FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

In the Matter of: MARC SCOTT 

CANEVA, No. 07-15686

Debtor,

D.C. No.

CV-06-01311-MHM

MARC SCOTT CANEVA,

 ORDER

Appellant, AMENDING

v. OPINION AND

AMENDED SUN COMMUNITIES OPERATING

OPINION LIMITED PARTNERSHIP,

Appellee. 

Appeal from the United States District Court

for the District of Arizona

Mary H. Murguia, District Judge, Presiding

Submitted October 24, 2008*

San Francisco, California

Filed November 5, 2008

Amended December 15, 2008

Before: Alfred T. Goodwin, Robert R. Beezer, and

Jay S. Bybee, Circuit Judges.

Per Curiam Opinion

*This panel unanimously finds this case suitable for decision without

oral argument. See Fed. R. App. P. 34(a)(2). 

16411
COUNSEL

Roberta J. Sunkin, Allan D. NewDelman, P.C., Phoenix, Arizona, for the defendant-appellant. 

Edwin B. Stanley, Simbro & Stanley, Scottsdale, Arizona, for

the plaintiff-appellee.

ORDER

The opinion filed November 5, 2008, appearing at slip op.

15129, is amended as follows: 

At slip op. 15132, line 2, change “plaintiff-appellant” to

“defendant-appellant.” 

At slip op. 15132, line 4, change “defendant-appellee” to

“plaintiff-appellee.” 

At slip op. 15133, first full paragraph, 3rd line, after

“§ 158(d).”, add footnote 1: 

16414 IN THE MATTER OF: CANEVA
Because the bankruptcy court specifically concluded

that its summary judgment grant effectively disposed

of all claims raised in Sun’s adversary complaint, we

determine that the appeal from the district court’s

affirmance thereof was from a final judgment for

jurisdictional purposes. Where there is any doubt

about finality, a bankruptcy or district court can

always avail itself of the direct appeal certification

procedures of 28 U.S.C. § 158(d)(2). 

OPINION

PER CURIAM: 

Marc Scott Caneva (Caneva) appeals the district court’s

order affirming the bankruptcy court’s grant of summary

judgment in favor of Sun Communities Operating Limited

Partnership (Sun). The bankruptcy judgment denied Caneva

discharge pursuant to 11 U.S.C. § 727(a)(3) because it was

undisputed that Caneva had failed to keep or preserve records

with respect to certain business entities that he owned or controlled and with respect to a payment of $500,000 to one

Anita Bowden. Caneva assigns error to both judgments,

asserting that “genuine issues of material fact” can be found

in the record. 

The district court had jurisdiction pursuant to 28 U.S.C.

§ 158(a). We have jurisdiction pursuant to 28 U.S.C. § 158(d).1

We affirm the challenged judgment. 

1Because the bankruptcy court specifically concluded that its summary

judgment grant effectively disposed of all claims raised in Sun’s adversary

complaint, we determine that the appeal from the district court’s affirmance thereof was from a final judgment for jurisdictional purposes.

Where there is any doubt about finality, a bankruptcy or district court can

always avail itself of the direct appeal certification procedures of 28

U.S.C. § 158(d)(2). 

IN THE MATTER OF: CANEVA 16415
FACTS AND PROCEDURAL HISTORY

Prior to filing his voluntary Chapter Seven Petition, Caneva

owned or controlled numerous business entities, recreational

vehicle and mobile home parks in Florida, and an airplane.

Sun, one of Caneva’s creditors, filed an adversary complaint

objecting to discharge pursuant to 11 U.S.C. § 727(a)(3) and

(a)(4)(A), and objecting to dischargeability pursuant to 11

U.S.C. § 523(a)(4). 

Sun argued that Caneva was not entitled to discharge under

11 U.S.C. § 727(a)(3) because he had failed to keep or preserve records from which his financial condition or business

transactions could be accurately ascertained. Throughout the

course of the bankruptcy proceedings, Caneva had filed multiple amendments to his bankruptcy Schedules and Statement

of Financial Affairs. In his final amendment to Schedule B,

listing his personal property, Caneva listed fifteen business

entities in which he held stock or interests and stated that

“[t]he extent of his interest and the status of several of the

entities is unknown. The debtor has made his best effort to list

all he knows and if additional information becomes available,

additional amendments will be made.” 

