FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

IN RE POINT CENTER FINANCIAL,

INC.,

Debtor,

DAN J. HARKEY; ROBIN B. GRAHAM;

CELIA ALLEN-GRAHAM; RICHARD 

SCHACHTER, as Trustees of the 

Robin B. Graham and Celia AllenGraham Revocable Trust,

Appellants,

v.

HOWARD B. GROBSTEIN, Chapter 7 

Trustee,

Appellee.

No. 18-56398

D.C. No.

8:16-cv-01336-

DSF

OPINION

Appeal from the United States District Court

for the Central District of California

Dale S. Fischer, District Judge, Presiding

Argued and Submitted February 4, 2020

Pasadena, California

Filed April 29, 2020
2 IN RE POINT CENTER FINANCIAL

Before: Sandra S. Ikuta and Morgan Christen, Circuit 

Judges, and Algenon L. Marbley,* District Judge.

Opinion by Judge Marbley;

Partial Concurrence and Partial Dissent by Judge Christen

SUMMARY**

Bankruptcy

The panel affirmed the district court’s order affirming 

the bankruptcy court’s judgment authorizing a Chapter 7 

trustee to exercise management rights over and to assume the 

operating agreement with a limited liability company created 

to hold title to foreclosed property securing investments by 

private investors in the debtor.

The panel held that appellants, the former principal of 

the debtor and members of the limited liability company, 

Dillon Avenue 44, LLC, had standing to appeal because they 

were pecuniarily affected by the bankruptcy court’s order.

The panel held that the bankruptcy court had subject 

matter jurisdiction to confirm Dillon members’ vote 

establishing the Chapter 7 trustee as manager of Dillon and 

to hear the trustee’s assumption motion. The panel held that 

the trustee’s failure to assume the operating agreement by 

* The Honorable Algenon L. Marbley, United States Chief District 

Judge for the Southern District of Ohio, sitting by designation.

** This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
IN RE POINT CENTER FINANCIAL 3

the bankruptcy court’s deadline did not deprive the court of 

jurisdiction over matters relating to the Dillon operating 

agreement, which was part of the bankruptcy estate. Further, 

under 11 U.S.C. § 1334(b), the bankruptcy court had 

“arising under” and “related to” jurisdiction to rule on the 

trustee’s assumption motion.

The panel held that the bankruptcy court properly 

authorized the trustee to exercise management rights over 

Dillon after the majority of Dillon’s members voted for the 

trustee to manage Dillon. The bankruptcy court had 

jurisdiction and was within its authority to confirm the 

trustee’s election as manager of Dillon.

The panel held, in Section III(d) of its opinion, that the 

bankruptcy court properly extended its own deadline for 

assumption of the operating agreement pursuant to Fed. R. 

Bankr. P. 9006(b)(1)(2) and did not run afoul of 11 U.S.C. 

§ 365(d)(1), which establishes a statutory 60-day deadline 

for assuming or rejecting executory contracts. The panel 

reasoned that § 365(d)(1) permits the bankruptcy court to 

grant a trustee additional time for cause within that 60-day 

period, and the bankruptcy court did so. Thus, when the 

bankruptcy court extended the deadline again, it was 

extending a period specified by court order, not extending a 

deadline mandated by statute.

The panel declined to reach the question of equitable 

mootness.

Judge Christen concurred in part and dissented in part. 

She concurred in the result reached by the majority and 

agreed with the majority’s conclusion that appellants had 

standing to pursue this appeal, and that the bankruptcy court 

had jurisdiction pursuant to § 1334(b). Judge Christen 
4 IN RE POINT CENTER FINANCIAL

disagreed with the majority’s decision that the bankruptcy 

court permissibly reopened the statutory period for the 

trustee to accept Dillon’s operating agreement, and she did 

not join Section III(d) of the majority’s opinion. She wrote 

that she would affirm the district court’s alternative holding 

that the appeal of the bankruptcy court’s order was equitably 

moot.

COUNSEL

Sean A. O’Keefe (argued), O’Keefe & Associates Law 

Corporation P.C., Newport Beach, California, for 

Appellants.

Roger M. Landau (argued) and Roye Zur, Landau Law LLP,

Los Angeles, California, for Appellee.

OPINION

MARBLEY, District Judge:

On October 9, 2018, the district court entered an order 

affirming the June 29, 2016 judgment of the bankruptcy 

court that granted a motion by Howard Grobstein, the 

Chapter 7 Trustee and Appellee, authorizing the Trustee to 

exercise management rights over Dillon Avenue 44, LLC 

(“Dillon”), and authorizing the Trustee’s assumption of the 

operating agreement with Dillon. Dillon is a limited liability 

company created to hold title to foreclosed property securing 

investments by private investors in Point Center Financial. 

