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In re: Enrique v. Greenberg, SC-16-1350-BJuF (2017)

Court: United States Bankruptcy Appellate Panel for the Ninth Circuit Number: SC-16-1350-BJuF Visitors: 2
Filed: Aug. 31, 2017
Latest Update: Mar. 03, 2020
Summary:  The bankruptcy court determined that Debtor had filed his, 4, case and plan solely with a litigation objective and not to, 5, reorganize., 2 Less than one week after the settlement between the chapter 7, 3 trustee and U.S. Bank, Debtor filed a third bankruptcy case, this, 4 time under chapter 11.
                                                            FILED
                                                             AUG 31 2017
                                                         SUSAN M. SPRAUL, CLERK
 1                          NOT FOR PUBLICATION            U.S. BKCY. APP. PANEL
                                                           OF THE NINTH CIRCUIT
 2
 3                   UNITED STATES BANKRUPTCY APPELLATE PANEL
                               OF THE NINTH CIRCUIT
 4
 5   In re:                        )       BAP No.      SC-16-1350-BJuF
                                   )
 6   ENRIQUE V. GREENBERG,         )       Bk. No.      3:15-bk-06578-MM
                                   )
 7                  Debtor.        )
                                   )
 8                                 )
     ENRIQUE V. GREENBERG,         )
 9                                 )
                    Appellant,     )
10                                 )
     v.                            )       M E M O R A N D U M1
11                                 )
     UNITED STATES TRUSTEE,        )
12                                 )
                    Appellee.      )
13   ______________________________)
14               Submitted Without Oral Argument on July 27, 2017
15                            Filed - August 31, 2017
16                Appeal from the United States Bankruptcy Court
                     for the Southern District of California
17
              Honorable Margaret M. Mann, Bankruptcy Judge, Presiding
18
19   Appearances:      Appellant Enrique V. Greenberg, pro se, on brief;
                       Ramona D. Elliott, P. Matthew Sutko and John
20                     Postulka of the Executive Office for United States
                       Trustee and Tiffany Carroll and Terri H. Didion of
21                     Office of the United States Trustee on brief for
                       appellee United States Trustee.
22
23   Before:      BRAND, JURY and FARIS, Bankruptcy Judges.
24
25
26
          1
27           This disposition is not appropriate for publication.
     Although it may be cited for whatever persuasive value it may
28   have, it has no precedential value. See 9th Cir. BAP Rule 8024-1.
 1
          Chapter 112 debtor Enrique Greenberg ("Debtor") appeals an
 2
     order dismissing his bankruptcy case under § 1112(b)(1) for bad
 3
     faith.    The bankruptcy court determined that Debtor had filed his
 4
     case and plan solely with a litigation objective and not to
 5
     reorganize.   We AFFIRM.
 6
                 I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
 7
     A.   Events prior to the instant bankruptcy case
 8
          Debtor's mother owned real property in Temecula, California
 9
     ("Property").   In 2008, she entered into a reverse mortgage loan
10
     agreement with Countrywide Bank and executed deeds of trust in
11
     favor of Countrywide and the U.S. Department of Housing and Urban
12
     Development that purported to encumber the Property.    The deeds of
13
     trust, however, inaccurately described the Property; the legal
14
     description misidentified the Property as Lot 35 instead of
15
     Lot 36.
16
          Debtor inherited the Property (subject to the debt) after his
17
     mother's death in 2010.3   Debtor does not live, and has never
18
     lived, in the Property.    After Debtor failed to make the required
19
     payments on the loan, which then totaled approximately $220,000,
20
     foreclosure proceedings were commenced on the Property.     In
21
     response, Debtor filed a wrongful foreclosure action.      When that
22
23
24
25        2
             Unless specified otherwise, all chapter, code and rule
     references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and
26   the Federal Rules of Bankruptcy Procedure, Rules 1001-9037.
27        3
             In April 1999, Debtor's mother executed a grant deed for
     the Property in favor of Debtor, but for reasons unknown it was
28   not recorded until September 2011.