Sun questioned Caneva about the nature of his interests in

these companies and the existence of financial records for

them during a Bankruptcy Rule 2004 Examination. Caneva

admitted that he kept no records for the entities, despite the

fact that some of them had business operations and others

existed as holding companies for active businesses. Caneva

also admitted during the Rule 2004 Examination that he had

no documentation regarding the payment of $500,000 to

Bowden as a brokerage fee for a $20 million loan that Caneva

stated he did not receive, although he indicated that Sun could

contact the Federal Bureau of Investigation for details on

Bowden’s criminal prosecution and conviction. 

Sun moved for summary judgment. It argued that Caneva

violated 11 U.S.C. § 727(a)(3) by failing to keep or preserve

16416 IN THE MATTER OF: CANEVA
records, 11 U.S.C. § 727(a)(4)(A) by failing to satisfactorily

explain the loss or diminution of assets, and 11 U.S.C.

§ 523(a)(4) by committing fraud or defalcation while acting in

a fiduciary capacity. The bankruptcy court granted summary

judgment on the § 727(a)(3) claim and denied Caneva discharge. Neither the bankruptcy court nor the district court

reached the § 727(a)(4)(A) diminution of assets or § 523(a)(4)

fraud questions. 

The bankruptcy court applied the analysis described in

Lansdowne v. Cox (In re Cox), 41 F.3d 1294 (9th Cir. 1994),

and found that Sun had shown a prima facie case that Caneva

failed to keep or preserve adequate records and that such failure made it impossible for Sun to accurately determine his

financial condition and the nature and extent of material business transactions. The court stated that “[t]his case presents a

situation factually different than most cases where the question is whether the information produced was adequate”

because Caneva admitted to “not providing any documentation on several business entities and transactions” despite

admitting “that some had operations or held assets as holding

companies.” The court found this to be fatal, reasoning that

“[b]y definition . . . the failure to have any documents or

records is inadequate” because “the absence of any documents

for these entities makes it impossible to determine their value,

their significance and their impact on [Caneva’s] estate.” 

After finding that Sun had shown a prima facie case, the

bankruptcy court found that Caneva failed to carry his burden

of explaining why his failure to keep or preserve records was

justified under the circumstances. The court faulted Caneva

for “simply parrot[ing] back in his affidavit the text of Section

727(a)(3), conclusorily denying its elements,” rather than providing affidavits or testimony from the accountants who set

up the companies that might have supported his assertion that

nothing related to these entities existed because there was

nothing to document. 

IN THE MATTER OF: CANEVA 16417
Caneva filed a motion to reconsider, which the bankruptcy

court denied, and then appealed to the district court. The district court affirmed the orders granting summary judgment

and denying Caneva’s motion to reconsider. It focused on

Caneva’s admissions during the Rule 2004 Examination that

“he had no books or records for several of his business entities despite that some of the entities had business operations”

and “that he had no documents to substantiate an alleged

$500,000 transfer to Anita Bowden . . . .” This appeal followed.

STANDARD OF REVIEW

“The roles of this Court and the district court are essentially

the same in the bankruptcy appellate process.” Parker v.

Community First Bank (In re Bakersfield Westar Ambulance,

Inc.), 123 F.3d 1243, 1245 (9th Cir. 1997) (citing In re DAK

Indus., 66 F.3d 1091, 1094 (9th Cir. 1995)). Thus, we directly

review the bankruptcy court’s decision. Id. “We review the

bankruptcy court’s grant of summary judgment de novo,” and

must view the evidence in the light most favorable to the nonmoving party and “determine whether there are any genuine

issues of material fact and whether the bankruptcy court correctly applied the substantive law.” Id. (citing Bagdadi v.