Appellants are the former principal of Point Center 

Financial, the debtor, and members of Dillon.
IN RE POINT CENTER FINANCIAL 5

Appellants argue that the bankruptcy court lacked 

jurisdiction to extend the deadline for accepting or rejecting 

the operating agreement and to issue an order approving the 

election of the Trustee as manager of Dillon. Appellants base 

their argument on the premise that the expiration of the 

deadline two years earlier constituted a statutory rejection of 

the agreement, and rendered the agreement no longer 

property of the estate. In addition to their jurisdictional 

arguments, Appellants argue that the bankruptcy court did 

not have authority to modify its own final order under Fed. 

R. Bankr. P. 9006(b).

Appellee argues Appellants do not have standing to bring 

this appeal because they are not pecuniarily harmed by the 

bankruptcy court’s order. Appellee further argues that the 

appeal is equitably moot because the Trustee has 

substantially completed the wind-down of Dillon.

The district court rejected Appellants’ jurisdictional and 

statutory arguments and affirmed the bankruptcy court’s 

order. This appeal followed. We AFFIRM.

I. BACKGROUND

A. Relevant Facts

Debtor Point Center Financial, Inc. (PCF) was in the 

business of originating and servicing loans by private 

investors. PCF would obtain funding from private investors 

secured by real property. Investors received either 

fractionalized interest in the deeds of trust securing their 

investments or investment in a blind mortgage pool in return 

for funding. When loans began to default following the 

recession in 2008, PCF foreclosed on the property securing 

the loans and would create a limited liability company 

(“LLC”) to hold title to the property. Investors’ interests 
6 IN RE POINT CENTER FINANCIAL

were commonly converted to membership interests in the 

LLC. Dillon Avenue 44, LLC (“Dillon”) was one such LLC 

that held title to undeveloped property in Indio, California. 

Appellants are PCF’s former principal and some of Dillon’s 

members.

B. History

On February 19, 2013, PCF filed a petition under 

Chapter 11 of the United States Bankruptcy Code in the 

United States Bankruptcy Court for the Central District of 

California.

On August 13, 2013, the bankruptcy court entered an 

order appointing Howard Grobstein as PCF’s Chapter 11 

Trustee. The case was converted to a Chapter 7 Bankruptcy, 

and Grobstein became the Chapter 7 Trustee.

On December 24, 2013, the Trustee moved for the 

bankruptcy court to extend the deadline set forth in 

11 U.S.C. § 365 for him to assume or reject executory 

contracts. On January 30, 2014, the bankruptcy court granted 

the Trustee’s motion and set February 28, 2014 as the 

deadline for the assumption or rejection of most executory 

contracts, including the operating agreement with Dillon. 

The Trustee did not assume the operating agreement by the 

deadline because Dan Harkey, PCF’s former principal, had 

falsely represented that no sale of real estate owned by 

Dillon was imminent. On May 31, 2016, the Trustee filed a 

motion seeking an order authorizing the Trustee to exercise 

management rights over Dillon based on his election as 

manager by Dillon’s members, and alternatively for an order 

permitting him to assume Dillon’s operating agreement. The 

Trustee argued that his failure to assume the operating 

agreement by the February 28, 2014 deadline was the result 

of “excusable neglect” under Fed. R. Bankr. P. 9006(b) 
IN RE POINT CENTER FINANCIAL 7

given Harkey’s dishonest “representations that there was no 

sale of Dillon’s real property on the horizon, and therefore 

no reasonable likelihood that the estate could recover . . .

millions of dollars.” A hearing was set on the assumption 

motion for June 21, 2016, and Appellants failed to appear, 

claiming they failed to understand the threat to their rights 

under the motion. They filed an emergency motion for 

reconsideration on June 28, 2016, contending the bankruptcy 

court lacked jurisdiction. The district court denied this 

motion, concluding that Appellants filed no written 

opposition to the assumption motion, offered no newly 

discovered evidence, and demonstrated no other highly 

unusual circumstances that would warrant reconsideration.

On June 29, 2016, the bankruptcy court issued an order 

granting the Chapter 7 Trustee’s motion authorizing the 

Trustee to exercise management rights over Dillon and 

authorizing the Trustee’s assumption of the operating 

agreement (“Assumption Order”). The Trustee sold the real 

property belonging to Dillon and distributed the proceeds to 

creditors, PCF, and Dillon members under a plan approved 

by the bankruptcy court.