                                      -2-
 1   failed, he filed his first bankruptcy case under chapter 13.4
 2   That case was dismissed less than two months after it was filed.
 3        A week after the chapter 13 case was dismissed, Debtor filed
 4   a second bankruptcy case under chapter 7.   The case was assigned
 5   to Judge Mann.   Debtor received a chapter 7 discharge on May 13,
 6   2014.5
 7        In the second bankruptcy case, the chapter 7 trustee
 8   discovered the defective deeds of trust and filed an adversary
 9   proceeding against U.S. Bank to avoid the liens.   The trustee
10   alleged that the defective trust deeds were ineffective to
11   encumber the Property.   After a hotly contested proceeding and
12   substantial negotiation, the chapter 7 trustee and U.S. Bank
13   agreed to settle the dispute.   The trustee paid U.S. Bank $58,000.
14   In exchange, the trust deeds would be reformed to perfect a lien
15   on the Property.   The parties also exchanged mutual releases,
16   eliminating any claims against the chapter 7 estate, and the
17   chapter 7 trustee agreed to dismiss the adversary proceeding with
18   prejudice and abandon the estate's interest in the Property.
19   Debtor opposed the settlement, contending that the lien should be
20   voided, resulting in the debt owed to U.S. Bank being unsecured.
21   The bankruptcy court approved the settlement; Debtor did not
22
23        4
             Debtor filed his first bankruptcy case in the Central
     District of California. His subsequent three cases were filed in
24   the Southern District of California.
25        5
             During the state court litigation and Debtor's first two
     bankruptcy filings, Bank of America acquired Countrywide and
26   became the successor-in-interest to the deed of trust. Bank of
     America later assigned its interest in the Property to Champion
27   Mortgage Company; Champion subsequently assigned its interest to
     U.S. Bank. For ease of reference, we refer to these four parties
28   collectively as U.S. Bank.

                                     -3-
 1   appeal the order.
 2        Less than one week after the settlement between the chapter 7
 3   trustee and U.S. Bank, Debtor filed a third bankruptcy case, this
 4   time under chapter 11.   This case was also assigned to Judge Mann.
 5   The chapter 7 trustee from the prior case, which was still
 6   pending, moved to dismiss the third case, arguing that the filing
 7   was an attempt to circumvent the settlement and therefore was an
 8   abuse of the bankruptcy process.   The bankruptcy court granted the
 9   motion and dismissed the case without prejudice, finding that any
10   attempt to restructure the secured debt in the chapter 11 case was
11   futile until the settlement closed and the Property was abandoned
12   back to Debtor subject to the secured claims.   The court declined
13   to find that Debtor had filed the case in bad faith.
14   B.   Debtor's instant bankruptcy case
15        After the chapter 7 trustee abandoned the estate's interest
16   in the Property in the second bankruptcy case, Debtor filed the
17   instant chapter 11 case, his fourth bankruptcy case in two years.
18   This case was also assigned to Judge Mann.   Debtor listed the
19   Property in his Schedule A, valuing it at $445,100 and contending
20   it was not subject to any secured claims.    Debtor listed U.S. Bank
21   in his Schedule D, but indicated its claim against the Property
22   was wholly unsecured.    Debtor listed no unsecured debt in his
23   Schedule F.   Debtor later filed an amended Schedule D, asserting
24   that U.S. Bank held a secured claim against the Property for
25   $1.00.
26        Debtor then filed a proof of claim on behalf of U.S. Bank and
27   proceeded to file his objection to the claim.   Debtor argued that
28   U.S. Bank had failed to establish that it had standing to file the