Nazar, 84 F.3d 1194, 1197 (9th Cir. 1996)). A material fact

is one that, “under the governing substantive law . . . could

affect the outcome of the case.” Thrifty Oil Co. v. Bank of

America Nat’l Trust & Savings Ass’n, 322 F.3d 1039, 1046

(9th Cir. 2003) (citing Anderson v. Liberty Lobby, Inc., 477

U.S. 242, 248 (1986)). A genuine issue of material fact exists

when “the evidence is such that a reasonable jury could return

a verdict for the nonmoving party.” Anderson, 477 U.S. at

248. The party moving for summary judgment must initially

identify “those portions of ‘the pleadings, depositions,

answers to interrogatories, and admissions on file, together

with the affidavits, if any,’ which it believes demonstrate the

absence of a genuine issue of material fact.” Celotex Corp. v.

Catrett, 477 U.S. 317, 323 (1986). Once the moving party

16418 IN THE MATTER OF: CANEVA
meets its burden, the non-moving party must “set out specific

facts showing a genuine issue for trial.” Fed R. Civ. P.

56(e)(2). 

DISCUSSION

I. Failure to Keep or Preserve Records 

[1] Section 727(a) of the Bankruptcy Code provides that a

debtor is entitled to discharge unless one of eight conditions

is met. 11 U.S.C. § 727(a)(1)-(8). Under 11 U.S.C.

§ 727(a)(3), the court shall grant the debtor discharge unless:

the debtor has concealed, destroyed, mutilated, falsified, or failed to keep or preserve any recorded information, including books, documents, records, and

papers, from which the debtor’s financial condition

or business transactions might be ascertained, unless

such act or failure to act was justified under all the

circumstances of the case. 

[2] We have stated that the purpose of § 727(a)(3) is to

make discharge dependent on the debtor’s true presentation of

his financial affairs. Cox, 41 F.3d at 1296 (citation omitted).

The disclosure requirement removes the risk to creditors of

“the withholding or concealment of assets by the bankrupt

under cover of a chaotic or incomplete set of books or

records.” Burchett v. Myers, 202 F.2d 920, 926 (9th Cir.

1953). The statute does not require absolute completeness in

making or keeping records. Rhoades v. Wikle, 453 F.2d 51, 53

(9th Cir. 1971). Rather, the debtor must “present sufficient

written evidence which will enable his creditors reasonably to

ascertain his present financial condition and to follow his

business transactions for a reasonable period in the past.” Id.

This exception to dischargeability, however, “should be

strictly construed in order to serve the Bankruptcy Act’s purpose of giving debtors a fresh start.” Industrie Aeronautiche

IN THE MATTER OF: CANEVA 16419
v. Kasler (Matter of Kasler), 611 F.2d 308, 310 (9th Cir.

1979) (citation omitted). 

A creditor states a prima facie case under § 727(a)(3) by

showing “ ‘(1) that the debtor failed to maintain and preserve

adequate records, and (2) that such failure makes it impossible

to ascertain the debtor’s financial condition and material business transactions.’ ” Cox, 41 F.3d at 1296 (quoting Meridian

Bank v. Alten, 958 F.2d 1226, 1232 (3d Cir. 1992)). After

showing inadequate or nonexistent records, “the burden of

proof then shifts to the debtor to justify the inadequacy or

nonexistence of the records.” Id. (citations omitted). 

Caneva argues that because he turned over a substantial

quantity of documents to both the bankruptcy trustee and Sun,

a genuine issue of material fact necessarily exists as to

whether these documents were adequate to determine his

financial condition and business transactions notwithstanding

his admission that he has no records for some of his business

entities. Caneva further contends that because Sun could have

obtained information about Bowden from the public record

generated by her criminal prosecution, the district court erred

in finding that his admission that he had no records related to

the payment of $500,000 to Bowden established a violation of

§ 727(a)(3). 

[3] We disagree. The Seventh Circuit has held that

§ 727(a)(3) “places an affirmative duty on the debtor to create

books and records accurately documenting his business

affairs.” Peterson v. Scott (In re Scott), 172 F.3d 959, 969 (7th

Cir. 1999) (citing In re Juzwiak, 89 F.3d 424, 429 (7th Cir.

