) waiver.


Special note: Debtor's discharge order was entered on March 23, 2020


Note: Debtor has filed a response to the Motion but does not appear to be opposing the Motion. Accordingly, no court appearance by either party is required. Should an opposing party appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Delecia A Holt Pro Se

10:00 AM

CONT...

Movant(s):


Delecia A Holt


Chapter 7

BMW Bank of North America Represented By Cheryl A Skigin

Trustee(s):

Thomas H Casey (TR) Pro Se

10:00 AM

8:20-10456


Jonathan Bondoc and Nida Bondoc


Chapter 7


#10.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] AMERICAN HONDA FINANCE CORPORATION

VS.


DEBTORS; AND WENETA M. KOSMALA, CHAPTER 7 TRUSTEE


Docket 18


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Nonappearance at the hearing will be deemed acceptance of the tentative ruling. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

10:00 AM

CONT...


Debtor(s):


Jonathan Bondoc and Nida Bondoc

Party Information


Chapter 7

Jonathan Bondoc Represented By Cara J Hagan

Joint Debtor(s):

Nida Bondoc Represented By

Cara J Hagan

Movant(s):

American Honda Finance Represented By Vincent V Frounjian

Trustee(s):

Weneta M Kosmala (TR) Pro Se

10:00 AM

8:20-10820


Jose Vitorino De Aguiar


Chapter 7


#11.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] BANK OF THE WEST

VS.


DEBTOR


Docket 9


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


April 9, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Nonappearance at the hearing will be deemed acceptance of the tentative ruling. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

10:00 AM

CONT...


Debtor(s):


Jose Vitorino De Aguiar

Party Information


Chapter 7

Jose Vitorino De Aguiar Represented By Anerio V Altman

Movant(s):

Bank of the West Represented By

Mary Ellmann Tang

Trustee(s):

Richard A Marshack (TR) Pro Se

10:30 AM

8:18-13119


DFH Network Inc.


Chapter 11


#12.00 Post Confirmation Status Conference RE: Final Chapter 11 Plan of Reorganization


(Set at Conf. Hrg. Held 10-3-19)


Docket 143

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion in Chapter 11 Case for the Entry of a Final Decree and an Order Closing Case Entered 12/5/2019

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion in Chapter 11 Case for the Entry of a Final Decree and an Order Closing Case Entered 12/5/2019 - td (4/3/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

DFH Network Inc. Represented By Andy C Warshaw

Richard L. Sturdevant

10:30 AM

8:19-12337


Jorge David Gonzalez


Chapter 7


#13.00 Hearing RE: Debtor's Motion Objecting to Debtor's Claimed Homestead Exemption as Amended


Docket 38

*** VACATED *** REASON: CONTINUED TO 5/21/2020 AT 10:30 A.M.,

Per Order Entered 4/6/2020 (XX) Courtroom Deputy:

CONTINUED: Hearing Continued to 5/21/2020 at 10:30 a.m., Per Order

Entered 4/6/2020 (XX) - td (4/6/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Jorge David Gonzalez Represented By Brian J Soo-Hoo

Movant(s):

Richard A Marshack (TR) Represented By Robert P Goe

Trustee(s):

Richard A Marshack (TR) Represented By Robert P Goe

10:30 AM

8:19-12411


Orange County Bail Bonds, Inc.


Chapter 11


#14.00 CONT'D Hearing RE: Disclosure Statement Describing Debtor's Chapter 11 Plan of Reorganization Dated December 20, 2019


FR: 2-20-20


Docket 82

*** VACATED *** REASON: OFF CALENDAR: Petition Amended to Subchapter V Under Chapter 11 filed 3/3/2020

Courtroom Deputy:

OFF CALENDAR: Petition Amended to Subchapter V Under Chapter 11 filed 3/3/2020 - td (3/19/2020)

Tentative Ruling:


February 20, 2020


Continue disclosure statement approval hearing to April 9, 2020 at 10:30 a.m.; amended disclosure statement and plan must be filed no later than March 12, 2020; responses to the amended plan must be filed by March 19, 2020 and any reply by March 26, 2020. (XX)


Court's Comments Re the Disclosure Statemen (DS):


  1. Debtor must amend the DS to address the concerns of the UST, except as to the timeliness issue re American. Debtors only file claims on behalf of creditors who have not filed a claim by the claims bar date; debtors cannot know whether a creditor will file a claim until after the bar date has expired. By definition, claims filed by a debtor on behalf of a creditor will not be filed "timely."


  2. Re American, Debtor needs to explain the basis for the estimated claim amount of $7,831,800 when it currently only has $10,000 of this type of debt. See DS at p. 24.

    10:30 AM

    CONT...


    Orange County Bail Bonds, Inc.


    Chapter 11

  3. DS at p. 17:20: Capitalized terms "Landlord" and "Lease" are not defined terms in the DS.


  4. DS at p.18: Debtor states there are no Class 1 priority claims but at p. 21 that Miller has such a claim in the amount of $13,650. This discrepancy needs to be corrected in the Plan as well.


  5. DS at p. 19:8: Delete "(Class 1)"


  6. DS at p. 19:23-27: Debtor needs to disclose the compensation structure to Magarian & DiMercurio. "TBD" is insufficient. This also begs the question, why has the application not been filed and what is the current status of the appeal?


  7. DS at p. 21:8: Typo re "T" and "the" needs to be capitalized.


  8. DS at p. 21:7: "Shareholder" should be modifie to "Interest" to be consistent with the preceding paragraph.


  9. DS at p. 26, fn 2: Somewhere in the DS, Debtor needs to explain what will happen if cramdown is required -- the abolute priority rule and new value. Fn 2 for this purpose is insufficient.


  10. DS at pP. 28 and 31: Contradictory statements as to revesting of property.


11: How will Miller's prepetition, non-priority wage claim be treated under the Plan?


12. Re separate classification issue: The court will defer this as a confirmation issue. Because, as pointed out by Debtor in its reply, Global may have redress against parties other than Debtor (e.g., Debtor's principals), the court cannot find at this time that the classification renders the plan patently unconfirmable.


13: Re feasibility: The court will defer this as a confirmation issue.

10:30 AM

CONT...


Orange County Bail Bonds, Inc.


Chapter 11

14. Outlook for the industry: Debtor needs to fully disclose as a risk factor the consequences of state law that will go into effect if the referendum is not successful.


Note: Appearances at this hearing are not required if all parties accept the foregoing tentative ruling.

Party Information

Debtor(s):

Orange County Bail Bonds, Inc. Represented By Marc C Forsythe Ryan S Riddles

Trustee(s):

Mark M Sharf (TR) Pro Se

10:30 AM

8:19-12411


Orange County Bail Bonds, Inc.


Chapter 11


#15.00 CONT'D STATUS CONFERENCE Hearing on Status of Chapter 11 Case; and

(2) Requiring Report on Status of Chapter 11 Case FR: 8-22-19; 10-17-19; 11-7-19; 1-30-20; 2-20-20

Docket 1

*** VACATED *** REASON: OFF CALENDAR: Petition Amended to Subchapter V Under Chapter 11 filed 3/3/2020; Status Conference Under Subchapter V is Set for 4/30/2020 at 10:30 a.m. (xx)

Courtroom Deputy:

OFF CALENDAR: Petition Amended to Subchapter V Under Chapter 11 filed 3/3/2020; Status Conference Under Subchapter V is Set for 4/30/2020 at 10:30 a.m. (xx) - td (3/13/2020)

Tentative Ruling:

August 22, 2019


Deadline to file Plan and Disclosure Statement: 10/21/19 Continued Status Conference Date: 11/21/19 at 10:30 a.m.

Updated Status Report due date: 11/7/19 unless a plan & DS


filed, in which case requirement of a report will

have been the

be waived.


Special Note: The court does not ordinarily set a deadline for the filing of objections to claim.


Note: If Debtor is in substantial compliance with the requirements of the United States Trustee, appearance at this hearing is not required. It is

10:30 AM

CONT...


Orange County Bail Bonds, Inc.


Chapter 11

Debtor's responsibility to confirm compliance with the UST prior to the hearing.


October 17, 2019


Continue status conference to November 7, 2019 at 10:30 a.m., same date/time as hearing on Debtor's motion to extend exclusivity. Updated status report not required. (XX)


November 7, 2019


Deadline to file plan/disclosure statement: Dec. 20, 2019


Continued status conference: Jan. 30, 2020 at 10:30 am (XX)


Updated status report due (only if plan &

DS not timely filed by 12/20/19): Jan. 16, 2020


Note: If Debtor is in substantial compliance with the requirements of the United States Trustee, appearance at this hearing is not required. It is Debtor's responsibility to confirm compliance with the UST prior to the hearing.


January 30, 2020


Continue status conference to 2/20/20 at 10:30 a.m., same date/time as hearing on approval of disclosure statement; updated status report not required. (XX)


Note: Appearance at this hearing is not required.


February 20, 2020


Continue status conference to April 9, 2020 at 10:30 a.m.; updated status

10:30 AM

CONT...


Orange County Bail Bonds, Inc.


Chapter 11

report not required. (XX)


Note: Appearance at this hearing is not required.

Party Information

Debtor(s):

Orange County Bail Bonds, Inc. Represented By Marc C Forsythe

10:30 AM

8:19-13242


10827 Studebaker LLC, a California limited liabili


Chapter 11


#16.00 CON'TD STATUS CONFERENCE RE: (1) Status of Chapter 11 Case; and (2) Requiring Report on Status of Chapter 11 Case


FR: 10-17-19


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


October 17, 2019


Claims bar date: Jan. 17, 2020 (notice to be served by 11/15/19


Deadline to file plan/DS Feb. 20, 2020


Continued Status Conf.: Apr. 9, 2020 at 10:30 a.m. (XX)


Updated Status Report Due: Mar. 19, 2019 (unless the plan/DS has been


the report

filed by such date, in which case requirement will be waived)

Note: If Debtor is in substantial compliance with the requirements of the United States Trustee, appearance at this hearing is not required. It is Debtor's responsiblity to confirm compliance with the UST prior to the hearing.


April 9, 2020

10:30 AM

CONT...


10827 Studebaker LLC, a California limited liabili


Chapter 11

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Continue Status Conference to April 30, 2020 at 10:30 a.m., the same date/time as hearing on approval of Debtor's Disclosure Statement; an updated status report is not required.


Note: Appearance at this hearing is not required. Nonappearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

10827 Studebaker LLC, a California Represented By

Steven Werth

10:30 AM

8:19-13547


Luis Alberto Rodriguez, Jr.


Chapter 11


#17.00 Hearing RE: Debtor's Disclosure Statement Describing Chapter 11 Plan of Reorganization


Docket 54


Courtroom Deputy:

Tentative Ruling:


April 23, 2020


Grant in part; deny in part. Grant with leave to amend as claims for relief under Sections 547 and related 550/551 as to Elieff and Camden; Grant without leave to amend as to all claims for relief for lien avoidance under 510(c); Deny motion as to all other claims for relief. Third amended complaint must be filed no later than May 14, 2020; responsive pleading no later than June 11, 2020.


Special note: The court apologizes to the parties for the analysis which follows. Due to the difficulty in reviewing the massive amount of pleadings and documents electronically (a skill the court is still developing), the tentative ruling has not been edited to "perfection." Hopefully, it will nevetheless assist the

2:00 PM

CONT...


Bruce Elieff


Chapter 11

parties in honing their oral argument.


Oral Argument: Movant will have 30 minutes max for argument; Respondents will have up to 30 minutes to respond; Movant will have 15 minutes for reply.


Basis for Tentative Ruling


Bruce Elieff ("Elieff") filed a voluntary chapter 11 on October 2, 2019, and Morse Properties, LLC ("Morse") and 4627 Camden, LLC ("Camden") filed voluntary chapter 11 petitions on October 3, 2019 (Debtor, Morse, and Camden, collectively, "Debtors"). Debtors’ cases are being jointly administered. On January 23, 2020, the UST appointed the following members to serve on the committee of creditors for Elieff’s estate: (1) Bond Safeguard Insurance Company, (2) Miller Barondess, LLP, and (3) E.O.C. Ord, A Professional Corporation (collectively, the "Committee").


The Adversary Proceeding


On October 15, 2019, Debtors filed an adversary complaint against defendant Todd Kurtin ("Kurtin") to avoid Kurtin’s $34 million judgment lien and subordinate Kurtin’s claim (the "AP"). On December 11, 2019, Debtors filed a second amended complaint (the "SAC")[AP dkt. #11]. On February 27, 2020, Debtors and the Committee filed a joint motion for summary judgment on the first claim for relief in the SAC, mandatory subordination under § 510(b) [AP dkt. # 57]. The motion for summary judgment is set for hearing with this Motion. On March 3, 2020, the order granting the Committee’s motion to intervene as to the first claim for relief only was entered [AP dkt. #65].


Kurtin moves to dismiss the entire SAC for failure to state a claim under FRCP 12(b)(6) (the "Motion")[AP dkt. #19]. Debtors and the Committee opposes the Motion.


    1. The Alleged Facts & Claims For Relief In The SAC


      Kurtin and Elieff were business partners in the real estate development

      2:00 PM

      CONT...


      Bruce Elieff


      Chapter 11

      field in the 1990s. (Comp., ⁋ 14). In 2005, the parties entered into a contract denominated a Settlement Agreement (the "Settlement Agreement") which was a securities purchase agreement. (Comp., ⁋⁋ 18-19). In this writing, Elieff agreed to buy and Kurtin agreed to sell Kurtin’s equity interests in thirty-four of the thirty- six business entities listed on Exhibit "B" to the Settlement Agreement (the "Joint Entities" or "Suncal LLCs"). (Comp., ⁋⁋ 18-21). The purchase price payable for these securities was $48.8 million. (Comp., ⁋ 19).


      Elieff made the first two installments due under the Settlement Agreement. (Comp., ⁋⁋ 18-19). However, only a partial payment was made on the third installment and nothing was paid on the fourth installment. (Comp., ⁋⁋ 24-25). Thereafter, litigation ensued over the balance due under the Settlement Agreement for over a decade. (Comp., ⁋⁋ 26-39). In 2019, this litigation concluded with Kurtin obtaining the 2017 Judgment. Id.


      Prior to October 2, 2019, the Elieff’s petition date, Kurtin recorded the following liens against Elieff: a lis pendens on 9/6/2012, an abstract of judgment on 5/12/2017, an abstract of judgment on 12/20/2017, an abstract of judgment on 2/11/2019, an abstract of judgment on 4/29/2019, and an abstract of judgment on 9/18/19 (together the "Kurtin Liens" or "Kurtin Lien" individually) (Comp., ⁋ 53).


      Based upon a state court order finding Elieff to be the alter ego of Camden and Morse, Kurtin recorded liens against the real properties owned by Camden and Morse. (Comp., ¶ 40). Against Camden, Kurtin filed a lis pendens on 9/6/2012, an abstract of judgment on 2/11/2019, an abstract of judgment on 4/29/2019, and an abstract of judgment on 9/18/2019 (the "Camden Liens"). (Comp., ⁋ 56). Against Morse, Kurtin filed an abstract of judgment on 9/18/2019 (the "Morse Lien"). (Comp., ⁋ 57).


      In the SAC, Debtors allege eighteen claims for relief ("Claims") as follows (with the name of plaintiff alleging the Claim):


      1. Elieff- mandatory subordination under §§ 510(b) and 510(c)(2)

      2. Elieff- preference under § 547 (re: the Kurtin Lien recorded 9/18/19)

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        Bruce Elieff

      3. Elieff- constructive fraudulent transfer under § 548


        Chapter 11

      4. Elieff- constructive fraudulent transfer under § 544 and Civil Code §§ 3439.4(a)(2) and 3439.05

      5. Elieff- preference under § 547 (re: the Perham Property)

        6. Elieff- §§ 550/551

        1. Morse- mandatory subordination under §§ 510(b) and (c)(2)

        2. Morse- preference under § 547 (re: the Morse Lien recorded 9/18/19)

        9. Morse- §§ 550/551

        1. Camden- mandatory subordination under §§ 510(b) and (c)(2)

        2. Camden- preference under § 547 (re: the Camden Lien recorded 9/18/19)

        3. Camden- constructive fraudulent transfer under § 548

        4. Camden- constructive fraudulent transfer under § 544 and Civil Code §§ 3439.4(a)(2) and 3439.05

        5. Camden- preference under § 547 (re: the Riverside Lots)

        15. Camden- §§ 550/551

        16. Elieff- §502(d)

        17. Morse- § 502(d)

        18. Camden- § 502(d)


        Because many of the Claims are based on similar statutes, the analysis below groups similar claims for relief together. The Motion does not specifically address the 2nd and 11th Claims.


    2. FRCP 12(b)(6) Standard


      FRCP 12(b)(6) is made applicable to this AP under Rule 7012. To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a "probability requirement," but it asks more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts that are merely consistent with a defendant’s liability, it stops short of the line

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      Bruce Elieff


      Chapter 11

      between possibility and probability of entitlement to relief. In keeping with these principles a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. Id. at 1950. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief. Id. The court must construe the complaint in the light most favorable to the plaintiff, and accept all well-pleaded factual allegations as true. Johnson v. Riverside Healthcare Sys., LP., 534 F.3d 1116, 1122 (9th Cir. 1990).


      In Atlantic Corp. v. Twombly, 550 U.S. 544, 561 (2007), the Supreme Court established more stringent notice-pleading standard for motions to dismiss for failure to state a claim upon which relief may be granted. A plaintiff is required to provide more than "labels and conclusions, and a formulaic recitation of the elements of a cause of action ...." Id. The plaintiff must provide "enough facts to state a claim to relief that is plausible on its face." Twombly overruled the more liberal Conley v. Gibson standard, which held that a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. With the new standard in Twombly, the Supreme Court has said that the facts asserted in support of the claim need to cross the line "from conceivable to plausible."


      The Court may consider: 1) the complaint and answer; 2) any documents attached or mentioned in the pleadings; 3) documents not attached but "integral" to the claims; and 4) matters subject to judicial notice. Coto Settlement v.

      Eisenberg, 593 F.3d 1031, 1038 (9th Cir. 2010); Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 1988)("The court need not, however, accept as true allegations that contradict matters properly subject to judicial notice or by exhibit."); Gerritsen v. Warner Bros. Ent. Inc., 116 F. Supp. 3d 1104, 1118 (C.D. Cal. 2015)("The incorporation by reference doctrine "permits a district court to consider documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the [plaintiff's] pleadings."). If the court considers evidence that is outside the four categories listed above, the court must covert the FRCP 12(b)(6) motion to a

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      Bruce Elieff


      Chapter 11

      motion for summary judgment under FRCP 56. See, FRCP 12(d); Gerritson, supra, at 1118.


      Per FRE 201, a court may take judicial notice of facts that are not subject to reasonable dispute in that they are either "(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." "It is well established that a court may take judicial notice of its own records... But this does not mean that a court can take judicial notice of the truth of all documents found within a court's records. That a fact sought to be noticed is found in a court's records is not talismanic; the fact still must be of the type described in [FRE] 201. In re Blumer, 95 B.R. 143, 146 (BAP 9th Cir. 1988). Per FRE 201, a court may take judicial notice of facts that are not subject to reasonable dispute in that they are either "(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned."


      "A court may take judicial notice of ‘matters of public record’ without converting a motion to dismiss into a motion for summary judgment. MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir.1986). But a court may not take judicial notice of a fact that is "subject to reasonable dispute." Fed.R.Evid. 201(b)." Lee v. City of Los Angeles, 250 F.3d 668, 689–90 (9th Cir. 2001).


      In this case, both Kurtin and Debtors request that the Court take judicial notice of facts within prior pleadings filed in both state court and bankruptcy court, prior state court orders and jury verdicts, and recorded abstracts of judgment. The court will only take judicial notice of pleadings and documents that are integral to the SAC itself. Stated otherwise, the court will only take judicial notice of documents outside the four corners of the SAC that are actually referenced therein, including, without limitation, the Settlement Agreement, complaints referenced in the SAC, arbitration award, and judicial opinions. All other documents will not be judicially noticed.


      The Court should grant the request to take judicial notice of pleadings, orders, and abstracts of judgment but not of the truth of any factual statements made in the pleadings or documents because these facts are not the type of

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      Bruce Elieff


      Chapter 11

      facts that may be judicially noticed, i.e., they are not generally known with the court’s territorial jurisdiction and are subject to reasonable dispute.


      "On a Rule 12(b)(6) motion to dismiss, when a court takes judicial notice of another court's opinion, it may do so ‘not for the truth of the facts recited therein, but for the existence of the opinion, which is not subject to reasonable dispute over its authenticity.’" Lee v. City of Los Angeles, 250 F.3d at 690 (reversing district court in 42 U.S.C. § 1983 action for taking judicial notice regarding the validity of an extradition waiver instead of only taking judicial notice that the waiver was filed).


    3. The Motion Should Be Partially Granted As To The § 510(b) Mandatory Subordination Claims [


      [1st (Elieff) 7th (Morse) and 10th (Camden) Claims]


      Under § 510(b), "a claim arising from rescission of a purchase or sale of a security of the debtor or of an affiliate of the debtor, for damages arising from the purchase or sale of such a security, or for reimbursement or contribution allowed under section 502 on account of such a claim, shall be subordinated to all claims or interests that are senior to or equal the claim or interest represented by such security[.]"


      Thus, § 510(b) effectuates "one of the general principles of corporate and bankruptcy law: that creditors are entitled to be paid ahead of shareholders in the distribution of corporate assets." See, In re Am. Wagering, Inc., 493 F.3d 1067, 1071 (9th Cir. 2007). The rationale behind § 510(b) is the dissimilar risk and return expectations of shareholders and creditors, and the reliance of creditors on the equity cushion provided by shareholder investment. See, In re Betacom of Phoenix, Inc. 240 F.3d 823, 830 (9th Cir. 200). Section 510(b) "contemplates three types of claims—rescission, damages, and Here, Kurtin advances three main arguments why the mandatory subordination claims should be dismissed:

      1. the Settlement Agreement is not an agreement to purchase or sale of securities, (2) even it were, the 2017 Judgment (the basis of Kurtin’s proofs of claim) does not "arise from" the sale or purchase of securities because the 2017 Judgment was based on Elieff’s liability for diversion of assets, and (3) Debtors

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        Bruce Elieff


        Chapter 11

        cannot transfer the liens securing the 2017 Judgment under § 510(c)(2) because that section is inapplicable to mandatory subordination.


        1. The 2017 Judgment is a Claim for Damages


          As a preliminary matter, Kurtin holds a claim, "a right to repayment," against Debtors based on the 2017 Judgment and the alter ego findings entered against Morse and Camden. See, SAC, ¶¶36-38, 40, 69, 100, 113; 11 U.S.C. § 101(5)(A). Moreover, the amounts owed under a judgment constitute "damages" under § 510(b). See, In re Tristar Esperanza Properties, LLC, 782 F.3d 492, 495-96 (9th Cir. 2015)(finding that money judgment based on underling breach of contract claim for failure to pay amounts owed under buyout provision of LLC’s operating agreement was "damages" under § 510(b)). Thus, the SAC has sufficiently pleaded damages for § 510(b) purposes.


        2. The SAC Sufficiently Alleges that Kurtin’s Interest In the Suncal LLCs and the Suncal LLCs are Debtors’ Affiliates


          The SAC alleges that Elieff and Kurtin owned equity interests in the Suncal LLCs, a combination of limited liability companies, limited partnerships or limited liability partnerships, which were subsequently purchased by Elieff. SAC,

          ¶¶15-16 and 19; see, Kurtin RJN, Ex. 4, p. 119. Interests in an LLC is a "security" under the Bankruptcy Code. Tristar, 782 F.3d at 495. 492, 495 (9th Cir. 2015). "The term ‘security"... includes...interest of a limited partner in a limited partnership." 11 U.S.C. § 101(49)(A)(xiii). The SAC further alleges that the Suncal LLCs are Debtors’ affiliates. SAC, ¶¶42-43, 69, 100, and 113; see, 11 U.S.C.§ 101(2)(A). Thus, the SAC sufficiently pleads that securities of Debtors’ affiliates are at issue.


        3. The SAC Sufficiently Pleads that the Settlement Agreement was one to Purchase or Securities within the meaning of 510(b)


          Turning to Kurtin’s first two arguments, Kurtin argues that (1) the Settlement Agreement is not an agreement to purchase or securities, (2) and even it were, the 2017 Judgment does not "arise from" the sale and purchase of

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          Bruce Elieff


          Chapter 11

          securities because the 2017 Judgment was based on Elieff’s liability for diversion of assets


          The Ninth Circuit has adopted a broad interpretation of what constitutes "a claim arising from the purchase or sale of a security." Am. Wagering, Inc., 493 F.3d at 1072. "[T]he statute sweeps broadly...and reaches even ordinary breach of contract claims so long as there is a sufficient nexus between the claim and the purchase of securities." In re Tristar Esperanza Properties, LLC, 782 F.3d 492, 495 (9th Cir. 2015); Am. Wagering, supra, at 1072 ("As noted above, a number of courts, including this one, have held that breach of contract claims may be subordinated under section 510(b) where there exists some nexus or causal relationship between the claim and the purchase of the securities. ").

          reimbursement/contribution—that all have a nexus with the purchase or sale of a security." In re Tristar Esperanza Properties, LLC, 488 B.R. 394, 399 (B.A.P. 9th Cir. 2013), aff'd, 782 F.3d 492 (9th Cir. 2015).


          In assessing the "arising from" element, the courts focus upon the origin or source of the claim. "The phrase ‘arising from’ as employed in § 510(b) ‘connotes, in ordinary usage, something broader than causation’ and is instead ‘ordinarily understood to mean originating from, having its origin in, growing out of, or flowing from or in short, incident to, or having connection with." In re Del Biaggio, 834 F.3d 1003, 1009 (9th Cir. 2016).


          "[T]he status of the claim on the date of the petition does not end the § 510(b) inquiry," so the "critical question for purposes of § 510(b), then, is not whether the claim is debt or equity at the time of the petition, but rather whether the claim arises from the purchase or sale of a security." Tristar, 782 F.3d at 497 (emphasis in original). To that end, courts may "look behind" a judgment to determine whether the claim arises from the purchase or sale of securities. See, Am. Wagering, 493 F.3d at 1071 (analyzing the terms of the underlying consulting contract to determine whether a money judgment based on the value of stock arose from the purchase or sale of securities); Betacom, 240 F.3d at 831-32 (remanding to the bankruptcy court the determination of whether two promissory notes arose from the purchase or sale of stock because "there is little evidence in the record to explain their origin" and directing that if the promissory

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          Bruce Elieff


          Chapter 11

          notes are "linked" to a merger agreement, they should be subordinated); See also, In re SeaQuest Diving, LP, 579 F.3d 411, 425 (5th Cir. 2009)("Rather, the court must look behind the judgment and examine the totality of the circumstances to determine whether the transaction is a ‘rescission of a purchase or sale of a security of a debtor.’").

          However, "there is a limit to the reach of § 510(b), which stops short of encompassing every transaction that touches on or involves stock in a corporation." In re Kahn, 846 F.3d 1058, 1064 (9th Cir. 2017).


          Here, the SAC alleges that Kurtin and Elieff agreed to resolve the First Action through Elieff’s leveraged buyout of "Kurtin’s equity in their partnerships, inclusive of Kurtin’s interest in the SunCal LLC, for $48.8 million." SAC, ¶¶18-19 and 39. This allegation is supported by the actual terms of the Settlement Agreement (which was referenced in the SAC, so it may be considered) which provide that the Settlement Agreement resolves the First Action and requires Kurtin to transfer his interest in the SunCal LLCs to Elieff, and transfer his interests in the trade name "SunCal".


          Kurtin argues that the Court should interpret the Settlement Agreement by only examining the plain language of the Settlement Agreement and find that, because the Settlement Agreement uses the term "settlement" throughout and settles the First Action, the Settlement Agreement is not an agreement to purchase or sale securities. See, Reply, p. 13:3-14:20. For pleading purposes, the argument is unpersuasive for two reasons.


          First, the plain language of the Settlement Agreement also includes the provisions requiring Kurtin to transfer his interests in the SunCal LLCs. Kurtin does not explain why the Court should consider the plain language of one section of the Settlement Agreement but ignore the plain language of the Settlement Agreement in another section. For Rule 8 and Rule 12(b)(6) purposes, the

          Second, in determining whether the Settlement Agreement "arises from" the purchase or sale of securities, the Court may "look behind" the 2017 Judgment and examine the the underlying transaction. As discussed above, the Settlement Agreement did more than simply provide for the dismissal of the First Action after Elieff paid the first $21 million for which Elieff was personally liable. Here, Kurtin agreed to transfer his equity interest in the Suncal LLCs and,

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          Bruce Elieff


          Chapter 11

          importantly, several entities included in the list of entities comprising the "Suncal LLCs" were not even parties to the First Action, for example KRE, LLC and Moorepark 150, LLC. Cf., RJN Ex. 3, p. 094 (first amended complaint the First Action) and Ex. 4, p. 119 (list of the Suncal LLCs). Thus, the Settlement Agreement was more than just a settlement of litigation between parties to the litigation.


          In sum, 1st, 7th, and 10th Claims state plausible claims for relief under § 510(b).


        4. The Kurtin Liens May Not Be Transferred Under §510(c)(2) as a Matter of Law


      11 U.S.C. § 510(c) provides:



      and a

      1. Notwithstanding subsections (a) and (b) of this section, after notice hearing, the court may—

        1. under principles of equitable subordination, subordinate for purposes of distribution all or part of an allowed claim to all or part of another allowed claim or all or part of an allowed interest to all or part of another allowed interest; or


        2. order that any lien securing such a subordinated claim be transferred to the estate.


      The SAC alleges that pursuant to § 510(c)(2), all judgment liens securing the 2017 Judgment should be transferred to Debtors’ estates. SAC, ¶¶71, 102,

      115. Kurtin argues that the § 510(c)(2) claim should be dismissed because, per the plain language of § 510(c)(2), the remedy of transferring a lien securing a subordinated claim to the estate is only available for equitable subordination. See, Mot., p. 27; Reply, p. 21:20-22:21. Debtors counterargue that, per the plain language of § 510(c), the word "or" between (c)(1) and (c)(2) of § 510 means that the remedy of § 510(c)(2) is available as a remedy for mandatory subordination of § 510(b). See, Opp’n, p. 20:6-21:19. The Court agrees with

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      Bruce Elieff


      Chapter 11

      Kurtin and the First Circuits interpretation of 510(c) in In re Merrimac Paper Co., Inc., 420 F.3d 53, 65 (1st Cir. 2005)(reversing bankruptcy court’s order equitably subordinating claims and the transfer of an attachment against debtor’s real estate) which stated that "a lien can only be transferred under [§ 510(c)(2)] when the underlying claim has been equitably subordinated. The Court agrees that the natural and logical ready of 510(c) is that the subsections (1) and (2) relate to equitable subordination only, to the exclusion of 510(a) and (b). Under 510(c), the bankruptcy court is provided with options regarding equitably subordinated claims. This Court rejects the interpretation offered by Debtors as an unnatural reading of the plain language of the statute.


      Accordingly, because § 510(c)(2) cannot be used as a remedy for § 510(b), the 1st, 7th, and 10th claims are not plausible and must be dismissed.


    4. The Motion is Granted as to the § 547 Claims, except as to Morse


      [5th (Elieff), 8th (Morse), 11th (Camden), 14th (Camden) Claims]


      No objection was made to the following § 547 claims for relief: 2nd (Elieff) and 11th (Camden) Claims


      To the extent that the SAC does not address the liens filed in 2017, it does not sufficiently state a claim under 547. For example, if an abstract of judgment was recorded in 2017 and the property was subsequently transferred, the lien would remain on the property and any transferee would take subject to such lien. In other words the lien is not legally stripped by the transfer, fraudulent or otherwise. The SAC is silent regarding the legal impact of the earlier pre- transfer liens.


      Morse alleges a plausible claim for relief under § 547(b) because the SAC sufficiently pleads facts that demonstrate that the 90-Day Lien was recorded by Kurtin during the ninety day preference period, during which time Morse is presumed to be insolvent on account of the antecedent 2017 Judgment. See, SAC, ¶¶53, 103-109. Kurtin’s two counter arguments, that the 8th Claim is a sham pleading because it contradicts Morse’s schedules and Kurtin did not receive more than he would have in chapter 7 because the claims filed against

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      Bruce Elieff


      Chapter 11

      the Morse estate should not be allowed (because they are "manufactured" claims and the claimants cannot rely on the alter ego doctrine) are unpersuasive for three reasons. See, Mot., p. 31-32; Reply, p. 25:24-26:16.


      First, notwithstanding Kurtin’s pending claim objections to the alleged claims "manufactured" by Morse, there has been no order disallowing those claims so they are currently deemed allowed. See, 11 U.S.C. § 502(a). Second, Kurtin’s arguments is procedurally improper because it is effectively requesting that the Court turn this Motion into a claim objection and disallow the alleged manufactured claims without providing any notice to the claimants. Thus, assuming that the claims filed against Morse presumed valid until disallowed, the 8th claim is plausible.


      Finally, as to the 14th Claim, Camden moves to avoid the "Riverside Lots Lien" which was recorded on February 13, 2019 in Riverside County thereby encumbering real property defined as the "Riverside Lots. SAC, ¶¶56, 58-62, 134-140. Camden alleges that the Riverside Lots Lien did not attach to the Riverside Lots on February 13, 2019 because, on August 17, 2018, Camden had transferred the Riverside Lots to a third party entity. Camden further alleges that the Riverside Lots were transferred back to Camden on October 2, 2019 (during the preference period) and at that time, the Riverside Lots Lien attached to the Riverside Lots. Id.


      Kurtin argues that Riverside Lots Lien attached to the Riverside Lots on February 13, 2019 because the transfer to the third party was a fraudulent transfer and therefore had no legal effect and is void. See, Mot., p. 31:7-15.