                                      -4-
 1   proof of claim based on its party-in-interest or ownership status
 2   in the mortgage note.     U.S. Bank moved to withdraw the claim and
 3   indicated its desire to litigate any disputes over the claim in
 4   state court.     Ultimately, the bankruptcy court deemed the claim
 5   withdrawn without prejudice.
 6           1.   U.S. Bank's motion for relief from stay
 7           U.S. Bank moved for relief from the automatic stay in order
 8   to file an action in state court to reform the trust deeds to
 9   identify the correct legal description for the Property.    In
10   support of the motion, U.S. Bank included a declaration from
11   Jeffrey Jefferson, an employee of Champion, the servicer of the
12   loan.    Jefferson stated that the mortgage note was being held by
13   Recon Trust Company as Custodian of Records for Champion.
14   Attached to the Jefferson declaration were copies of:    (1) the
15   mortgage note executed by Debtor's mother for the reverse mortgage
16   loan; (2) the assignment of the deed of trust from Bank of America
17   to Champion; (3) the assignment of the deed of trust from Champion
18   to U.S. Bank; and (4) the 1999 grant deed from Debtor's mother to
19   Debtor.
20           Debtor opposed the stay relief motion, contesting U.S. Bank's
21   standing to enforce the note or foreclose on the Property.    In
22   short, Debtor contended that U.S. Bank had not sufficiently
23   established that it possessed the mortgage note.
24           In its tentative ruling, the bankruptcy court noted that
25   Debtor had yet to file a chapter 11 plan and that the exclusivity
26   period had expired long ago.     In addition, the only claims filed
27   by the deadline were one for Debtor's car loan, which was current,
28   and the one he filed for U.S. Bank and then objected to.    Although

                                       -5-
 1   Debtor still had time to file his plan, the court questioned the
 2   legitimacy of his case; U.S. Bank was the only creditor, and
 3   Debtor did not seek to reorganize its claim but merely eliminate
 4   it through a claim objection.    Furthermore, U.S. Bank did not wish
 5   to assert any claim in Debtor's case and wanted to resolve the
 6   parties' lien dispute in state court.
 7           Overruling Debtor's standing argument and tentatively
 8   granting U.S. Bank's motion, the bankruptcy court opined that
 9   Debtor was not using the case to accomplish any legitimate
10   bankruptcy purpose to restructure his debts, but instead sought
11   merely to eliminate U.S. Bank's claims against the Property which
12   were settled, at least in part, during his prior chapter 7 case.
13   In short, Debtor's goal was not a proper bankruptcy goal.
14        At the hearing, after considering the parties' arguments, the
15   bankruptcy court sustained its tentative ruling granting stay
16   relief to U.S. Bank.    The court noted that it was not deciding
17   whether the endorsement on the mortgage note was proper or whether
18   the loan was properly securitized; that was for the state court to
19   decide.
20           Notably, the court again expressed its concerns about the
21   legitimacy of Debtor's case; all he wished to do was litigate
22   U.S. Bank's claim, not reorganize it.    Specifically, the court
23   opined that the case should be dismissed as premature.    Until the
24   parties' claims in state court had been decided, it was unknown
25   whether the debt to U.S. Bank, if any, needed to be restructured.
26   Without a claim from U.S. Bank, which had yet to be determined,
27   the court told Debtor that he had no possibility of confirming a
28   plan.    Although Debtor's case appeared to have no bankruptcy