On October 9, 2018, the Central District of California 

affirmed the bankruptcy court’s Assumption Order, holding 

the bankruptcy court had jurisdiction to hear the assumption 

motion and approve the Dillon membership vote, and 

properly extended its own deadline pursuant to Fed. R. 

Bankr. P. 9006(b). Appellants filed a notice of appeal to this 

Circuit on October 19, 2018.

II. JURISDICTION AND STANDARD OF REVIEW

This Court has jurisdiction to hear appeals from the 

district court pursuant to 28 U.S.C. § 1291. This Court 

generally “review[s] de novo a district court's decision on 
8 IN RE POINT CENTER FINANCIAL

appeal from a bankruptcy court,” and “review[s] a 

bankruptcy court decision independently and without 

deference to the district court's decision.” In re JTS Corp., 

617 F.3d 1102, 1109 (9th Cir. 2010). Findings of fact of the 

bankruptcy court are reviewed for clear error, and 

conclusions of law are reviewed de novo. Id. (citing In re 

Strand, 375 F.3d 854, 857 (9th Cir. 2004)). Mixed questions 

of law and fact are reviewed de novo. Id. (citing In re Chang, 

163 F.3d 1138, 1140 (9th Cir. 1998).

The question of a bankruptcy court’s jurisdiction is a 

question of law reviewed de novo. In re Marciano, 459 B.R. 

27, 34 (B.A.P. 9th Cir. 2011). The question of the statutory 

construction of Fed. R. Bankr. P. 9006 is also a question of 

law reviewed de novo. In re Simpson, 557 F.3d 1010, 1014 

(9th Cir. 2009).

Appellee argues that the standard of review of the 

bankruptcy court’s order is plain error because Appellants 

forfeited their opposition to the Assumption Motion by 

failing to appear at the underlying hearing at the bankruptcy 

court. In its May 29, 2018 Order, this Court found 

Appellants had not waived their challenge to the Assumption 

Order but found “the question of forfeiture is open for 

determination on remand.” Matter of Point Ctr. Fin., Inc., 

890 F.3d 1188, 1193 (9th Cir. 2018). In a footnote, the 

district court noted it “affirms the bankruptcy court’s 

decision on other grounds, and therefore does not address the 

issue of forfeiture.” Because this Court likewise affirms the 

district court’s decision on other grounds, we need not reach 

the question of forfeiture.
IN RE POINT CENTER FINANCIAL 9

III. ANALYSIS

A. The Harkey parties have standing to pursue this 

appeal.

The Trustee argues Appellants lack standing to pursue 

this appeal because they are not pecuniarily harmed by the 

bankruptcy court’s order. The Trustee moved to assume 

Dillon’s operating agreement after the deadline for assuming 

or rejecting the executory contract had passed. The 

bankruptcy court granted this motion in its Assumption 

Order. The district court initially found Appellants lacked 

standing to challenge the bankruptcy court’s order because 

they did not attend the hearing before the bankruptcy court.

This Court reversed and remanded. Matter of Point Ctr. 

Fin., Inc., 890 F.3d 1188. This Court reviewed the district 

court’s decision de novo. Id. at 1191. In order to appeal a 

bankruptcy court’s order, Appellants must be “directly and 

adversely affected pecuniarily” by the order. Matter of 

Fondiller, 707 F.2d 441, 442 (9th Cir. 1983). This Court 

found that “[b]ankruptcy standing concerns whether an 

individual or entity is ‘aggrieved,’ not whether one makes 

that known to the bankruptcy court,” and therefore 

Appellants failure to appear in court did not deprive them of 

standing to appeal the bankruptcy court’s order. Matter of 

Point Ctr. Fin., Inc., 890 F.3d at 1193.

The Trustee now argues Appellants lack standing to 

pursue this appeal because they are not pecuniarily harmed 

given that the bankruptcy court’s order does not require them 

to do anything or surrender any property. Appellants explain 

that their interest in reversing the bankruptcy court’s order 

means preventing Dillon’s investors from “forfeit[ing] 

another thirty to forty percent of the remaining cash 

available through the deduction of the ‘springing’ 
10 IN RE POINT CENTER FINANCIAL

management fee created by the bankruptcy court’s order.” 

The Trustee argues that, because the bankruptcy court found 

that the issue of management fees would be dealt with in 

another proceeding, Appellants cannot claim this is a 

pecuniary interest affected by the bankruptcy court’s order.