      Kurtin’s argument is persuasive. In In re Cass, 476 B.R. 602, 608 (Bankr. C.D. Cal. 2012) the "dispute between the parties...is whether Defendants’ judgment lien- perfected under state law after the Debtor made a fraudulent transfer of the Residence- attached to the property." The bankruptcy court found that, "California law has well established the a judgment lien attaches to real property that is fraudulently transferred by treating the transfer as void in the first place, and not just voidable." Id. at 614 (citing Hassen v. Jonas, 373 F.2d 880, 883 (9th Cir. 1967)("The effect of [§3439.07] that transfers within the statute are fraudulent is that such transfers are deemed void as to creditors."). The bankruptcy court concluded that, " Because the fraudulent transfer is

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      Bruce Elieff


      Chapter 11

      disregarded, a perfected judgment lien reaches the interest of a judgment debtor in property that has been fraudulent transferred to another-even if the transfer place before the judgment lien attached." Id. at 615. The court held that the judgment lien perfected after the property had been fraudulent transferred attached to debtor’s residence because the fraudulent transfer was void. Id. at 618.


      The Ninth Circuit BAP affirmed the Cass bankruptcy court’s decision and found that, "Under California law, a transferee of property transferred in fraud of creditors by the transferor holds only nominal or bare legal title to the property conveyed; the transferor retains the beneficial and equitable interest in the conveyed property, which remains liable to the debts of creditors." In re Cass, 2013 WL 1459272 *15 (BAP 9th Cir., Apr. 11, 2013).


      In this case, the SAC admits that the transfer of the Riverside Lots on July 17, 2018 was a constructive fraudulent transfer under both federal and state law. SAC, ¶60. Thus, as discussed in Cass, the transfer was void under California law and Kurtin’s judgment lien on the Riverside Lots attached on February 13, 2019- well outside the ninety day preference period. Accordingly, the 14th Claim fails to allege a plausible claim for relief under § 547(b).


      The term "Kurtin Liens" refers to abstracts specially recorded against Elieff- not Camden- and the SAC is devoid of any factual allegations that Camden has an interest in Elieff’s assets. SAC, ¶53. The SAC should have sought to avoid the "Camden Liens," which is defined in ¶56 as liens against Camden’s real properties. Thus, on the face of the SAC, the 14th Claim is also not plausible because Camden is seeking to avoid the preferential transfer of an interest in Elieff’s property, not its own property.


      In sum, Elieff and Camden fail to allege plausible claims for relief in the 5th and 14th Claims. Morse, however, alleges a plausible claim for relief under the 8th Claim.


      The Motion is Denied as to the § 548(a)(2)(B) Claims [3rd (Elieff), 12th (Camden) Claims]

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      Bruce Elieff


      Chapter 11

      Under § 548(a)(1)(B), "constructive" fraudulent transfers are avoidable if the transfer, or debt incurred, was for less than reasonably equivalent value and the debtor was, or by way of the transfer or debt incurred became, insolvent.


      Per FRCP 9, "In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake." Unlike an intentional fraudulent transfer causes of action, however, a "cause of action asserting a constructively fraudulent transfer is not subject to the heightened pleading standards [of FRCP 9]... These causes of action are adequately pled as to most elements with a short plain statement as required by [FRCP] 8, as modified by Twombly." In re Automated Fin. Corp., 2011 WL 10502417, at *4 (Bankr. C.D. Cal. Jan. 25, 2011).


      As for the 3rd Claim, Elieff seeks to avoid Kurtin Liens that were recorded within two years of the petition date as constructive fraudulent transfers. See, SAC, ¶¶80-84. And as for the 12th Claim, Camden seeks to avoid the Camden Liens that were recorded within two years of the petition date as constructive fraudulent transfers. Id., ¶¶123-128.


      Kurtin first argues that Elieff and Camden have cited the elements in a conclusory fashion. See, Mot., p. 28:19-29:3. This argument is unpersuasive because, as discussed above, "short plain statements" satisfy the pleading requirements for constructive fraudulent transfer claims, and the SAC provides those "short plain statements." See, SAC, ¶¶80-84 and 123-128.


      Kurtin also argues that because Elieff and Camden received reasonably equivalent value under § 548(d)(2)(A), the recording of the Kurtin’s judgment liens was not a constructive fraudulent transfer. See, Reply, 22:23-24:5. This argument is also unpersuasive.


      Under § 548(d)(2)(A), "value" for purposes of § 548 is defined as "property, or satisfaction or securing of a present or antecedent debt of the debtor, but does not include an unperformed promise to furnish support to the debtor or to a relative of the debtor[.]" (emphasis added). In re Fitness Holdings Intern. Inc., 714 F.3d 1141, 1145-46 (9th Cir. 2013)(finding what while "reasonably equivalent value is not defined, the term "value" is defined as

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      Bruce Elieff


      Chapter 11

      "satisfaction or securing of a present or antecedent debt of the debtor"); In re GTI Capital Holdings, LLC, 373 B.R. 671, 680 (Bankr. D. Ariz. 2007) ("Debtor did roughly receive a dollar-for-dollar value exchange. Comerica received a security interest in the Debtor's personal property, and the Debtor received the value of having secured the antecedent debt acquired by Comerica in an amount that was equal to the value of the personal property."); Anand v. Nat’l Republic Bank of Chicago, 239 B.R. 511, 517 ("There is no dispute that collateralization of an antecedent debt confers value on the debtor, since the bankruptcy statute’s definition of ‘value’ includes "securing of a present or antecedent debtor of the debtor.").


      The determination of the "reasonably equivalent value is factual question, however, to be decided on the facts of each case." GTI Capital, 373 B.R. at 671 (citing In re United Energy Corp., 944 F.2d 589, 597 (9th Cir. 1991)). Thus, while there is no per se rule that if "a debtor grants a security interest to a creditor, the debtor receives reasonably equivalent value by securing the antecedent debt," see, GTI Capital, 373 B.R. at 676-677, the debtor will receive reasonably equivalent value "if the collateral securing the antecedent debt was equal to, or less than, the amount of the debtor." Id. at 680. In this case, the recording of Kurtin’s judgment liens against Elieff and Camden during the two years prior to the petition date could be "value" under § 548(d)(2)(A). However, the determination of whether this "value" is "reasonably equivalent value" is a factual question which cannot be made at the pleading stage.


      "At the motion to dismiss stage, to plead adequately a constructive fraud claim all that is needed... is an allegation that there was a transfer for less than reasonably equivalent value at a time when the Debtors were insolvent." Beskrone v. OpenGate Capital Grp. (In re Pennysaver USA Publ'g, LLC), 587

      B.R. 445, 456 (Bankr. D. Del. 2018) (quotations and citation omitted). "Reasonably equivalent value and insolvency are generally factual determinations that should be reserved for discovery." Id. (citation omitted). And, "[a] constructive fraudulent conveyance claim is sufficient under Rule 8(a)(2) even if it alleges an aggregate monetary amount for multiple transfers during a multi-year period without a breakdown of individual transfers." Tronox Inc. v. Anadarko Petroleum Corp. (In re Tronox Inc.), 429 B.R. 73 (Bankr. S.D.N.Y. 2010).

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      Bruce Elieff


      Chapter 11

      Thus, deeming the allegations in the SAC that Elieff and Camden did not receive reasonably equivalent value as true, the 3rd and 12th Claims are plausible.


    5. The Motion is Denied as to the § 544 Claims


      [4th (Elieff), 13th (Camden) Claims]


      The "strong-arm" powers under § 544(b) allow Plaintiff to utilize remedies available to creditors under state law, including the California’s Uniform Voidable Transactions Act under California Civil Code ("Civil Code") § 3439 et seq. provides such a remedy. In the SAC, Elieff and Camden seek to avoid all of the Kurtin Liens and the Camden Liens as constructive fraudulent transfers pursuant to § 544(b) and Civil Code §§ 3439.04(a)(2) and 3439.05. SAC, ¶¶85-89, 129-133.


      Under Civil Code § 3439.04(a)(2), like § 548(a)(1)(B), a plaintiff may avoid "constructive" fraudulent transfers if transfer was made for less than reasonably equivalent value and the debtor was, or by way of the transfer, became insolvent. Under Civil Code § 3439.05, "A transfer made or obligation incurred by a debtor is voidable as to a creditor whose claim arose before the transfer was made or the obligation was incurred if the debtor made the transfer or incurred the obligation without receiving a reasonably equivalent value in exchange for the transfer or obligation and the debtor was insolvent at that time or the debtor became insolvent as a result of the transfer or obligation."


      Here, Kurtin argues that Civil Code § 3439.08(e)(2) limits the application of Civil Code §§ 3439.04(a)(2) and 3439.05 because the Kurtin’s judgment liens were enforced, through recordation, without collusion with Debtors. See, Mot., p. 29:19-30:3. In relevant part, Civil Code § 3439.08(e)(2) states, "A transfer is not voidable under paragraph (2) of subdivision (a) of Section 3439.04 or Section 3439.05 if the transfer results from... Enforcement of a lien in a noncollusive manner and in compliance with applicable law, including Division 9 (commencing with Section 9101) of the Commercial Code , other than a retention of collateral under Sections 9620 and 9621 of the Commercial Code and other than a voluntary transfer of the collateral by the debtor to the lienor in satisfaction of all or part of the secured obligation."

      2:00 PM

      CONT...


      Bruce Elieff


      Chapter 11


      Debtors counterargue that Civil Code § 3439.08(e)(2) is not applicable because the statute refers to "enforcement" and not the recording of the lien, and the section was intended to prevent the avoidance fraudulent transfers effectuated by collusive foreclosure sales. See, Opp’n, p. 24:19-25:6.


      While neither party has provided a case on point, Debtors’ argument, at a minimum supports the claim. The plain language of the statute states "enforcement of a lien." While Kurtin reasonably maintains that recording a lien is part of enforcing a lien, for pleading purposes, the SAC meets minimum pleading requirements.


      Kurtin next argues that "an asset that encumbered by a valid security interest is not subject to the UVTA." Reply, p. 24:27-27. For support, Kurtin relies on In re Consol. Pioneer Mortg. Entities, 1999 WL 23156, *1 (9th Cir. 1999)("Moreover, property encumbered by a valid security interest is not recoverable under California law. See Cal.Civ.Code § 3439.01(a)(1)").

      Consolidated Pioneer, however, is factually distinguishable. In that case, the asset transferred was previously encumbered by the bank’s UCC lien. Consol., Pioneer, supra at 1. Thus, the Ninth Circuit’s reference to a "valid security interest" refers to a prior existing lien, and property with no equity can not be recovered as a fraudulent transfer. See, In re Brun, 360 B.R. 669, 674 (Bankr.

      C.D. Cal. 2007)("As such, property that is fully encumbered and/or exempt is not voidable as a fraudulent transfer.")(citing Consol. Pioneer). Here, because Kurtin did not have a prior lien on Debtors’ assets before recording the Kurtin Liens and the Camden Liens, Consolidated Pioneer is inapplicable.


      And as discussed above in the § 548 claims section, the issues of whether reasonably equivalent value was received and Debtors’ insolvency are factual questions that should not be decided at the pleading stage. Thus, deeming the allegations in the SAC as true, the 4th and 13th Claims state plausible claims for relief under § 544 and avoidance of a constructive fraudulent transfer under California law.


    6. The Motion is Denied as to §§ 550, 551, and 502(d) Claims

      2:00 PM

      CONT...


      Bruce Elieff


      Chapter 11

      [6th (Elieff- §§550/551), 9th (Morse- §§550/551), 15th (Camden- §§ 550/551), 16th (Elieff- §502(d)), 17th (Morse- §502(d)), 18th (Camden- §502(d)) Claims]


      Under § 550(a), a debtor-in-possession or trustee may recover from the initial transferee for the benefit of the estate transfers set aside pursuant to § 544 or the value of those transfers. The use of the word "may" in § 550(a) provides bankruptcy courts with discretion to first determine whether to award any recovery under § 500, and second, to determine which of the alternative forms of relief to grant- the property itself or the value of the property transferred. In re Taylor, 599 F.3d 880, 890 (9th Cir. 2010)(citing In re Bremer, 408 B.R. 355, 359 (BAP 10th Cir. 2009). Per § 502(d), in relevant part, a bankruptcy court shall disallow any claim of any entity from which property is recoverable under § 550 or that is a transferee of a transfer avoidable under § 544, unless such entity has paid the amount or turned over the property recovered.


      Here, Kurtin argues that the Claims under §§ 550, 551, and 502(d) should be dismissed because Debtors fail to allege any plausible claims under §§ 544, 547, or 548. See, Mot., p. 32:22-27. However, as discussed above, Debtors have alleged plausible claims under the 2nd Claim- § 547 (Elieff)(no objection filed), 3rd Claim- § 548 (Elieff), 4th Claim- § 544 (Elieff), 8th Claim- §547 (Morse), 11th Claim- § 547 (Camden)(no objection filed), 12th Claim- §548 (Camden), and 13th Claim- § 544 (Camden).


      Accordingly, the Motion is denied as to claims under §§ 550, 551, and 502(d), except to the extent the court has granted the Motion as to certain 547 claims herein.


    7. Leave to Amend


Leave to amend a complaint or claim is generally within the discretion of the bankruptcy court and is reviewed under the abuse of discretion standard. Mende v. Dun & Bradstreet, Inc., 670 F.2d 129 (9th Cir. 1982). FRCP 15(a), made applicable herein by FRBP 7015, provides that a party may amend the party’s pleading by leave of court and leave shall be freely given when justice so requires. The Ninth Circuit applies this rule with "extreme liberality." Forsyth v.

2:00 PM

CONT...


Bruce Elieff


Chapter 11

Humana, Inc., 114 F.3d 1467, 1482 (9th Cir. 1997). In exercising its discretion, a bankruptcy court "must be guided by the underlying purpose of Rule 15 to facilitate decision on the merits, rather than on the pleadings or technicalities." In re Magno, 216 B.R. 34 (9th Cir. BAP 1997). A bankruptcy court considers the following factors in determining whether a motion to amend should be granted:

(1) undue delay; (2) bad faith; (3) futility of amendment; and (4) prejudice to the opposing party. Hurn v. Retirement Fund Trust of Plumbing, Etc., 648 F.2d 1252, 1254 (9th Cir. 1981). While recognizing the principles that leave to amend should be freely granted and the preference for decisions on the merits, if the court finds that a complaint has failed to state a claim, dismissal may be without leave to amend. Lopez v. Smith, 203 F.3d 1122, 1126-30 (9th Cir. 2000). A court may also dismiss a complaint without leave to amend when amendment would be futile. McQuillion v. Schwarzenegger, 369 F.3d 1091, 1099 (9th Cir. 2004).


In this case, although Debtors have not requested leave to amend if any claim is dismissed, in light of the Ninth Circuit’s liberal policy towards amendments, leave to amend will be allowed except as to the 510(c) claim


Party Information

Debtor(s):

Bruce Elieff Represented By

Paul J Couchot

Defendant(s):

Todd Kurtin Represented By

Lewis R Landau

2:00 PM

CONT...

Movant(s):


Bruce Elieff


Chapter 11

Todd Kurtin Represented By

Lewis R Landau

Plaintiff(s):

Bruce Elieff Represented By

Paul J Couchot

Morse Properties, LLC Represented By Paul J Couchot

4627 Camden, LLC Represented By Paul J Couchot

8:19-13858

Bruce Elieff

Chapter 11

Adv#: 8:19-01205 Elieff et al v. Kurtin


#3.00 CONT'D STATUS CONFERENCE RE: Second Amended Complaint for Mandatory Subordination and Recovery of Liens Pursuant to 11 U.S.C. §§510(b) and 510(c) (2), Avoidance and Recovery of Preferential and Fraudulent Transfers, and Disallowance of Claims Pursuant to 11 U.S.C. §502(d)


FR: 3-5-20; 4-9-20


Docket 11


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

April 23, 2020


Continue status conference to August 20, 2020 at 9:30 a.m.; joint status report is due August 6, 2020 (XX)

Party Information

2:00 PM

CONT...

Debtor(s):


Bruce Elieff


Chapter 11

Bruce Elieff Represented By

Paul J Couchot

Defendant(s):

Todd Kurtin Pro Se

Plaintiff(s):

Bruce Elieff Represented By

Paul J Couchot

Morse Properties, LLC Represented By Paul J Couchot

4627 Camden, LLC Represented By Paul J Couchot

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01015 Speier v. SunCal Management LLC et al


#1.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management, LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 417

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01015 Speier v. SunCal Management LLC et al


#2.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Breach of Contract; (2) Restitution and/or Unjust Enrichment; (3) To Avoid and Recover Fraudulent Transfers; and (4) To Avoid and Recover Preferential Transfers [Debtor: SunCal Oak Knoll, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 95

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta

2:00 PM

CONT...


Palmdale Hills Property, LLC


Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01021 Speier v. SunCal Management LLC et al


#3.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management, LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 372

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01021 Speier v. SunCal Management LLC et al


#4.00 CONT'D STATUS CONFERENCE RE: Third Amended Complaint (1) To Avoid and Recover Fraudulent Transfers and (2) To Avoid and Recover Preferential Transfers [Debtor: SunCal Torrance, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 327

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander

2:00 PM

CONT...


Palmdale Hills Property, LLC


R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch

Argent Management, LLC Represented By Craig H Averch

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01022 Speier v. SunCal Management LLC et al


#5.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management, LLC Was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 374

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01022 Speier v. SunCal Management LLC et al


#6.00 CONT'D STATUS CONFERENCE RE: Third Amended Complaint to Avoid and Recover Fraudulent Transnfers [Debtor: SunCal PSV, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 329

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch

Argent Management, LLC Represented By Craig H Averch

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01023 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#7.00 CON'TD STATUS CONFERENCE RE: Third Amended Complaint (1) To Avoid and Recover Fraudulent Transfers and (2) To Avoid and Recover Preferential Transfers [Debtor: Palmdale Hills Property, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 298

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander

2:00 PM

CONT...


Palmdale Hills Property, LLC


R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01024 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#8.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; and (4) To Avoid and Recover Fraudulent Transfers [Debtor: SunCal Summit Valley, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 68

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta

2:00 PM

CONT...


Palmdale Hills Property, LLC


Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01025 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#9.00 CONT'D STATUS CONFERENCE RE: Second Amended Complaint: (1) To Avoid and Recover Preferential Transfers; (2) For Declaratory Relief, (3) In the Alternative, Breach of Contract; (4) Restitution and/or Unjust Enrichment; and

(5) To Avoid and Recover Fruadulent Transfers

[Debtor: SunCal Bickford Ranch, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 77

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker

2:00 PM

CONT...


Palmdale Hills Property, LLC


Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01026 Speier v. SunCal Management LLC et al


#10.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) To Avoid and Recover Preferential Transfers; (2) For Declaratory Relief, (3) In the Alternative, Breach of Contract; (4) Restitution and/or Unjust Enrichment; and

(5) to Avoid and Recover Fraudulent Transfers [Debtor: SunCal Emerald Meadows, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 69

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker

2:00 PM

CONT...


Palmdale Hills Property, LLC


Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch

Argent Management, LLC Represented By Craig H Averch

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01125 Speier v. SunCal Management LLC et al


#11.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief; (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fradudulent Transfers; and (5) To Avoid and Recover Preferential Transfers

[Debtor: SunCal Marblehead, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 105

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker

2:00 PM

CONT...


Palmdale Hills Property, LLC


Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Doah Kim Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Doah Kim Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01126 Speier v. SunCal Management, LLC et al


#12.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 530

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management, LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01126 Speier v. SunCal Management, LLC et al


#13.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers; and

(5) To Avoid and Recover Preferential Transfers

[Debtor: SunCal Heartland, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 99

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker

2:00 PM

CONT...


Palmdale Hills Property, LLC


Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management, LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01127 Speier v. SunCal Management LLC et al


#14.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication That SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 518

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01127 Speier v. SunCal Management LLC et al


#15.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restititution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers [Debtor: SunCal Northlake, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 98

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta

2:00 PM

CONT...


Palmdale Hills Property, LLC


Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01128 Speier v. SunCal Management LLC et al


#16.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 518

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01128 Speier v. SunCal Management LLC et al


#17.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; and (4) to Avoid and Recover Fraudulent Transfers [Debtor: LBL-SunCal Oak Valley, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 98

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta

2:00 PM

CONT...


Palmdale Hills Property, LLC


Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01129 Speier v. Argent Management, LLC et al


#18.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20


Docket 522

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Oral Ruling Continued to 5/28/2020 at 2:00 p.m., on the

Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:08-17206


Palmdale Hills Property, LLC


Chapter 11

Adv#: 8:18-01129 Speier v. Argent Management, LLC et al


#19.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers; and

(5) To Avoid and Recover Preferential Transfers

[Debtor: Delta Coves Venture LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20


Docket 100

*** VACATED *** REASON: CONTINUED TO 5/28/2020 AT 2:00 PM, on

the Court's Own Motion (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 5/28/2020 at 2:00 p.m., on

the Court's Own Motion (XX) - td (4/24/2020)

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker

2:00 PM

CONT...


Palmdale Hills Property, LLC


Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

1:30 PM

8:20-10691


Teresita Lases


Chapter 13


#1.00 Hearing RE: Confirmation of Chapter 13 Plan


Docket 2


Courtroom Deputy:

Tentative Ruling:


January 9, 2020


No tentative ruling. Oral Argument only. Plaintiff will have 30 minutes to argue in favor of the Motion; Defendant will have 30 minutes to respond; Plaintiff will have 30 minutes to reply. The matter will then be taken under submission. Oral Ruling: March 26, 2020 at 2:00 p.m.

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

May 28, 2020


Grant motion for partial summary adjudication on the grounds that Plaintiff has established as a matter of undisputed fact and law that SCM is both a statutory insider under FRBP 101(31)(E) [affiliate within the meaning of 101(30)(D)], and FRBP 101(31)(F) [managing agent] and is also a nonstatutory insider.


The basis for the ruling and relevant evidentiary rulings will be posted in the tentative ruling field in lieu of an oral ruling on the record on May 29, 2020 between 12:00pm and 1:00pm. A hearing will be held on May 29, 2020 at 2:00

p.m. regarding any questions regarding the ruling, as well as scheduling of future motions/status conferences.


May 29, 2020


EVIDENTIARY RULINGS


Plaintiff's Evidentiary Objections to Declaration of Jeffrey Cook


Objection # Ruling


1-9 Overruled


  1. Sustained as to "My understanding is that Michael Delvin would review the work in the field and then write a report on the status of construction that was submitted to Lehman via Trimont." Overruled as to the balance


  2. Overruled

  3. Overruled

  4. Sustained

  5. Sustained


Basis for Ruling

2:00 PM

CONT...


Palmdale Hills Property, LLC

  1. Background


    Chapter 11


    An involuntary petition was filed against debtor SunCal PSV, LLC on November 14, 2008 "Debtor"). The order for relief was entered on January 6, 2009 and plaintiff, chapter 11 trustee Steven M. Spier ("Trustee" or "Plaintiff") was appointed on January 22, 2009.


    On May 1, 2012, Plaintiff commenced this adversary proceeding against SunCal Management, LLC ("SCM") and Argent Management, LLC ("Argent") (collectively, "Defendants"). Trustee seeks the return of management fees of more than $900,000 paid by Debtor (and eleven other related debtors) to SCM during the period 2004 to 2008 based on several legal theories. The original complaint was subsequently amended and timely answers were filed by Defendants. On September 9, 2016, this adversary proceeding, as well as the eleven other related adversary proceedings (sometimes referred to herein collectively as the "Related Adversaries") were transferred to Judge Geraldine Mund. Judge Mund made several rulings in the Related Adversaries, including the granting of summary adjudication in favor of Defendants on Plaintiff’s claims for breach of contract and restitution/unjust enrichment in this adversary proceeding. Importantly, on October 12, Judge Mund also ruled in one of the Related Adversaries involving SunCal Marblehead LLC ("Marblehead") that SCM was both a statutory and non-statutory insider of Marblehead. On January 25, 2018, the Related Adversaries were transferred back to this court.


    On May 30, 2019, Plaintiff filed the instant motion for partial summary adjudication [dkt. #417] ("Motion") for findings that SCM was also an insider of Debtor pursuant to §101(31) from the date Debtor and SCM entered into that certain Development Management Agreement ("DMA") until the petition date. Specifically, Plaintiff asserts that SCM is an insider under §101(31)(E) as an insider of an affiliate of Debtor, as the managing agent of Debtor under §101(31) (F), and as a non-statutory insider of Debtor. Defendants vigorously oppose the Motion.


  2. Standard for Summary Judgment/Partial Adjudication


    A party seeking summary judgment bears the initial responsibility of

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The opposing party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial. Id. at 324. The substantive law will identify which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Id. A factual dispute is genuine where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Id. The court must view the evidence presented on the motion in the light most favorable to the opposing party. Id.


    As explained by the Ninth Circuit in Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000):


    "A moving party without the ultimate burden of persuasion at trial— usually, but not always, a defendant—has both the initial burden of production and the ultimate burden of persuasion on a motion for summary judgment... In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party's claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial... In order to carry its ultimate burden of persuasion on the motion, the moving party must persuade the court that there is no genuine issue of material fact...

    If a moving party fails to carry its initial burden of production, the nonmoving party has no obligation to produce anything, even if the nonmoving party would have the ultimate burden of persuasion at trial... In such a case, the nonmoving party may defeat the motion for summary judgment without producing anything... If, however, support its claim or defense... If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion for summary judgment.

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Id. at 1102-03 (citations omitted). In ruling on a summary judgment motion, the Court does not weigh the evidence. Anderson, 477 U.S. at 255. Rather, the Court’s role is to assess whether a genuine dispute exists as to the material facts requiring a trial. Id. at 249. In conducting this assessment, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Tolan v. Cotton, 572 U.S. 650, 651 (2014). Furthermore, where intent is at issue, summary judgment is seldom granted. See, Provenz v. Miller, 102 F.3d 1478, 1489 (9th Cir. 1996), cert. denied, 118 S. Ct. 48 (1997).


    Federal Rules of Bankruptcy Procedure 7056 incorporates by reference most of the procedural requirements of Rule 56 of the Federal Rules of Civil Procedure ("FRCP") governing motions for summary judgment. In this District, Rule 7056-1 of the Local Bankruptcy Rules ("LBR") also applies.


  3. Statement of Uncontroverted Facts and Conclusions of Law/Statement of Genuine Facts


    Under FRCP 56(c)(1)(A), the moving party must cite to materials in the record, including "depositions, documents, electronically stored information, affidavits, declarations . . . admissions, interrogatory answers, or other materials." LBR 7056-1(b)(2) requires that the moving party serve and file a proposed statement of uncontroverted facts and conclusions of law. LBR 7056-1(c)(2)(A) and (B) requires that the respondent file a separate statement of genuine issues, "identify each material fact that is disputed and cite the particular portions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish the dispute "


    In this matter, Plaintiff timely filed a Statement of Uncontroverted Facts and Conclusions of Law "UF") and Defendants timely filed a Statement of Genuine Facts ("GI"). rules in favor of Defendants on evidentiary grounds.


    Defendants filed evidentiary objections to the admission of the content of Exhibit 4 of Plaintiff’s Request for Judicial Notice, Exhibit 4 being the Third Amended Disclosure Statement ("TAD") filed on August 5, 2011 by counsel for SCC Acquisitions [Dkt #424]. The objections are sustained on the basis of hearsay and personal knowledge and affect certain UFs that identify the TAD as

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    the supporting evidence for various fact statements, including the identification of Defendant SCM and SCC Acquisitions, Inc. as "insiders" of Debtor, SCM as a "SunCal Affiliate", SCC Acquisitions, Inc. as an "indirect parent company" of Debtor, and that Debtor was "an affiliate of SCC Acquisitions".


    Defendants also objected to Exhibit G to the Declaration of Gary Pemberton on personal knowledge grounds. Exhibit G is the deposition testimony of Edward Nolan and includes a "Project Detail Report." The objection is sutained except as to the Project Detail Report exhibit which the court finds is adequately authenticated.


    In sum, for purposes of this Motion, all of the statements in Plaintiff’s UF are deemed admitted and uncontroverted, except UFs that are disputed or stricken by evidentiary ruling. Some of the uncontroverted facts are summarized below.


  4. Uncontroverted Facts


    "The SunCal Companies," or "SunCal," is a brand name or dba used by an integrated network of real estate acquisition, holding and development companies owned by Bruce Elieff ("Elieff") and/or his brother, Stephen Elieff. UF

    1 Debtor was formed at Elieff’s direction as a single-purpose limited liability company to own certain real property located in Oakland, California (the "Oak Knoll Project"). UF 2, 3.


    Debtor did not have any employees and, as such, could not develop the Project itself. UF 6. Accordingly, on December 29, 2005, Debtor entered into a Development Management Agreement ("DMA") with SCM. UF 7. SCM was formed to "provide management and development services to entities who have direct or indirect ownership interests in certain real estate projects, and who are affiliated with the SunCal group of companies." UF 8. As a SunCal entity, SCM shared common management with Debtor. At all relevant times, Bruce owned 100% of SCM and served as its Manager as well as Debtor’s Manager. He executed the DMA on behalf of both SCM and Debtor. UF 9, 11. SCM’s General Counsel, Bruce Cook, participated in filing the documents used to form Debtor, prepared the Debtor’s Operating Agreement and the First Amendment thereto, as

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    well as the DMA, and was one of Debtor’s authorized signatories. UF 10. Frank Faye, SCM’s Chief Operating Officer, was also an officer of Debtor. UF 12.


    Under the DMA, Debtor engaged SCM "to perform the development and management functions set forth below in connection with the development, marketing and sale of the Project, and to assist in all aspects of the Project[.]" UF

    1. The DMA also provided SCM "the authority to perform (and incur expenses in connection with the performance of) the Development and Sale Services & Functions . . . and to otherwise act in accordance with the Project Budget" and to "take any action with respect to the Property or Project or incur any expense for which [the Debtor] is or may be responsible" so long as SCM "reasonably deems such action or expense as necessary in furtherance of the proper development, sale and marketing of the Project." UF 14. SCM reviewed and coordinated the work of the various contractors and consultants for Debtor’s Project. UF 15. SCM’s Project responsibilities were wide-ranging and included:


      • "[r]eview bids and prepare bid analyses";

      • "[c]oordinate the work of all contractors . . . [and] schedule and conduct development and progress meetings at which contractors, consultants, and [SCM] can discuss jointly such matters as procedures, progress, problems, and scheduling";


      • "monitor the delivery of, and if necessary, arrange storage, protection and security for, all materials, systems and equipment which are to be used in the development of, or incorporated

        into, the Project";


      • "arrange with contractors to provide adequate security for the Project, including, without limitation, prevention of trespassing and dumping."


        "assemble and retain all contracts, agreements and other records and data as may be necessary to carry out [SCM's] functions hereunder, and similar records for functions performed by contractors and other third parties in connection herewith";


      • "keep and maintain proper books of contracts and records on behalf of

        2:00 PM

        CONT...


        Palmdale Hills Property, LLC


        Chapter 11

        [the Debtor] relating to . . . the development, operations, expenses and proceeds of the Property and the lots and other parcels comprising the Property";


      • "[r]ecord the progress of the Project and submit to [the Debtor], from time to time as may be requested by [the Debtor], and as may be required by any Project Lenders, status reports consisting of (i) a payables transaction report listing all payables due for the month; (ii) a job

        cost report, (iii) a report explaining any budget variances, (iv) a committed cost report updated to include the invoices being paid during the month, and (v) a cash needs projection showing

        anticipated cash requirements for the ensuing four (4) months." UF 15, 16

        The DMA provided that Debtor would pay SCM a management fee "[a]s compensation for the performance of the Development and Sale Services & Functions and the other duties and services to be performed by [SCM]," the payment of which could be deferred or delayed based on the availability of funds. UF 17. Debtor was also liable for all third party costs incurred by SCM and compensation for SCM’s employees. UF 18.


        Under the DMA, SCM served as Debtor’s "developer/operator" and "management company." UF 19. In this capacity, SCM was the party responsible for managing the development of the Oak Knoll Project from late 2005 through at least November 2008. UF 20. SCM’s owner (and Debtor’s Manager), Elieff, was "in charge of overall supervision and monitoring of . . . [SCM’s] services" and "was aware of and oversaw what was being done for the [Debtor’s] Project[]." UF 21. Specifically, he "personally monitored, participated in and oversaw others who also participated in the day-to-day activities performed by SCM . . . in furtherance of the design, planning, entitlement [and] . . . development of the Project," was responsible for supervising SCM’s "extensive" work on the Project, met, typically on a weekly basis, with members of SCM’s senior management to discuss material matters relating to the entitlement and development of the Project, and toured the Project site. UF 22, 23, 29. SCM’s Chief Operating Officer, Frank Faye (also an officer of Debtor) had "oversight

        2:00 PM

        CONT...


        Palmdale Hills Property, LLC


        Chapter 11

        responsibility of [a number of SCM] employees and their work product" and was in charge of supervising SCM’s activities with respect to the development of the Oak Knoll Project. UF 12, 24, 25. Under the direction of SCM’s Chief Accounting Officer, Tom Rollins, SCM "[m]anag[ed] the process of payments by [the Debtor] to contractors, consultants, vendors and others" and "[p]rovid[ed] accounting and asset management services for the Project[]." UF 26. SCM also prepared Debtor’s business plans and project budgets. UF 27.


        SCM performed all day-to-day operations related to the Project, including:


      • "investigating and evaluating all potential site uses for the Project, including preparing site plans";


      • "preparing financial reports and status reports concerning the Project . . . regarding all work performed on the Project by SCM, contractors, consultants, third party vendors, and others";


      • "providing contract administration for the numerous contracts relating to the entitlement effort and other activities on the site of the Project";


      • "creating bid packages, and negotiating and drafting agreements and all related documents for work performed by consultants, contractors, and third-party vendors for the Project";


      • "engaging and consulting with consultants, contractors, and attorneys in connection with the preparation of environmental impact reports, the CEQA process, the Subdivision Map Act process, resource agency permits, and other necessary entitlements for the Project";


      • "engaging, monitoring, and evaluating consultants, contractors, third party vendors, and others, who performed services related to the construction and development of the Project . . .";


      • "engaging and consulting with architects and engineers and overseeing work performed by them";

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    UF 28


    Pursuant to the DMA’s terms, Debtor was responsible for paying SCM’s management fees and expense reimbursements. UF 17, 18. According to SCM’s Chief Accounting Officer, Tom Rollins, SCM "invoiced the Debtor directly for services performed" from "the inception of the Project to the Petition Date." UF 30. After SCM generated an invoice, it would go to the Project accountant, an SCM employee. UF 31. The Project accountant would then send the SCM invoices to SCM’s asset management group for review and approval. UF 32. Ultimately, an SCM employee would issue a check or wire funds from Debtor’s account to SCM. UF 33. Mr. Rollins and Ed Nolan, also an SCM employee,

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    were responsible for approving such transfers. UF 34. Mr. Rollins testified that SCM employees would "try to make sure that billings [were] done properly, the accounting [was] done properly." UF 35. However, Debtor did not have any employees, and thus there was no personnel of Debtor to question whether an invoice was correct or whether a management fee payment should be deferred in accordance with the DMA based on a shortage of funds. UF 6. In total, SCM received at least $5,506,401.00 in management fees from Debtor between 2005 and 2008. UF 37.