                                       -6-
 1   purpose, the court again declined to find that it had been filed
 2   in bad faith.
 3        The order granting U.S. Bank's stay relief motion provided
 4   that the automatic stay was terminated "to allow litigation to
 5   proceed in state court against Debtor or any other party to
 6   determine U.S. Bank's rights in the [Property]" and that "absent
 7   further order of this Court, U.S. Bank may not proceed to execute
 8   any judgment obtained in state court regarding any interest
 9   U.S. Bank may have in the Property."   Thereafter, Debtor filed a
10   motion for reconsideration of the stay relief order, which the
11   bankruptcy court denied.
12        Ultimately, Debtor's appeal of the stay relief order was
13   dismissed as moot on January 31, 2017, because his underlying
14   bankruptcy case had been dismissed.    Debtor's appeal of the
15   Panel's dismissal to the Ninth Circuit Court of Appeals was
16   dismissed for failure to pay the filing fee.
17        2.   Debtor's chapter 11 plan
18        Meanwhile, Debtor filed his proposed chapter 11 plan and
19   disclosure statement, which purported to pay U.S. Bank $1.00 for
20   its (alleged) secured claim of approximately $235,829.87.
21        Prior to the plan hearing, the bankruptcy court issued a
22   tentative ruling disapproving the plan because it failed to pay
23   anything to creditors in violation of § 1123(a)(3).   The court
24   also found that Debtor's bankruptcy case had only a litigation
25   objective and a desire to retain his property; therefore, Debtor's
26   plan had not been filed in good faith.
27        No party presented argument at the plan hearing.   The
28   bankruptcy court sustained its tentative ruling and disapproved

                                    -7-
 1   Debtor's chapter 11 plan.   The U.S. Trustee ("UST") announced it
 2   was moving to dismiss Debtor's case and set a hearing date.   The
 3   court informed Debtor that he could file another chapter 11 plan
 4   in response to the UST's motion to dismiss.   No additional plans
 5   were filed.
 6        3.   UST's motion to dismiss
 7        In its motion to dismiss Debtor's case under § 1112(b)(1),
 8   the UST contended that "cause" existed to dismiss because the
 9   court had disapproved Debtor's plan, finding that it had not been
10   filed in good faith, and had found that Debtor filed his case
11   solely with a litigation objective and not to repay creditors.
12   The UST contended that conversion was not appropriate because
13   Debtor's schedules listed no unsecured debt and he was ineligible
14   to receive a chapter 7 discharge, having received one less than
15   three years earlier.
16        Debtor opposed the motion to dismiss, arguing that his case
17   had been filed in good faith.   Debtor stated that his "intent in
18   filing his first proposed plan payment of $1.00 should be
19   construed as an effort to move creditors to providing evidence as
20   to the validity and extent of their lien, and the exact amount."
21   Debtor also disputed the Jefferson declaration offered in support
22   of U.S. Bank's stay relief motion.    Debtor argued that "without
23   adjudication of his appeal (of the stay relief order) pending on
24   the question of standing and claims objections, dismissal of his
25   bankruptcy case would be both premature and a manifest injustice."
26   Finally, Debtor argued that he still had time to file another
27   plan, so no "cause" existed to dismiss his case.
28        Prior to the hearing, the bankruptcy court issued a tentative

                                     -8-
 1   ruling granting the UST's motion, finding that "cause" existed to
 2   dismiss Debtor's case.   First, the court found that Debtor's
 3   chapter 11 plan lacked any repayment for his creditors, offering
 4   only a nominal $1.00 to U.S. Bank, and was not a good faith plan.
 5   Second, Debtor admitted that his intent behind proposing a $1.00
 6   payment was to motivate his creditors to furnish more evidence as
 7   to the validity of the loan, which evidenced that Debtor's case
 8   was filed with an improper litigation objective.    Therefore, based
 9   on the totality of the circumstances, the court found that
10   Debtor's case had not been filed in good faith and should be
11   dismissed.
12        At the dismissal hearing, the bankruptcy court sustained its
13   tentative ruling and reiterated that it was finding bad faith as
14   to Debtor's chapter 11 plan and to his case filing.    These bad
15   faith findings were both independent grounds for the court's
16   ruling to dismiss for cause.    The court further noted that
17   dismissal was the proper outcome, because there were no creditors
18   to pay in a converted case.    This timely appeal followed.
19                             II. JURISDICTION
20        The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334
21   and 157(b)(2)(A).   We have jurisdiction under 28 U.S.C. § 158.
22                                  III. ISSUE
23        Did the bankruptcy court abuse its discretion in dismissing
24   Debtor's chapter 11 case for bad faith?
25                         IV. STANDARDS OF REVIEW
26        "We review for abuse of discretion the bankruptcy court’s
27   decision to dismiss a case as a 'bad faith' filing.    We review the
28   finding of 'bad faith' for clear error."     Marsch v. Marsch