1996)). The court also noted that when a debtor is sophisticated and carries on a business involving substantial assets,

“creditors have an expectation of greater and better record

keeping.” Id. at 970 (citing Juzwiak, 89 F.3d at 428). Prior to

filing for bankruptcy, Caneva owned or controlled numerous

business entities, owned an aircraft, and had substantial

assets. He argues that because many of his business entities

16420 IN THE MATTER OF: CANEVA
were holding companies or did not conduct business operations, records for them may not exist. Caneva has asked Sun,

the bankruptcy and district courts, and now this court to disregard the affirmative duty that § 727(a)(3) imposes on a debtor

to keep and preserve records, take him at his word that he has

no records because there was nothing to record, and focus

instead on what might be learned from the boxes of records

he did keep and eventually offered to the bankruptcy court. In

other words, he says that if there is a needle in this haystack,

it is up to the court to find it. 

[4] Caneva’s continued focus throughout these proceedings

on the quantity of the records that he produced misses the crucial point that the total absence of records related to his business entities and to his alleged $500,000 payment to Bowden

necessarily makes it impossible for Sun to accurately determine his financial condition and business transactions. 

[5] As the Third Circuit has stated “ ‘[c]omplete disclosure

is in every case a condition precedent to the granting of the

discharge, and if such a disclosure is not possible without the

keeping of books or records, then the absence of such

amounts to that failure to which the act applies.’ ” Meridian

Bank, 958 F.2d at 1230 (quoting In re Underhill, 82 F.2d 258,

259-60 (2d Cir. 1936)). Without the records that Caneva

admitted he did not keep, Sun cannot determine what assets

his business entities held or may still hold, what assets passed

through them and where they might have gone, and what their

present value is, if anything. Without any documentation

related to the payment to Bowden, Sun cannot determine the

details of that transaction or verify that it actually took place.

[6] Caneva’s testimony given during the Bankruptcy Rule

2004 Examination unequivocally establishes that he failed to

keep or preserve any recorded information related to certain

of his business entities and to the $500,000 payment to Bowden. Although § 727(a)(3) does not demand absolute completeness in a debtor’s records, it does require a debtor to keep

IN THE MATTER OF: CANEVA 16421
and preserve records that will enable his creditors to accurately ascertain his financial condition and business transactions. See Rhoades, 453 F.2d at 53. Thus, we hold that when

a debtor owns and controls numerous business entities and

engages in substantial financial transactions, the complete

absence of recorded information related to those entities and

transactions establishes a prima facie violation of 11 U.S.C.

§ 727(a)(3). Likewise, we hold that when a debtor transfers a

substantial amount of money to a third party, the failure to

keep any documentation evidencing the terms of the transfer

or the fact that the payment actually took place establishes a

prima facie violation of 11 U.S.C. § 727(a)(3). 

II. The Debtor’s Burden to Justify the Failure to Keep

or Preserve Records 

[7] If a creditor establishes a prima facie violation of

§ 727(a)(3), a debtor may show that he is nonetheless entitled

to discharge by establishing that his failure to keep or preserve records was justified under the circumstances of his

case. See 11 U.S.C. § 727(a)(3); Cox, 41 F.3d at 1296-97.

Thus, after Sun put forth evidence that established that no

question of material fact existed as to Caneva’s failure to keep

or preserve records, Caneva could have avoided summary

judgment by presenting evidence sufficient to show that a

question of material fact did exist as to whether such failure

was justified under the circumstances of his case. Aside from

a conclusory statement tracking the language of § 727(a)(3) in

his affidavit in opposing summary judgment, however,

Caneva made no effort to present evidence tending to show

that the business entities for which he admitted no records

existed were of the type that would not generate records.

Likewise, he has not presented any evidence that might justify

his failure to keep records regarding the $500,000 payment to

Bowden. 