  5. Marblehead Decision


    During the time that he Related Adversaries were pending before Judge Mund, Plaintiff filed a similar motion for partial adjudication based on facts nearly identical presented here that SCM was a statutory and non-statutory insider of related debtor. SunCal Marblehead, LLC ("Marblehead"), adv. no 18-01125. In a thorough and well-analyzed opinion, Judge Mund held as follows:


    1. SCM was not an insider as an "affiliate" of Marblehead under § 101(31)(E),

    2. SCM was not an insider of Marblehead’s affiliate, Elieff, under §101(31)(E),

    3. SCM was an insider of Marblehead as "managing agent" under §101(31)(F), and

    4. SCM was a non-statutory insider of Marblehead.


    See Palmdale Hills Prop. v. Argent Mgmt., LLC (In re Palmdale Hills Prop.), 2017 Bankr. LEXIS 3534, at *19 (Bankr. C.D. Cal. Oct. 12, 2017). Both sides cite to Judge Mund’s prior decision and address Judge Mund’s analysis in their arguments. With one notable exception, this court agrees with Judge Mund’s findings and conclusions. To avoid "re-inventing the wheel," the court will borrow heavily from her reasoned opinion.


  6. Analysis


    1. Insider Status Under §101(31)


      The SAC alleges a claim for relief under §547 for preferential transfer. Section 547(b)(4)(B) extends the "look back" period for recovery a preferential

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      transfer to an insider from ninety days to one year prior to the petition date. Pursuant to § 547(g), Plaintiff bears the burden of proving that SCM is an insider, in connection with Plaintiff’s preference claim against SCM. Batlan v. Transamerica Commer. Fin. Corp. (In re Smith's Home Furnishings, Inc.), 265 F.3d 959, 963 (9th Cir. Or. 2001) ("Section 547(g) places the burden of proof on the trustee to show all of the conditions of §547(b).").


      There are "two types of insiders: statutory insiders and non-statutory insiders." In re The Village at Lakeridge, LLC, 814 F.3d 993, 999 (9th Cir. 2016), aff'd sub nom. U.S. Bank Nat. Ass'n ex rel. CWCapital Asset Mgmt. LLC v.

      Village at Lakeridge, LLC, 138 S. Ct. 960, 200 L. Ed. 2d 218 (2018). "To be a ‘statutory insider,’ a creditor must fall within one of the categories listed in 11

      U.S.C. § 101(31)." Village at Lakeridge, supra, at 996 (emphasis in original). "Whether a creditor is an insider is a factual inquiry that must be conducted on a case-by-case basis." Id. at 1000. "In conducting a factual inquiry for insider status, courts should begin with the statute. If the [alleged insider] fits within the statutory insider classification on his own, the court’s review ends; it need not examine the nature of the statutory insider’s relationship to the debtor." Id. at 1001.


      Under §101(31), the term "insider" includes as to corporations:


        1. if the debtor is a corporation –

          1. director of the debtor;

          2. officer of the debtor;

          3. person in control of the debtor;


      1. affiliate, or insider of an affiliate as if such affiliate were the debtor; and


      2. and managing agent of the debtor.


    2. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(E) Based on Its Affiliate

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC

      Status Under §101(2)(D)


      Chapter 11


      Section 101(2)(D) defines "affiliate" as an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." (emphasis added)


      It is undisputed that SCM and its employees operated all aspects of Debtor’s project development business as previously noted in detail herein. Plaintiff contends that under these circumstances, SCM, as the operator of Debtor’s business, falls squarely within the definition of affiliate under §101(2) (D). SCE, on the other hand, argues that because it did not operate under a lease or operating agreement it is not an affiliate within the meaning of §101(2) (D). The issue is whether the DMA, a management agreement, is the functional equivalent of an operating agreement as that term is used in §101(2)(D). As pointed out by Judge Mund in the Marblehead decision, there are very few cases interpreting "operating agreement," and none in the Ninth Circuit. Some cases have interpreted the term expansively. See, e.g., In re Chira, 353 B.R. 693, 724-25 (Bankr.S.D.Fla.2006) ("the hotel also represented substantially all of [the debtor’s] property. Elizabeth and Lounge Corp. are both ‘entities’ and they both operated the business and property of the Shelton Beach Hotel."); In re Century Inv. Fund VII Ltd., P’ship, 96 B.R. 884, 892 (Bankr.E.D.Wis.1989) (""Affiliate" means an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." 11 U.S.C. § 101(2)(D). CMG has certainly been managing all of the property of the debtor under its management agreement.). By contrast, other courts have interpreted the term more strictly. See, In re Washington Mut., 462 B.R. 137, 145-46 (rejecting debtors’ argument that certain pooling and servicing agreements were de facto operating agreement within the meaning of the statute).

      Judge Mund held that principles of statutory construction led her to the conclusion that SCM does not fall within the statutory definition of affiliate under

      §101(31)(D), relying at least in part on the statutory construction principles referenced in the decision of the Ninth Circuit Bankruptcy Appellate Panel in Miller Ave. Prof’l & Promotional Servs. v. Brady (In re Entertainment Acquisition Partners, Inc., 319 B.R. 626, 632-33 (9th Cir. BAP 2004). In Miller, the BAP held the corporation of a statutory insider was not an insider under §101(31)(B) and

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      noted that "there is no justification for expanding the definition of a per se insider beyond what is plainly contained in the statute." Judge Mund observed that because §101(2) states that the term "affiliate" means, as opposed to the more flexible includes (as with §101(31), Congress intended a precise and restricted meaning. Further, giving meaning to all of the statutory language requires the existence of an actual operating agreement. Finally, and most importantly, Judge Mund opined that operating agreements "have specific meanings in the law of limited liability companies and for oil and gas rights," and that "terming the DMA to be an ‘operating agreement’ would be expanding the definition of affiliate (and thus insider) beyond what is plainly contained in the statute." 2017 Bankr.Lexis 3534 at 29.

      SCM urges the court to employ the restrictive construction of the term, arguing that "leasing or operating agreement implies entitlement to benefits akin to ownership, which is not the case here. SCM also cites several a number of cases which describe an "operating agreement" as a contract used in the oil and gas industry. See Defendants’ Opposition at p. 30 and citations therein [Dkt # 424].


      Respectfully, the principles of statutory construction lead this court to a contrary conclusion. First, the court is not persuaded that the plain meaning of the term means a literal meaning of the same without regard to substance or context. Certainly, nothing in the legislative history of §101 suggests that Congress intended to limit affiliate status to operating agreements associated with limited liability companies or oil and gas contracts. The legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      Second, as "operating agreement" is not defined in §101, consideration of the context of the surrounding language is in order. It is a "fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme. Food and Drug Admin. v. Brown & Williamson Tobacco Co., 529 U.S. 120, 133 (2000); accord Gale v. First Franklin Loan Services, 701 F.3d. 1240, 1244 (9th Cir. 2012). See, generally Badgley v. United States, 957 F.3d. 969, 977 (9th Cir. 2020) ("In

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      applying the statute, we focus on the substance of the retained interest. Labels are not dispositive."). Section 101(2)(D) starts with "entity that operates the business . . .of the debtor. The court interprets this to mean the emphasis is on whether someone other than the debtor is operating its business. As the DMA is an agreement governing the SCM’s operation of every aspect of Debtor’s business and property, it is, the court’s view, an "operating agreement" within the meaning of §101(2)(D).


      The court concludes as a matter of undisputed fact that SCM is an affiliate under §101(2)(D) and, therefore, a statutory insider pursuant to §101(31) (E).


    3. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(F) Based on Its Status as Managing Agent


      Under §101(31)(F), the term "insider" includes a managing agent of the debtor. As with "operating agreement," "managing agent" is not a defined term under the Code. In analyzing whether SCM was the managing agent of Marblehead, Judge Mund looked to guidance from the case of Rush v. Riddle (In re Standard Shoes, Inc.), 124 B.R. 318 (Bankr.C.D.Cal.1991). Though neither Standard Shoes or Judge Mund’s decision regarding the Marblehead matter are binding on this court, the court nevertheless finds them instructive and soundly reasoned.


      In Standard Shoes, Judge Zurzolo, in addressing the ambiguity of the term "managing agent," developed the following useful definition:


      "In defining ‘managing agent,’ I therefore conclude that it refers to Those entities that exert or could exert operational control over a debtor, a division or unit of a debtor, or a significant portion of a debtor’s property. Such operational control would ordinarily include the ability to make personnel decisions, the authority to incur or pay obligations and access to financial and other information essential to the operation of the debtor.

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      The definition of ‘managing agent’ is consistent with the principal design of §101[31] and does not overlap or conflict with the categories of insiders expressly described in the preceding subsections of that statute."


      124 B.R. at 323-24.


      SCE contends that it did not have operational control over Debtor or over a significant portion of Debtor’s property and that its authority was limited to performing services and making recommendations to Lehman which had ultimate approval power and control. Opposition at pp. 17-18. The court finds SCM’s arguments wholly unpersuasive. Instead, the court agrees with and adopts Judge Mund’s analysis and findings in the Marblehead matter:


      "SCM exercised operational control over the Debtor and thus was a managing agent. All three factors indicating such control in Standard Shoes exist: although its actions needed to be in accord with Project Budgets, SCM had authority to incur expenses on the Project, ability to make personnel decisions (as the Debtor’s operations were all conducted by SCM employees), and access the Debtor’s books and records (which

      it maintained). It is undisputed that SCM conducted the Debtor’s operations. While its actions may have been subject to the Lehman-approved Project Budget and Plan and Lehman may have had veto power over all payments, the standard does not demand unfettered control over the debtor. Standard Stores used a person in charge of a division of a corporate debtor as an example of a managing agent and cited the authority to direct payment of obligations, employ personnel, or order supplies as hallmarks of such control. Such people would still be subject to supervision and veto power by the officers and board of directors of the company."


      2017 Bankr. Lexis 3534 at 33-34.


      The duties and responsibilities of SCM under the DMA meet and exceed

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      the managing agent factors set forth in Standard Stores. The court, therefore, finds as a matter of undisputed fact, that SCM was a managing agent of Debtor within the meaning of §101(31)(F) and a statutory insider of Debtor under § 101(31).


    4. Plaintiff has not Met his Burden of Proof that SCC Acquisitions was an Affiliate and Statutory Insider of Debtor


      Plaintiff’s assertion that SCC Acquisitions was an Affiliate of Debtor is based on representations made in the Third Amended Disclosure Statement. UF 4, 5. However, the court has sustained the evidentiary objections regarding such representations. As a consequence, Plaintiff has not established as a matter of undisputed fact the SCC Acquisitions was an affiliate and, therefore, an insider of Debtor.


    5. Plaintiff has not Met his Burden of Proof that SCM was an Affiliate and Insider of SCC Acquisitions


      Again, Plaintiff’s assertion is based on representations made in the Third Amended Disclosure Statement. UF 46, 47. As the court has sustained the evidentiary objections regarding such representations and, therefore, Plaintiff has not established as matter of undisputed fact that SCM was an affiliate and insider of SCC Acquisitions.


    6. Plaintiff has not Met his Burden of Proof that SunCal Marblehead was an Affiliate of Debtor


      Plaintiff relies on conclusory statements made by Elieff in Debtor’s involuntary bankruptcy petition that Suncal Marblehead was an affiliate of Debtor. This is insufficient to satisfy Plaintiff’s burden of proof regarding SunCal Marblehead’s status as an affiliate of Debtor as a matter of undisputed fact.


    7. Plaintiff has Met his Burden of Proof that SCM was a Non- statutory Insider


      In The Village at Lakeridge, the Ninth Circuit held that non-statutory

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      insiders are the "functional equivalent of statutory insiders" if they fall within the ambit of §101(31). 814 F.3d at 1001. An entity is a non-statutory insider if "1) the closeness of its relationship with the debtor is comparable to that of the enumerated insider classifications in §101(31), and 2) the relevant transaction is negotiated at less than arm’s length." Id. As previously noted herein, the legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      The court agrees with and adopts by reference below, Judge Mund’s two- step analysis concerning the non-statutory insider status of SCM in the SunCal Marblehead matter:


      "[I]t is beyond dispute that SCM conducted the Debtor’s day-to-day operations, its employees conducted all of the Debtor’s business functions, and it maintained the Debtor’s books and records. It had ‘some degree of control’ and access to the Debtor’s information and

      records, both of which are indications of insider status cited by the Ninth Circuit in Vill.at Lakeridge. It was also close enough for SCM to gain some advantage due simply to affinity: even if all of the Debtor’s payments needed Lehman’s prior approval, SCM was responsible for the first line of review of its own invoices and had some control over when its invoices were submitted for approval and were paid. This extremely close relationship between SCM and the Debtor was of the type that Congress intended to subject to ‘a greater level of scrutiny.’


      However much control Lehman may have had over the Project, the Project Budgets, the draw requests, and the vendor payments, it is undisputed that SCM processed, reviewed, and paid its own invoices on the Debtor’s behalf. An SCM employee actually issuing the Debtor’s payment to SCM was not a transaction conducted ‘as if the parties were strangers.’ A conflict of interest does not

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      require nefarious behavior by SCM, merely the potential for abuse. These payments to SCM cannot be called ‘arms’ length transactions.


      2017 Bankr. Lexis at 37-38.


      SCM disagrees with the foregoing analysis. First, SCM argues that Lehman did not show SCM any preferential treatment in its decisions regarding payment and that there is no evidence that payments made to SCM were for any reason of affinity. SCM attempt to distinguish itself from the familial affinity that existed in In re Rexford Properties, LLC, 557 B.R. 788 (Bankr.C.D.Cal 2016). SCM misses the point. The close relationship prong does not require a showing of actual preferential treatment, but rather that the closeness could provide an opportunity for potential abuse. The discussion of Rexford is not helpful the facts in that case are not comparable to the circumstances here. For example, SCE states that it has no ownership interest in Debtor. However, ownership interest is not critical factor or requirement for non-statutory insider status.


      Next, while acknowledging that control is not a required factor in this Circuit, SCM refers the court to an unpublished, non-precedential Ninth Circuit case, Farrar v. Warda & Yonano LLP (In re Bella Vista by Paramount LLC), 549 Fed.Appx, 648 (2013) for the quote therein that "insider status is a question of control." Farrar predates the published (and binding) Ninth Circuit case, The Village at Lakeridge ("Some degree of control is one of many indications that a creditor may be a non-statutory insider, but actual control is not required to find non-statutory insider status") (emphasis added) 814 F.3d at 1001. In footnote 12 of The Village at Lakeridge, the Court observed that "if actual control were required for non-statutory insider status, all non-statutory insiders would also be statutory insiders under §101)(31). The remainder of the arguments and citations to non-binding decisions, most of which predate The Village at Lakeridge, are not persuasive.


  7. Conclusion


Based upon the foregoing, the Motion is granted in part and denied in part.

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11



Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01022 Speier v. SunCal Management LLC et al


#6.00 CONT'D STATUS CONFERENCE RE: Third Amended Complaint to Avoid and Recover Fraudulent Transnfers [Debtor: SunCal PSV, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 329


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

2:00 PM

CONT...

Debtor(s):


Palmdale Hills Property, LLC


Chapter 11

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch

Argent Management, LLC Represented By Craig H Averch

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

2:00 PM

CONT...

Trustee(s):


Palmdale Hills Property, LLC


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01023 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#7.00 CON'TD STATUS CONFERENCE RE: Third Amended Complaint (1) To Avoid and Recover Fraudulent Transfers and (2) To Avoid and Recover Preferential Transfers [Debtor: Palmdale Hills Property, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 298


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


January 9, 2020


No tentative ruling. Oral Argument only. Plaintiff will have 30 minutes to argue in favor of the Motion; Defendant will have 30 minutes to respond; Plaintiff will have 30 minutes to reply. The matter will then be taken under submission. Oral Ruling: March 26, 2020 at 2:00 p.m.


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

2:00 PM

CONT...

Debtor(s):


Palmdale Hills Property, LLC


Chapter 11

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton

2:00 PM

CONT...


Trustee(s):


Palmdale Hills Property, LLC


Brianna L Frazier


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01024 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#8.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; and (4) To Avoid and Recover Fraudulent Transfers [Debtor: SunCal Summit Valley, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 68


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin

2:00 PM

CONT...


Palmdale Hills Property, LLC


Asa S Hami Charles Liu James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo

Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

2:00 PM

CONT...


8:08-17206

Palmdale Hills Property, LLC Palmdale Hills Property, LLC


Lei Lei Wang Ekvall


Chapter 11


Chapter 11

Adv#: 8:18-01025 SPEIER v. SUNCAL MANAGEMENT, LLC et al


#9.00 CONT'D STATUS CONFERENCE RE: Second Amended Complaint: (1) To Avoid and Recover Preferential Transfers; (2) For Declaratory Relief, (3) In the Alternative, Breach of Contract; (4) Restitution and/or Unjust Enrichment; and (5) To Avoid and Recover Fruadulent Transfers

[Debtor: SunCal Bickford Ranch, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 77


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe

2:00 PM

CONT...


Palmdale Hills Property, LLC


Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SUNCAL MANAGEMENT, LLC Represented By

Craig H Averch

Argent Management LLC Represented By Craig H Averch

Plaintiff(s):

STEVEN M. SPEIER Represented By Evan C Borges Mike D Neue William N Lobel

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01026 Speier v. SunCal Management LLC et al

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

#10.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) To Avoid and Recover Preferential Transfers; (2) For Declaratory Relief, (3) In the Alternative, Breach of Contract; (4) Restitution and/or Unjust Enrichment; and (5) to Avoid and Recover Fraudulent Transfers [Debtor: SunCal Emerald Meadows, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 69


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow

2:00 PM

CONT...


Palmdale Hills Property, LLC


Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch

Argent Management, LLC Represented By Craig H Averch

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01125 Speier v. SunCal Management LLC et al


#11.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief; (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fradudulent Transfers; and (5) To Avoid and Recover Preferential Transfers

[Debtor: SunCal Marblehead, LLC]

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 105


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Doah Kim Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Doah Kim Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01126 Speier v. SunCal Management, LLC et al


#12.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20; 4-27-20; 5-28-20


Docket 530

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Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Grant motion for partial summary adjudication on the grounds that Plaintiff has established as a matter of undisputed fact and law that SCM is both a statutory insider under FRBP 101(31)(E) [affiliate within the meaning of 101(30)(D)], and FRBP 101(31)(F) [managing agent] and is also a nonstatutory insider.


The basis for the ruling and relevant evidentiary rulings will be posted in the tentative ruling field in lieu of an oral ruling on the record on May 29, 2020 between 12:00pm and 1:00pm. A hearing will be held on May 29, 2020 at 2:00

p.m. regarding any questions regarding the ruling, as well as scheduling of future motions/status conferences.


May 29, 2020


EVIDENTIARY RULINGS


Plaintiff's Evidentiary Objections to the Declaration of Randy Teteak


Objection # Ruling


  1. Sustained


  2. Sustained as to lists referenced therein Basis for Ruling:

    1. Background

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      Palmdale Hills Property, LLC


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      An involuntary petition was filed against SunCal Heartland, LLC ("Debtor") on November 12, 2008, bankruptcy case no. 18-17472. The order for relief was entered on January 6, 2009 and plaintiff, chapter 11 trustee Steven M. Spier ("Plaintiff" or "Trustee") was appointed on January 22, 2009 and subsequently also became the liquidating trustee under Debtor’s confirmed plan. The order granting joint administration with the Palmdale lead case was entered March 18, 2009.


      On May 1, 2012, Plaintiff commenced this adversary proceeding against SunCal Management, LLC ("SCM") and Argent Management, LLC ("Argent") (collectively, "Defendants"). Trustee seeks the return of management fees of more than $900,000 paid by Debtor (and eleven other related debtors) to SCM during the period 2004 to 2008 based on several legal theories, including preferential transfer under §547. The original complaint was subsequently amended twice and timely answers were filed by Defendants. On September 9, 2016, this adversary proceeding, as well as the eleven other related adversary proceedings (sometimes referred to herein collectively as the "Related Adversaries") were transferred to Judge Geraldine Mund. Judge Mund made several rulings in the Related Adversaries, including the granting of summary adjudication in favor of Defendants on Plaintiff’s claims for breach of contract and restitution/unjust enrichment in this adversary proceeding. Importantly, on October 12, Judge Mund also ruled in one of the Related Adversaries involving SunCal Marblehead LLC ("Marblehead") that SCM was both a statutory and non- statutory insider of Marblehead. On January 25, 2018, the Related Adversaries were transferred back to this court.


      On May 30, 2019, Plaintiff filed the instant motion for partial summary adjudication [dkt. #417] ("Motion") for findings that SCM was also an insider of Debtor pursuant to §101(31) from the date Debtor and SCM entered into that certain Development Management Agreement ("DMA") until the petition date. Specifically, Plaintiff asserts that SCM is an insider under §101(31)(E) as an insider of an affiliate of Debtor, as the managing agent of Debtor under §101(31) (F), and as a non-statutory insider of Debtor. Defendants vigorously oppose the Motion.

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    2. Standard for Summary Judgment/Partial Adjudication


      A party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The opposing party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial. Id. at 324. The substantive law will identify which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Id. A factual dispute is genuine where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Id. The court must view the evidence presented on the motion in the light most favorable to the opposing party. Id.


      As explained by the Ninth Circuit in Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000):


      "A moving party without the ultimate burden of persuasion at trial—usually, but not always, a defendant—has both the initial burden of production and the ultimate burden of persuasion on a motion for summary judgment... In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party's claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial... In order to carry its ultimate burden of persuasion on the motion, the moving party must persuade the court that there is no genuine issue of material fact... If a moving party fails to carry its initial burden of production, the nonmoving party has no obligation to produce anything, even if the nonmoving party would have the ultimate burden of persuasion at trial... In such a case, the nonmoving party may defeat the motion for summary judgment without producing anything... If, however, support its claim or defense... If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion

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      for summary judgment."


      Id. at 1102-03 (citations omitted). In ruling on a summary judgment motion, the Court does not weigh the evidence. Anderson, 477 U.S. at 255. Rather, the Court’s role is to assess whether a genuine dispute exists as to the material facts requiring a trial. Id. at 249. In conducting this assessment, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Tolan v. Cotton, 572 U.S. 650, 651 (2014). Furthermore, where intent is at issue, summary judgment is seldom granted. See, Provenz v. Miller, 102 F.3d 1478, 1489 (9th Cir. 1996), cert. denied, 118 S. Ct. 48 (1997).


      Federal Rules of Bankruptcy Procedure 7056 incorporates by reference most of the procedural requirements of Rule 56 of the Federal Rules of Civil Procedure ("FRCP") governing motions for summary judgment. In this District, Rule 7056-1 of the Local Bankruptcy Rules ("LBR") also applies.


    3. Statement of Uncontroverted Facts and Conclusions of Law/Statement of Genuine Facts


      Under FRCP 56(c)(1)(A), the moving party must cite to materials in the record, including "depositions, documents, electronically stored information, affidavits, declarations . . . admissions, interrogatory answers, or other materials." LBR 7056-1(b)(2) requires that the moving party serve and file a proposed statement of uncontroverted facts and conclusions of law. LBR 7056-1(c)(2)(A) and (B) requires that the respondent file a separate statement of genuine issues, "identify each material fact that is disputed and cite the particular portions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish the dispute "


      In this matter, Plaintiff timely filed a Statement of Uncontroverted Facts and Conclusions of Law "UF") and Defendants timely filed a Statement of Genuine Facts ("GI").


      Defendants filed evidentiary objections to the admission of the content of Exhibit 4 of Plaintiff’s Request for Judicial Notice, Exhibit 4 being the Third Amended Disclosure Statement ("TAD") filed on August 5, 2011 by counsel for

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      SCC Acquisitions [Dkt #424]. The objections are sustained on the basis of hearsay and personal knowledge and affect UF #59-68. Among other things, UF #s 64, 65, 66, 67 and 68 identify the TAD as the basis for various fact statements concerning the identification of Defendant SCM and SCC Acquisitions, Inc. as "insiders" of Debtor, SCM as a "SunCal Affiliate", SCC Acquisitions, Inc. as an "indirect parent company" of Debtor and that Debtor was "an affiliate of SCC Acquisitions".


      Defendants also objected to Exhibit "F" to the Declaration of Gary Pemberton on personal knowledge grounds. The court believes Defendants are actually referring to Exhibit G, which is the deposition testimony of Edward Nolan. On page 187, lines 18-19, when asked about SCC Acquisitions, Mr. Nolan simply states that it is "the company that Bruce [Elieff] owns." The objection is sustained except as to the reference by Mr. Nolan to a "Project Detail Report" which is adequately authenticated by Mr. Nolan.


      In sum, for purposes of this Motion, all of the statements in Plaintiff’s UF are deemed admitted and uncontroverted, except where disputed by Defendants. Some of the uncontroverted facts are summarized below. The court notes that in their Statement of Genuine Issues, Defendants have added several "Additional Material Facts," which may or may not be reflected in "Uncontroverted Facts" set forth below but may be addressed in the overall analysis of the Motion. If certain such additional facts are not mentioned, it is because the court did not believe them to be germane to the issues presented.


    4. Uncontroverted Facts


      Most of the pertinent are undisputed and are not fully set forth herein.

      The court incorporates

      by reference herein, the all of the fact set forth in the UF that are not disputed by Defendants in their GI.


      "The SunCal Companies," or "SunCal," is a brand name or dba used by an integrated network of real estate acquisition, holding and development companies owned by Bruce Elieff ("Elieff") and/or his brother, Stephen Elieff. UF 1 Debtor was formed at Elieff’s direction as a single-purpose limited liability company to

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      own certain real property located in Oakland, California (the "Oak Knoll Project"). UF 2, 3.


      Debtor did not have any employees and, as such, could not develop the Project itself. UF 6. Accordingly, on December 29, 2005, Debtor entered into a Development Management Agreement ("DMA") with SCM. UF 7. SCM was formed to "provide management and development services to entities who have direct or indirect ownership interests in certain real estate projects, and who are affiliated with the SunCal group of companies." UF 8. As a SunCal entity, SCM shared common management with Debtor. At all relevant times, Bruce owned 100% of SCM and served as its Manager as well as Debtor’s Manager. He executed the DMA on behalf of both SCM and Debtor. UF 9, 11. SCM’s General Counsel, Bruce Cook, participated in filing the documents used to form Debtor, prepared the Debtor’s Operating Agreement and the First Amendment thereto, as well as the DMA, and was one of Debtor’s authorized signatories. UF 10. Frank Faye, SCM’s Chief Operating Officer, was also an officer of Debtor. UF 12.


      Under the DMA, Debtor engaged SCM "to perform the development and management functions set forth below in connection with the development, marketing and sale of the Project, and to assist in all aspects of the Project[.]" UF

      13. The DMA also provided SCM "the authority to perform (and incur expenses in connection with the performance of) the Development and Sale Services & Functions . . . and to otherwise act in accordance with the Project Budget" and to "take any action with respect to the Property or Project or incur any expense for which [the Debtor] is or may be responsible" so long as SCM "reasonably deems such action or expense as necessary in furtherance of the proper development, sale and marketing of the Project." UF 14. SCM reviewed and coordinated the work of the various contractors and consultants for Debtor’s Project. UF 15. SCM’s Project responsibilities were wide-ranging and included:


      • "[r]eview bids and prepare bid analyses";


      • "[c]oordinate the work of all contractors . . . [and] schedule and conduct development and progress meetings at which contractors, consultants, and [SCM] can discuss jointly such matters as procedures, progress, problems, and scheduling";

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      • "monitor the delivery of, and if necessary, arrange storage, protection and security for, all materials, systems and equipment which are to be used in the development of, or incorporated

        into, the Project";


      • "arrange with contractors to provide adequate security for the Project, including, without limitation, prevention of trespassing and dumping."


        "assemble and retain all contracts, agreements and other records and data as may be necessary to carry out [SCM's] functions hereunder, and similar records for functions performed by contractors and other third parties in connection herewith";


      • "keep and maintain proper books of contracts and records on behalf of [the Debtor] relating to . . . the development, operations, expenses and proceeds of the Property and the lots and other parcels comprising the Property";


      • "[r]ecord the progress of the Project and submit to [the Debtor], from time to time as may be requested by [the Debtor], and as may be required by any Project Lenders, status reports consisting of (i) a payables transaction report listing all payables due for the month; (ii) a job

        cost report, (iii) a report explaining any budget variances, (iv) a committed cost report updated to include the invoices being paid during the month, and (v) a cash needs projection showing

        anticipated cash requirements for the ensuing four (4) months." UF 15, 16

        The DMA provided that Debtor would pay SCM a management fee "[a]s compensation for the performance of the Development and Sale Services & Functions and the other duties and services to be performed by [SCM]," the payment of which could be deferred or delayed based on the availability of funds. UF 17. Debtor was also liable for all third party costs incurred by SCM and compensation for SCM’s employees. UF 18.

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        Under the DMA, SCM served as Debtor’s "developer/operator" and "management company." UF 19. In this capacity, SCM was the party responsible for managing the development of the Oak Knoll Project from late 2005 through at least November 2008. UF 20. SCM’s owner (and Debtor’s Manager), Elieff, was "in charge of overall supervision and monitoring of . . . [SCM’s] services" and "was aware of and oversaw what was being done for the [Debtor’s] Project[]." UF 21. Specifically, he "personally monitored, participated in and oversaw others who also participated in the day-to-day activities performed by SCM . . . in furtherance of the design, planning, entitlement [and] . . . development of the Project," was responsible for supervising SCM’s "extensive" work on the Project, met, typically on a weekly basis, with members of SCM’s senior management to discuss material matters relating to the entitlement and development of the Project, and toured the Project site. UF 22, 23, 29. SCM’s Chief Operating Officer, Frank Faye (also an officer of Debtor) had "oversight responsibility of [a number of SCM] employees and their work product" and was in charge of supervising SCM’s activities with respect to the development of the Oak Knoll Project. UF 12, 24, 25. Under the direction of SCM’s Chief Accounting Officer, Tom Rollins, SCM "[m]anag[ed] the process of payments by [the Debtor] to contractors, consultants, vendors and others" and "[p]rovid[ed] accounting and asset management services for the Project[]." UF 26. SCM also prepared Debtor’s business plans and project budgets. UF 27.


        SCM performed all day-to-day operations related to the Project, including:


      • "investigating and evaluating all potential site uses for the Project, including preparing site plans";


      • "preparing financial reports and status reports concerning the Project . . . regarding all work performed on the Project by SCM, contractors, consultants, third party vendors, and others";


      • "providing contract administration for the numerous contracts relating to the entitlement effort and other activities on the site of the Project";


      • "creating bid packages, and negotiating and drafting agreements and all related documents for work performed by consultants, contractors, and third-party

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        Palmdale Hills Property, LLC


        Chapter 11

        vendors for the Project";


      • "engaging and consulting with consultants, contractors, and attorneys in connection with the preparation of environmental impact reports, the CEQA process, the Subdivision Map Act process, resource agency permits, and other necessary entitlements for the Project";


      • "engaging, monitoring, and evaluating consultants, contractors, third party vendors, and others, who performed services related to the construction and development of the Project . . .";


      • "engaging and consulting with architects and engineers and overseeing work performed by them";


      • "consulting with applicable local and state governmental agencies regarding the Project";


      • "causing to be prepared and processing architectural and landscape design guidelines . . .";


      • "negotiating on behalf of the Debtor with respect to an owner participation agreement with the City . . . for the development of the Project";


      • "conferring with community groups regarding the Project . . .";


      • "negotiating and drafting agreements with adjacent land owners for easements and other rights needed in connection with the development of the Project . .

        .";

      • "processing the formation of a Community Facilities District that would provide financing for the development of public infrastructure improvements for the Project"; and


      • "performing extensive work to process all necessary approvals and permits for entitlements including preparing the entire entitlement package for the

        Project . . ."

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        UF 28


        Palmdale Hills Property, LLC


        Chapter 11


        Pursuant to the DMA’s terms, Debtor was responsible for paying SCM’s management fees and expense reimbursements. UF 17, 18. According to SCM’s Chief Accounting Officer, Tom Rollins, SCM "invoiced the Debtor directly for services performed" from "the inception of the Project to the Petition Date." UF 30. After SCM generated an invoice, it would go to the Project accountant, an SCM employee. UF 31. The Project accountant would then send the SCM invoices to SCM’s asset management group for review and approval. UF 32. Ultimately, an SCM employee would issue a check or wire funds from Debtor’s account to SCM. UF 33. Mr. Rollins and Ed Nolan, also an SCM employee, were responsible for approving such transfers. UF 34. Mr. Rollins testified that SCM employees would "try to make sure that billings [were] done properly, the accounting [was] done properly." UF 35. However, Debtor did not have any employees, and thus there was no personnel of Debtor to question whether an invoice was correct or whether a management fee payment should be deferred in accordance with the DMA based on a shortage of funds. UF 6. In total, SCM received at least $ 2,914,232.00 in management fees from Debtor between 2005 and 2008. UF 37.


    5. Marblehead Decision


      During the time that he Related Adversaries were pending before Judge Mund, Plaintiff filed a similar motion for partial adjudication based on facts nearly identical presented here that SCM was a statutory and non-statutory insider of related debtor. SunCal Marblehead, LLC ("Marblehead"), adv. no 18-01125. In a thorough and well-analyzed opinion, Judge Mund held as follows:


      1. SCM was not an insider as an "affiliate" of Marblehead under § 101(31)(E),

      2. SCM was not an insider of Marblehead’s affiliate, Elieff, under §101(31)(E),

      3. SCM was an insider of Marblehead as "managing agent" under §101(31)(F), and

      4. SCM was a non-statutory insider of Marblehead.


      See Palmdale Hills Prop. v. Argent Mgmt., LLC (In re Palmdale Hills Prop.), 2017 Bankr. LEXIS 3534, at *19 (Bankr. C.D. Cal. Oct. 12, 2017). Both sides cite to

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      Judge Mund’s prior decision and address Judge Mund’s analysis in their arguments. With one notable exception, this court agrees with Judge Mund’s findings and conclusions. To avoid "re-inventing the wheel," the court will borrow heavily from her reasoned opinion.