                                       -9-
 1   (In re Marsch), 
36 F.3d 825
, 828 (9th Cir. 1994) (citing Stolrow
 2   v. Stolrow’s, Inc. (In re Stolrow’s, Inc.), 
84 B.R. 167
, 170 (9th
 3   Cir. BAP 1988)).   A bankruptcy court abuses its discretion if it
 4   applied the wrong legal standard or its findings were illogical,
 5   implausible, or without support in the record.   TrafficSchool.com,
 6   Inc. v. Edriver Inc., 
653 F.3d 820
, 832 (9th Cir. 2011).
 7                               V. DISCUSSION
 8   A.   The bankruptcy court did not abuse its discretion in
          dismissing Debtor's chapter 11 case for bad faith.
 9
10        Section 1112(b)(1) provides that "the court shall convert a
11   case under this chapter to a case under chapter 7 or dismiss a
12   case under this chapter, whichever is in the best interests of
13   creditors and the estate, for cause . . . ."   § 1112(b)(1).   The
14   Ninth Circuit has held that a lack of good faith in filing a
15   chapter 11 petition establishes "cause" for dismissal under
16   § 1112(b).   In re 
Marsch, 36 F.3d at 828
.   "'The existence of good
17   faith depends on an amalgam of factors and not upon a specific
18   fact.'"   
Id. (quoting Idaho
Dep't of Lands v. Arnold
19   (In re Arnold), 
806 F.2d 937
, 939 (9th Cir. 1986)).
20        On a motion to dismiss under § 1112(b), the debtor bears the
21   burden to prove the chapter 11 petition was filed in good faith.
22   Marshall v. Marshall (In re Marshall), 
721 F.3d 1032
, 1048 (9th
23   Cir. 2013) (citing Soto v. Leavitt (In re Leavitt), 
209 B.R. 935
,
24   940 (9th Cir. BAP 1997)).   In seeking to determine whether the
25   petition was filed in good faith, the debtor's "subjective intent"
26   is not determinative.   In re 
Marsch, 36 F.3d at 828
.   Rather, the
27   good faith inquiry focuses on the manifest purpose of the petition
28   filing and whether the debtor is seeking to achieve thereby

                                     -10-
 1   "objectives outside the legitimate scope of the bankruptcy laws."
 2   
Id. Put another
way, the good faith standard requires the
 3   bankruptcy court to ascertain "whether [the] debtor is attempting
 4   to unreasonably deter and harass creditors or attempting to effect
 5   a speedy, efficient reorganization on a feasible basis."    
Id. 6 (citing
In re 
Arnold, 806 F.2d at 939
).
 7         We have long said that the bankruptcy court must consider the
 8   totality of the circumstances when determining whether the debtor
 9   acted in bad faith.   Meadowbrook Inv'rs Grp. v. Thirtieth Place,
10   Inc. (In re Thirtieth Place, Inc.), 
30 B.R. 503
, 505 (9th Cir. BAP
11   1983) (finding of bad faith "require[s] an examination of all the
12   particular facts and circumstances in each case").   Debtor
13   contends the court erred by dismissing his case based on only one
14   factor — that his proposed chapter 11 plan offered to pay
15   U.S. Bank $1.00.6
16         Courts have developed helpful lists of circumstantial factors
17   that might indicate bad faith.   The bankruptcy court does not need
18   to consider all of the factors, nor does it have to weigh them
19   equally.   A bankruptcy court may find one factor dispositive or
20   may find bad faith even if none of the factors are present.
21   Mahmood v. Khatib (In re Mahmood), CC–16–1210–TaFC, 
2017 WL 22
  1032569, at *4 (9th Cir. BAP Mar. 17, 2017).
23         In St. Paul Self Storage Ltd. Partnership v. Port Authority
24   of St. Paul (In re St. Paul Self Storage Ltd. Partnership),
25
           6
             Debtor contends that his $1.00 payment offer was
26   reasonable given that U.S. Bank failed to establish that it held
     the mortgage note or the amount owed. U.S. Bank's standing was
27   the subject of the order granting stay relief and a prior appeal,
     which has since been dismissed. Therefore, this issue is not
28   properly before us and we do not consider it.