In Cox, we stated that “ ‘[j]ustification for [a] bankrupt’s

failure to keep or preserve books or records will depend on

16422 IN THE MATTER OF: CANEVA
. . . whether others in like circumstances would ordinarily

keep them.’ ” 41 F.3d at 1299 (quoting Matter of Russo, 3

B.R. 28, 34 (Bankr. E.D.N.Y. 1980)). The Third Circuit has

stated that the fact that a debtor was honest in producing all

the records he had was not sufficient to satisfy the requirements of § 727(a)(3); rather, it is a condition to obtaining a

discharge in bankruptcy “ ‘either that the bankrupt shall produce such records as are customarily kept by a person doing

the same kind of business, or that he shall satisfy the bankruptcy court with adequate reasons why he was not in duty

bound to keep them.’ ” Meridian Bank, 958 F.2d at 1232

(quoting White v. Schoenfeld, 117 F.2d 131, 132 (2d Cir.

1941)). Rather than attempting to provide justification, however, Caneva has continuously asserted that the fact that he

produced some records creates a question of material fact as

to whether those records were adequate. In briefing to this

court, Caneva asserted that because he did not believe that

Sun had met its initial burden of establishing that the records

he did keep were not adequate, he did not have to show that

a question of material fact existed as to whether his failure to

keep records with respect to certain of his business entities

and the payment to Bowden was justified under the circumstances of his case. Thus, the only explanation that Caneva

has submitted that purports to justify his failure to keep or

preserve such records is the statement in his affidavit that the

circumstances of his business dealings justified the absence of

any records he did not possess. He did not disclose the socalled circumstances of his business entities. 

[8] Although it may appear to be unsympathetic to a debtor

to expect him or her to explain by books and records that a

corporation or other entity conducted no business, our cases

establish that a conclusory statement in an affidavit that an

absence of records is justified is not enough to avoid summary

judgment. See FTC v. Publ’g Clearing House, Inc., 104 F.3d

1168, 1171 (9th Cir. 1997) (“A conclusory, self-serving affidavit, lacking detailed facts and any supporting evidence, is

insufficient to create a genuine issue of material fact.”) (citing

IN THE MATTER OF: CANEVA 16423
Hansen v. United States, 7 F.3d 137, 138 (9th Cir. 1993);

United States v. One Parcel of Real Property, 904 F.2d 487,

492 n.3 (9th Cir. 1990)). Caneva’s failure to provide an explanation for the lack of records regarding the $500,000 payment

to Bowden is even more egregious. The transfer of a half million dollars is the kind of transaction for which most business

entities would preserve some record. Caneva has not offered

any hypothesis, much less pointed out a genuine issue of

material fact, the answer to which would justify his failure to

keep a record of the transaction.

CONCLUSION

In support of its motion for summary judgment, Sun submitted uncontested testimony from Caneva that he did not

have records with respect to certain of his business entities

and to a $500,000 payment to a third party. Sun carried its

burden under 11 U.S.C. § 727(a)(3) by establishing a prima

facie case (1) that Caneva had failed to keep or preserve

records and (2) that such failure made it impossible to ascertain his financial condition and material business transactions.

The prima facie case shifted to Caneva the burden to avoid

summary judgment by showing that a genuine issue of material fact existed with respect to whether his failure was justified under the circumstances of his case. Instead of attempting

to shoulder this burden, Caneva focused almost exclusively

on his assertion that he had produced boxes of unidentified

documents which by themselves created a question of material fact as to whether those documents were adequate. 

This is not enough. The terms of 11 U.S.C. § 727(a)(3) do

not condition a debtor’s discharge on the presentation of the

documents that he did keep and preserve. Rather, the statute

imposes an affirmative duty on the debtor to keep and preserve recorded information that will allow his creditors to

ascertain his financial condition and business transactions. A

debtor who has admitted to owning businesses for which he

kept no recorded information and to transferring a substantial

16424 IN THE MATTER OF: CANEVA
sum of money without retaining any documentation has not

kept or preserved information within the meaning of the statute, and must provide a justification for this failure that goes

beyond a conclusory statement in an affidavit that he is entitled to discharge. 

The district court’s order affirming the bankruptcy court’s

grant of summary judgment is AFFIRMED. 

IN THE MATTER OF: CANEVA 16425