    6. Analysis


      1. Insider Status Under §101(31)


        The SAC alleges a claim for relief under §547 for preferential transfer. Section 547(b)(4)(B) extends the "look back" period for recovery a preferential transfer to an insider from ninety days to one year prior to the petition date. Pursuant to § 547(g), Plaintiff bears the burden of proving that SCM is an insider, in connection with Plaintiff’s preference claim against SCM. Batlan v. Transamerica Commer. Fin. Corp. (In re Smith's Home Furnishings, Inc.), 265 F.3d 959, 963 (9th Cir. Or. 2001) ("Section 547(g) places the burden of proof on the trustee to show all of the conditions of §547(b).").


        There are "two types of insiders: statutory insiders and non-statutory insiders." In re The Village at Lakeridge, LLC, 814 F.3d 993, 999 (9th Cir. 2016), aff'd sub nom. U.S. Bank Nat. Ass'n ex rel. CWCapital Asset Mgmt. LLC v. Village at Lakeridge, LLC, 138 S. Ct. 960, 200 L. Ed. 2d 218 (2018). "To be a ‘statutory insider,’ a creditor must fall within one of the categories listed in 11 U.S.C. § 101(31)." Village at Lakeridge, supra, at 996 (emphasis in original). "Whether a creditor is an insider is a factual inquiry that must be conducted on a case-by- case basis." Id. at 1000. "In conducting a factual inquiry for insider status, courts should begin with the statute. If the [alleged insider] fits within the statutory insider classification on his own, the court’s review ends; it need not examine the nature of the statutory insider’s relationship to the debtor." Id. at 1001.


        Under §101(31), the term "insider" includes as to corporations:


        1. if the debtor is a corporation –

          1. director of the debtor;

          2. officer of the debtor;

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            Palmdale Hills Property, LLC

          3. person in control of the debtor;


        Chapter 11


        1. affiliate, or insider of an affiliate as if such affiliate were the debtor; and


        2. and managing agent of the debtor.


      2. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(E) Based on Its Affiliate Status Under §101(2)(D)


        Section 101(2)(D) defines "affiliate" as an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." (emphasis added)


        It is undisputed that SCM and its employees operated all aspects of Debtor’s project development business as previously noted in detail herein. Plaintiff contends that under these circumstances, SCM, as the operator of Debtor’s business, falls squarely within the definition of affiliate under §101(2)(D). SCE, on the other hand, argues that because it did not operate under a lease or operating agreement it is not an affiliate within the meaning of §101(2)(D). The issue is whether the DMA, a management agreement, is the functional equivalent of an operating agreement as that term is used in §101(2)(D). As pointed out by Judge Mund in the Marblehead decision, there are very few cases interpreting "operating agreement," and none in the Ninth Circuit. Some cases have interpreted the term expansively. See, e.g., In re Chira, 353 B.R. 693, 724-25 (Bankr.S.D.Fla.2006) ("the hotel also represented substantially all of [the debtor’s] property. Elizabeth and Lounge Corp. are both ‘entities’ and they both operated the business and property of the Shelton Beach Hotel."); In re Century Inv. Fund VII Ltd., P’ship, 96 B.R. 884, 892 (Bankr.E.D.Wis.1989) (""Affiliate" means an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." 11 U.S.C. § 101(2)(D). CMG has certainly been managing all of the property of the debtor under its management agreement.). By contrast, other courts have interpreted the term

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        Palmdale Hills Property, LLC


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        more strictly. See, In re Washington Mut., 462 B.R. 137, 145-46 (rejecting debtors’ argument that certain pooling and servicing agreements were de facto operating agreement within the meaning of the statute).


        Judge Mund held that principles of statutory construction led her to the conclusion that SCM does not fall within the statutory definition of affiliate under

        §101(31)(D), relying at least in part on the statutory construction principles referenced in the decision of the Ninth Circuit Bankruptcy Appellate Panel in Miller Ave. Prof’l & Promotional Servs. v. Brady (In re Entertainment Acquisition Partners, Inc., 319 B.R. 626, 632-33 (9th Cir. BAP 2004). In Miller, the BAP held the corporation of a statutory insider was not an insider under §101(31)(B) and noted that "there is no justification for expanding the definition of a per se insider beyond what is plainly contained in the statute." Judge Mund observed that because §101(2) states that the term "affiliate" means, as opposed to the more flexible includes (as with §101(31), Congress intended a precise and restricted meaning. Further, giving meaning to all of the statutory language requires the existence of an actual operating agreement. Finally, and most importantly, Judge Mund opined that operating agreements "have specific meanings in the law of limited liability companies and for oil and gas rights," and that "terming the DMA to be an ‘operating agreement’ would be expanding the definition of affiliate (and thus insider) beyond what is plainly contained in the statute." 2017 Bankr.Lexis 3534 at 29.

        SCM urges the court to employ the restrictive construction of the term, arguing that "leasing or operating agreement implies entitlement to benefits akin to ownership, which is not the case here. SCM also cites several a number of cases which describe an "operating agreement" as a contract used in the oil and gas industry. See Defendants’ Opposition at p. 30 and citations therein [Dkt #424].


        Respectfully, the principles of statutory construction lead this court to a contrary conclusion. First, the court is not persuaded that the plain meaning of the term means a literal meaning of the same without regard to substance or context. Certainly, nothing in the legislative history of §101 suggests that Congress intended to limit affiliate status to operating agreements associated with limited liability companies or oil and gas contracts. The legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny

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        that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


        Second, as "operating agreement" is not defined in §101, consideration of the context of the surrounding language is in order. It is a "fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme. Food and Drug Admin. v. Brown & Williamson Tobacco Co., 529 U.S. 120, 133 (2000); accord Gale v. First Franklin Loan Services, 701 F.3d. 1240, 1244 (9th Cir. 2012). See, generally Badgley v. United States, 957 F.3d. 969, 977 (9th Cir. 2020) ("In applying the statute, we focus on the substance of the retained interest. Labels are not dispositive."). Section 101(2)(D) starts with "entity that operates the business . . .of the debtor. The court interprets this to mean the emphasis is on whether someone other than the debtor is operating its business. As the DMA is an agreement governing the SCM’s operation of every aspect of Debtor’s business and property, it is, the court’s view, an "operating agreement" within the meaning of §101(2)(D).

        The court concludes as a matter of undisputed fact that SCM is an affiliate under

        §101(2)(D) and, therefore, a statutory insider pursuant to §101(31)(E).


      3. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(F) Based on Its Status as Managing Agent


        Under §101(31)(F), the term "insider" includes a managing agent of the debtor. As with "operating agreement," "managing agent" is not a defined term under the Code. In analyzing whether SCM was the managing agent of Marblehead, Judge Mund looked to guidance from the case of Rush v. Riddle (In re Standard Shoes, Inc.), 124 B.R. 318 (Bankr.C.D.Cal.1991). Though neither Standard Shoes or Judge Mund’s decision regarding the Marblehead matter are binding on this court, the court nevertheless finds them instructive and soundly reasoned.


        In Standard Shoes, Judge Zurzolo, in addressing the ambiguity of the term "managing agent," developed the following useful definition:

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        Palmdale Hills Property, LLC


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        "In defining ‘managing agent,’ I therefore conclude that it refers to Those entities that exert or could exert operational control over a debtor, a division or unit of a debtor, or a significant portion of a debtor’s property. Such operational control would ordinarily include the ability to make personnel decisions, the authority to incur or pay obligations and access to financial and other information essential to the operation of the debtor.


        The definition of ‘managing agent’ is consistent with the principal design of §101[31] and does not overlap or conflict with the categories of insiders expressly described in the preceding subsections of that statute."


        124 B.R. at 323-24.


        SCE contends that it did not have operational control over Debtor or over a significant portion of Debtor’s property and that its authority was limited to performing services and making recommendations to Lehman which had ultimate approval power and control. Opposition at pp. 17-18. The court finds SCM’s arguments wholly unpersuasive. Instead, the court agrees with and adopts Judge Mund’s analysis and findings in the Marblehead matter:


        "SCM exercised operational control over the Debtor and thus was a managing agent. All three factors indicating such control in Standard Shoes exist: although its actions needed to be in accord with Project Budgets, SCM had authority to incur expenses on the Project, ability to make personnel decisions (as the Debtor’s operations were all conducted by SCM employees), and access the Debtor’s books and records (which

        it maintained). It is undisputed that SCM conducted the Debtor’s operations. While its actions may have been subject to the Lehman-approved Project Budget and Plan and Lehman may have had veto power over all payments, the standard does not demand unfettered control over the debtor. Standard Stores used a person in charge of a division of a corporate debtor as an example of a

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        Palmdale Hills Property, LLC

        managing agent and cited the authority to direct payment of


        Chapter 11

        obligations, employ personnel, or order supplies as hallmarks of such control. Such people would still be subject to supervision and veto power by the officers and board of directors of the company."


        2017 Bankr. Lexis 3534 at 33-34.


        The duties and responsibilities of SCM under the DMA meet and exceed the managing agent factors set forth in Standard Stores. The court, therefore, finds as a matter of undisputed fact, that SCM was a managing agent of Debtor within the meaning of §101(31)(F) and a statutory insider of Debtor under § 101(31).


      4. Plaintiff has not Met his Burden of Proof that SCC Acquisitions was an Affiliate and Statutory Insider of Debtor


        Plaintiff’s assertion that SCC Acquisitions was an Affiliate of Debtor is based on representations made in the Third Amended Disclosure Statement. Motion at p.

        20. However, the court has sustained the evidentiary objections regarding such representations. As a consequence, Plaintiff has not established as a matter of undisputed fact the SCC Acquisitions was an affiliate and, therefore, an insider of Debtor.


      5. Plaintiff has not Met his Burden of Proof that SCM was an Affiliate and Insider of SCC Acquisitions, Rendering SCM an Insider of Debtor


        In the Motion, Plaintiff relies principally on representations made in the Third Amended Disclosure Statement. See Motion at p. 20. As the court has sustained the evidentiary objections regarding such representations and, therefore, Plaintiff has not established as matter of undisputed fact that SCM was an affiliate and insider of SCC Acquisitions.

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        CONT...


        Palmdale Hills Property, LLC


      6. Plaintiff has not Met his Burden of Proof that SunCal Marblehead was an Affiliate of Debtor


        Chapter 11


        Plaintiff relies on conclusory statements made by Elieff in Debtor’s involuntary bankruptcy petition that Suncal Marblehead was an affiliate of Debtor. This is insufficient to satisfy Plaintiff’s burden of proof regarding SunCal Marblehead’s status as an affiliate of Debtor as a matter of undisputed fact.


      7. Plaintiff has Met his Burden of Proof that SCM was a Non- statutory Insider


        In The Village at Lakeridge, the Ninth Circuit held that non-statutory insiders are the "functional equivalent of statutory insiders" if they fall within the ambit of § 101(31). 814 F.3d at 1001. An entity is a non-statutory insider if "1) the closeness of its relationship with the debtor is comparable to that of the enumerated insider classifications in §101(31), and 2) the relevant transaction is negotiated at less than arm’s length." Id. As previously noted herein, the legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.

        The court agrees with and adopts by reference below, Judge Mund’s two-step analysis concerning the non-statutory insider status of SCM in the SunCal Marblehead matter:


        "[I]t is beyond dispute that SCM conducted the Debtor’s day-to-day operations, its employees conducted all of the Debtor’s business functions, and it maintained the Debtor’s books and records. It had ‘some degree of control’ and access to the Debtor’s information and records, both of which are indications of insider status cited by the Ninth Circuit in Vill.at Lakeridge. It was also close enough for SCM

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        CONT...


        Palmdale Hills Property, LLC


        Chapter 11

        to gain some advantage due simply to affinity: even if all of the Debtor’s payments needed Lehman’s prior approval, SCM was responsible for the first line of review of its own invoices and had some control over when its invoices were submitted for approval and were paid. This extremely close relationship between SCM and the Debtor was of the type that Congress intended to subject to ‘a greater level of scrutiny.’


        However much control Lehman may have had over the Project, the Project Budgets, the draw requests, and the vendor payments, it

        is undisputed that SCM processed, reviewed, and paid its own invoices on the Debtor’s behalf. An SCM employee actually issuing the Debtor’s payment to SCM was not a transaction conducted

        ‘as if the parties were strangers.’ A conflict of interest does not require nefarious behavior by SCM, merely the potential for abuse. These payments to SCM cannot be called ‘arms’ length transactions."


        2017 Bankr. Lexis at 37-38.


        SCM disagrees with the foregoing analysis. First, SCM argues that Lehman did not show SCM any preferential treatment in its decisions regarding payment and that there is no evidence that payments made to SCM were for any reason of affinity. SCM attempt to distinguish itself from the familial affinity that existed in In re Rexford Properties, LLC, 557 B.R. 788 (Bankr.C.D.Cal 2016). SCM misses the point. The close relationship prong does not require a showing of actual preferential treatment, but rather that the closeness could provide an opportunity for potential abuse. The discussion of Rexford is not helpful the facts in that case are not comparable to the circumstances here. For example, SCE states that it has no ownership interest in Debtor. However, ownership interest is not critical factor or requirement for non-statutory insider status.


        Next, while acknowledging that control is not a required factor in this Circuit, SCM refers the court to an unpublished, non-precedential Ninth Circuit case, Farrar v. Warda & Yonano LLP (In re Bella Vista by Paramount LLC), 549 Fed.Appx, 648 (2013) for the quote therein that "insider status is a question of control." Farrar predates the published (and binding) Ninth Circuit case, The

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        Palmdale Hills Property, LLC


        Chapter 11

        Village at Lakeridge ("Some degree of control is one of many indications that a creditor may be a non-statutory insider, but actual control is not required to find non-statutory insider status") (emphasis added) 814 F.3d at 1001. In footnote 12 of The Village at Lakeridge, the Court observed that "if actual control were required for non-statutory insider status, all non-statutory insiders would also be statutory insiders under §101)(31). The remainder of the arguments and citations to non-binding decisions, most of which predate The Village at Lakeridge, are not persuasive.


    7. Conclusion


Based upon the foregoing, the Motion is granted in part; denied in part.


Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez

2:00 PM

CONT...


Palmdale Hills Property, LLC


Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management, LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01126 Speier v. SunCal Management, LLC et al


#13.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers; and (5) To Avoid and Recover Preferential Transfers

[Debtor: SunCal Heartland, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20

2:00 PM

CONT...


Palmdale Hills Property, LLC

Docket 99

Chapter 11


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

Defendant(s):

SunCal Management, LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01127 Speier v. SunCal Management LLC et al


#14.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication That SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20; 4-27-20; 5-28-20


Docket 518


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11


May 28, 2020


Grant motion for partial summary adjudication on the grounds that Plaintiff has established as a matter of undisputed fact and law that SCM is both a statutory insider under FRBP 101(31)(E) [affiliate within the meaning of 101(30)(D)], and FRBP 101(31)(F) [managing agent] and is also a nonstatutory insider.


The basis for the ruling and relevant evidentiary rulings will be posted in the tentative ruling field in lieu of an oral ruling on the record on May 29, 2020 between 12:00pm and 1:00pm. A hearing will be held on May 29, 2020 at 2:00

p.m. regarding any questions regarding the ruling, as well as scheduling of future motions/status conferences.


May 29, 2020


Basis for Ruling


  1. Background


    An involuntary petition was filed against SunCal Northlake, LLC ("Debtor") on November 12, 2008, bankruptcy case no. 18-17472. The order for relief was entered on January 6, 2009 and plaintiff, chapter 11 trustee Steven M. Spier ("Plaintiff" or "Trustee") was appointed on January 22, 2009 and subsequently also became the liquidating trustee under Debtor’s confirmed plan. The order granting joint administration with the Palmdale lead case was entered March 18, 2009.


    On May 1, 2012, Plaintiff commenced this adversary proceeding against SunCal Management, LLC ("SCM") and Argent Management, LLC ("Argent") (collectively, "Defendants"). Trustee seeks the return of management fees of more than $900,000 paid by Debtor (and eleven other related debtors) to SCM during the period 2004 to 2008 based on several legal theories, including

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    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    preferential transfer under §547. The original complaint was subsequently amended twice and timely answers were filed by Defendants. On September 9, 2016, this adversary proceeding, as well as the eleven other related adversary proceedings (sometimes referred to herein collectively as the "Related Adversaries") were transferred to Judge Geraldine Mund. Judge Mund made several rulings in the Related Adversaries, including the granting of summary adjudication in favor of Defendants on Plaintiff’s claims for breach of contract and restitution/unjust enrichment in this adversary proceeding. Importantly, on October 12, Judge Mund also ruled in one of the Related Adversaries involving SunCal Marblehead LLC ("Marblehead") that SCM was both a statutory and non- statutory insider of Marblehead. On January 25, 2018, the Related Adversaries were transferred back to this court.


    On May 30, 2019, Plaintiff filed the instant motion for partial summary adjudication [dkt. #417] ("Motion") for findings that SCM was also an insider of Debtor pursuant to §101(31) from the date Debtor and SCM entered into that certain Development Management Agreement ("DMA") until the petition date. Specifically, Plaintiff asserts that SCM is an insider under §101(31)(E) as an insider of an affiliate of Debtor, as the managing agent of Debtor under §101(31) (F), and as a non-statutory insider of Debtor. Defendants vigorously oppose the Motion.


  2. Standard for Summary Judgment/Partial Adjudication


    A party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The opposing party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial. Id. at 324. The substantive law will identify which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Id. A factual dispute is genuine where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Id. The court must view the evidence presented on the motion in the light most favorable

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    Palmdale Hills Property, LLC


    Chapter 11

    to the opposing party. Id.


    As explained by the Ninth Circuit in Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000):


    "A moving party without the ultimate burden of persuasion at trial—usually, but not always, a defendant—has both the initial burden of production and the ultimate burden of persuasion on a motion for summary judgment... In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party's claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial... In order to carry its ultimate burden of persuasion on the motion, the moving party must persuade the court that there is no genuine issue of material fact... If a moving party fails to carry its initial burden of production, the nonmoving party has no obligation to produce anything, even if the nonmoving party would have the ultimate burden of persuasion at trial... In such a case, the nonmoving party may defeat the motion for summary judgment without producing anything... If, however, support its claim or defense... If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion for summary judgment."


    Id. at 1102-03 (citations omitted). In ruling on a summary judgment motion, the Court does not weigh the evidence. Anderson, 477 U.S. at 255. Rather, the Court’s role is to assess whether a genuine dispute exists as to the material facts requiring a trial. Id. at 249. In conducting this assessment, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Tolan v. Cotton, 572 U.S. 650, 651 (2014). Furthermore, where intent is at issue, summary judgment is seldom granted. See, Provenz v. Miller, 102 F.3d 1478, 1489 (9th Cir. 1996), cert. denied, 118 S. Ct. 48 (1997).


    Federal Rules of Bankruptcy Procedure 7056 incorporates by reference most of the procedural requirements of Rule 56 of the Federal Rules of Civil Procedure ("FRCP") governing motions for summary judgment. In this District, Rule 7056-1 of the Local Bankruptcy Rules ("LBR") also applies.

    2:00 PM

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    Palmdale Hills Property, LLC


    Chapter 11


  3. Statement of Uncontroverted Facts and Conclusions of Law/Statement of Genuine Facts


    Under FRCP 56(c)(1)(A), the moving party must cite to materials in the record, including "depositions, documents, electronically stored information, affidavits, declarations . . . admissions, interrogatory answers, or other materials." LBR 7056-1(b)(2) requires that the moving party serve and file a proposed statement of uncontroverted facts and conclusions of law. LBR 7056-1(c)(2)(A) and (B) requires that the respondent file a separate statement of genuine issues, "identify each material fact that is disputed and cite the particular portions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish the dispute "


    In this matter, Plaintiff timely filed a Statement of Uncontroverted Facts and Conclusions of Law "UF") and Defendants timely filed a Statement of Genuine Facts ("GI").


    Defendants filed evidentiary objections to the admission of the content of Exhibit 4 of Plaintiff’s Request for Judicial Notice, Exhibit 4 being the Third Amended Disclosure Statement ("TAD") filed on August 5, 2011 by counsel for SCC Acquisitions [Dkt #424]. The objections are sustained on the basis of hearsay and personal knowledge and affect UF #59-68. Among other things, UF #s 64, 65, 66, 67 and 68 identify the TAD as the basis for various fact statements concerning the identification of Defendant SCM and SCC Acquisitions, Inc. as "insiders" of Debtor, SCM as a "SunCal Affiliate", SCC Acquisitions, Inc. as an "indirect parent company" of Debtor and that Debtor was "an affiliate of SCC Acquisitions".


    Defendants also objected to Exhibit "F" to the Declaration of Gary Pemberton on personal knowledge grounds. The court believes Defendants are actually referring to Exhibit G, which is the deposition testimony of Edward Nolan. On page 187, lines 18-19, when asked about SCC Acquisitions, Mr. Nolan simply states that it is "the company that Bruce [Elieff] owns." The objection is sustained except as to the reference by Mr. Nolan to a "Project Detail Report" which is adequately authenticated by Mr. Nolan.

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11


    In sum, for purposes of this Motion, all of the statements in Plaintiff’s UF are deemed admitted and uncontroverted, except where disputed by Defendants. Some of the uncontroverted facts are summarized below. The court notes that in their Statement of Genuine Issues, Defendants have added several "Additional Material Facts," which may or may not be reflected in "Uncontroverted Facts" set forth below but may be addressed in the overall analysis of the Motion. If certain such additional facts are not mentioned, it is because the court did not believe them to be germane to the issues presented.


  4. Uncontroverted Facts


    Most of the pertinent are undisputed and are not fully set forth herein.

    The court incorporates

    by reference herein, the all of the fact set forth in the UF that are not disputed by Defendants in their GI.


    "The SunCal Companies," or "SunCal," is a brand name or dba used by an integrated network of real estate acquisition, holding and development companies owned by Bruce Elieff ("Elieff") and/or his brother, Stephen Elieff. UF 1 Debtor was formed at Elieff’s direction as a single-purpose limited liability company to own certain real property located in Oakland, California (the "Oak Knoll Project"). UF 2, 3.


    Debtor did not have any employees and, as such, could not develop the Project itself. UF 6. Accordingly, on December 29, 2005, Debtor entered into a Development Management Agreement ("DMA") with SCM. UF 7. SCM was formed to "provide management and development services to entities who have direct or indirect ownership interests in certain real estate projects, and who are affiliated with the SunCal group of companies." UF 8. As a SunCal entity, SCM shared common management with Debtor. At all relevant times, Bruce owned 100% of SCM and served as its Manager as well as Debtor’s Manager. He executed the DMA on behalf of both SCM and Debtor. UF 9, 11. SCM’s General Counsel, Bruce Cook, participated in filing the documents used to form Debtor, prepared the Debtor’s Operating Agreement and the First Amendment thereto, as well as the DMA, and was one of Debtor’s authorized signatories. UF 10. Frank

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Faye, SCM’s Chief Operating Officer, was also an officer of Debtor. UF 12.


    Under the DMA, Debtor engaged SCM "to perform the development and management functions set forth below in connection with the development, marketing and sale of the Project, and to assist in all aspects of the Project[.]" UF

    13. The DMA also provided SCM "the authority to perform (and incur expenses in connection with the performance of) the Development and Sale Services & Functions . . . and to otherwise act in accordance with the Project Budget" and to "take any action with respect to the Property or Project or incur any expense for which [the Debtor] is or may be responsible" so long as SCM "reasonably deems such action or expense as necessary in furtherance of the proper development, sale and marketing of the Project." UF 14. SCM reviewed and coordinated the work of the various contractors and consultants for Debtor’s Project. UF 15. SCM’s Project responsibilities were wide-ranging and included:


  5. Marblehead Decision


    During the time that he Related Adversaries were pending before Judge Mund, Plaintiff filed a similar motion for partial adjudication based on facts nearly identical presented here that SCM was a statutory and non-statutory insider of related debtor. SunCal Marblehead, LLC ("Marblehead"), adv. no 18-01125. In a thorough and well-analyzed opinion, Judge Mund held as follows:


    1. SCM was not an insider as an "affiliate" of Marblehead under § 101(31)(E),

    2. SCM was not an insider of Marblehead’s affiliate, Elieff, under §101(31)(E),

    3. SCM was an insider of Marblehead as "managing agent" under §101(31)(F), and

    4. SCM was a non-statutory insider of Marblehead.


    See Palmdale Hills Prop. v. Argent Mgmt., LLC (In re Palmdale Hills Prop.), 2017 Bankr. LEXIS 3534, at *19 (Bankr. C.D. Cal. Oct. 12, 2017). Both sides cite to Judge Mund’s prior decision and address Judge Mund’s analysis in their arguments. With one notable exception, this court agrees with Judge Mund’s findings and conclusions. To avoid "re-inventing the wheel," the court will borrow heavily from her reasoned opinion.


  6. Analysis


    1. Insider Status Under §101(31)


      The SAC alleges a claim for relief under §547 for preferential transfer. Section 547(b)(4)(B) extends the "look back" period for recovery a preferential transfer to an insider from ninety days to one year prior to the petition date. Pursuant to § 547(g), Plaintiff bears the burden of proving that SCM is an insider, in connection with Plaintiff’s preference claim against SCM. Batlan v. Transamerica Commer. Fin. Corp. (In re Smith's Home Furnishings, Inc.), 265 F.3d 959, 963 (9th Cir.

      2:00 PM

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      Palmdale Hills Property, LLC


      Chapter 11

      Or. 2001) ("Section 547(g) places the burden of proof on the trustee to show all of the conditions of §547(b).").


      There are "two types of insiders: statutory insiders and non-statutory insiders." In re The Village at Lakeridge, LLC, 814 F.3d 993, 999 (9th Cir. 2016), aff'd sub nom. U.S. Bank Nat. Ass'n ex rel. CWCapital Asset Mgmt. LLC v. Village at Lakeridge, LLC, 138 S. Ct. 960, 200 L. Ed. 2d 218 (2018). "To be a ‘statutory insider,’ a creditor must fall within one of the categories listed in 11 U.S.C. § 101(31)." Village at Lakeridge, supra, at 996 (emphasis in original). "Whether a creditor is an insider is a factual inquiry that must be conducted on a case-by- case basis." Id. at 1000. "In conducting a factual inquiry for insider status, courts should begin with the statute. If the [alleged insider] fits within the statutory insider classification on his own, the court’s review ends; it need not examine the nature of the statutory insider’s relationship to the debtor." Id. at 1001.


      Under §101(31), the term "insider" includes as to corporations:


      1. if the debtor is a corporation –

        1. director of the debtor;

        2. officer of the debtor;

        3. person in control of the debtor;


      1. affiliate, or insider of an affiliate as if such affiliate were the debtor; and


      2. and managing agent of the debtor.


    2. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(E) Based on Its Affiliate Status Under §101(2)(D)


      Section 101(2)(D) defines "affiliate" as an "entity that operates the business or substantially all of the property of the debtor under a lease or operating

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      agreement." (emphasis added)


      It is undisputed that SCM and its employees operated all aspects of Debtor’s project development business as previously noted in detail herein. Plaintiff contends that under these circumstances, SCM, as the operator of Debtor’s business, falls squarely within the definition of affiliate under §101(2)(D). SCE, on the other hand, argues that because it did not operate under a lease or operating agreement it is not an affiliate within the meaning of §101(2)(D). The issue is whether the DMA, a management agreement, is the functional equivalent of an operating agreement as that term is used in §101(2)(D). As pointed out by Judge Mund in the Marblehead decision, there are very few cases interpreting "operating agreement," and none in the Ninth Circuit. Some cases have interpreted the term expansively. See, e.g., In re Chira, 353 B.R. 693, 724-25 (Bankr.S.D.Fla.2006) ("the hotel also represented substantially all of [the debtor’s] property. Elizabeth and Lounge Corp. are both ‘entities’ and they both operated the business and property of the Shelton Beach Hotel."); In re Century Inv. Fund VII Ltd., P’ship, 96 B.R. 884, 892 (Bankr.E.D.Wis.1989) (""Affiliate" means an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." 11 U.S.C. § 101(2)(D). CMG has certainly been managing all of the property of the debtor under its management agreement.). By contrast, other courts have interpreted the term more strictly. See, In re Washington Mut., 462 B.R. 137, 145-46 (rejecting debtors’ argument that certain pooling and servicing agreements were de facto operating agreement within the meaning of the statute).

      Judge Mund held that principles of statutory construction led her to the conclusion that SCM does not fall within the statutory definition of affiliate under

      §101(31)(D), relying at least in part on the statutory construction principles referenced in the decision of the Ninth Circuit Bankruptcy Appellate Panel in Miller Ave. Prof’l & Promotional Servs. v. Brady (In re Entertainment Acquisition Partners, Inc., 319 B.R. 626, 632-33 (9th Cir. BAP 2004). In Miller, the BAP held the corporation of a statutory insider was not an insider under §101(31)(B) and noted that "there is no justification for expanding the definition of a per se insider beyond what is plainly contained in the statute." Judge Mund observed that because §101(2) states that the term "affiliate" means, as opposed to the more flexible includes (as with §101(31), Congress intended a precise and restricted

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      Palmdale Hills Property, LLC


      Chapter 11

      meaning. Further, giving meaning to all of the statutory language requires the existence of an actual operating agreement. Finally, and most importantly, Judge Mund opined that operating agreements "have specific meanings in the law of limited liability companies and for oil and gas rights," and that "terming the DMA to be an ‘operating agreement’ would be expanding the definition of affiliate (and thus insider) beyond what is plainly contained in the statute." 2017 Bankr.Lexis 3534 at 29.


      SCM urges the court to employ the restrictive construction of the term, arguing that "leasing or operating agreement implies entitlement to benefits akin to ownership, which is not the case here. SCM also cites several a number of cases which describe an "operating agreement" as a contract used in the oil and gas industry. See Defendants’ Opposition at p. 30 and citations therein [Dkt #424].


      Respectfully, the principles of statutory construction lead this court to a contrary conclusion. First, the court is not persuaded that the plain meaning of the term means a literal meaning of the same without regard to substance or context. Certainly, nothing in the legislative history of §101 suggests that Congress intended to limit affiliate status to operating agreements associated with limited liability companies or oil and gas contracts. The legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      Second, as "operating agreement" is not defined in §101, consideration of the context of the surrounding language is in order. It is a "fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme. Food and Drug Admin. v. Brown & Williamson Tobacco Co., 529 U.S. 120, 133 (2000); accord Gale v. First Franklin Loan Services, 701 F.3d. 1240, 1244 (9th Cir. 2012). See, generally Badgley v. United States, 957 F.3d. 969, 977 (9th Cir. 2020) ("In applying the statute, we focus on the substance of the retained interest. Labels are not dispositive."). Section 101(2)(D) starts with "entity that operates the business . . .of the debtor. The court interprets this to mean the emphasis is on whether someone other than the debtor is operating its business. As the DMA is an agreement governing the SCM’s operation of every aspect of Debtor’s

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      Palmdale Hills Property, LLC


      Chapter 11

      business and property, it is, the court’s view, an "operating agreement" within the meaning of §101(2)(D).


      The court concludes as a matter of undisputed fact that SCM is an affiliate under

      §101(2)(D) and, therefore, a statutory insider pursuant to §101(31)(E).


    3. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(F) Based on Its Status as Managing Agent


      Under §101(31)(F), the term "insider" includes a managing agent of the debtor. As with "operating agreement," "managing agent" is not a defined term under the Code. In analyzing whether SCM was the managing agent of Marblehead, Judge Mund looked to guidance from the case of Rush v. Riddle (In re Standard Shoes, Inc.), 124 B.R. 318 (Bankr.C.D.Cal.1991). Though neither Standard Shoes or Judge Mund’s decision regarding the Marblehead matter are binding on this court, the court nevertheless finds them instructive and soundly reasoned.


      In Standard Shoes, Judge Zurzolo, in addressing the ambiguity of the term "managing agent," developed the following useful definition:


      "In defining ‘managing agent,’ I therefore conclude that it refers to Those entities that exert or could exert operational control over a debtor, a division or unit of a debtor, or a significant portion of a debtor’s property. Such operational control would ordinarily include the ability to make personnel decisions, the authority to incur or pay obligations and access to financial and other information essential to the operation of the debtor.


      The definition of ‘managing agent’ is consistent with the principal design of §101[31] and does not overlap or conflict with the categories of insiders expressly described in the preceding subsections of that statute."


      124 B.R. at 323-24.

      2:00 PM

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      Palmdale Hills Property, LLC


      Chapter 11


      SCE contends that it did not have operational control over Debtor or over a significant portion of Debtor’s property and that its authority was limited to performing services and making recommendations to Lehman which had ultimate approval power and control. Opposition at pp. 17-18. The court finds SCM’s arguments wholly unpersuasive. Instead, the court agrees with and adopts Judge Mund’s analysis and findings in the Marblehead matter:


      "SCM exercised operational control over the Debtor and thus was a managing agent. All three factors indicating such control in Standard Shoes exist: although its actions needed to be in accord with Project Budgets, SCM had authority to incur expenses on the Project, ability to make personnel decisions (as the Debtor’s operations were all conducted by SCM employees), and access the Debtor’s books and records (which

      it maintained). It is undisputed that SCM conducted the Debtor’s operations. While its actions may have been subject to the Lehman-approved Project Budget and Plan and Lehman may have had veto power over all payments, the standard does not demand unfettered control over the debtor. Standard Stores used a person in charge of a division of a corporate debtor as an example of a managing agent and cited the authority to direct payment of obligations, employ personnel, or order supplies as hallmarks of such control. Such people would still be subject to supervision and veto power by the officers and board of directors of the company."


      2017 Bankr. Lexis 3534 at 33-34.


      The duties and responsibilities of SCM under the DMA meet and exceed the managing agent factors set forth in Standard Stores. The court, therefore, finds as a matter of undisputed fact, that SCM was a managing agent of Debtor within the meaning of §101(31)(F) and a statutory insider of Debtor under § 101(31).

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      Palmdale Hills Property, LLC


      Chapter 11


    4. Plaintiff has not Met his Burden of Proof that SCC Acquisitions was an Affiliate and Statutory Insider of Debtor


      Plaintiff’s assertion that SCC Acquisitions was an Affiliate of Debtor is based on representations made in the Third Amended Disclosure Statement. Motion at p.