                                      -11-
 1   
185 B.R. 580
, 582-83 (9th Cir. BAP 1995), we set forth a list of
 2   factors that might indicate whether a chapter 11 case has been
 3   filed in bad faith for purposes of dismissal under § 1112(b):
 4        1.   the debtor has only one asset;
 5        2.   the debtor has an ongoing business to reorganize;
 6        3.   there are any unsecured creditors;
 7        4.   the debtor has any cash flow or sources of income to
               sustain a plan of reorganization or to make adequate
 8             protection payments; and
 9        5.   the case is essentially a two-party dispute capable of
               prompt adjudication in state court.
10
11   We have also utilized a more expansive list of factors.    See,
12   e.g., In re Stolrow's, 
Inc., 84 B.R. at 171
(considering eight
13   factors, including the factor that debtor has only one asset and
14   that the secured creditor's lien encumbers that asset).
15        Although the bankruptcy court did not cite a list of factors
16   it considered in finding that Debtor's case had been filed in bad
17   faith, we disagree with Debtor's contention that the $1.00 plan
18   payment offer was the only factor the court considered and relied
19   upon for its bad faith finding.    However, it would not be
20   reversible error if that was all the court had considered.    See
21   In re Mahmood, CC–16–1210–TaFC, 
2017 WL 1032569
, at *4.    The court
22   also found bad faith because Debtor's proposed plan had only a
23   litigation objective, not one to reorganize, and the automatic
24   stay had already been terminated to allow the parties' lien
25   dispute to be resolved by the state court.
26        A petition in bankruptcy arising out of a two-party dispute
27   does not per se constitute a bad-faith filing by the debtor.      
Id. 28 But
courts find bad faith based on two-party disputes where "'it

                                       -12-
 1   is an apparent two-party dispute that can be resolved outside of
 2   the Bankruptcy Court's jurisdiction.'"   Sullivan v. Harnisch
 3   (In re Sullivan), 
522 B.R. 604
, 616 (9th Cir. BAP 2014)
 4   (quoting Oasis at Wild Horse Ranch, LLC v. Sholes (In re Oasis at
 5   Wild Horse Ranch, LLC), 
2011 WL 4502102
, at *10 (9th Cir. BAP
 6   Aug. 26, 2011) (citing N. Cent. Dev. Co. v. Landmark Capital Co.
 7   (In re Landmark Capital Co.), 
27 B.R. 273
, 279 (Bankr. D. Ariz.
 8   1983))).   See also, In re Silberkraus, 
253 B.R. 890
, 902-03
 9   (Bankr. C.D. Cal. 2000) (bad faith may be found under § 1112(b)
10   where the debtor has filed bankruptcy as a litigation tactic —
11   e.g., forum shopping).
12        We see no clear error with the bankruptcy court's finding of
13   bad faith based on Debtor's apparent improper litigation objective
14   with his chapter 11 filing and proposed $1.00 plan.   The record
15   clearly evidences Debtor's intent to forum shop by invoking the
16   automatic stay with the filing of his petition and attempting to
17   have the bankruptcy court, rather than the state court, determine
18   the extent and validity of U.S. Bank's lien.   Those issues are
19   purely state law issues easily resolved by the state court.     This
20   was Debtor's fourth successive bankruptcy filing in two years,
21   which, based on its timing, was likely filed to impede U.S. Bank's
22   settlement with the chapter 7 trustee and frustrate its efforts to
23   reform the deeds of trust.   It is apparent that Debtor's case had
24   no reorganizational purpose.
25        We reject Debtor's argument that the bankruptcy court erred
26   by citing to Chinichian v. Campolongo (In re Chinichian), 
784 F.2d 27
  1440, 1445-46 (9th Cir. 1986), for the proposition that a debtor's
28   plan is not filed in good faith if its purpose is to retain

