Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-04889/USCOURTS-cand-3_06-cv-04889-3/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 11:101 Bankruptcy

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United States District Court

For the Northern District of California

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 The factual and procedural background of this case is set forth in the Court’s June 28, 2007

order.

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

In re

MACADAM COMPUTER, INC.,

Debtor

TOM SANTOS,

Appellant,

 v.

JANINA M. ELDER, Trustee,

Appellee. /

No. C 06-4889 SI

ORDER DENYING MOTION FOR

ATTORNEYS’ FEES AND COSTS

Appellee’s motion for attorneys’ fees is scheduled for a hearing on October 19, 2007. Pursuant

to Civil Local Rule 7-1(b), the Court determines that the matter is appropriate for resolution without oral

argument, and VACATES the hearing. For the reasons set forth below, the Court DENIES appellant’s

motion. 

DISCUSSION

By order filed June 28, 2007, the Court affirmed the Bankruptcy Court’s decision approving a

compromise agreement in this bankruptcy case.1

 Appellee, Trustee Janina M. Elder, now seeks

Case 3:06-cv-04889-SI Document 33 Filed 10/17/07 Page 1 of 3
United States District Court

For the Northern District of California

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attorneys’ fees and costs pursuant to Rule 8020 of the Federal Rules of Bankruptcy Procedure. Rule

8020 provides that “[i]f a district court . . . determines that an appeal from an order, judgment, or decree

of a bankruptcy judge is frivolous, it may, . . . award just damages and single or double costs to the

appellee.” Fed. R. Bankr. Proc. 8020. Appellee contends that the instant appeal was frivolous because

appellant misrepresented certain facts regarding settlement negotiations related to the underlying case,

failed to timely perfect the appeal, and “failed to cite applicable authority and relevant portions of the

record” in appellant’s opening brief on the merits of the appeal. 

After review of the record in this case and appellant’s contentions on appeal, the Court concludes

that this appeal was not frivolous. Appellant argued that the Bankruptcy Court should not have

approved the proposed settlement of state court claims between the Trustee and Apple Computer, Inc.

While this Court ultimately agreed with appellee that the Bankruptcy Court did not abuse its discretion

in approving the settlement, the Court also notes that the proceedings before the Bankruptcy Court were

somewhat protracted and complicated. The Bankruptcy Court held two hearings on the proposed

settlement, initially denied the motion for approval without prejudice, and appointed special counsel to

evaluate the state court action and provide an opinion on the merits of the Trustee’s case and the likely

range of recovery in the state action. On this record, the Court cannot conclude that appellant’s

contentions – while ultimately lacking merit – were frivolous.

Nor does the Court agree with appellee that this appeal was frivolous because appellant failed

to timely perfect the appeal. As appellant notes, appellant’s attorney filed a declaration explaining that

he failed to comply with certain deadlines because he was having medical problems, and counsel

eventually cured the defects. In addition, although the Court found that the record did not support

certain of appellant’s factual assertions about the parties’ underlying settlement negotiations, those

arguments do not render the entire appeal frivolous. Finally, the fact that appellant did not cite

particular cases or portions of the record does not mean that appellant’s challenge to the Bankruptcy

Court’s order was frivolous.

CONCLUSION

For the foregoing reasons, the Court DENIES appellant’s motion for attorneys’ fees and costs.

Case 3:06-cv-04889-SI Document 33 Filed 10/17/07 Page 2 of 3
United States District Court

For the Northern District of California

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(Docket No. 20).

IT IS SO ORDERED.

Dated: October 17, 2007 

SUSAN ILLSTON

United States District Judge

Case 3:06-cv-04889-SI Document 33 Filed 10/17/07 Page 3 of 3