      20. However, the court has sustained the evidentiary objections regarding such representations. As a consequence, Plaintiff has not established as a matter of undisputed fact the SCC Acquisitions was an affiliate and, therefore, an insider of Debtor.


    5. Plaintiff has not Met his Burden of Proof that SCM was an Affiliate and Insider of SCC Acquisitions, Rendering SCM an Insider of Debtor


      In the Motion, Plaintiff relies principally on representations made in the Third Amended Disclosure Statement. See Motion at p. 20. As the court has sustained the evidentiary objections regarding such representations and, therefore, Plaintiff has not established as matter of undisputed fact that SCM was an affiliate and insider of SCC Acquisitions.


    6. Plaintiff has not Met his Burden of Proof that SunCal Marblehead was an Affiliate of Debtor


      Plaintiff relies on conclusory statements made by Elieff in Debtor’s involuntary bankruptcy petition that Suncal Marblehead was an affiliate of Debtor. This is insufficient to satisfy Plaintiff’s burden of proof regarding SunCal Marblehead’s status as an affiliate of Debtor as a matter of undisputed fact.


    7. Plaintiff has not Satisfied his Burden of Proof that Bruce Elieff

      was an Affiliate of Debtor


      Plaintiff’s argues thatunder § 101(31)(E) SCM should be found to be an "insider" of Debtor because SCM was an insider of Debtor’s affiliate, Bruce Elieff. Mot., p. 23:15-24. Judge Mund previously found this argument

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      unpersuasive. Palmdale, supra at 29-30. She found that that Plaintiff failed to establish as a matter of undisputed fact that Elieff met the requirements of 101(2)(D), that is, that Elieff has actually operated Marblehead's business. The same issue persists here.


      Further, under § 101(31)(E), a statutory insider includes an "insider of an affiliate as if such affiliate were the debtor." Plaintiff’s argument is unpersuasive because Plaintiff has failed to demonstrate that Bruce (rather than SCC JV) is an affiliate of Debtor. Under the Grandparent Operating, SCC JV, not Bruce, was the party to the agreement. In addition, Plaintiff has failed to demonstrate SCM itself is an insider of SCC JV. Thus, even if SCM is be an insider of Bruce, Plaintiff has not demonstrated the absence of a material fact that Bruce (rather than SCC JV) is an affiliate of Debtor


    8. Plaintiff has Met his Burden of Proof that SCM was a Non-statutory Insider


      Plaintiff’s argues thatunder § 101(31)(E) SCM should be found to be an "insider" of Debtor because SCM was an insider of Debtor’s affiliate, Bruce Elieff. Mot., p. 23:15-24. Judge Mund previously found this argument unpersuasive. Palmdale, supra at 29-30. She found that that Plaintiff failed to establish as a matter of undisputed fact that Elieff met the requirements of 101(2)(D), that is, that Elieff has actually operated Marblehead's business. The same issue persists here.


      Further, under § 101(31)(E), a statutory insider includes an "insider of an affiliate as if such affiliate were the debtor." Plaintiff’s argument is unpersuasive because Plaintiff has failed to demonstrate that Bruce (rather than SCC JV) is an affiliate of Debtor. Under the Grandparent Operating, SCC JV, not Bruce, was the party to the agreement. In addition, Plaintiff has failed to demonstrate SCM itself is an insider of SCC JV. Thus, even if SCM is be an insider of Bruce, Plaintiff has not demonstrated the absence of a material fact that Bruce (rather than SCC JV) is an affiliate of Debtor


      H. Plaintiff has Met his Burden of Proof that SCM was a Non-statutory Insider

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11


      In The Village at Lakeridge, the Ninth Circuit held that non-statutory insiders are the "functional equivalent of statutory insiders" if they fall within the ambit of § 101(31). 814 F.3d at 1001. An entity is a non-statutory insider if "1) the closeness of its relationship with the debtor is comparable to that of the enumerated insider classifications in §101(31), and 2) the relevant transaction is negotiated at less than arm’s length." Id. As previously noted herein, the legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.

      The court agrees with and adopts by reference below, Judge Mund’s two-step analysis concerning the non-statutory insider status of SCM in the SunCal Marblehead matter:


      "[I]t is beyond dispute that SCM conducted the Debtor’s day-to-day operations, its employees conducted all of the Debtor’s business functions, and it maintained the Debtor’s books and records. It had ‘some degree of control’ and access to the Debtor’s information and records, both of which are indications of insider status cited by the Ninth Circuit in Vill.at Lakeridge. It was also close enough for SCM to gain some advantage due simply to affinity: even if all of the Debtor’s payments needed Lehman’s prior approval, SCM was responsible for the first line of review of its own invoices and had some control over when its invoices were submitted for approval and were paid. This extremely close relationship between SCM and the Debtor was of the type that Congress intended to subject to ‘a greater level of scrutiny.’


      However much control Lehman may have had over the Project, the Project Budgets, the draw requests, and the vendor payments, it

      is undisputed that SCM processed, reviewed, and paid its own invoices on the Debtor’s behalf. An SCM employee actually issuing the Debtor’s payment to SCM was not a transaction conducted

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      ‘as if the parties were strangers.’ A conflict of interest does not require nefarious behavior by SCM, merely the potential for abuse. These payments to SCM cannot be called ‘arms’ length transactions."


      2017 Bankr. Lexis at 37-38.


      SCM disagrees with the foregoing analysis. First, SCM argues that Lehman did not show SCM any preferential treatment in its decisions regarding payment and that there is no evidence that payments made to SCM were for any reason of affinity. SCM attempt to distinguish itself from the familial affinity that existed in In re Rexford Properties, LLC, 557 B.R. 788 (Bankr.C.D.Cal 2016). SCM misses the point. The close relationship prong does not require a showing of actual preferential treatment, but rather that the closeness could provide an opportunity for potential abuse. The discussion of Rexford is not helpful the facts in that case are not comparable to the circumstances here. For example, SCE states that it has no ownership interest in Debtor. However, ownership interest is not critical factor or requirement for non-statutory insider status.


      Next, while acknowledging that control is not a required factor in this Circuit, SCM refers the court to an unpublished, non-precedential Ninth Circuit case, Farrar v. Warda & Yonano LLP (In re Bella Vista by Paramount LLC), 549 Fed.Appx, 648 (2013) for the quote therein that "insider status is a question of control." Farrar predates the published (and binding) Ninth Circuit case, The Village at Lakeridge ("Some degree of control is one of many indications that a creditor may be a non-statutory insider, but actual control is not required to find non-statutory insider status") (emphasis added) 814 F.3d at 1001. In footnote 12 of The Village at Lakeridge, the Court observed that "if actual control were required for non-statutory insider status, all non-statutory insiders would also be statutory insiders under §101)(31). The remainder of the arguments and citations to non-binding decisions, most of which predate The Village at Lakeridge, are not persuasive.


  7. Conclusion


Based upon the foregoing, the Motion is granted in part; denied in part.

2:00 PM

CONT...


Debtor(s):


Palmdale Hills Property, LLC

Party Information


Chapter 11

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

2:00 PM

CONT...


Trustee(s):


Palmdale Hills Property, LLC


Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01127 Speier v. SunCal Management LLC et al


#15.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restititution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers

[Debtor: SunCal Northlake, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 98


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By

2:00 PM

CONT...


Palmdale Hills Property, LLC


Paul J Couchot Peter W Lianides Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

2:00 PM

CONT...

Trustee(s):


Palmdale Hills Property, LLC


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01128 Speier v. SunCal Management LLC et al


#16.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20; 4-27-20; 5-28-20


Docket 518


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Grant motion for partial summary adjudication on the grounds that Plaintiff has established as a matter of undisputed fact and law that SCM is both a statutory insider under FRBP 101(31)(E) [affiliate within the meaning of 101(30)(D)], and FRBP 101(31)(F) [managing agent] and is also a nonstatutory insider.


The basis for the ruling and relevant evidentiary rulings will be posted in the tentative ruling field in lieu of an oral ruling on the record on May 29, 2020 between 12:00pm and 1:00pm. A hearing will be held on May 29, 2020 at 2:00

p.m. regarding any questions regarding the ruling, as well as scheduling of future motions/status conferences.

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

May 29, 2020


Basis for Ruling


  1. Background


    An involuntary petition was filed against SunCal Oak Valley, LLC ("Debtor") on November 12, 2008, bankruptcy case no. 18-17472. The order for relief was entered on January 6, 2009 and plaintiff, chapter 11 trustee Steven M. Spier ("Plaintiff" or "Trustee") was appointed on January 22, 2009 and subsequently also became the liquidating trustee under Debtor’s confirmed plan. The order granting joint administration with the Palmdale lead case was entered March 18, 2009.


    On May 1, 2012, Plaintiff commenced this adversary proceeding against SunCal Management, LLC ("SCM") and Argent Management, LLC ("Argent") (collectively, "Defendants"). Trustee seeks the return of management fees of more than $900,000 paid by Debtor (and eleven other related debtors) to SCM during the period 2004 to 2008 based on several legal theories, including preferential transfer under §547. The original complaint was subsequently amended twice and timely answers were filed by Defendants. On September 9, 2016, this adversary proceeding, as well as the eleven other related adversary proceedings (sometimes referred to herein collectively as the "Related Adversaries") were transferred to Judge Geraldine Mund. Judge Mund made several rulings in the Related Adversaries, including the granting of summary adjudication in favor of Defendants on Plaintiff’s claims for breach of contract and restitution/unjust enrichment in this adversary proceeding. Importantly, on October 12, Judge Mund also ruled in one of the Related Adversaries involving SunCal Marblehead LLC ("Marblehead") that SCM was both a statutory and non- statutory insider of Marblehead. On January 25, 2018, the Related Adversaries were transferred back to this court.


    On May 30, 2019, Plaintiff filed the instant motion for partial summary adjudication [dkt. #417] ("Motion") for findings that SCM was also an insider of

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Debtor pursuant to §101(31) from the date Debtor and SCM entered into that certain Development Management Agreement ("DMA") until the petition date. Specifically, Plaintiff asserts that SCM is an insider under §101(31)(E) as an insider of an affiliate of Debtor, as the managing agent of Debtor under §101(31) (F), and as a non-statutory insider of Debtor. Defendants vigorously oppose the Motion.


  2. Standard for Summary Judgment/Partial Adjudication


    A party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The opposing party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial. Id. at 324. The substantive law will identify which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Id. A factual dispute is genuine where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Id. The court must view the evidence presented on the motion in the light most favorable to the opposing party. Id.


    As explained by the Ninth Circuit in Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000):


    "A moving party without the ultimate burden of persuasion at trial—usually, but not always, a defendant—has both the initial burden of production and the ultimate burden of persuasion on a motion for summary judgment... In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party's claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial... In order to carry its ultimate burden of persuasion on the motion, the moving party must persuade the court that there is no genuine issue of material fact... If a moving party fails to carry its initial burden of

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    production, the nonmoving party has no obligation to produce anything, even if the nonmoving party would have the ultimate burden of persuasion at trial... In such a case, the nonmoving party may defeat the motion for summary judgment without producing anything... If, however, support its claim or defense... If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion for summary judgment."


    Id. at 1102-03 (citations omitted). In ruling on a summary judgment motion, the Court does not weigh the evidence. Anderson, 477 U.S. at 255. Rather, the Court’s role is to assess whether a genuine dispute exists as to the material facts requiring a trial. Id. at 249. In conducting this assessment, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Tolan v. Cotton, 572 U.S. 650, 651 (2014). Furthermore, where intent is at issue, summary judgment is seldom granted. See, Provenz v. Miller, 102 F.3d 1478, 1489 (9th Cir. 1996), cert. denied, 118 S. Ct. 48 (1997).


    Federal Rules of Bankruptcy Procedure 7056 incorporates by reference most of the procedural requirements of Rule 56 of the Federal Rules of Civil Procedure ("FRCP") governing motions for summary judgment. In this District, Rule 7056-1 of the Local Bankruptcy Rules ("LBR") also applies.


  3. Statement of Uncontroverted Facts and Conclusions of Law/Statement of Genuine Facts


    Under FRCP 56(c)(1)(A), the moving party must cite to materials in the record, including "depositions, documents, electronically stored information, affidavits, declarations . . . admissions, interrogatory answers, or other materials." LBR 7056-1(b)(2) requires that the moving party serve and file a proposed statement of uncontroverted facts and conclusions of law. LBR 7056-1(c)(2)(A) and (B) requires that the respondent file a separate statement of genuine issues, "identify each material fact that is disputed and cite the particular portions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish the dispute "


    In this matter, Plaintiff timely filed a Statement of Uncontroverted Facts

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    and Conclusions of Law "UF") and Defendants timely filed a Statement of Genuine Facts ("GI").


    Defendants filed evidentiary objections to the admission of the content of Exhibit 4 of Plaintiff’s Request for Judicial Notice, Exhibit 4 being the Third Amended Disclosure Statement ("TAD") filed on August 5, 2011 by counsel for SCC Acquisitions [Dkt #424]. The objections are sustained on the basis of hearsay and personal knowledge and affect UF #59-68. Among other things, UF #s 64, 65, 66, 67 and 68 identify the TAD as the basis for various fact statements concerning the identification of Defendant SCM and SCC Acquisitions, Inc. as "insiders" of Debtor, SCM as a "SunCal Affiliate", SCC Acquisitions, Inc. as an "indirect parent company" of Debtor and that Debtor was "an affiliate of SCC Acquisitions".


    Defendants also objected to Exhibit "F" to the Declaration of Gary Pemberton on personal knowledge grounds. The court believes Defendants are actually referring to Exhibit G, which is the deposition testimony of Edward Nolan. On page 187, lines 18-19, when asked about SCC Acquisitions, Mr. Nolan simply states that it is "the company that Bruce [Elieff] owns." The objection is sustained except as to the reference by Mr. Nolan to a "Project Detail Report" which is adequately authenticated by Mr. Nolan.


    In sum, for purposes of this Motion, all of the statements in Plaintiff’s UF are deemed admitted and uncontroverted, except where disputed by Defendants. Some of the uncontroverted facts are summarized below. The court notes that in their Statement of Genuine Issues, Defendants have added several "Additional Material Facts," which may or may not be reflected in "Uncontroverted Facts" set forth below but may be addressed in the overall analysis of the Motion. If certain such additional facts are not mentioned, it is because the court did not believe them to be germane to the issues presented.


  4. Uncontroverted Facts


    Most of the pertinent are undisputed and are not fully set forth herein.

    The court incorporates

    by reference herein, the all of the fact set forth in the UF that are not disputed by

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Defendants in their GI.


    "The SunCal Companies," or "SunCal," is a brand name or dba used by an integrated network of real estate acquisition, holding and development companies owned by Bruce Elieff ("Elieff") and/or his brother, Stephen Elieff. UF 1 Debtor was formed at Elieff’s direction as a single-purpose limited liability company to own certain real property located in Oakland, California (the "Oak Knoll Project"). UF 2, 3.


    Debtor did not have any employees and, as such, could not develop the Project itself. UF 6. Accordingly, on December 29, 2005, Debtor entered into a Development Management Agreement ("DMA") with SCM. UF 7. SCM was formed to "provide management and development services to entities who have direct or indirect ownership interests in certain real estate projects, and who are affiliated with the SunCal group of companies." UF 8. As a SunCal entity, SCM shared common management with Debtor. At all relevant times, Bruce owned 100% of SCM and served as its Manager as well as Debtor’s Manager. He executed the DMA on behalf of both SCM and Debtor. UF 9, 11. SCM’s General Counsel, Bruce Cook, participated in filing the documents used to form Debtor, prepared the Debtor’s Operating Agreement and the First Amendment thereto, as well as the DMA, and was one of Debtor’s authorized signatories. UF 10. Frank Faye, SCM’s Chief Operating Officer, was also an officer of Debtor. UF 12.


    Under the DMA, Debtor engaged SCM "to perform the development and management functions set forth below in connection with the development, marketing and sale of the Project, and to assist in all aspects of the Project[.]" UF

    13. The DMA also provided SCM "the authority to perform (and incur expenses in connection with the performance of) the Development and Sale Services & Functions . . . and to otherwise act in accordance with the Project Budget" and to "take any action with respect to the Property or Project or incur any expense for which [the Debtor] is or may be responsible" so long as SCM "reasonably deems such action or expense as necessary in furtherance of the proper development, sale and marketing of the Project." UF 14. SCM reviewed and coordinated the work of the various contractors and consultants for Debtor’s Project. UF 15. SCM’s Project responsibilities were wide-ranging and included:

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

  5. Marblehead Decision


    During the time that he Related Adversaries were pending before Judge Mund, Plaintiff filed a similar motion for partial adjudication based on facts nearly identical presented here that SCM was a statutory and non-statutory insider of related debtor. SunCal Marblehead, LLC ("Marblehead"), adv. no 18-01125. In a thorough and well-analyzed opinion, Judge Mund held as follows:


    1. SCM was not an insider as an "affiliate" of Marblehead under § 101(31)(E),

    2. SCM was not an insider of Marblehead’s affiliate, Elieff, under §101(31)(E),

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

    3. SCM was an insider of Marblehead as "managing agent" under §101(31)(F), and

    4. SCM was a non-statutory insider of Marblehead.


    See Palmdale Hills Prop. v. Argent Mgmt., LLC (In re Palmdale Hills Prop.), 2017 Bankr. LEXIS 3534, at *19 (Bankr. C.D. Cal. Oct. 12, 2017). Both sides cite to Judge Mund’s prior decision and address Judge Mund’s analysis in their arguments. With one notable exception, this court agrees with Judge Mund’s findings and conclusions. To avoid "re-inventing the wheel," the court will borrow heavily from her reasoned opinion.


  6. Analysis


    1. Insider Status Under §101(31)


      The SAC alleges a claim for relief under §547 for preferential transfer. Section 547(b)(4)(B) extends the "look back" period for recovery a preferential transfer to an insider from ninety days to one year prior to the petition date. Pursuant to § 547(g), Plaintiff bears the burden of proving that SCM is an insider, in connection with Plaintiff’s preference claim against SCM. Batlan v. Transamerica Commer. Fin. Corp. (In re Smith's Home Furnishings, Inc.), 265 F.3d 959, 963 (9th Cir. Or. 2001) ("Section 547(g) places the burden of proof on the trustee to show all of the conditions of §547(b).").


      There are "two types of insiders: statutory insiders and non-statutory insiders." In re The Village at Lakeridge, LLC, 814 F.3d 993, 999 (9th Cir. 2016), aff'd sub nom. U.S. Bank Nat. Ass'n ex rel. CWCapital Asset Mgmt. LLC v. Village at Lakeridge, LLC, 138 S. Ct. 960, 200 L. Ed. 2d 218 (2018). "To be a ‘statutory insider,’ a creditor must fall within one of the categories listed in 11 U.S.C. § 101(31)." Village at Lakeridge, supra, at 996 (emphasis in original). "Whether a creditor is an insider is a factual inquiry that must be conducted on a case-by- case basis." Id. at 1000. "In conducting a factual inquiry for insider status, courts should begin with the statute. If the [alleged insider] fits within the statutory insider classification on his own, the court’s review ends; it need not examine the nature of the statutory insider’s relationship to the debtor." Id. at 1001.

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11


      Under §101(31), the term "insider" includes as to corporations:


      1. if the debtor is a corporation –

        1. director of the debtor;

        2. officer of the debtor;

        3. person in control of the debtor;


      1. affiliate, or insider of an affiliate as if such affiliate were the debtor; and


      2. and managing agent of the debtor.


    2. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(E) Based on Its Affiliate Status Under §101(2)(D)


      Section 101(2)(D) defines "affiliate" as an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." (emphasis added)


      It is undisputed that SCM and its employees operated all aspects of Debtor’s project development business as previously noted in detail herein. Plaintiff contends that under these circumstances, SCM, as the operator of Debtor’s business, falls squarely within the definition of affiliate under §101(2)(D). SCE, on the other hand, argues that because it did not operate under a lease or operating agreement it is not an affiliate within the meaning of §101(2)(D). The issue is whether the DMA, a management agreement, is the functional equivalent of an operating agreement as that term is used in §101(2)(D). As pointed out by Judge Mund in the Marblehead decision, there are very few cases interpreting "operating agreement," and none in the Ninth Circuit. Some cases have interpreted the term expansively. See, e.g., In re Chira, 353 B.R. 693, 724-25 (Bankr.S.D.Fla.2006) ("the hotel also represented substantially all of [the debtor’s] property. Elizabeth and Lounge Corp. are both ‘entities’ and they both

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      operated the business and property of the Shelton Beach Hotel."); In re Century Inv. Fund VII Ltd., P’ship, 96 B.R. 884, 892 (Bankr.E.D.Wis.1989) (""Affiliate" means an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." 11 U.S.C. § 101(2)(D). CMG has certainly been managing all of the property of the debtor under its management agreement.). By contrast, other courts have interpreted the term more strictly. See, In re Washington Mut., 462 B.R. 137, 145-46 (rejecting debtors’ argument that certain pooling and servicing agreements were de facto operating agreement within the meaning of the statute).


      Judge Mund held that principles of statutory construction led her to the conclusion that SCM does not fall within the statutory definition of affiliate under

      §101(31)(D), relying at least in part on the statutory construction principles referenced in the decision of the Ninth Circuit Bankruptcy Appellate Panel in Miller Ave. Prof’l & Promotional Servs. v. Brady (In re Entertainment Acquisition Partners, Inc., 319 B.R. 626, 632-33 (9th Cir. BAP 2004). In Miller, the BAP held the corporation of a statutory insider was not an insider under §101(31)(B) and noted that "there is no justification for expanding the definition of a per se insider beyond what is plainly contained in the statute." Judge Mund observed that because §101(2) states that the term "affiliate" means, as opposed to the more flexible includes (as with §101(31), Congress intended a precise and restricted meaning. Further, giving meaning to all of the statutory language requires the existence of an actual operating agreement. Finally, and most importantly, Judge Mund opined that operating agreements "have specific meanings in the law of limited liability companies and for oil and gas rights," and that "terming the DMA to be an ‘operating agreement’ would be expanding the definition of affiliate (and thus insider) beyond what is plainly contained in the statute." 2017 Bankr.Lexis 3534 at 29.

      SCM urges the court to employ the restrictive construction of the term, arguing that "leasing or operating agreement implies entitlement to benefits akin to ownership, which is not the case here. SCM also cites several a number of cases which describe an "operating agreement" as a contract used in the oil and gas industry. See Defendants’ Opposition at p. 30 and citations therein [Dkt #424].


      Respectfully, the principles of statutory construction lead this court to a contrary conclusion. First, the court is not persuaded that the plain meaning of the term

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      means a literal meaning of the same without regard to substance or context. Certainly, nothing in the legislative history of §101 suggests that Congress intended to limit affiliate status to operating agreements associated with limited liability companies or oil and gas contracts. The legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      Second, as "operating agreement" is not defined in §101, consideration of the context of the surrounding language is in order. It is a "fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme. Food and Drug Admin. v. Brown & Williamson Tobacco Co., 529 U.S. 120, 133 (2000); accord Gale v. First Franklin Loan Services, 701 F.3d. 1240, 1244 (9th Cir. 2012). See, generally Badgley v. United States, 957 F.3d. 969, 977 (9th Cir. 2020) ("In applying the statute, we focus on the substance of the retained interest. Labels are not dispositive."). Section 101(2)(D) starts with "entity that operates the business . . .of the debtor. The court interprets this to mean the emphasis is on whether someone other than the debtor is operating its business. As the DMA is an agreement governing the SCM’s operation of every aspect of Debtor’s business and property, it is, the court’s view, an "operating agreement" within the meaning of §101(2)(D).

      The court concludes as a matter of undisputed fact that SCM is an affiliate under

      §101(2)(D) and, therefore, a statutory insider pursuant to §101(31)(E).


    3. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(F) Based on Its Status as Managing Agent


      Under §101(31)(F), the term "insider" includes a managing agent of the debtor. As with "operating agreement," "managing agent" is not a defined term under the Code. In analyzing whether SCM was the managing agent of Marblehead, Judge Mund looked to guidance from the case of Rush v. Riddle (In re Standard Shoes, Inc.), 124 B.R. 318 (Bankr.C.D.Cal.1991). Though neither

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      Standard Shoes or Judge Mund’s decision regarding the Marblehead matter are binding on this court, the court nevertheless finds them instructive and soundly reasoned.


      In Standard Shoes, Judge Zurzolo, in addressing the ambiguity of the term "managing agent," developed the following useful definition:


      "In defining ‘managing agent,’ I therefore conclude that it refers to Those entities that exert or could exert operational control over a debtor, a division or unit of a debtor, or a significant portion of a debtor’s property. Such operational control would ordinarily include the ability to make personnel decisions, the authority to incur or pay obligations and access to financial and other information essential to the operation of the debtor.


      The definition of ‘managing agent’ is consistent with the principal design of §101[31] and does not overlap or conflict with the categories of insiders expressly described in the preceding subsections of that statute."


      124 B.R. at 323-24.


      SCE contends that it did not have operational control over Debtor or over a significant portion of Debtor’s property and that its authority was limited to performing services and making recommendations to Lehman which had ultimate approval power and control. Opposition at pp. 17-18. The court finds SCM’s arguments wholly unpersuasive. Instead, the court agrees with and adopts Judge Mund’s analysis and findings in the Marblehead matter:


      "SCM exercised operational control over the Debtor and thus was a managing agent. All three factors indicating such control in Standard Shoes exist: although its actions needed to be in accord with Project Budgets, SCM had authority to incur expenses on the Project, ability to make personnel decisions (as the Debtor’s operations were all conducted by SCM employees), and access the Debtor’s books and records (which

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      it maintained). It is undisputed that SCM conducted the Debtor’s operations. While its actions may have been subject to the Lehman-approved Project Budget and Plan and Lehman may have had veto power over all payments, the standard does not demand unfettered control over the debtor. Standard Stores used a person in charge of a division of a corporate debtor as an example of a managing agent and cited the authority to direct payment of obligations, employ personnel, or order supplies as hallmarks of such control. Such people would still be subject to supervision and veto power by the officers and board of directors of the company."


      2017 Bankr. Lexis 3534 at 33-34.


      The duties and responsibilities of SCM under the DMA meet and exceed the managing agent factors set forth in Standard Stores. The court, therefore, finds as a matter of undisputed fact, that SCM was a managing agent of Debtor within the meaning of §101(31)(F) and a statutory insider of Debtor under § 101(31).


    4. Plaintiff has not Met his Burden of Proof that SCC Acquisitions was an Affiliate and Statutory Insider of Debtor


      Plaintiff’s assertion that SCC Acquisitions was an Affiliate of Debtor is based on representations made in the Third Amended Disclosure Statement. Motion at p.

      20. However, the court has sustained the evidentiary objections regarding such representations. As a consequence, Plaintiff has not established as a matter of undisputed fact the SCC Acquisitions was an affiliate and, therefore, an insider of Debtor.


    5. Plaintiff has not Met his Burden of Proof that SCM was an Affiliate and Insider of SCC Acquisitions, Rendering SCM an Insider of Debtor

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11


      In the Motion, Plaintiff relies principally on representations made in the Third Amended Disclosure Statement. See Motion at p. 20. As the court has sustained the evidentiary objections regarding such representations and, therefore, Plaintiff has not established as matter of undisputed fact that SCM was an affiliate and insider of SCC Acquisitions.


    6. Plaintiff has not Met his Burden of Proof that SunCal Marblehead was an Affiliate of Debtor


      Plaintiff relies on conclusory statements made by Elieff in Debtor’s involuntary bankruptcy petition that Suncal Marblehead was an affiliate of Debtor. This is insufficient to satisfy Plaintiff’s burden of proof regarding SunCal Marblehead’s status as an affiliate of Debtor as a matter of undisputed fact.


    7. Plaintiff has not Satisfied his Burden of Proof that Bruce Elieff

      was an Affiliate of Debtor


      Plaintiff’s argues thatunder § 101(31)(E) SCM should be found to be an "insider" of Debtor because SCM was an insider of Debtor’s affiliate, Bruce Elieff. Mot., p. 23:15-24. Judge Mund previously found this argument unpersuasive. Palmdale, supra at 29-30. She found that that Plaintiff failed to establish as a matter of undisputed fact that Elieff met the requirements of 101(2)(D), that is, that Elieff has actually operated Marblehead's business. The same issue persists here.


      Further, under § 101(31)(E), a statutory insider includes an "insider of an affiliate as if such affiliate were the debtor." Plaintiff’s argument is unpersuasive because Plaintiff has failed to demonstrate that Bruce (rather than SCC JV) is an affiliate of Debtor. Under the Grandparent Operating, SCC JV, not Bruce, was the party to the agreement. In addition, Plaintiff has failed to demonstrate SCM itself is an insider of SCC JV. Thus, even if SCM is be an insider of Bruce, Plaintiff has not demonstrated the absence of a material fact that Bruce (rather than SCC JV) is an affiliate of Debtor


    8. Plaintiff has Met his Burden of Proof that SCM was a Non-statutory Insider

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      In The Village at Lakeridge, the Ninth Circuit held that non-statutory


      Chapter 11

      insiders are the "functional equivalent of statutory insiders" if they fall within the ambit of §101(31). 814 F.3d at 1001. An entity is a non-statutory insider if "1) the closeness of its relationship with the debtor is comparable to that of the enumerated insider classifications in §101(31), and 2) the relevant transaction is negotiated at less than arm’s length." Id. As previously noted herein, the legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      The court agrees with and adopts by reference below, Judge Mund’s two-step analysis concerning the non-statutory insider status of SCM in the SunCal Marblehead matter:


      "[I]t is beyond dispute that SCM conducted the Debtor’s day-to-day operations, its employees conducted all of the Debtor’s business functions, and it maintained the Debtor’s books and records. It had ‘some degree of control’ and access to the Debtor’s information and records, both of which are indications of insider status cited by the Ninth Circuit in Vill.at Lakeridge. It was also close enough for SCM to gain some advantage due simply to affinity: even if all of the Debtor’s payments needed Lehman’s prior approval, SCM was responsible for the first line of review of its own invoices and had some control over when its invoices were submitted for approval and were paid. This extremely close relationship between SCM and the Debtor was of the type that Congress intended to subject to ‘a greater level of scrutiny.’


      However much control Lehman may have had over the Project, the Project Budgets, the draw requests, and the vendor payments, it

      is undisputed that SCM processed, reviewed, and paid its own invoices on the Debtor’s behalf. An SCM employee actually issuing the Debtor’s payment to SCM was not a transaction conducted

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      ‘as if the parties were strangers.’ A conflict of interest does not require nefarious behavior by SCM, merely the potential for abuse. These payments to SCM cannot be called ‘arms’ length transactions."


      2017 Bankr. Lexis at 37-38.


      SCM disagrees with the foregoing analysis. First, SCM argues that Lehman did not show SCM any preferential treatment in its decisions regarding payment and that there is no evidence that payments made to SCM were for any reason of affinity. SCM attempt to distinguish itself from the familial affinity that existed in In re Rexford Properties, LLC, 557 B.R. 788 (Bankr.C.D.Cal 2016). SCM misses the point. The close relationship prong does not require a showing of actual preferential treatment, but rather that the closeness could provide an opportunity for potential abuse. The discussion of Rexford is not helpful the facts in that case are not comparable to the circumstances here. For example, SCE states that it has no ownership interest in Debtor. However, ownership interest is not critical factor or requirement for non-statutory insider status.


      Next, while acknowledging that control is not a required factor in this Circuit, SCM refers the court to an unpublished, non-precedential Ninth Circuit case, Farrar v. Warda & Yonano LLP (In re Bella Vista by Paramount LLC), 549 Fed.Appx, 648 (2013) for the quote therein that "insider status is a question of control." Farrar predates the published (and binding) Ninth Circuit case, The Village at Lakeridge ("Some degree of control is one of many indications that a creditor may be a non-statutory insider, but actual control is not required to find non-statutory insider status") (emphasis added) 814 F.3d at 1001. In footnote 12 of The Village at Lakeridge, the Court observed that "if actual control were required for non-statutory insider status, all non-statutory insiders would also be statutory insiders under §101)(31). The remainder of the arguments and citations to non-binding decisions, most of which predate The Village at Lakeridge, are not persuasive.


  7. Conclusion


Based upon the foregoing, the Motion is granted in part; denied in part.

2:00 PM

CONT...


Debtor(s):


Palmdale Hills Property, LLC

Party Information


Chapter 11

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

2:00 PM

CONT...


Trustee(s):


Palmdale Hills Property, LLC


Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01128 Speier v. SunCal Management LLC et al


#17.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; and (4) to Avoid and Recover Fraudulent Transfers

[Debtor: LBL-SunCal Oak Valley, LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 98


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By

2:00 PM

CONT...


Palmdale Hills Property, LLC


Paul J Couchot Peter W Lianides Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue


Chapter 11

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

2:00 PM

CONT...

Trustee(s):


Palmdale Hills Property, LLC


Chapter 11

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01129 Speier v. Argent Management, LLC et al


#18.00 CONT'D ORAL RULING RE: The Trustee's Motion for Partial Summary Adjudication that SunCal Management LLC was an Insider of the Debtor


FR: 10-10-19; 1-9-20; 3-26-20; 4-27-20; 5-28-20


Docket 522


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 28, 2020


Grant motion for partial summary adjudication on the grounds that Plaintiff has established as a matter of undisputed fact and law that SCM is both a statutory insider under FRBP 101(31)(E) [affiliate within the meaning of 101(30)(D)], and FRBP 101(31)(F) [managing agent] and is also a nonstatutory insider.


The basis for the ruling and relevant evidentiary rulings will be posted in the tentative ruling field in lieu of an oral ruling on the record on May 29, 2020 between 12:00pm and 1:00pm. A hearing will be held on May 29, 2020 at 2:00

p.m. regarding any questions regarding the ruling, as well as scheduling of future motions/status conferences.

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

May 29, 2020


Basis for Ruling


  1. Background


    An involuntary petition was filed against SunCal Coves Venture, LLC ("Debtor") on November 12, 2008, bankruptcy case no. 18-17472. The order for relief was entered on January 6, 2009 and plaintiff, chapter 11 trustee Steven M. Spier ("Plaintiff" or "Trustee") was appointed on January 22, 2009 and subsequently also became the liquidating trustee under Debtor’s confirmed plan. The order granting joint administration with the Palmdale lead case was entered March 18, 2009.