                                     -13-
 1   property or not pay creditors in pursuit of a litigation
 2   objective.   Debtor argues that because Chinichian involved a
 3   chapter 13 case, not a chapter 11 case, it has no relevance.    We
 4   have observed that, because the provisions governing dismissal or
 5   conversion of chapter 13 and chapter 11 cases are similar, cases
 6   under one chapter often are helpful in resolving cases under the
 7   other chapter.   See Nelson v. Meyer (In re Nelson), 
343 B.R. 671
,
 8   674-75 (9th Cir. BAP 2006).   Thus, the court did not err by
 9   relying on Chinichian.
10        Other factors in the record further support the bankruptcy
11   court's finding of bad faith.   Debtor was current on his auto loan
12   payments and had no unsecured debt due to his prior chapter 7
13   discharge.   Debtor's proposed plan showed he had no interest in
14   reorganizing the debt owed to U.S. Bank; he sought only to
15   eliminate the bank's claim against the Property, which was the
16   only asset of the estate.   Ultimately, as the bankruptcy court
17   repeatedly told Debtor, his current case served no legitimate
18   bankruptcy purpose.
19        If a bankruptcy court determines that cause exists to convert
20   or dismiss, it must also (1) decide whether dismissal, conversion,
21   or the appointment of a trustee or examiner is in the best
22   interests of creditors and the estate and (2) identify whether
23   there are unusual circumstances establishing that dismissal or
24   conversion is not in the best interests of creditors and the
25   estate.   § 1112(b)(1), (b)(2); In re 
Sullivan, 522 B.R. at 612
.
26        The bankruptcy court determined that conversion served no
27   purpose as there were no creditors to pay.   We find no error in
28   that determination.   Debtor did not argue that any unusual

                                     -14-
 1   circumstances existed for the court to consider or raise that
 2   issue in his opening brief.   Thus, he has waived that argument.
 3   Smith v. Marsh, 
194 F.3d 1045
, 1052 (9th Cir. 1999) ("[A]n
 4   appellate court will not consider issues not properly raised
 5   before the [trial] court.   Furthermore, on appeal, arguments not
 6   raised by a party in his opening brief are deemed waived.").     In
 7   any event, none exist here.   There is nothing unusual about a
 8   debtor trying to get a free house.
 9        Finally, Debtor contends the bankruptcy court erred by
10   dismissing his case when his appeal of the stay relief order was
11   pending.   This argument is now moot due to the dismissal of that
12   appeal.    Nonetheless, there was nothing improper about the court's
13   decision to entertain a motion to dismiss while the appeal of the
14   stay relief order was pending.7
15                               VI. CONCLUSION
16        We conclude that the bankruptcy court did not abuse its
17   discretion in dismissing Debtor's chapter 11 case as a bad faith
18   filing under § 1112(b).   Accordingly, we AFFIRM.
19
20
21
22
23
24
          7
             In conjunction with Debtor's opening brief, he filed a
25   "declaration" which objects to the evidence U.S. Bank filed in
     support of its stay relief motion. We will not consider the
26   declaration for two reasons. First, it is essentially an
     impermissible second opening brief, consisting almost entirely of
27   argument and citations to authority. Second, the arguments
     pertain to issues involved in the dismissed appeal of the stay
28   relief order and thus are not relevant to the issue before us.

                                       -15-

Source:  CourtListener

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