Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_04-cv-00376/USCOURTS-caed-2_04-cv-00376-2/pdf.json

Nature of Suit Code: 210
Nature of Suit: Land Condemnation
Cause of Action: 28:1983 Civil Rights

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

ROSIE L. HALL,

Plaintiff,

v.

U.S. BANKRUPTCY COURT, U.S.

BANKRUPTCY APPELLATE PANEL,

JUDGE RUSSELL DAVIS, U.S.

TRUSTEE, JUDITH HOTZE, HELGA

A. WHITE, and ROBERT WEGNER,

Defendants.

CIV. S-04-0376 LKK PAN PS

FINDINGS AND RECOMMENDATIONS

—NFN—

0

On April 19, 2005, this court recommended dismissal of

all federal defendants but denial of defendant Robert Wenger’s

motion to dismiss on statute of limitation grounds. The court

recommended Wenger be accorded 20 days to renew his motion on

other grounds. On April 26, Wenger filed a new motion to dismiss

pursuant to Fed. R. Civ. P. 12(b)(6), on the ground plaintiff has

failed to state a claim upon which relief can be granted. As

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oral argument is unnecessary to resolve this matter, the hearing

scheduled before this court on May 25, 2005, is vacated and the

court issues these findings and recommendations. 

In a separate order, this court dismisses the only other

remaining defendant--Helga A. White, Wenger’s attorney--for

insufficiency of service of process.

Plaintiff has filed neither an opposition nor statement

of non-opposition to Wenger’s motion, as required by E. D. Cal.

L. R. 78-230(c) (opposition shall be filed with the Clerk of

Court and served on the opposing party not less than 14 days

preceding the hearing date). Plaintiff’s failure to oppose the 

motion is properly construed as acquiescence thereto. E. D. Cal.

L. R. 78-230(c), 11-110, and 83-183. Dismissal is also warranted

on the merits.

Plaintiff’s complaint, filed February 23, 2004, alleges 

Wenger (sued as Robert Wegner) was appointed trustee of the

assets of plaintiff’s estate after she filed a bankruptcy

petition on October 13, 1993. Plaintiff contends Wenger made

errors and omissions resulting in significant financial loss to

plaintiff, including but not limited to: auctioning the tools

and inventory of plaintiff’s business; closing plaintiff’s

business for six months despite continuing obligations to pay

rent and utilities; failing to collect rents; obtaining improper

insurance coverage and letting other insurance policies lapse;

improperly permitting foreclosures; selling property below market

value; and incomplete record keeping.

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1 The court’s review of the bankruptcy docket demonstrates, for

example: plaintiff’s representation by counsel Mark J. Hannon commencing

November 1993 (Docket Entries 6 and 7); plaintiff’s substitution of John I.

Meeker in June 1994 (Docket Entries 124, 136-140), terminated November 1995

(Docket Entry 348), whereupon plaintiff commenced representing herself;

January 11, 1994, order appointing Robert Wenger as Trustee (Docket Entry 20);

Wenger’s approved application to employ law firm of Downey, Brand, Seymour &

Rohwe (Docket Entries 25-27); Wenger’s approved application to substitute

attorney Helga A. White (Docket Entries 47, 48, 159); Wenger’s approved

motion to sell property (Highlander #210) (Docket Entries 30-36, 50, 63);

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“Bankruptcy trustees are entitled to broad immunity from

suit when acting within the scope of their authority and pursuant

to court order. However, a trustee may be liable for intentional

or negligent violations of duties imposed upon him by law. A

trustee has a duty to preserve the assets of an estate and must

exercise that measure of care and diligence that an ordinarily

prudent person would exercise under similar circumstances. Out

of this apparent conflict, certain standards have evolved which a

trustee must satisfy before immunity may attach. The trustee

should obtain court approval and give notice to the debtor of a

proposed action. The trustee’s disclosure to the court must be

candid. The act must be within the trustee’s official duties.” 

Bennett v. Williams, 892 F.2d 822, 823 (9th Cir. 1989) (citations

and internal quotations omitted).

Wenger asserts all of his challenged actions were made

“pursuant to a noticed motion, giving Rosie Hall and her

attorneys plenty of notice, and all of the Trustee’s motions were

approved by the Bankruptcy Court.” Motion to Dismiss, at p. 1. 

Wenger has submitted the docket of plaintiff’s bankruptcy case,

No. 93-28625-A-11. This court has carefully review the docket1

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Wenger’s approved motion for examination of plaintiff and Max Bagheri (Docket

Entries 37-42, 71); Wenger’s approved motion to Limit Notices of Prospective

Motions to Creditors with Claims Exceeding $2000 and to Creditors Requesting

Special Notice HAW-3 (Docket Entries 43-46, 49, 70); Wenger’s approved motion

for release of money to reclaim jewelry (Docket Entries 53-54); Wenger’s

approved application to employ Lyon and Associates Realtors to sell property

(Old Auburn Road) (Docket Entries 72-75, 76); Wenger’s approved application to

employ Tri County Real Estate to sell property (Olivine Avenue) (Docket

Entries 77, 81); Wenger’s approved motion to abandon property (Olivine Avenue)

(Docket Entries 146-151, 160); Wenger’s approved application to employ

realtors ERA Concepts Unlimited (Docket Entries 87–90); Wenger’s approved

motion to sell equipment, fixtures and inventory (Docket Entries 128-132);

Wenger’s approved application to employ Sandra Stockman-Fortier (Docket

Entries 187, 180); Wenger’s approved application to employ Master Realtors

(Docket Entries 243, 237); Wenger’s approved motion approving stipulation for

sale of property (Docket Entries 267, 288); Wenger’s approved application to

employ accountant (Docket Entries 271, 290); Wenger’s approved motion to sell

bankruptcy assets (Docket Entries 306, 326); Wenger’s approved motion to sell

estate asserts (Docket Entries 335, 354); Court Order Confirming Chapter 11

Plan and notice of intent to enter final decree (Docket Entries 359, 435);

Wenger’s approved motions for compensation (Docket Entries 198-199, 226, 245,

309, 329, 376, 409); White’s approved applications for compensation (Docket

Entries 188, 153, 232, 246, 387, 405, 443, 484, 485); Final Decree (Docket

Entry 634, following resolution of objections and appeals by plaintiff

herein).

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and finds Wenger’s actions routine, including appropriate notice

to plaintiff and court approval of his actions. Since plaintiff

has not responded to his motion and did not assert in her

complaint that Wenger’s actions were without full disclosure,

outside the scope of his authority as trustee or without court

approval, the court finds no basis for concluding otherwise. 

I find, therefore that Wenger “act[ed] within the scope

of [his] authority, with the informed approval of the court and

notice to the debtor [and] is [therefore] entitled to derived

quasi-judicial immunity for [any] discretionary acts.” Bennett

v. Williams, 892 F.2d at 825. Accordingly, I recommend Wenger’s

motion to dismiss be granted.

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These findings and recommendations are submitted to the

Honorable Lawrence K. Karlton, the United States District Judge

assigned to this case. 28 U.S.C. § 636(b)(l). Written

objections may be filed within ten days after being served with

these findings and recommendations. The document should be

captioned “Objections to Magistrate Judge’s Findings and

Recommendations.” The failure to file objections within the

specified time may waive the right to appeal the District Court’s

order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

Dated: May 25, 2005.

 /s/ Peter A. Nowinski 

 PETER A. NOWINSKI

 Magistrate Judge

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