    On May 1, 2012, Plaintiff commenced this adversary proceeding against SunCal Management, LLC ("SCM") and Argent Management, LLC ("Argent") (collectively, "Defendants"). Trustee seeks the return of management fees of more than $900,000 paid by Debtor (and eleven other related debtors) to SCM during the period 2004 to 2008 based on several legal theories, including preferential transfer under §547. The original complaint was subsequently amended twice and timely answers were filed by Defendants. On September 9, 2016, this adversary proceeding, as well as the eleven other related adversary proceedings (sometimes referred to herein collectively as the "Related Adversaries") were transferred to Judge Geraldine Mund. Judge Mund made several rulings in the Related Adversaries, including the granting of summary adjudication in favor of Defendants on Plaintiff’s claims for breach of contract and restitution/unjust enrichment in this adversary proceeding. Importantly, on October 12, Judge Mund also ruled in one of the Related Adversaries involving SunCal Marblehead LLC ("Marblehead") that SCM was both a statutory and non- statutory insider of Marblehead. On January 25, 2018, the Related Adversaries were transferred back to this court.


    On May 30, 2019, Plaintiff filed the instant motion for partial summary adjudication [dkt. #417] ("Motion") for findings that SCM was also an insider of

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Debtor pursuant to §101(31) from the date Debtor and SCM entered into that certain Development Management Agreement ("DMA") until the petition date. Specifically, Plaintiff asserts that SCM is an insider under §101(31)(E) as an insider of an affiliate of Debtor, as the managing agent of Debtor under §101(31) (F), and as a non-statutory insider of Debtor. Defendants vigorously oppose the Motion.


  2. Standard for Summary Judgment/Partial Adjudication


    A party seeking summary judgment bears the initial responsibility of demonstrating the absence of a genuine issue of material fact and establishing that it is entitled to judgment as a matter of law as to those matters upon which it has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The opposing party must make an affirmative showing on all matters placed in issue by the motion as to which it has the burden of proof at trial. Id. at 324. The substantive law will identify which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Id. A factual dispute is genuine where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Id. The court must view the evidence presented on the motion in the light most favorable to the opposing party. Id.


    As explained by the Ninth Circuit in Nissan Fire & Marine Ins. Co. v. Fritz Companies, Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000):


    "A moving party without the ultimate burden of persuasion at trial—usually, but not always, a defendant—has both the initial burden of production and the ultimate burden of persuasion on a motion for summary judgment... In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party's claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial... In order to carry its ultimate burden of persuasion on the motion, the moving party must persuade the court that there is no genuine issue of material fact... If a moving party fails to carry its initial burden of

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    production, the nonmoving party has no obligation to produce anything, even if the nonmoving party would have the ultimate burden of persuasion at trial... In such a case, the nonmoving party may defeat the motion for summary judgment without producing anything... If, however, support its claim or defense... If the nonmoving party fails to produce enough evidence to create a genuine issue of material fact, the moving party wins the motion for summary judgment."


    Id. at 1102-03 (citations omitted). In ruling on a summary judgment motion, the Court does not weigh the evidence. Anderson, 477 U.S. at 255. Rather, the Court’s role is to assess whether a genuine dispute exists as to the material facts requiring a trial. Id. at 249. In conducting this assessment, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Tolan v. Cotton, 572 U.S. 650, 651 (2014). Furthermore, where intent is at issue, summary judgment is seldom granted. See, Provenz v. Miller, 102 F.3d 1478, 1489 (9th Cir. 1996), cert. denied, 118 S. Ct. 48 (1997).


    Federal Rules of Bankruptcy Procedure 7056 incorporates by reference most of the procedural requirements of Rule 56 of the Federal Rules of Civil Procedure ("FRCP") governing motions for summary judgment. In this District, Rule 7056-1 of the Local Bankruptcy Rules ("LBR") also applies.


  3. Statement of Uncontroverted Facts and Conclusions of Law/Statement of Genuine Facts


    Under FRCP 56(c)(1)(A), the moving party must cite to materials in the record, including "depositions, documents, electronically stored information, affidavits, declarations . . . admissions, interrogatory answers, or other materials." LBR 7056-1(b)(2) requires that the moving party serve and file a proposed statement of uncontroverted facts and conclusions of law. LBR 7056-1(c)(2)(A) and (B) requires that the respondent file a separate statement of genuine issues, "identify each material fact that is disputed and cite the particular portions of any pleading, affidavit, deposition, interrogatory answer, admission, or other document relied upon to establish the dispute "


    In this matter, Plaintiff timely filed a Statement of Uncontroverted Facts

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    and Conclusions of Law "UF") and Defendants timely filed a Statement of Genuine Facts ("GI").


    Defendants filed evidentiary objections to the admission of the content of Exhibit 4 of Plaintiff’s Request for Judicial Notice, Exhibit 4 being the Third Amended Disclosure Statement ("TAD") filed on August 5, 2011 by counsel for SCC Acquisitions [Dkt #424]. The objections are sustained on the basis of hearsay and personal knowledge and affect UF #59-68. Among other things, UF #s 64, 65, 66, 67 and 68 identify the TAD as the basis for various fact statements concerning the identification of Defendant SCM and SCC Acquisitions, Inc. as "insiders" of Debtor, SCM as a "SunCal Affiliate", SCC Acquisitions, Inc. as an "indirect parent company" of Debtor and that Debtor was "an affiliate of SCC Acquisitions".


    Defendants also objected to Exhibit "F" to the Declaration of Gary Pemberton on personal knowledge grounds. The court believes Defendants are actually referring to Exhibit G, which is the deposition testimony of Edward Nolan. On page 187, lines 18-19, when asked about SCC Acquisitions, Mr. Nolan simply states that it is "the company that Bruce [Elieff] owns." The objection is sustained except as to the reference by Mr. Nolan to a "Project Detail Report" which is adequately authenticated by Mr. Nolan.


    In sum, for purposes of this Motion, all of the statements in Plaintiff’s UF are deemed admitted and uncontroverted, except where disputed by Defendants. Some of the uncontroverted facts are summarized below. The court notes that in their Statement of Genuine Issues, Defendants have added several "Additional Material Facts," which may or may not be reflected in "Uncontroverted Facts" set forth below but may be addressed in the overall analysis of the Motion. If certain such additional facts are not mentioned, it is because the court did not believe them to be germane to the issues presented.


  4. Uncontroverted Facts


    Most of the pertinent are undisputed and are not fully set forth herein.

    The court incorporates

    by reference herein, the all of the fact set forth in the UF that are not disputed by

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Defendants in their GI.


    "The SunCal Companies," or "SunCal," is a brand name or dba used by an integrated network of real estate acquisition, holding and development companies owned by Bruce Elieff ("Elieff") and/or his brother, Stephen Elieff. UF 1 Debtor was formed at Elieff’s direction as a single-purpose limited liability company to own certain real property located in Oakland, California (the "Oak Knoll Project"). UF 2, 3.


    Debtor did not have any employees and, as such, could not develop the Project itself. UF 6. Accordingly, on December 29, 2005, Debtor entered into a Development Management Agreement ("DMA") with SCM. UF 7. SCM was formed to "provide management and development services to entities who have direct or indirect ownership interests in certain real estate projects, and who are affiliated with the SunCal group of companies." UF 8. As a SunCal entity, SCM shared common management with Debtor. At all relevant times, Bruce owned 100% of SCM and served as its Manager as well as Debtor’s Manager. He executed the DMA on behalf of both SCM and Debtor. UF 9, 11. SCM’s General Counsel, Bruce Cook, participated in filing the documents used to form Debtor, prepared the Debtor’s Operating Agreement and the First Amendment thereto, as well as the DMA, and was one of Debtor’s authorized signatories. UF 10. Frank Faye, SCM’s Chief Operating Officer, was also an officer of Debtor. UF 12.


    Under the DMA, Debtor engaged SCM "to perform the development and management functions set forth below in connection with the development, marketing and sale of the Project, and to assist in all aspects of the Project[.]" UF

    13. The DMA also provided SCM "the authority to perform (and incur expenses in connection with the performance of) the Development and Sale Services & Functions . . . and to otherwise act in accordance with the Project Budget" and to "take any action with respect to the Property or Project or incur any expense for which [the Debtor] is or may be responsible" so long as SCM "reasonably deems such action or expense as necessary in furtherance of the proper development, sale and marketing of the Project." UF 14. SCM reviewed and coordinated the work of the various contractors and consultants for Debtor’s Project. UF 15. SCM’s Project responsibilities were wide-ranging and included:

    2:00 PM

    CONT...


    Palmdale Hills Property, LLC


    Chapter 11

    Project . . ." UF 28

    Pursuant to the DMA’s terms, Debtor was responsible for paying SCM’s management fees and expense reimbursements. UF 17, 18. According to SCM’s Chief Accounting Officer, Tom Rollins, SCM "invoiced the Debtor directly for services performed" from "the inception of the Project to the Petition Date." UF 30. After SCM generated an invoice, it would go to the Project accountant, an SCM employee. UF 31. The Project accountant would then send the SCM invoices to SCM’s asset management group for review and approval. UF 32. Ultimately, an SCM employee would issue a check or wire funds from Debtor’s account to SCM. UF 33. Mr. Rollins and Ed Nolan, also an SCM employee, were responsible for approving such transfers. UF 34. Mr. Rollins testified that SCM employees would "try to make sure that billings [were] done properly, the accounting [was] done properly." UF 35. However, Debtor did not have any employees, and thus there was no personnel of Debtor to question whether an invoice was correct or whether a management fee payment should be deferred in accordance with the DMA based on a shortage of funds. UF 6. In total, SCM received at least $ 2,914,232.00 in management fees from Debtor between 2005 and 2008. UF 37.


  5. Marblehead Decision


    During the time that he Related Adversaries were pending before Judge Mund, Plaintiff filed a similar motion for partial adjudication based on facts nearly identical presented here that SCM was a statutory and non-statutory insider of related debtor. SunCal Marblehead, LLC ("Marblehead"), adv. no 18-01125. In a thorough and well-analyzed opinion, Judge Mund held as follows:


    1. SCM was not an insider as an "affiliate" of Marblehead under § 101(31)(E),

    2. SCM was not an insider of Marblehead’s affiliate, Elieff, under §101(31)(E),

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

    3. SCM was an insider of Marblehead as "managing agent" under §101(31)(F), and

    4. SCM was a non-statutory insider of Marblehead.


    See Palmdale Hills Prop. v. Argent Mgmt., LLC (In re Palmdale Hills Prop.), 2017 Bankr. LEXIS 3534, at *19 (Bankr. C.D. Cal. Oct. 12, 2017). Both sides cite to Judge Mund’s prior decision and address Judge Mund’s analysis in their arguments. With one notable exception, this court agrees with Judge Mund’s findings and conclusions. To avoid "re-inventing the wheel," the court will borrow heavily from her reasoned opinion.


  6. Analysis


    1. Insider Status Under §101(31)


      The SAC alleges a claim for relief under §547 for preferential transfer. Section 547(b)(4)(B) extends the "look back" period for recovery a preferential transfer to an insider from ninety days to one year prior to the petition date. Pursuant to § 547(g), Plaintiff bears the burden of proving that SCM is an insider, in connection with Plaintiff’s preference claim against SCM. Batlan v. Transamerica Commer. Fin. Corp. (In re Smith's Home Furnishings, Inc.), 265 F.3d 959, 963 (9th Cir. Or. 2001) ("Section 547(g) places the burden of proof on the trustee to show all of the conditions of §547(b).").


      There are "two types of insiders: statutory insiders and non-statutory insiders." In re The Village at Lakeridge, LLC, 814 F.3d 993, 999 (9th Cir. 2016), aff'd sub nom. U.S. Bank Nat. Ass'n ex rel. CWCapital Asset Mgmt. LLC v. Village at Lakeridge, LLC, 138 S. Ct. 960, 200 L. Ed. 2d 218 (2018). "To be a ‘statutory insider,’ a creditor must fall within one of the categories listed in 11 U.S.C. § 101(31)." Village at Lakeridge, supra, at 996 (emphasis in original). "Whether a creditor is an insider is a factual inquiry that must be conducted on a case-by- case basis." Id. at 1000. "In conducting a factual inquiry for insider status, courts should begin with the statute. If the [alleged insider] fits within the statutory insider classification on his own, the court’s review ends; it need not examine the nature of the statutory insider’s relationship to the debtor." Id. at 1001.

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11


      Under §101(31), the term "insider" includes as to corporations:


      1. if the debtor is a corporation –

        1. director of the debtor;

        2. officer of the debtor;

        3. person in control of the debtor;


      1. affiliate, or insider of an affiliate as if such affiliate were the debtor; and


      2. and managing agent of the debtor.


    2. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(E) Based on Its Affiliate Status Under §101(2)(D)


      Section 101(2)(D) defines "affiliate" as an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." (emphasis added)


      It is undisputed that SCM and its employees operated all aspects of Debtor’s project development business as previously noted in detail herein. Plaintiff contends that under these circumstances, SCM, as the operator of Debtor’s business, falls squarely within the definition of affiliate under §101(2)(D). SCE, on the other hand, argues that because it did not operate under a lease or operating agreement it is not an affiliate within the meaning of §101(2)(D). The issue is whether the DMA, a management agreement, is the functional equivalent of an operating agreement as that term is used in §101(2)(D). As pointed out by Judge Mund in the Marblehead decision, there are very few cases interpreting "operating agreement," and none in the Ninth Circuit. Some cases have interpreted the term expansively. See, e.g., In re Chira, 353 B.R. 693, 724-25 (Bankr.S.D.Fla.2006) ("the hotel also represented substantially all of [the debtor’s] property. Elizabeth and Lounge Corp. are both ‘entities’ and they both

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      operated the business and property of the Shelton Beach Hotel."); In re Century Inv. Fund VII Ltd., P’ship, 96 B.R. 884, 892 (Bankr.E.D.Wis.1989) (""Affiliate" means an "entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement." 11 U.S.C. § 101(2)(D). CMG has certainly been managing all of the property of the debtor under its management agreement.). By contrast, other courts have interpreted the term more strictly. See, In re Washington Mut., 462 B.R. 137, 145-46 (rejecting debtors’ argument that certain pooling and servicing agreements were de facto operating agreement within the meaning of the statute).


      Judge Mund held that principles of statutory construction led her to the conclusion that SCM does not fall within the statutory definition of affiliate under

      §101(31)(D), relying at least in part on the statutory construction principles referenced in the decision of the Ninth Circuit Bankruptcy Appellate Panel in Miller Ave. Prof’l & Promotional Servs. v. Brady (In re Entertainment Acquisition Partners, Inc., 319 B.R. 626, 632-33 (9th Cir. BAP 2004). In Miller, the BAP held the corporation of a statutory insider was not an insider under §101(31)(B) and noted that "there is no justification for expanding the definition of a per se insider beyond what is plainly contained in the statute." Judge Mund observed that because §101(2) states that the term "affiliate" means, as opposed to the more flexible includes (as with §101(31), Congress intended a precise and restricted meaning. Further, giving meaning to all of the statutory language requires the existence of an actual operating agreement. Finally, and most importantly, Judge Mund opined that operating agreements "have specific meanings in the law of limited liability companies and for oil and gas rights," and that "terming the DMA to be an ‘operating agreement’ would be expanding the definition of affiliate (and thus insider) beyond what is plainly contained in the statute." 2017 Bankr.Lexis 3534 at 29.

      SCM urges the court to employ the restrictive construction of the term, arguing that "leasing or operating agreement implies entitlement to benefits akin to ownership, which is not the case here. SCM also cites several a number of cases which describe an "operating agreement" as a contract used in the oil and gas industry. See Defendants’ Opposition at p. 30 and citations therein [Dkt #424].


      Respectfully, the principles of statutory construction lead this court to a contrary conclusion. First, the court is not persuaded that the plain meaning of the term

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      means a literal meaning of the same without regard to substance or context. Certainly, nothing in the legislative history of §101 suggests that Congress intended to limit affiliate status to operating agreements associated with limited liability companies or oil and gas contracts. The legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      Second, as "operating agreement" is not defined in §101, consideration of the context of the surrounding language is in order. It is a "fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme. Food and Drug Admin. v. Brown & Williamson Tobacco Co., 529 U.S. 120, 133 (2000); accord Gale v. First Franklin Loan Services, 701 F.3d. 1240, 1244 (9th Cir. 2012). See, generally Badgley v. United States, 957 F.3d. 969, 977 (9th Cir. 2020) ("In applying the statute, we focus on the substance of the retained interest. Labels are not dispositive."). Section 101(2)(D) starts with "entity that operates the business . . .of the debtor. The court interprets this to mean the emphasis is on whether someone other than the debtor is operating its business. As the DMA is an agreement governing the SCM’s operation of every aspect of Debtor’s business and property, it is, the court’s view, an "operating agreement" within the meaning of §101(2)(D).

      The court concludes as a matter of undisputed fact that SCM is an affiliate under

      §101(2)(D) and, therefore, a statutory insider pursuant to §101(31)(E).


    3. Plaintiff has Satisfied his Burden of Proof that SCM is a Statutory Insider Under §101(31)(F) Based on Its Status as Managing Agent


      Under §101(31)(F), the term "insider" includes a managing agent of the debtor. As with "operating agreement," "managing agent" is not a defined term under the Code. In analyzing whether SCM was the managing agent of Marblehead, Judge Mund looked to guidance from the case of Rush v. Riddle (In re Standard Shoes, Inc.), 124 B.R. 318 (Bankr.C.D.Cal.1991). Though neither

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      Standard Shoes or Judge Mund’s decision regarding the Marblehead matter are binding on this court, the court nevertheless finds them instructive and soundly reasoned.


      In Standard Shoes, Judge Zurzolo, in addressing the ambiguity of the term "managing agent," developed the following useful definition:


      "In defining ‘managing agent,’ I therefore conclude that it refers to Those entities that exert or could exert operational control over a debtor, a division or unit of a debtor, or a significant portion of a debtor’s property. Such operational control would ordinarily include the ability to make personnel decisions, the authority to incur or pay obligations and access to financial and other information essential to the operation of the debtor.


      The definition of ‘managing agent’ is consistent with the principal design of §101[31] and does not overlap or conflict with the categories of insiders expressly described in the preceding subsections of that statute."


      124 B.R. at 323-24.


      SCE contends that it did not have operational control over Debtor or over a significant portion of Debtor’s property and that its authority was limited to performing services and making recommendations to Lehman which had ultimate approval power and control. Opposition at pp. 17-18. The court finds SCM’s arguments wholly unpersuasive. Instead, the court agrees with and adopts Judge Mund’s analysis and findings in the Marblehead matter:


      "SCM exercised operational control over the Debtor and thus was a managing agent. All three factors indicating such control in Standard Shoes exist: although its actions needed to be in accord with Project Budgets, SCM had authority to incur expenses on the Project, ability to make personnel decisions (as the Debtor’s operations were all conducted by SCM employees), and access the Debtor’s books and records (which

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      it maintained). It is undisputed that SCM conducted the Debtor’s operations. While its actions may have been subject to the Lehman-approved Project Budget and Plan and Lehman may have had veto power over all payments, the standard does not demand unfettered control over the debtor. Standard Stores used a person in charge of a division of a corporate debtor as an example of a managing agent and cited the authority to direct payment of obligations, employ personnel, or order supplies as hallmarks of such control. Such people would still be subject to supervision and veto power by the officers and board of directors of the company."


      2017 Bankr. Lexis 3534 at 33-34.


      The duties and responsibilities of SCM under the DMA meet and exceed the managing agent factors set forth in Standard Stores. The court, therefore, finds as a matter of undisputed fact, that SCM was a managing agent of Debtor within the meaning of §101(31)(F) and a statutory insider of Debtor under § 101(31).


    4. Plaintiff has not Met his Burden of Proof that SCC Acquisitions was an Affiliate and Statutory Insider of Debtor


      Plaintiff’s assertion that SCC Acquisitions was an Affiliate of Debtor is based on representations made in the Third Amended Disclosure Statement. Motion at p.

      20. However, the court has sustained the evidentiary objections regarding such representations. As a consequence, Plaintiff has not established as a matter of undisputed fact the SCC Acquisitions was an affiliate and, therefore, an insider of Debtor.


    5. Plaintiff has not Met his Burden of Proof that SCM was an Affiliate and Insider of SCC Acquisitions, Rendering SCM an Insider of Debtor

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11


      In the Motion, Plaintiff relies principally on representations made in the Third Amended Disclosure Statement. See Motion at p. 20. As the court has sustained the evidentiary objections regarding such representations and, therefore, Plaintiff has not established as matter of undisputed fact that SCM was an affiliate and insider of SCC Acquisitions.


    6. Plaintiff has not Met his Burden of Proof that SunCal Marblehead was an Affiliate of Debtor


      Plaintiff relies on conclusory statements made by Elieff in Debtor’s involuntary bankruptcy petition that Suncal Marblehead was an affiliate of Debtor. This is insufficient to satisfy Plaintiff’s burden of proof regarding SunCal Marblehead’s status as an affiliate of Debtor as a matter of undisputed fact.


    7. Plaintiff has not Satisfied his Burden of Proof that Bruce Elieff  was an Affiliate of Debtor


      Plaintiff’s argues thatunder § 101(31)(E) SCM should be found to be an "insider" of Debtor because SCM was an insider of Debtor’s affiliate, Bruce Elieff. Mot., p. 23:15-24. Judge Mund previously found this argument unpersuasive. Palmdale, supra at 29-30. She found that that Plaintiff failed to establish as a matter of undisputed fact that Elieff met the requirements of 101(2)(D), that is, that Elieff has actually operated Marblehead's business. The same issue persists here.


      Further, under § 101(31)(E), a statutory insider includes an "insider of an affiliate as if such affiliate were the debtor." Plaintiff’s argument is unpersuasive because Plaintiff has failed to demonstrate that Bruce (rather than SCC JV) is an affiliate of Debtor. Under the Grandparent Operating, SCC JV, not Bruce, was the party to the agreement. In addition, Plaintiff has failed to demonstrate SCM itself is an insider of SCC JV. Thus, even if SCM is be an insider of Bruce, Plaintiff has not demonstrated the absence of a material fact that Bruce (rather than SCC JV) is an affiliate of Debtor.


    8. Plaintiff has Met his Burden of Proof that SCM was a Non-statutory Insider

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      In The Village at Lakeridge, the Ninth Circuit held that non-statutory


      Chapter 11

      insiders are the "functional equivalent of statutory insiders" if they fall within the ambit of §101(31). 814 F.3d at 1001. An entity is a non-statutory insider if "1) the closeness of its relationship with the debtor is comparable to that of the enumerated insider classifications in §101(31), and 2) the relevant transaction is negotiated at less than arm’s length." Id. As previously noted herein, the legislative history of the 1978 Code defines an insider as a person or entity with "a sufficiently close relationship with the Debtor that his conduct is made subject to closer scrutiny that those dealing at arm's length with the Debtor." S.Rep. No. 95–989, 95th Cong., 2d Sess., reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5810.


      The court agrees with and adopts by reference below, Judge Mund’s two-step analysis concerning the non-statutory insider status of SCM in the SunCal Marblehead matter:


      "[I]t is beyond dispute that SCM conducted the Debtor’s day-to-day operations, its employees conducted all of the Debtor’s business functions, and it maintained the Debtor’s books and records. It had ‘some degree of control’ and access to the Debtor’s information and records, both of which are indications of insider status cited by the Ninth Circuit in Vill.at Lakeridge. It was also close enough for SCM to gain some advantage due simply to affinity: even if all of the Debtor’s payments needed Lehman’s prior approval, SCM was responsible for the first line of review of its own invoices and had some control over when its invoices were submitted for approval and were paid. This extremely close relationship between SCM and the Debtor was of the type that Congress intended to subject to ‘a greater level of scrutiny.’


      However much control Lehman may have had over the Project, the Project Budgets, the draw requests, and the vendor payments, it

      is undisputed that SCM processed, reviewed, and paid its own invoices on the Debtor’s behalf. An SCM employee actually issuing the Debtor’s payment to SCM was not a transaction conducted

      2:00 PM

      CONT...


      Palmdale Hills Property, LLC


      Chapter 11

      ‘as if the parties were strangers.’ A conflict of interest does not require nefarious behavior by SCM, merely the potential for abuse. These payments to SCM cannot be called ‘arms’ length transactions."


      2017 Bankr. Lexis at 37-38.


      SCM disagrees with the foregoing analysis. First, SCM argues that Lehman did not show SCM any preferential treatment in its decisions regarding payment and that there is no evidence that payments made to SCM were for any reason of affinity. SCM attempt to distinguish itself from the familial affinity that existed in In re Rexford Properties, LLC, 557 B.R. 788 (Bankr.C.D.Cal 2016). SCM misses the point. The close relationship prong does not require a showing of actual preferential treatment, but rather that the closeness could provide an opportunity for potential abuse. The discussion of Rexford is not helpful the facts in that case are not comparable to the circumstances here. For example, SCE states that it has no ownership interest in Debtor. However, ownership interest is not critical factor or requirement for non-statutory insider status.


      Next, while acknowledging that control is not a required factor in this Circuit, SCM refers the court to an unpublished, non-precedential Ninth Circuit case, Farrar v. Warda & Yonano LLP (In re Bella Vista by Paramount LLC), 549 Fed.Appx, 648 (2013) for the quote therein that "insider status is a question of control." Farrar predates the published (and binding) Ninth Circuit case, The Village at Lakeridge ("Some degree of control is one of many indications that a creditor may be a non-statutory insider, but actual control is not required to find non-statutory insider status") (emphasis added) 814 F.3d at 1001. In footnote 12 of The Village at Lakeridge, the Court observed that "if actual control were required for non-statutory insider status, all non-statutory insiders would also be statutory insiders under §101)(31). The remainder of the arguments and citations to non-binding decisions, most of which predate The Village at Lakeridge, are not persuasive.


  7. Conclusion


Based upon the foregoing, the Motion is granted in part; denied in part.

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11


Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch

2:00 PM

CONT...


Palmdale Hills Property, LLC


Aalok Sharma


Chapter 11

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier Shane M Biornstad

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall


8:08-17206

Palmdale Hills Property, LLC

Chapter 11

Adv#: 8:18-01129 Speier v. Argent Management, LLC et al


#19.00 CON'TD STATUS CONFERENCE RE: Second Amended Complaint: (1) For Declaratory Relief, (2) In the Alternative, Breach of Contract; (3) Restitution and/or Unjust Enrichment; (4) To Avoid and Recover Fraudulent Transfers; and (5) To Avoid and Recover Preferential Transfers

[Debtor: Delta Coves Venture LLC]


FR: 8-1-18; 9-11-18; 5-2-18; 5-7-19; 9-26-19; 12-17-19; 1-9-20; 3-26-20; 4-27-20;

5-28-20


Docket 100


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

May 28, 2020


Continue status conference to May 29, 2020 at 2:00 p.m.

Party Information

Debtor(s):

Palmdale Hills Property, LLC Represented By Paul J Couchot Peter W Lianides

Richard W Esterkin Asa S Hami Charles Liu

James M Miller Raymond H. Aver Sean A OKeefe Marc J Winthrop Martin Pritikin Selia M Acevedo Francis T Donohue Richard H Golubow Louis R Miller Jeffrey W Broker Kavita Gupta Garrick A Hollander R Grace Rodriguez Lei Lei Wang Ekvall Mike D Neue

Defendant(s):

SunCal Management LLC Represented By Craig H Averch Aalok Sharma

Argent Management, LLC Represented By Craig H Averch Aalok Sharma

2:00 PM

CONT...


Palmdale Hills Property, LLC


Chapter 11

Plaintiff(s):

Steven M Speier Represented By Mike D Neue

Gary A Pemberton Heather B Dillion Brianna L Frazier

Trustee(s):

Steven M Speier (TR) Represented By Louis R Miller Mike D Neue

Lei Lei Wang Ekvall

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#1.00 Hearing RE: Motion of Debtors for an Order Authorizing the Debtors to (I) Pay and/or Honor Prepetition Wages, Salaries, Employee Benefits, and Other Compensation; (II) Remit Withholding Obligations; and (III) Maintain Employee Compensation and Benefits Programs and Pay Related Administrative Obligations


Docket 6


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


June 2, 2020


Court's Comments re the Motion:


  1. Approval of the Motion will be conditioned on Debtors providing a list with the names of each employee to be paid and the amount for each.


  2. On page 4, line 20 of the Motion, it is stated that "Debtors do not have any independent contractors." However, on page 5 at lines 16-18, reference is made to debtor Hytera East's Dominican Republic's independent contractors. This contradiction needs to be explained.


  3. Re the Norsat Employees, is Hytera East seeking authority to pay the wages of a non-debtor affiliate out of estate funds? What is the legal authority for paying such wages? The court is inclined not to approve such payments under 105(a)


  4. Is Hytera East also seeking to pay the health benefits costs of the Norsat Employees from estate funds as well? What is the legal authority for that? The court is not inclined to approve such paymens under 105(a).


Party Information

2:00 PM

CONT...

Debtor(s):


Hytera Communications America (West) Inc


Chapter 11

Hytera Communications America Represented By

John W Lucas Jason H Rosell

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#2.00 Hearing RE: Motion of Debtors for an Order Authorizing (A) Maintenance of Existing Bank Accounts, (B) Continuance of Existing Cash Management System, Bank Accounts, Checks, and (C) Related Relief


Docket 7


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


June 2, 2020


Subject to the comments of the US Trustee and others, the court is inclined to grant the Motion, except as to Hytera West acct x0581 that has no balance because the credit limits are no longer triggered, and Hytera East account x6867 which is a dormant account.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#3.00 Hearing RE: Motion Pursuant to Sections 105, 363, 1107, and 1108 of the Bankruptcy Code for an Order Authorizing Debtors to Maintain and Administer Dealer Incentive Programs, Honor Prepetition Obligations to their Dealers, and Related Relief


Docket 8


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


June 2, 2020


The court is inclined to grant the motion, except to the extent that it includes dealer incentives for any non-debtor entities.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#4.00 Hearing RE: Motion of Debtors for an Order Pursuant to 11 U.S.C. Sections 105(a) and 366: (I) Prohibiting Utility Companies from Altering, Refusing, or Discontinuing Service, (II) Determining Adequate Assurance of Payment for Future Utility Services, and (III) Establishing Procedures for Determining Adequate Assurance of Payment


Docket 9


Courtroom Deputy:

June 2, 2020


Appearances:


NOTES:


RULING: TENTATIVE RULING STANDS


SPECIAL NOTE TO COURTROOM DEPUTY/LAW CLERK:


Tentative Ruling:


June 2, 2020


The court is inclined to grant the Motion except as to the request that any motion filed by a Utility following a Debtor's default shall be heard on an expedited basis, The court is not inclined to grant such relief as no grounds have been stated therefor.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell

2:00 PM

CONT...


Hytera Communications America (West) Inc

Victoria Newmark


Chapter 11

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#5.00 Hearing RE: Motion for Authority to Pay in the Ordinary Course of Business Prepetition Claims Related to Shipping and Warehousing Charges and Related Relief


Docket 10


Courtroom Deputy:

June 2, 2020


Appearances:


NOTES:


RULING: TENTATIVE RULING STANDS


SPECIAL NOTE TO COURTROOM DEPUTY/LAW CLERK:


Tentative Ruling:


June 2, 2020


The court is inclined to deny this motion on the basis of lack of evidence to justify the extraordinary relief requested. Debtors have provided no information regarding the amount of outstanding prepetition shipping charges owed to each shipper by a particular debtor. Debtors are essentially seeking a blank order to pay shippers as "critcal vendors" without out substantiation.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#6.00 Hearing RE: Emergency Motion for the Entry of an Order Authorizing Hytera America Incorporated to Assume the Amended and Restated Independent Director Service Agreement


Docket 11


Courtroom Deputy:

June 2, 2020


Appearances:


NOTES:


RULING: TENTATIVE RULING STANDS


SPECIAL NOTE TO COURTROOM DEPUTY/LAW CLERK:


Tentative Ruling:


June 2, 2020


The court is inclined to deny this Motion on an expedited basis. The IDSA is essentially the equivalent to the employment and/or appointment of a restructuring officer, ther terms of which involve a substantial use of estate funds without court oversight, to wit, a monthly fee of $25,000 per month, the employment of attorneys, advisors and other professionals at the Independent Director's discretion, etc.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell

2:00 PM

CONT...


Hytera Communications America (West) Inc

Victoria Newmark


Chapter 11

2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#7.00 Hearing RE: First Omnibus Motion of Debtors for Entry of an Order (I) Authorizing the Debtors to (A) Reject Executory Contracts, (B) Reject Non-residential Real Property Leases, and (C) Abandon any Personal Property Located at Such Premises, and (II) Fixing a Bar Date for Claims of Counterparties


Docket 12


Courtroom Deputy:

June 2, 2020


Appearances:


NOTES:


RULING: TENTATIVE RULING STANDS


SPECIAL NOTE TO COURTROOM DEPUTY/LAW CLERK:


Tentative Ruling:


June 2, 2020


The court is inclined to grant this Motion.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark


Tuesday, June 2, 2020 Hearing Room 6D


2:00 PM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#8.00 Hearing RE: Motion of Debtors for an Order Extending Time to File Schedules of Assets and Liabilities and Statement of Financial Affairs


Docket 16


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


June 2, 2020


The court is inclined to grant this Motion.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark

9:30 AM

8:16-12110


Stuart Moore (USA) Ltd.


Chapter 7

Adv#: 8:18-01085 Thomas H. Casey, Chapter 7 Trustee v. Moore et al


#1.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint for Avoidance of Recovery of Fraudulent and Preferential Transfers

(Another Summons Issued 9/13/18)


FR: 12-6-18; 1-31-19; 3-12-19; 4/18/19; 7-11-19, 7-16-19; 9-12-19; 11-21-19;

2-20-20; 5-7-20


Docket 3

*** VACATED *** REASON: CONTINUED TO 7/9/2020 AT 10:30 A.M.,

Per Order Entered 6/1/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 7/9/2020 at 10:30 a.m., Per

Order Entered 6/1/2020 (XX) - td (6/1/2020)

Tentative Ruling:


January 31, 2019


Continued to March 12, 2019 at 10:30 a.m.; updated status report not required. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at this hearing are not required.

Party Information

Debtor(s):

Stuart Moore (USA) Ltd. Represented By William M Burd Jeffrey S Shinbrot

Defendant(s):

Stuart Moore Pro Se

Sylvie Moore Masson Pro Se

9:30 AM

CONT...


Stuart Moore (USA) Ltd.


Chapter 7

Plaintiff(s):

Thomas H. Casey, Chapter 7 Trustee Represented By

Jeffrey S Shinbrot

Trustee(s):

Thomas H Casey (TR) Represented By Thomas H Casey Jeffrey S Shinbrot Jeffrey I Golden

9:30 AM

8:17-14077


Team Business Solutions, Inc.


Chapter 7

Adv#: 8:18-01141 Richard A Marshack v. SNCR California, Inc., et al


#2.00 CONT'D STATUS CONFERENCE RE: First Amended Complaint for: 1.

Declaratory Relief (Successor Liability); 2. Intentional Fraudulent Transfer; 3. Constructive Fraudulent Transfer; 4. Preservation of Avoided Transfer; 5. Turnover of Assets; 6. Breach of Fiduciary Duty; 7. Misappropriation of Trade Secrets; 8. Unjust Enrichment (Another Summons Issued 12/6/10)


FR: 2-12-19; 3-12-19; 4-4-19; 4-16-19; 6-20-19; 8-22-19; 11-7-19; 1-9-20; 4-2-20


Docket 55

*** VACATED *** REASON: CONTINUED TO 8/6/2020 AT 9:30 A.M.,

Per Order Entered 5/21/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Notice of Voluntary Dismissal of Adversary Proceeding

Against Kirk Nelson Only filed 1/7/2019, Document # 72 - td (1/9/2019)


CONTINUED: Status Conference Continued to 8/6/2020 at 9:30 a.m., Per Order Entered 5/21/2020 (XX) - td (5/21/2020)

Tentative Ruling:


June 20, 2019


Joint status report not filed by June 13, 2019 pursuant to this court's order entered 4/25/19. Impose sanctions in the amount of $100 against each party for the failure to do so.


Note: Appearances at this hearing are required.


August 22, 2019


Joint status report not filed by August 8, 2019 pursuant to this court's order entered June 17, 2019. Impose sanctions in the amount of $100 against each

9:30 AM

CONT...


Team Business Solutions, Inc.


Chapter 7

party's attorney for the failure to do so.


Note: Appearances at this hearing are required.


January 9, 2020


Updated joint status report not filed as required by this court's order entered October 17, 2019 [docket #117]. Impose sanctions of $200 against counsel for plaintiff and defendants.


Note: Appearances at this hearing are required.

Party Information

Debtor(s):

Team Business Solutions, Inc. Represented By

J Scott Williams

Defendant(s):

SNCR California, Inc., Represented By Michael G Spector

John Creamer Pro Se

Kirk Nelson Pro Se

Plaintiff(s):

Richard A Marshack Represented By Thomas J Eastmond Robert P Goe

Trustee(s):

Richard A Marshack (TR) Represented By Thomas J Eastmond Robert P Goe

9:30 AM

8:17-14406


Kirk M. Nelson


Chapter 7

Adv#: 8:19-01016 Marshack v. Nelson


#3.00 CON'TD STATUS CONFERENCE RE: Complaint: 1. To Determine Non- Dischargeability Of Debt Pursuant to 11 U.S.C. Section 523(a)(3)(B)


FR: 4-11-19; 5-30-19; 9-12-19; 11-7-19; 1-9-20; 4-2-20


Docket 1

*** VACATED *** REASON: CONTINUED TO 8/6/2020 AT 9:30 A.M.,

Per Order Entered 5/21/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 8/6/2020 at 9:30 a.m., Per

Order Entered 5/21/2020 (XX) - td (5/21/2020)

Tentative Ruling:


April 11, 2019


Continue Status Conference to May 30, 2019 at 10:30 a.m., same date/time as hearing on Defendants' motion to dismiss. Joint status report not required. (XX)


Note: Appearances at this hearing are not required.


May 30, 2019


No tentative ruling -- trail matter to the 2:00pm calendar


January 9, 2020


Updated joint status report not filed as required by this court's order entered October 17, 2019 [docket #22]. Impose sanctions of $100 against counsel for plaintiff and defendants.

9:30 AM

CONT...


Kirk M. Nelson


Chapter 7

Note: Appearances at this hearing are required.


Party Information

Debtor(s):

Kirk M. Nelson Represented By

J Scott Williams

Defendant(s):

Kirk M Nelson Pro Se

Plaintiff(s):

Richard A Marshack Represented By Robert P Goe

Thomas J Eastmond

Trustee(s):

Weneta M Kosmala (TR) Pro Se

9:30 AM

8:17-14535


Prime Metals U.S.A., Inc.


Chapter 7

Adv#: 8:19-01215 Marshack v. R-Techo, Co., Ltd.


#4.00 CONT'D STATUS CONFERENCE RE: Complaint for: 1. Avoidance and Recovery of Iintentional Fraudulent Transfers; 2. Avoidance and Recovery of Constructive Fraudulent Transfers; 3. Avoidance and Recovery of Preferential Transfers; 4.

Recovery of Avoided Transfers; 5. Declaratory Judgment: Alber Ego; 6. Recovery of Unauthorized, Improper Distributions to Shareholders; 7. Substantive Consolidation;

8. Breach of Fiduciary Duty; 9. Turnover of Property of the Estate; 10. Preservations of Avoided Transfers; 11. Disallowance of Claims; and 12. Temporary Restraining Order and Preliminary Injunction


FR: 2-6-20; 4-2-20


Docket 1

*** VACATED *** REASON: CONTINUED TO 8/6/2020 AT 9:30 A.M.,

Per Order Entered 6/1/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 8/6/2020 at 9:30 a.m., Per

Order Entered 6/1/2020 (XX) - td (6/1/2020)

Tentative Ruling:


February 6, 2020


No timely filed updated status report or motion for default judgment has been filed in this case. Accordingly, the court may impose sanctions in the amount of

$100 and/or issue an order to show cause why this adversary proceeding should not be dismissed for failure to prosecute.


Note: Appearance at this hearing is required.

9:30 AM

CONT...


Debtor(s):


Prime Metals U.S.A., Inc.

Party Information


Chapter 7

Prime Metals U.S.A., Inc. Represented By Steven Werth

Defendant(s):

R-Techo, Co., Ltd. Pro Se

Plaintiff(s):

Richard A Marshack Represented By Ronald S Hodges Robert P Goe Ryan S Riddles

Trustee(s):

Richard A Marshack (TR) Represented By

D Edward Hays Laila Masud David M Goodrich Robert P Goe

9:30 AM

8:17-14535


Prime Metals U.S.A., Inc.


Chapter 7

Adv#: 8:19-01217 Marshack v. Mr. C's Towing at Southgate, Inc.


#5.00 CONT'D STATUS CONFERENCE RE: Complaint for: 1. Avoidance and Recovery of Constructive Fraudulent Transfers pursant to 11 U.S.C. Sections 544, 548, 550,

551; California Civil Code Sections 3439.04, 3439.05, 3439.07, 3439.08, 3439.09;

2. Recovery of Avoided Transfers; 3. Turnover of Property of the Estate; 4. Preservation of Avoided Transfers; 5. Temporary Restraining Order and Preliminary Injunction against Mr. C's Towing at Southgate, Inc.


FR: 2-6-20; 4-2-20


Docket 1

*** VACATED *** REASON: CONTINUED TO 8/6/2020 AT 9:30 A.M.,

Per Order Entered 6/1/2020 (XX) Courtroom Deputy:

CONTINUED: Status Conference Continued to 8/6/2020 at 9:30 a.m., Per

Order Entered 6/1/2020 (XX) - td (6/1/2020)

Tentative Ruling:


February 6, 2020


A proof of service showing proper service of the summons and complaint has not been filed. Further, no timely filed updated status report or motion for default judgment has been filed in this case. Accordingly, the court may impose sanctions in the amount of $100 and/or issue an order to show cause why this adversary proceeding should not be dismissed for failure to prosecute.


Note: Appearance at this hearing is required.


April 2, 2020


Continue status conference to May 21, 2020 at 9:30 a.m.; Joint status report must be filed by May 7, 2020.

9:30 AM

CONT...


Prime Metals U.S.A., Inc.


Chapter 7


The tentative ruling is based on the fact that it is not clear that the service issue has been resolved.


Note: If the parties accept the foregoing tentative ruling, appearances at this hearing are not required and Plaintiff shall lodge an order consistent with the same.


Party Information

Debtor(s):

Prime Metals U.S.A., Inc. Represented By Steven Werth

Defendant(s):

Mr. C's Towing at Southgate, Inc. Represented By

Ryan S Riddles

Plaintiff(s):

Richard A Marshack Represented By Ronald S Hodges Robert P Goe Ryan S Riddles

Trustee(s):

Richard A Marshack (TR) Represented By

D Edward Hays Laila Masud David M Goodrich Robert P Goe

9:30 AM

8:17-14535


Prime Metals U.S.A., Inc.


Chapter 7

Adv#: 8:19-01218 Marshack v. Kim et al


#6.00 CON'TD STATUS CONFERENCE RE: RE: Complaint for: 1. Breach of Fiduciary Duty; 2. Accounting; and 3. Defalcation of Trust


(Another Summons Issued 2/11/2020) FR: 4-30-10


Docket 1

*** VACATED *** REASON: CONTINUED TO 8/6/2020 AT 9:30 AM.,

Per Order Entered 6/2/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Pre-trial Conference Scheduled for 10/8/2020 at 9:30

a.m. - td (3/10/2020)


CONTINUED: Status Conference Continued to 8/6/2020 at 9:30 a.m., Per Order Entered 6/2/2020 (XX) - td (6/2/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Prime Metals U.S.A., Inc. Represented By Steven Werth

Defendant(s):

Ik Dong Kim Pro Se

Gill Su Sun Pro Se

Minho An Represented By

Michael H Yi

Plaintiff(s):

Richard A Marshack Represented By

9:30 AM

CONT...


Trustee(s):


Prime Metals U.S.A., Inc.


Ronald S Hodges Robert P Goe Ryan S Riddles


Chapter 7

Richard A Marshack (TR) Represented By

D Edward Hays Laila Masud David M Goodrich Robert P Goe

9:30 AM

8:18-12967


Lillian Sikanovski Dulac


Chapter 7

Adv#: 8:19-01078 Bertrand H Dulac and Georgette C Dulac, Trustees o v. Dulac et al


#7.00 CON'TD STATUS CONFERENCE RE: Complaint to Determine Validity of Certain Notes and Deeds of Trust and to Perfect Secured Liens


FR: 7-18-19; 9-19-19; 12-5-19; 2-6-20


Docket 1

*** VACATED *** REASON: CONTINUED TO 9/3/2020 AT 2:00 P.M.,

Per Order Entered 5/26/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Status conference set for 6/4/2020 at 9:30 a.m. re:

Complaint in intervention - td (5/26/2020)


CONTINUED: Status Conference Continued to 9/3/2020 at 2:00 p.m., Per Order Entered 5/26/2020 (XX) - td (5/26/2020)

Tentative Ruling:


July 18, 2019


Continue status conference to September 19, 2019 at 9:30 a.m. to allow the chapter 7 trustee the opportunity to intervene. (XX)


Special Note: It appears the complaint is seeking relief against property of the bankruptcy estate and, therefore, the chapter 7 trustee would be an indispensable party.


Note: If all parties accept the foregoing tentative ruling, appearances at today's hearing are not required and Plaintiff shall serve notice of the continued hearing date/time (including service to the chapter 7 trustee).


September 19, 2019

9:30 AM

CONT...


Lillian Sikanovski Dulac


Chapter 7

Continue status conference to December 5, 2019 at 9:30 a.m.; updated status report must be filed by November 21, 2019. (XX)


Special comment: The court notes that though the Trustee signed the Joint Status Report on 9/17/19, the Trustee dismissed her Complaint in Intervention on 9/16/19.


Note: Appearances at today's hearing are not required; Plaintiff to serve notice of the continued hearing date/time.


December 5, 2019


Continue the Status Conference to February 6, 2020 at 9:30 a.m., same date/time as Status Conference now set for Third Party Complaint. Joint Status Report must be filed by January 23, 2020. (XX)


Note: Appearances at today's hearing are not required; Plaintiff to serve notice of the continued hearing date/time.


February 6, 2020


Continue status conference to June 4, 2020 at 9:30 a.m.; updated joint status report must be filed by May 21, 2020. Any motion for relief from stay and/or abstention must be filed no later than April 16, 2020 and set for hearing no later than May 7, 2020. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at this hearing are not required and Plaintiffs shall lodge a scheduling order consistent with the same.


Party Information

Debtor(s):

Lillian Sikanovski Dulac Represented By Michael Jones Sara Tidd

9:30 AM

CONT...


Lillian Sikanovski Dulac


Chapter 7

Defendant(s):

Ronald H. Dulac Pro Se

Lillian Sikanovski Pro Se

Plaintiff(s):

Bertrand H Dulac and Georgette C Represented By

Ronald Appel

Trustee(s):

Weneta M Kosmala (TR) Represented By Erin P Moriarty

9:30 AM

8:18-12967


Lillian Sikanovski Dulac


Chapter 7

Adv#: 8:19-01078 Bertrand H Dulac and Georgette C Dulac, Trustees o v. Dulac et al


#8.00 CON'TD STATUS CONFERENCE RE: Complaint in Intervention to Determine Estate's Interest in Real Property and Validity and Extent of Liens, and Ancillary Relief


FR: 2-6-20


Docket 16

*** VACATED *** REASON: CONTINUED TO 9/3/2020 AT 2:00 P.M.,

Per Order Entered 5/26/2020 (XX) Courtroom Deputy:

SPECIAL NOTE: Status conference set for 6/4/2020 at 9:30 a.m. re:

Original Complaint - td (5/26/2020)


CONTINUED: Status Conference Continued to 9/3/2020 at 2:00 p.m., Per Order Entered 5/26/2020 (XX) - td (5/26/2020)

Tentative Ruling:


February 6, 2020


Continue status conference to June 4, 2020 at 9:30 a.m.; updated joint status report must be filed by May 21, 2020. Any motion for relief from stay and/or abstention must be filed no later than April 16, 2020 and set for hearing no later than May 7, 2020. (XX)


Note: If all parties accept the foregoing tentative ruling, appearances at this hearing are not required and Plaintiffs shall lodge a scheduling order consistent with the same.


Party Information

Debtor(s):

Lillian Sikanovski Dulac Represented By

9:30 AM

CONT...


Lillian Sikanovski Dulac


Michael Jones Sara Tidd


Chapter 7

Defendant(s):

Ronald H. Dulac Pro Se

Lillian Sikanovcki Dulac Pro Se

Plaintiff(s):

Bertrand H Dulac and Georgette C Represented By

Ronald Appel Michael Jones

Trustee(s):

Weneta M Kosmala (TR) Represented By Erin P Moriarty

9:30 AM

8:19-11414


Peter Woo Sik Kim


Chapter 7

Adv#: 8:19-01155 Kang Family 2007 Revocable Trust v. Kim et al


#9.00 CONT'D PRE-TRIAL CONFERENCE RE: Complaint Objecting to Discharge of Debt Under 11 U.S.C. §523(a)(3)(a) and 11 U.S.C. §523(a)(2)(B)


FR: 10-17-19; 1-16-20; 5-7-20


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


October 17, 2019


Discovery Cut-off Date: Mar. 6, 2020

Deadline to Attend Mediation: Jan. 31, 2020

Pretrial Conference Date: Apr. 30, 2020 at 9:30 a.m. Deadline to Lodge Joint Pretrial Stipulaton: Apr. 16, 2020


Note: If all parties agree with the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.divider


January 16, 2020


Discovery Cut-off Date: Mar. 16, 2020

Pretrial Conference Date: May 7, 2020 at 9:30 a.m. (XX) Deadline to Lodge Joint Pretrial Stipulaton: Apr. 23, 2020


Note: If all parties accept the foregoing schedule, appearances at today's hearing are waived and Plaintiff shall serve/lodge a scheduling order consistent with the same.

9:30 AM

CONT...


Peter Woo Sik Kim


Chapter 7


June 4, 2020


Continue the Pretrial Conference to July 9, 2020 at 9:30 a.m. to allow the parties to file an amended pretrial stipulation by June 25, 2020. The amended pretrial stipulation should address the comments of the court in its tentative ruling and also whether each party wishes to submit direct testimony by declaration in advance of the trial in accordance with this court's Trial Procedures or if they prefer live direct testimony.


Comments re the Pretrial Stipulation:


  1. The court commends the parties for timely filing a thorough and thoughtful pretrial stipulation ("PS"), including a complete list of exhibits and witnesses. That said, the PS will need to be amended per the comments below.


  2. Page 3, line 7: There appear to be action words missing, e.g., should "submitted a signed Letter of Intent to lease the property" be inserted?


  3. Chronologically, paragraph 4 should probably replace paragraph 7.


  4. Curiously, the Issues of Fact to be Litigated, starting on page 6, do not include all of the factual issues relating to 523(a)(2)(A) and (B). Instead, those issues have been relegated to section IV called Claims for Relief which includes mixed issues of fact and law re 523(a)(2). Also added are sections V (Remedies) and VI (Affirmative Defenses). Sections IV, V and VI (collectively the "Added Sections") are confusing and are not consistent with the structure of a pretrial stipulation as plainly set forth in LBR 7016-1(b)(2)(B) and (C). The section on Issues of Fact to be Litigated should include all issues of fact, including those that appear in the Added Sections. Similarly, the section on Issues of Law to be Litigated (Remaining Legal Issues) should include all legal issues, including those in the Added Sections. The court does not mind subheadings within the Issues of Fact and/or Issues of Law, but there should be one section on disputed facts and one section on issues of law.

9:30 AM

CONT...


Peter Woo Sik Kim


Chapter 7

  1. Page 15, lines 1 and 3: "A list of" should be inserted after "Exhibits:" since the exhibits themselves are not attached.


  2. It is the court's usual procedure to conduct direct testimony by declaration (the plaintiff submits written direct testimony 30 days before; the defendant does so 21 days before trial and both parties submit any evidentiary objections 7 days prior to trial). See, the court's Trial Procedures at cacb.uscourts.gov. However, direct testimony by declaration is not mandatory if the parties prefer live direct testimonyl By listing the direct examination time estimates in the PS, are the communicating a preference for live direct testimony as opposed to direct testimony by declaration (exclusive of adverse or rebuttal testimony)? Live direct vs. written direct will affect the trial time estimate.


  3. The trial will likely take place the week of September 21, 2020. While in- person appearances may be possible by that time, the court is amenable to a video conference option for any parties who cannot appear in person.


Note: If all parties accept the foregoing tentative ruling, appearances at this hearing are not required; nonappearance at the hearing will be deemed acceptance of the tentative ruling.


Party Information

Debtor(s):

Peter Woo Sik Kim Represented By Andrew S Bisom

Defendant(s):

Peter Kim Pro Se

Sharon Kim Pro Se

Joint Debtor(s):

Sharon Soyun Kim Represented By Andrew S Bisom

9:30 AM

CONT...


Peter Woo Sik Kim


Chapter 7

Plaintiff(s):

Kang Family 2007 Revocable Trust Represented By

Edmond Richard McGuire

Trustee(s):

Weneta M Kosmala (TR) Represented By Lynda T Bui Rika Kido

10:00 AM

8:15-15096


Darshan Upadhyaya


Chapter 7

Adv#: 8:16-01024 Floorit Financial, Inc. v. Upadhyaya


#10.00 CONT'D Examination of Third Person Amanda Upadhyaya aka Amanda C. Ramos Upadhyaya Re: Enforcement of Judgment


FR: 4-9-20


Docket 20


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Continue the examination to September 10, 2020 at 10:00 a.m. Basis for Tentative Ruling

The courthouse remains closed to in-person court appearances and on-site in- person judgment debtor examinations. Judgment creditor is free to schedule an examination outside the courthouse, including by video conference, prior to September 10, 2020. Depending on the status of pandemic-related rules and policies in place on September 1, 2020, the September 10, 2020 hearing may be further continued.

10:00 AM

CONT...


Darshan Upadhyaya


Chapter 7


Note: If the Judgment Creditor accepts the foregoing tentative ruling, appearance at this hearing is not required and Judgment Creditor shall serve notice of the continued hearing date/time. Non-appearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Darshan Upadhyaya Represented By Amid Bahadori

Defendant(s):

Darshan Upadhyaya Represented By Amid Bahadori

Plaintiff(s):

Floorit Financial, Inc. Represented By

Tom Roddy Normandin James T Jackson

Trustee(s):

Jeffrey I Golden (TR) Represented By Jeremy Faith Nina Z Javan

Meghann A Triplett

10:00 AM

8:15-15096


Darshan Upadhyaya


Chapter 7

Adv#: 8:16-01024 Floorit Financial, Inc. v. Upadhyaya


#11.00 CONT'D Examination of Judgment Debtor Darshan Upadhyaya Re: Enforcement of Judgment


FR: 4-2-20


Docket 23


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


April 2, 2020


In order to comply with social distancing guidelines, continue the examination to June 4, 2020 at 10:00 a.m., except that the parties are free to stipulate to a remote videoconference examination at a mutually agreeable time prior to June 4, 2020.


Note: If all parties accept the foregoing tentative ruling, appearances at this hearing are not required and Plaintiff shall lodge an order consistent with the same.

10:00 AM

CONT...


Darshan Upadhyaya


Chapter 7

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Continue the examination to September 10, 2020 at 10:00 a.m. Basis for Tentative Ruling

The courthouse remains closed to in-person court appearances and on-site in- person judgment debtor examinations. Judgment creditor is free to schedule an examination outside the courthouse in accordance with applicable rules, including by video conference, prior to September 10, 2020. Depending on the status of pandemic-related rules and policies in place on September 1, 2020, the September 10, 2020 hearing may be further continued.


Note: If the Judgment Creditor accepts the foregoing tentative ruling, appearance at this hearing is not required and Judgment Creditor shall serve notice of the continued hearing date/time. Non-appearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Darshan Upadhyaya Represented By Amid Bahadori

Defendant(s):

Darshan Upadhyaya Represented By Amid Bahadori

10:00 AM

CONT...


Darshan Upadhyaya


Chapter 7

Plaintiff(s):

Floorit Financial, Inc. Represented By

Tom Roddy Normandin James T Jackson

Trustee(s):

Jeffrey I Golden (TR) Represented By Jeremy Faith Nina Z Javan

Meghann A Triplett

10:00 AM

8:18-12797


Johnny Phan


Chapter 13


#12.00 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


SELENE AS ATTORNEY IN FACT U.S. BANK NATIONAL ASSOCIATION VS.

DEBTOR FR: 4-2-20

Docket 56

*** VACATED *** REASON: Order Approving Adequate Protection Agreement Entered 6/3/20

Courtroom Deputy:

OFF CALENDAR: Order Approving Adequate Protection Agreement Entered 6/3/20- mp/td(6/3/20)

Tentative Ruling:


April 2, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Grant relief from stay co-debtor stay relief and without FRBP 4001(a)(3) waiver unless the parties agree to an alternative resolution. If more time is needed, and

10:00 AM

CONT...


Johnny Phan


Chapter 13

Movant agrees to such additional time, continue the hearing to June 4, 2020 at 10:00 a.m. upon request of Movant during the pre-hearing calendar roll call by the court clerk.


Party Information

Debtor(s):

Johnny Phan Represented By

Christopher J Langley

Movant(s):

U.S. BANK NATIONAL Represented By

Dane W Exnowski Sean C Ferry

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:18-13257


Scott Samuel Wilson and Stacy Anne Wilson


Chapter 13


#13.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


U.S. BANK N.A.


VS.


DEBTORS


Docket 35


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


If Debtors are now postpetition current with payments, grant an adequate protection order. If more time is needed to negotiate the terms of an adequate protection order, the parties may request a continuance during the calendar roll call just prior to the hearing. Available continued hearing dates are June 11, 2020, June 18, 2020, July 9, 2020 and July 16, 2020 at 10:00 a.m.


Special note: Debtor has provided a copy of a bank statement showing a payment on May 20, 2020; however, the court cannot confirm the tender of a payment on May 7, 2020 based on the evidence presented.

10:00 AM

CONT...


Debtor(s):


Scott Samuel Wilson and Stacy Anne Wilson

Party Information


Chapter 13

Scott Samuel Wilson Represented By Kristin R Lamar

Joint Debtor(s):

Stacy Anne Wilson Represented By Kristin R Lamar

Movant(s):

U.S. Bank National Association Represented By

Kristin A Schuler-Hintz Nancy L Lee

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:18-13337


Manuel Trejo and Maria I Trejo


Chapter 13


#14.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] DEUTSCHE BANK NATIONAL TRUST COMPANY

VS.


DEBTORS


Docket 46


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Grant motion with co-debtor relief and without waiver of 4001(a)(3) unless Movant is amenable to an adequate protection order. If Movant would like additional time to expore the terms of an adequate protection ord, it may request a continuance at the time of the calendar roll call just prior to the hearing.

Available hearing dates are June 11, 2020, June 18, 2020, July 9, 2020 and July

16, 2020 at 10:00 a.m.

10:00 AM

CONT...


Manuel Trejo and Maria I Trejo


Chapter 13

Special note: Debtor has not provided evidence of additional payments having been made that are not reflected in the Motion.

Party Information

Debtor(s):

Manuel Trejo Represented By Lionel E Giron

Joint Debtor(s):

Maria I Trejo Represented By

Lionel E Giron

Movant(s):

DEUTSCHE BANK NATIONAL Represented By

Sean C Ferry

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:18-14136


David Maurice Denman


Chapter 13


#15.00 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


DEUTSCHE BANK, TRUST COMPANY AMERICAS VS.

DEBTOR FR: 4-30-20

Docket 53


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


The parties previously stipulated to a continuance of the prior hearing in order to negotiate an adequate protection order and to obtain the necessary approvals by Movant's management. If more time is needed, the parties may request a continuance of this hearing by requesting the same at the time of the calendar roll call just prior to the hearing. Available continued dates are June 11, 2020, June 18, 2020, July 9, 2020 and July 16, 2020 at 10:00 a.m.

10:00 AM

CONT...


Debtor(s):


David Maurice Denman

Party Information


Chapter 13

David Maurice Denman Represented By Nicholas W Gebelt

Movant(s):

Deutsche Bank National Trust Represented By Eric P Enciso Sean C Ferry Erin Elam

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-11870


Darlene Futrel


Chapter 13


#16.00 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


BANK OF AMERICA, N.A. VS.

DEBTOR


FR: 4-2-20; 4-30-20


Docket 44

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 6/2/2020

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 6/2/2020 - td (6/2/2020)

Tentative Ruling:


April 30, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Continue hearing to June 4, 2020 at 10:00 a.m. to allow the parties to complete resolution discussions. (XX)

10:00 AM

CONT...


Darlene Futrel


Chapter 13


Special note: If the parties have been unable to reach resolution and Movant wishes to proceed with this hearing, Movant so indicate to the clerk during the calendar roll call.


Note: If the parties accept the foregoing tentative ruling, appearances at this hearing are not required. Nonappearance by the parties shall be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Darlene Futrel Represented By Christopher J Langley

Movant(s):

Bank of America, N.A Represented By Nancy L Lee

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-11985


Charles A Thomas and Theresa A. Thomas


Chapter 13


#17.00 CON'TD Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


CITIBANK, N.A., AS TRUSTEE VS.

DEBTORS FR: 5-12-20

Docket 35

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion for Relief rom the Automatic Stay (Settled by Stipulation) Entered 6/2/2020

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion for Relief rom the Automatic Stay (Settled by Stipulation) Entered 6/2/2020 - td (6/2/2020)

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


May 12, 2020


Grant with 4001(a)(3) waiver.


Note: This matter appears to be uncontested. Accordingly, no court

10:00 AM

CONT...


Charles A Thomas and Theresa A. Thomas


Chapter 13

appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.

Party Information

Debtor(s):

Charles A Thomas Represented By Joseph C Rosenblit

Joint Debtor(s):

Theresa A. Thomas Represented By Joseph C Rosenblit

Movant(s):

Citibank, N.A., as Trustee, in trust Represented By

Robert P Zahradka

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-12337


Jorge David Gonzalez


Chapter 7


#18.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] THE BANK OF NEW YORK MELLON

VS.


DEBTOR


Docket 55


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Deny motion under 362(d)(1) and 362(d)(2). Basis for Tentative Ruling:

  1. 362(d)(1): Movant admits there is an $80,000, or 15%, equity cushion protecting its interest. The 9th Circuit in In re Mellor, 734 F.2d 1396, 1401 (9th Cir. 1984), in finding that the 20% equity cushion in the case before it was sufficient protection, cited with approval other cases which found that a 10% or

    10:00 AM

    CONT...


    Jorge David Gonzalez


    Chapter 7

    15% equity was sufficient. "A 20% cushion has been held to be an adequate protection for a secured creditor. See In re McGowan, 6 B.R. 241, 243 (B.Ct.E.D.Pa.1980) [holding a 10% cushion is sufficient to be adequate protection]; In re Rogers Development Corp., 2 B.R. 679, 685 (B.Ct.E.D.Virg.1980) [court decided that an equity cushion of approximately 15% to 20% was sufficient adequate protection to the creditor, even though the debtors had no equity in the property.]"


  2. 362(d)(2): Movant admits there is equity of $80,000 and, therefore, has failed to establish lack of equity, for which it has the initial burden of proof.


Note: If Movant accepts the foregoing tentative ruling, appearance at this hearing is not required; non-appearance at the hearing will be deemed acceptance of the tentative ruling.


Party Information

Debtor(s):

Jorge David Gonzalez Represented By Robert G Uriarte

Movant(s):

The Bank of NewYork Mellon FKA Represented By

Austin P Nagel

Trustee(s):

Richard A Marshack (TR) Represented By Robert P Goe

10:00 AM

8:19-12933


Lisa Nguyen


Chapter 13


#19.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] THE BANK OF NEW YORK MELLON

VS.


DEBTOR


Docket 82

*** VACATED *** REASON: OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 5/13/2020

Courtroom Deputy:

OFF CALENDAR: Order Granting Motion for Relief from the Automatic Stay (Settled by Stipulation) Entered 5/13/2020 - td (5/13/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Lisa Nguyen Represented By

Christine A Kingston

Movant(s):

The Bank of New York Mellon f/k/a Represented By

Austin P Nagel

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-13239


John Fouse


Chapter 13


#20.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] HSBC BANK USA, NA

VS.


DEBTOR


Docket 40

*** VACATED *** REASON: OFF CALENDAR: Notice of Withdrawal of Motion, filed 5/5/2020

Courtroom Deputy:

OFF CALENDAR: Notice of Withdrawal of Motion, filed 5/5/2020 - td (5/5/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

John Fouse Represented By

Sundee M Teeple

Movant(s):

HSBC Bank USA, National Represented By Katie M Parker

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:19-13600


Ellie Elape Lam


Chapter 13


#21.00 CONT'D Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY]


U.S. BANK NATIONAL ASSOCIATION, NOT INDIVIDUALLY BUT SOLELY AS TRUSTEE FOR BLUEWATER INVESTMENT TRUST 2018-1, ITS SUCCESSOR AND ASSIGNS


VS.


DEBTOR


FR: 3-19-20; 4-30-20


Docket 30


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


March 19, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that, starting with the March 19, 2020 hearings, ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through April 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Grant motion with 4001(a)(3) waiver unless Debtor is postpetition current by the time of the hearing (in which case a standard "3 Strikes" adequate protection

10:00 AM

CONT...


Ellie Elape Lam


Chapter 13

order will be granted) or if the parties have reached an alternate resolution. If more time is needed to reach resolution, Movant may request a continuance of the hearing at the time of the calendar roll call by the court clerk on the day of the hearing. Available continued dates are: 4/2, 4/9, 4/16, 4/30 and 5/2 at 10:00 a.m.


April 30, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Continue hearing to June 4, 2020 at 10:00 a.m. to allow the parties to complete resolution discussions. (XX)


Special note: If the parties have been unable to reach resolution and Movant wishes to proceed with this hearing, Movant so indicate to the clerk during the calendar roll call.


Note: If the parties accept the foregoing tentative ruling, appearances at this hearing are not required. Nonappearance by the parties shall be deemed acceptance of the tentative ruling.


June 4, 2020


The parties have previously requested a continuance of the hearing in order to discuss the terms of an adequate protection order. If more time is needed, continue the hearing one final time to July 16, 200 at 10:00 a.m.

10:00 AM

CONT...


Ellie Elape Lam


Chapter 13

Note: If the parties accept the tentative ruling to continue the matter one final time to July 16, 2020, appearances at this hearing are not required; non-appearance at the hearing will be deemed acceptance of the tentative ruling.


Party Information

Debtor(s):

Ellie Elape Lam Represented By Christopher J Langley

Movant(s):

U.S. Bank National Association, not Represented By

Dane W Exnowski Sean C Ferry

Lemuel Bryant Jaquez

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:20-10294


German A Gutierrez


Chapter 13


#22.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] GESA CREDIT UNION

VS.


DEBTOR


Docket 25

*** VACATED *** REASON: Order Approving Stipulation to Withdraw Motion Entered 6/3/20

Courtroom Deputy:

OFF CALENDAR: Order Approving Stipulation to Withdraw Motion Entered 6/3/2020 - td (6/3/2020 )

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

German A Gutierrez Represented By Christopher J Langley

Movant(s):

Gesa Credit Union Represented By Nina Z Javan

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:00 AM

8:20-10436


Chandra Marie Adam


Chapter 7


#23.00 Hearing RE: Motion for relief from the automatic stay [REAL PROPERTY] WELLS FARGO BANK, N.A.

VS.


DEBTOR


Docket 14


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Grant Motion under 362(d)(1) and 362(d)(2) with waiver of FRBP 4001(a)(3). Basis for Tentative Ruling:

  1. The moving party has established that it has colorable beneficial interest, which is all that is required for a hearing on relief from the automatic stay. Whether the moving party has the right under applicable non-bankruptcy law to foreclose on the property is not an issue decided in a summary relief from stay

    10:00 AM

    CONT...


    Chandra Marie Adam


    Chapter 7

    hearing.


  2. According to the value of the real property as set forth in Debtor's own schedules, $950,000, there is less than a 3% equity cushion to protect the interest of the moving party and there is no equity cushion if the ordinary costs of sale are taken into account. 11 U.S.C. 362(d)(1) (lack of adequate protection)


  3. The arrearages (unpaid payments) total nearly $500,000 with no mortgage payments having been made in approximately 11 years.


  4. There is no equity in the property, i.e., the liens against the property exceed the value of the property by at least $200,000. And, there is no reorganization in chapter 7 cases. 11 U.S.C. 362(d)(2) (lack of equity in property and property not necessary for reorganization).


  5. Debtor asserts certain claims against the moving party and has attached a draft of a complaint that includes various cause of action under non-bankruptcy law. However, such claims, if they exist, arose prior to the bankruptcy filing and are, therefore, property of the bankruptcy estate under 11 U.S.C. 541. As this is a chapter 7 case, the trustee has control over all property of the bankruptcy estate and is the only person who may prosecute claims on behalf of the estate. Stated otherwise, unless the claims have been abandoned either by the trustee or by operation of law, Debtor has no standing or authority to prosecute the claims. The court notes that there has been no motion by the chapter 7 trustee to abandon the claims. Further, Debtor did not list the claims in her bankruptcy schedules. As a consequence, even once the case closes, the claims will not be deemed abandoned by operation of law and will remain property of the estate, over which Debtor will have no standing to prosecute. 11 U.S.C. 554. If, at some point, the claims are abandoned to Debtor and therefore no longer property of the estate, this court will have no jurisdiction to adjudicate such non-core, non- bankruptcy claims which would have no impact on the administration of the bankruptcy case.


  6. In the event that the claims referenced in the draft complaint are abandoned to Debtor at some point, her recourse would be in state or other non-bankruptcy court.


    Party Information

    10:00 AM

    CONT...

    Debtor(s):


    Chandra Marie Adam


    Chapter 7

    Chandra Marie Adam Pro Se

    Movant(s):

    Wells Fargo Bank, N.A. Represented By

    Dane W Exnowski

    Trustee(s):

    Thomas H Casey (TR) Pro Se

    10:00 AM

    8:20-10533


    American Renewable Power LLC


    Chapter 7


    #24.00 Hearing RE: Motion for relief from the automatic stay [PERSONAL PROPERTY] CALIFORNIA PHYSICIANS' SERVICE dba BLUE SHIELD OF CALIFORNIA VS.

    DEBTOR


    Docket 96


    Courtroom Deputy:

    - NONE LISTED -

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Grant motion.


    Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


    Party Information

    10:00 AM

    CONT...

    Debtor(s):


    American Renewable Power LLC


    Chapter 7

    American Renewable Power LLC Represented By

    David B Golubchik Todd M Arnold

    Movant(s):

    California Physicians' Service dba Represented By

    Andrew Still Michael B Reynolds

    Trustee(s):

    Thomas H Casey (TR) Represented By Beth Gaschen Steven T Gubner

    10:30 AM

    8:16-14450


    Cameron Malin Davis


    Chapter 13


    #25.00 Hearing RE: Chapter 13 Trustee's Motion for Entry of Order Deeming Claim Satisfied


    Docket 50


    Courtroom Deputy:

    SPECIAL NOTE: Stipulation Between BFW West, and Chapter 13 Trustee Regarding Order and Distribution of Funds Being Held by Chapter 13 Trustee filed 6/1/2020 - td (6/1/2020)

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Take matter off calendar in light of the stipulation filed by the chapter 13 trustee and claimant on June 1, 2020 [docket #54]; the trustee shall lodge an order consistent with the same.


    Note: Appearances at this hearing are not required.

    Party Information

    Debtor(s):

    Cameron Malin Davis Represented By Joseph A Weber

    10:30 AM

    CONT...

    Trustee(s):


    Cameron Malin Davis


    Chapter 13

    Amrane (SA) Cohen (TR) Pro Se

    10:30 AM

    8:17-14535


    Prime Metals U.S.A., Inc.


    Chapter 7

    Adv#: 8:19-01214 Marshack v. Chang Ding Metal Co., Ltd. et al


    #26.00 CON'TD Hearing RE: Defendant Chang Ding Metal Co., Ltd.'s Motion to Dismiss Adversary Proceeding Pursuant to Federal Rule of Civil Procedure 12(B)


    FR: 4-30-20


    Docket 10

    *** VACATED *** REASON: CONTINUED TO 8/20/2020 AT 2:00 P.M.,

    Per Order Entered 5/29/2020 (XX) Courtroom Deputy:

    CONTINUED: Hearing Continued to 8/20/2020 at 2:00 p.m., Per Order

    Entered 5/29/2020 (XX) - td (5/29/2020)

    Tentative Ruling:

    - NONE LISTED -

    Party Information

    Debtor(s):

    Prime Metals U.S.A., Inc. Represented By Steven Werth

    Defendant(s):

    Chang Ding Metal Co., Ltd. Represented By Mohammad Tehrani Jeff D Kahane

    Hoa Phat Steel Co., Ltd. Pro Se

    Pomina 2 Steel Corporation Pro Se

    Movant(s):

    Chang Ding Metal Co., Ltd. Represented By Mohammad Tehrani Jeff D Kahane

    10:30 AM

    CONT...


    Prime Metals U.S.A., Inc.


    Chapter 7

    Plaintiff(s):

    Richard A Marshack Represented By Ronald S Hodges Robert P Goe Ryan S Riddles

    Trustee(s):

    Richard A Marshack (TR) Represented By

    D Edward Hays Laila Masud David M Goodrich Robert P Goe

    10:30 AM

    8:18-12875


    Michael D O'Donnell


    Chapter 7


    #27.00 Hearing RE: Chapter 7 Trustee's Final Report and Application for Final Fees and Expenses


    [KAREN SUE NAYLOR, CHAPTER 7 TRUSTEE]


    Docket 99


    Courtroom Deputy:

    - NONE LISTED -

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Approve fees and expenses as requested.


    Note: This matter appears to be uncontested. Accordingly, no court appearance by Applicant is required. Should an opposition party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Applicant will be so notified.


    Party Information

    Debtor(s):

    Michael D O'Donnell Represented By

    10:30 AM

    CONT...


    Trustee(s):


    Michael D O'Donnell


    David P Farrell


    Chapter 7

    Karen S Naylor (TR) Represented By Thomas H Casey

    10:30 AM

    8:18-12875


    Michael D O'Donnell


    Chapter 7


    #28.00 Hearing RE: Second and Final Application for Fees and Reimbursement of Expenses [June 20, 2019 through January 31, 2020]


    [THE LAW OFFICE OF THOMAS H. CASEY, INC., ATTORNEY FOR CHAPTER 7 TRUSTEE KAREN SUE NAYLOR]


    Docket 97


    Courtroom Deputy:

    - NONE LISTED -

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Approve fees and expenses as requested.


    Note: This matter appears to be uncontested. Accordingly, no court appearance by Applicant is required. Should an opposition party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Applicant will be so notified.


    Party Information

    10:30 AM

    CONT...

    Debtor(s):


    Michael D O'Donnell


    Chapter 7

    Michael D O'Donnell Represented By David P Farrell

    Trustee(s):

    Karen S Naylor (TR) Represented By Thomas H Casey

    10:30 AM

    8:18-12875


    Michael D O'Donnell


    Chapter 7


    #29.00 Hearing RE: First and Final Fee Application for Allowance of Fees and Expenses From October 28, 2018 through January 21, 2020


    [HAHN FIFE & COMPANY LLP, ACCOUNTANT FOR CHAPTER 7 TRUSTEE]


    Docket 95


    Courtroom Deputy:

    - NONE LISTED -

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Approve fees and expenses as requested.


    Note: This matter appears to be uncontested. Accordingly, no court appearance by Applicant is required. Should an opposition party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Applicant will be so notified.


    Party Information

    Debtor(s):

    Michael D O'Donnell Represented By

    10:30 AM

    CONT...


    Trustee(s):


    Michael D O'Donnell


    David P Farrell


    Chapter 7

    Karen S Naylor (TR) Represented By Thomas H Casey

    10:30 AM

    8:18-13296


    Roman Gabriel Machutt


    Chapter 7


    #30.00 Hearing RE: Chapter 7 Trustee's Motion for Order Finding Debtor in Contempt for Violation of the Court's Order, Sanctions Based Upon the Debtor's Contempt, and Request for Authority for Trustee to Move to Compel Debtor to Appear at Section 341(a) Meeting Pursuant to Federal Rule of Bankruptcy Procedure 2005


    Docket 60


    Courtroom Deputy:

    - NONE LISTED -

    Tentative Ruling:

    SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


    June 4, 2020


    Grant in part; deny in part. Grant the request for a finding of contempt; deny the request for a $500/day fine; deny request for attorneys fee due to lack of evidence; grant request for FRBP 2005 relief, subject to any applicable international laws, rules, policies and/or treaties.


    Basis for Tentative Ruling


    Trustee moves for an order finding Debtor in civil contempt for violating the Compelling Order (defined below) by failing to appear at fourteen 341(a) meeting of creditors and failing to produce documents (the "Motion")[dkt. 60].

    10:30 AM

    CONT...


    Roman Gabriel Machutt


    Chapter 7

    Trustee also seeks civil sanctions in the form of attorneys’ fees and costs, imposition of a $500 daily fine for each day that Debtor fails to produce documents, imposing a fine for each subsequent 341(a) meeting missed by Debtor, and authorizing the U.S. Marshall Service to arrest Debtor to compel attendance.


    1. Relief Under §105(a) is Warranted


      Pursuant to 11 U.S.C. § 105(a), a bankruptcy court has the authority to "issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title." Contempt proceedings are governed by Rule 9020, which states that Rule 9014 governs a motion for an order of contempt. The bankruptcy court has the authority to impose civil contempt sanctions under

      § 105(a). Knupfer v. Lindblade (In re Dyer), 322 F.3d 1178, 1189–90 (9th Cir.2003); Walls v. Wells Fargo Bank, 276 F.3d 502, 507 (9th Cir.2002).


      To find a party in civil contempt, the court must find that the offending party knowingly violated a definite and specific court order, and the moving party has the burden of showing the violation by clear and convincing evidence. In re Dyer, 322 F.3d at 1190–91; In re Wallace, 490 B.R. 898, 905 (B.A.P. 9th Cir. 2013). But "civil contempt should not be resorted to where there is a fair ground of doubt as to the wrongfulness of the defendant’s conduct.’" Taggart v.

      Lorenzen, 139 S.Ct. 1795, 1801-02 (2019)(citation omitted)(establishing the objective fair ground of doubt standard in the context of a discharge order).


      The burden then shifts to the contemnors to demonstrate why they were unable to comply. FTC v. Affordable Media, 179 F.3d 1228, 1239 (9th Cir.1999). A person fails to act as ordered by the court when he fails to take all the reasonable steps within his power to insure compliance with the court's order. Shuffler v. Heritage Bank, 720 F.2d 1141, 1146–47 (9th Cir.1983).


      1. The Order was Definite and Specific


        On August 6, 2019, the Court entered an order requiring Debtor to cooperate with Trustee, produce documents to Trustee, appear at the October 3, 2019 meeting of creditors, and appear at any subsequent meeting of creditors

        10:30 AM

        CONT...


        Roman Gabriel Machutt


        Chapter 7

        (the "Order"). The Order was definite and specific in that it identified the date of the October 3, 2019 meeting of creditors and stated that Debtor had to appear at any subsequent 341(a) meetings and produce documents to Trustee. See, Mot., Ex. 1.


      2. Debtor was Properly Served with the Order


        The Order properly was served on Debtor by first class mail at the mailing address listed in the petition, i.e., his residence in Aliso Viejo, California. The Order was also served on Debtor’s Counsel, Brian Soo-Hoo. See, BNC Notice [dkt. 42]. Mr. Soo-Hoo's declaration in support of the opposition to the Motion that he filed on behalf of Debtor indicates that Debtor had actual notice of the Order in that Debtor returned to California in October 2019 to attend the meeting of creditors. See, Soo-Hoo Decl., p. 1-2, ¶4.


      3. Debtor Violated the Order


        When determining whether an alleged contemnor has violated a court order, "the focus is not on the subjective beliefs or intent of the contemnors in complying with the order, but whether in fact their conduct complied with the order at issue." Dyer, 322 F.3d at 1191 (internal quotes omitted). This general objective standard was reaffirmed by the Supreme Court in Taggart v. Lorenzen, 139 S. Ct. 1795, 1804 (2019)(analyzing civil contempt in the context of a discharge violation) in which the Court explained that "a party's subjective belief that she was complying with an order ordinarily will not insulate her from civil contempt if that belief was objectively unreasonable." In re Freeman, 608 B.R. 228, 234 (B.A.P. 9th Cir. 2019)(quoting Taggart, 139 S.Ct. at 1802). Thus, a party may be held in civil contempt if there is not a "fair ground of doubt" as to whether the alleged conduct might be lawful. See, Taggart, supra, at 1804.


        Subjective good faith belief is not always irrelevant, however, because "a party's good faith, even if it does not prevent a finding of civil contempt, might help determine the appropriate sanction." Freeman, 608 B.R. at 234 (citing Taggart, 139 S.Ct. at 1802). As such, "advice of counsel and good faith conduct do not relieve from liability for a civil contempt, although they may affect the extent of the penalty." TWM Mfg. Co. v. Dura Corp., 722 F.2d 1261, 1273 (6th Cir.

        10:30 AM

        CONT...

        1983).


        Roman Gabriel Machutt


        Chapter 7


        In this case, Trustee demonstrated that Debtor failed to comply with the Order. The Order required Debtor's attendance at the October 3, 2019 meeting of creditors as well as all subsequently scheduled meetings. Though no meeting was held on October 3, 2019, a subsequent meeting was scheduled for October 17, 2019. See, Notice of Continued Meeting of Creditors ("October 2019 Notice")[dkt. 44]. The October 2019 Notice was served on Debtor and Debtor’s counsel. See, October 2019 Notice. And per Debtor’s Counsel’s testimony, Debtor returned to California to attend the October 17, 2019 meeting of creditors, i.e., had actual knowledge, but Debtor did not attend the October 17, 2019. See, Debtor’s Counsel Decl., p. 1-2, ¶4. No reason is provided why Debtor did not appear at the October 17, 2019 meeting. Mr. Soo-Hoo states only that Debtor had to return to Europe before the continued November 2019 meeting of creditors. See id. Thus, Debtor knowingly failed to comply with the Order by failing to attend the properly noticed October 17, 2019 meeting of creditors. In addition, the October 2019 Notice listed specific documents that Debtor was required to produce, but didn't. See, Mot., p. 4:16-18 and p. 9, ¶5 (Kosmala Decl.); October 2019 Notice.


      4. Debtor’s Defense to Civil Contempt


        A person fails to act as ordered by the court when he fails to take all the reasonable steps within his power to insure compliance with the court's order. Shuffler v. Heritage Bank, 720 F.2d 1141, 1146–47 (9th Cir.1983). The burden is on the contemnors to demonstrate why they were unable to comply. FTC v. Affordable Media, 179 F.3d 1228, 1239 (9th Cir.1999). However, "the party asserting the impossibility defense must show "categorically and in detail" why he is unable to comply." Id. at 1241.


        The sole defense offered by Mr. Soo-Hoo is that Debtor may not have received this Motion or notice of the same and, therefore, entering a civil contempt order may violate his due process rights. This argument is unpersuasive because, as explained in the Reply, the Motion was served in accordance with the FRBP and LBR on Debtor and Debtor’s Counsel. See, Reply, p. 2:15-3:8. It is Debtor's responsiblity to keep the court updated with his

        10:30 AM

        CONT...


        Roman Gabriel Machutt


        Chapter 7

        current mailing address. If, in fact, Debtor has relocated out of the country, he was aware when he left that his 341a meeting had not been concluded. As noted by Trustee, Debtor cannot simply avoid his statutory duties as a chapter 7 debtor by knowingly disappearing from the case. Debtor filed a voluntary chapter 7 petition and subsequently received a discharge (although that is now subject to revocation).


      5. Civil Sanctions are Awardable but Trustee Failed to Request Attormeys Fees and Costs in any Amount


        Civil sanctions must either be compensatory or designed to coerce compliance." Id. at 1059 (quoting Knupfer v. Lindblade (In re Dyer, 322 F.3d 1178, 1192 (9th Cir. 2003)); Brace v. Speier (In re Brace), 2019 Bankr. LEXIS 80 at *21 (B.A.P. 9th Cir. 2019). Civil contempt sanctions may include compensatory damages which include reimbursement of reasonable attorneys’ fees, the imposition of a daily coercive (but not punitive) fine, and in extreme cases, incarceration, See, e.g., Gharib v. Casey (In re Kenny G. Enterprises, LLC), 692 Fed.Appx. 950, 953 (9th Cir. 2017).


        Here, Trustee seeks compensatory sanctions for attorneys’ fees and costs incurred by Trustee to bring this Motion because Trustee should not have been required to bring the Motion. Under § 521(a)(3), Debtor’s statutory duties include cooperation with the Trustee "as necessary to enable the trustee to perform the trustee’s duties[.]" Certainly, Debtor has a duty to cooperate with Trustee and attend his 341(a) examination. However, Trustee has provided no evidence of the fees and costs incurred by Trustee in connection with Debtor's contempt, including bringing the instant Motion.


      6. Daily Sanction Awards Would be Punitive


        The request for additional daily $500 sanctions for each day that documents are not produced, and the request for additional sanctions each time Debtor fails to appear for meeting of creditors, is denied because such sanctions would be punitive rather than coercive. Debtor’s counsel has moved to withdraw as his attorney of record due to lack of communication, and Debtor may be residing outside the country. Thus, it is unclear how Debtor would receive notice

        10:30 AM

        CONT...


        Roman Gabriel Machutt


        Chapter 7

        of these additional sanctions in order to coerce his behavior.


      7. Relief under FRBP 2005 is Appropriate


Trustee's request fork an order authorizing the U.S. Marshall to apprehend Debtor should be granted. Under Rule 2005, "On motion of any party in interest supported by an affidavit alleging (1) that the examination of the debtor is necessary for the proper administration of the estate and that there is reasonable cause to believe that the debtor is about to leave or has left the debtor's residence or principal place of business to avoid examination, or (2) that the debtor has evaded service of a subpoena or of an order to attend for examination, or (3) that the debtor has willfully disobeyed a subpoena or order to attend for examination, duly served, the court may issue to the marshal, or some other officer authorized by law, an order directing the officer to bring the debtor before the court without unnecessary delay." (emphasis added).


In this case, there is substantial evidence that Debtor willfully violated the Order by failing to attend the October 17, 2019 meeting of creditors, as well as all subsequent meetings of creditors. See, Mot. p. 8-9. Thus, the third prong of Rule 2005 is satisfied. Moreover, it appears that Debtor is willfully attempting to evade attending a meeting of creditors because Debtor was in California in October 2019 but failed to attend the October 17, 2019 meeting without explanation. See, Debtor’s Counsel Decl., p. 1-2, ¶4. Finally, as it appears that Debtor resides outside the country, Trustee will require assistance from the United States Marshal to secure Debtor's appearance at future meetings of creditors. It shall be the responsibility of Trustee to determine the specific information needed by the United States Marshal to execute a 2005 order (or writ). The court understands that apprehension of Debtor could be complicated by applicable international laws, rules, policies and/or treaties.


Party Information

Debtor(s):

Roman Gabriel Machutt Represented By Brian J Soo-Hoo

10:30 AM

CONT...

Trustee(s):


Roman Gabriel Machutt


Chapter 7

Weneta M Kosmala (TR) Represented By Reem J Bello

10:30 AM

8:18-13296


Roman Gabriel Machutt


Chapter 7


#31.00 Hearing RE: Motion for Leave to Withdraw as Counsel for Debtor (Brian J. Soo-Hoo dba Bankruptcy Law Professionals)


Docket 62


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 6, 2020


Grant the Motion.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


Party Information

Debtor(s):

Roman Gabriel Machutt Represented By Brian J Soo-Hoo

10:30 AM

CONT...

Trustee(s):


Roman Gabriel Machutt


Chapter 7

Weneta M Kosmala (TR) Represented By Reem J Bello

10:30 AM

8:19-12411


Orange County Bail Bonds, Inc.


Chapter 11


#32.00 CONT'D Hearing RE: Debtor's Application to Employ Magaraian & Dimercurio, A Professional Law Corporation as State Court and Appeal Litigation Counsel


FR: 5-21-20


Docket 110


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 6, 2020


Continue this hearing to July 16, 2020 at 10:30 a.m., the same date/time set for hearing on approval of Debtor's amended disclosure statement and the Subchapter V status conference.


Re this application, the court believes it would be premature to rule on the application until a determinaton is made regarding the pending motion to dismiss or convert the case.


Note: If the parties accept the foregoing tentative ruling, appearances at today's hearing are excused; non-appearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

10:30 AM

CONT...

Debtor(s):


Orange County Bail Bonds, Inc.


Chapter 11

Orange County Bail Bonds, Inc. Represented By Marc C Forsythe Ryan S Riddles

Trustee(s):

Mark M Sharf (TR) Pro Se

10:30 AM

8:19-12411


Orange County Bail Bonds, Inc.


Chapter 11


#33.00 CONT'D Hearing RE: Motion to (1) Dismiss Debtor's Chapter 11 Bankruptcy or, in the Alternative, to Convert Case to Chapter 7; and (2) Objecting to Amended Petition Electing Subchapter V


FR: 5-7-20


Docket 123


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 6, 2020


Continue this hearing to July 16, 2020 at 10:30 a.m., the same date/time set for hearing on approval of Debtor's amended disclosure statement and the Subchapter V status conference.


Basis for Tentative Ruling


The court would like to review this motion along with the disclosure statement in order to put the entire matter in context. The court would also appreciate input from the Subchapter V Trustee has provided the most objective view of the viability and prospects for reorganization than either of the warring parties.

10:30 AM

CONT...


Orange County Bail Bonds, Inc.


Chapter 11


The court encourages the Movant and Debtor to work with the Trustee regarding the possible terms of a consensual plan that will end this costly litigation once and for all.


The court encourages Debtor to re-review the Trustee's status report filed on April 29, 2020, in particular re the alleged $7M contingent ACIC claim filed Debtor on its behalf, for which Debtor is not contractually liable, the status of the Civic Center lease as statutorily rejected, and the fair market rental value of the premises.


Note: If the parties accept the foregoing tentative ruling, appearances at today's hearing are excused; non-appearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Orange County Bail Bonds, Inc. Represented By Marc C Forsythe Ryan S Riddles

Trustee(s):

Mark M Sharf (TR) Pro Se

10:30 AM

8:19-13242


10827 Studebaker LLC, a California limited liabili


Chapter 11


#34.00 Hearing RE: Debtor's Motion for Order Authorizing Use of Cash Collateral


Docket 97


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 6, 2020


Grant the Motion.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required.

Party Information

Debtor(s):

10827 Studebaker LLC, a California Represented By

Steven Werth

10:30 AM

8:20-10307


David Patterson


Chapter 13


#35.00 Hearing RE: Debtor's Objection to Claim of Alley Bank (Claim No. 6) and Motion for Order Disallowing Claim


Docket 16


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Continue hearing to July 9, 2020 at 10:30 a.m. to allow Debtor to correct service issue.


Basis for Tentative Ruling:


Service: Debtor did not serve claimant, a federally insured depository, in accordance with FRBP 7004(h). Rule 7004(h) requires service by certified mail to an officer of claimant, unless unless the claimant has appeared by its attorney. The court is aware that subsequent to the filing of the claim objection, Debtor entered into a stipulation with claimant for relief from stay re claimant's collateral and that claimant's attorney signed off on the stipulation. However, that attorney, Adam Barasch, was not served with the claim objection, so service is defective.

10:30 AM

CONT...


David Patterson


Chapter 13

Merits: The court is inclined to sustain the objection on the merits, except the request for attorneys fees and costs as no legal authority for such has been presented.


Tentative ruling for 7/9/20 (if unopposed): Sustain objection; deny request for attorneys fees and costs.


Note: If Debtor accepts the foregoing tentative ruling, appearance at this hearing is not required. Non-appearance at the hearing will be deemed acceptance of the tentative ruling.


Party Information

Debtor(s):

David Patterson Represented By Amanda G Billyard

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:30 AM

8:20-11026


Little John's Antique Arms, Inc.


Chapter 11


#36.00 STATUS CONFERENCE Hearing RE: Status of Chapter 11 Case; and (2) Requiring Report on Status of Chapter 11 Case


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Claims bar date: Aug. 7, 2020 (notice by 6/6/20)

Deadline to file plan/DS: Aug. 28, 2020

Continued Status Conference: Sept. 17, 2020 at 10:30 a.m. Deadline to file Status Report: Sept. 3, 2020*


*Status report not required if 1) Debtor has filed a plan and DS, or 2) Debtor has filed a motion to dismiss the case by such date.


Note: If Debtor accepts the foregoing tentative ruling and is in substantial compliance with the requirements of the U.S. Trustee, appearance at this hearing is not required; the court shall enter it's own order.

Party Information

10:30 AM

CONT...

Debtor(s):


Little John's Antique Arms, Inc.


Chapter 11

Little John's Antique Arms, Inc. Represented By Richard A Marshack Chad V Haes

10:30 AM

8:20-11102


Eugene S. Tamburelli and Shirley A. Tamburelli


Chapter 13


#37.00 Hearing RE: Debtors' Objection to Merrick Bank's Claim, Claim Number 2-1


Docket 16

*** VACATED *** REASON: OFF CALENDAR: Notice of Withdrawal of Objection to Claim filed 5/21/2020

Courtroom Deputy:

OFF CALENDAR: Notice of Withdrawal of Objection to Claim filed 5/21/2020 - td (5/21/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Eugene S. Tamburelli Represented By Joseph A Weber Fritz J Firman

Joint Debtor(s):

Shirley A. Tamburelli Represented By Joseph A Weber Fritz J Firman

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

10:30 AM

8:20-11102


Eugene S. Tamburelli and Shirley A. Tamburelli


Chapter 13


#38.00 Hearing RE: Debtors' Objection to Merrick Bank's Claim, Claim Number 3-1 ($2,438.73)


Docket 19

*** VACATED *** REASON: OFF CALENDAR: Notice of Withdrawal of Objection to Claim filed 5/21/2020

Courtroom Deputy:

OFF CALENDAR: Notice of Withdrawal of Objection to Claim filed 5/21/2020 - td (5/21/2020)

Tentative Ruling:

- NONE LISTED -

Party Information

Debtor(s):

Eugene S. Tamburelli Represented By Joseph A Weber Fritz J Firman

Joint Debtor(s):

Shirley A. Tamburelli Represented By Joseph A Weber Fritz J Firman

Trustee(s):

Amrane (SA) Cohen (TR) Pro Se

2:00 PM

8:19-14441


Aimen Elbusifi


Chapter 7

Adv#: 8:20-01020 Angar v. Aimen


#39.00 Hearing RE: Defendant's Motion to Dismiss Adversary Complaint with Prejudice on All Causes of Action


Docket 3


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:

SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


June 4, 2020


Grant the Motion in its entirety based upon the argument and legal analysis set forth in the Motion. The court retains jurisdiction to decide any motion for attorneys fees/costs under 11 U.S.C. 523(d).


Special note: This adversary was commenced by an unrepresented plaintiff. Under such circumstance, the court would ordinarily allow leave to amend if the pro se litigant shows any interest in prosecuting his claims. Here, however, the plaintiff has not filed an opposition to the Motion, the facts described in the complaint states a claim for breach of contract, which is dischargeable, and does not allege a single fact that addresses any of the elements of Sections 523(a)(2) or 523(a)(4). For the reasons, stated in the Motion, relief under Section 542 is only available to trustees. In sum, under the circustances here,

2:00 PM

CONT...


Aimen Elbusifi


Chapter 7

granting leave to amend would be an exercise in futility.


Note: This matter appears to be uncontested. Accordingly, no court appearance by the Movant is required. Should an opposing party file a late opposition or appear at the hearing, the court will determine whether further hearing is required and Movant will be so notified.


On November 13, 2019, Aimen Elbusifi ("Debtor" or "Defendant")) filed a voluntary chapter 7 petition. Thomas H. Casey was appointed chapter 7 trustee ("Trustee"). On December 24, 2019, Trustee filed a "no-asset" report. On March 2, 2020, Debtor received a discharge. The case was closed on March 3, 2020.


On September 7, 2018, plaintiff Mohammed Angar ("Plaintiff"), pro se,

filed

a nondischargeability complaint (the "Complaint") against Defendant. The Complaint alleges one cause of action for "Fraudulent Agreement."


The adversary cover sheet (the "Coversheet") had three causes of action checked §§ 542, 523(a)(2), and §523(a)(4). These causes of action do not appear in the Complaint.


In sum, the Complaint alleges that Defendant borrowed monies, paid most back, Plaintiff sued for the maximum allowed in small claims court, got a judgment, Defendant


Party Information

Debtor(s):

Aimen Elbusifi Represented By Brian J Soo-Hoo

2:00 PM

CONT...


Aimen Elbusifi


Chapter 7

Defendant(s):

Elbusifi Aimen Represented By Michael D Franco

Plaintiff(s):

Mohammed Angar Pro Se

Trustee(s):

Thomas H Casey (TR) Pro Se

2:00 PM

8:19-14441


Aimen Elbusifi


Chapter 7

Adv#: 8:20-01020 Angar v. Aimen


#40.00 CON'TD STATUS CONFERENCE RE: Adversary Complaint Against Debtor, Elbusifi, Aimen, For Fraudulent Agreement


FR: 5-7-20


Docket 1


Courtroom Deputy:

- NONE LISTED -

Tentative Ruling:


May 7, 2020


SPECIAL IMPORTANT NOTICE! In order to mitigate the spread of the COVID-19 virus, notice is hereby given that ALL hearings before Judge Smith will be by TELEPHONE APPEARANCE ONLY until further notice. The courtroom will be locked. Any party who wishes to appear must register in advance by contacting CourtCall at (866) 582-6878. It is suggested that parties register with CourtCall at least 30 minutes prior to the hearing. Through June 30, 2020, CourtCall is offering discounted registration for attorneys and free registration for parties without an attorney.


Contine the status conference to June 4, 2020 at 2:00 p.m., same date/time as hearing on Defendant's motion to dismiss. An updated status report is not required. (XX)


Note: Appearances at this hearing are not required; non-appearance at the hearing will be deemed acceptance of the tentative ruling.

Party Information

Debtor(s):

Aimen Elbusifi Represented By

2:00 PM

CONT...


Aimen Elbusifi


Brian J Soo-Hoo


Chapter 7

Defendant(s):

Elbusifi Aimen Pro Se

Plaintiff(s):

Mohammed Angar Pro Se

Trustee(s):

Thomas H Casey (TR) Pro Se

9:30 AM

8:18-10566


Eugene Martin Huapaya


Chapter 7

Adv#: 8:20-01019 Kosmala v. Journey Investments Inc et al


#1.00 CON'TD STATUS CONFERENCE RE: Complaint for Declaratory Relief; Breach of Contract; and Turnover Earnest Money Deposit (11 U.S. C. Section 542, 543)


FR: 4-30-20


Docket 1


Courtroom Deputy:

Tentative Ruling:

August 27, 2020


The court is inclined to grant the Motion but is concerned about the possible transfer of inventory that may be include intellectual property of Motorola.

Debtors need to address whether there is a way of excluding any such inventory. If not, this hearing may need to be postponed until a decision on the TRO/preliminary matter is adjudicated in District Court in Illinois.


The court notes that it does not share the UST's or Motorola's concerns about the independence of the Independent Director or the marketing efforts of Imperial.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark

10:00 AM

CONT...


Hytera Communications America (West) Inc

Steptoe & Johnson


Chapter 11

10:00 AM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#2.00 CON'TD Hearing RE: Motion of Motorola Solutions, Inc. to Dismiss Chapter 11 Case Pursuant to 11 U.S.C. Section 1112 or Alternatively to Suspend Case Pending Resolution of District Court Matters Pursuant to 11 U.S.C. Section 305


FR:8-20-20


Docket 111

Courtroom Deputy:

Tentative Ruling:


August 20, 2020


Continue hearing to August 27, 2020 at 10:00 a.m., same date/time as the Sale Motion. (XX)


Note: Appearances at today's hearing are not required.

--------------------------------------------------------------------


August 27, 2020


The court is inclined to continue the hearing on the Motion for six months until the disposition of the pending TRO/Preliminary Injunction matter is ruled on by the District Court in Illinois.


Basis for Continuance:


  1. The court is not persuaded that Debtors' failure to seek or obtain an appeal bond for a $700M+ judgment is a basis for dismissal of the case as there is no evidence that Debtors had the ability to post such a bond and the fact that its parent (or indirect) parent may have had the ability to do so is, in the court's view, irrelevant as such entity had no legal duty to post such an appeal bond on behalf of Debtors.

    10:00 AM

    CONT...


    Hytera Communications America (West) Inc


    Chapter 11


  2. The court is concerrned, however, with the fact that Debtors may have continued to distribute products containing Motorola's source code or other protected intellectual property in the absence of the issuance of an injunction by the District Court. See Ms. Huang's 341a testimony. The court is not aware of any declaration testimony by Debtors directly addressing this issue.


  3. The scope of any injunction, if granted, could directly impact the viability of Debtors' reorganization.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark Steptoe & Johnson

10:00 AM

8:20-11507


Hytera Communications America (West) Inc


Chapter 11


#3.00 CONT'D Hearing RE: Motion for Relief from Stay Under 11 USC Section 362 [ACTION IN NONBANKRUPTCY FORUM]


MOTOROLA SOLUTIONS, INC. VS.

DEBTOR FR: 8-20-20

Docket 112

*** VACATED *** REASON: Order approving stipulation resolving relief from stay entered 8/27/20

Courtroom Deputy:

OFF CALENDAR: Order approving stipulation resolving relief from stay entered 8/27/20- mp(8/27/20)/td

Tentative Ruling:

August 20, 2020


Continue hearing to August 27, 2020 at 10:00 a.m., same date/time as the Sale Motion. (XX)


Note: Appearances at today's hearing are not required.

Party Information

Debtor(s):

Hytera Communications America Represented By

John W Lucas Jason H Rosell Victoria Newmark Steptoe & Johnson

10:00 AM

CONT...

Movant(s):


Hytera Communications America (West) Inc


Chapter 11

Motorola Solutions, Inc. Represented By Mark E McKane