This Court finds Appellants have standing to bring this 

appeal. Even if the management fees will be addressed in 

another proceeding, Appellants’ ability to pursue them is 

dependent on the bankruptcy court’s original order and this 

appeal. This Court has already found “there is no question 

that Appellants’ pecuniary interests are directly and 

adversely affected by the bankruptcy court order in 

question.” Matter of Point Ctr. Fin., Inc., 890 F.3d at 1194.

B. The bankruptcy court had subject matter 

jurisdiction to confirm the vote establishing the 

Trustee as manager of Dillon and to hear the 

assumption motion.

28 U.S.C. § 1334(b) and (e) provide:

(b) Except as provided in subsection (e)(2), 

and notwithstanding any Act of Congress that 

confers exclusive jurisdiction on a court or 

courts other than the district courts, the 

district courts shall have original but not 

exclusive jurisdiction of all civil proceedings 

arising under title 11, or arising in or related 

to cases under title 11.

. . .

(e) The district court in which a case under 

title 11 is commenced or is pending shall 

have exclusive jurisdiction—
IN RE POINT CENTER FINANCIAL 11

(1) of all the property, wherever located, of 

the debtor as of the commencement of such 

case, and of property of the estate[.]

Appellants argue the district court erroneously found the 

bankruptcy court had jurisdiction to extend the deadline for 

the Trustee to accept the operating agreement. They argue 

that when the original deadline to assume or reject the 

operating agreement passed, this constituted a statutory 

rejection of the agreement, meaning the agreement was no 

longer property of the estate and, therefore, the bankruptcy 

court had no jurisdiction over it under § 1334(e). See 

11 U.S.C. § 365(d)(1) (“In a case under chapter 7 of this title, 

if the trustee does not assume or reject an executory contract 

or unexpired lease of residential real property or of personal 

property of the debtor within 60 days after the order for 

relief, or within such additional time as the court, for cause, 

within such 60-day period, fixes, then such contract or lease 

is deemed rejected.”).

The Trustee argues that Appellants base their argument 

on the erroneous belief that the operating agreement is an 

executory contract.1 But even if the operating agreement is 

1 The district court assumed, but did not decide, that the operating 

agreement was an executory contract. The district court stated that “[i]t 

is not clear whether Appellee contends the Agreement is not an 

executory contract” and that “[n]either party has adequately addressed 

the issue and the Court need not decide it.” Though the district court 

noted “Dillon’s members have ongoing financial obligations and are 

required to vote to remove the manager, and PCF has ongoing fiduciary 

and managerial obligations,” citing In re Robert L. Helms Constr. & 

Dev. Co., 139 F.3d 702, 705 (9th Cir. 1998) (“[A] contract is executory 

if the obligations of both parties are so unperformed that the failure of 

either party to complete performance would constitute a material breach 

and thus excuse the performance of the other.”) (quotation marks 

omitted).
12 IN RE POINT CENTER FINANCIAL

executory, the Trustee claims rejection of the operating 

agreement resulted only in its breach and did not deprive the 

bankruptcy court of jurisdiction.

This Court finds that the Trustee’s failure to assume the 

operating agreement by the bankruptcy court’s deadline did 

not deprive the court of jurisdiction over matters relating to 

the Dillon operating agreement. Appellants’ argument that 

the bankruptcy court could not rule on the Trustee’s 

assumption motion under § 1334(e) is unavailing because 

the subject of that motion, the operating agreement, was not 

outside the bankruptcy estate. Even had there been a 

rejection of the operating agreement, the operating 

agreement would remain part of the estate because rejection 

of an executory contract merely constitutes a breach. See 

Mission Prod. Holdings, Inc. v. Tempnology, LLC, 139 S. 

Ct. 1652, 1661 (2019).

In any event, § 1334(b) provides an alternative 

jurisdictional basis for the bankruptcy court’s order 

confirming the Trustee’s election as manager and permitting 

him to assume the operating agreement. The Trustee’s 

election as manager of Dillon, acting in his capacity as 

Trustee of the estate, is undoubtedly “related to” the 

bankruptcy proceeding under § 1334(b). And § 1334(b) also 

affords the district court (and thus the bankruptcy court by 

reference under 28 U.S.C. § 157(a)) jurisdiction over matters 

“arising under” the Bankruptcy Code. A proceeding “arises 

under” the Bankruptcy Code if it “has no independent 

existence outside of bankruptcy and could not be brought in 

another forum, but whose cause of action is not expressly 

rooted in the Bankruptcy Code.” In re Ray, 624 F.3d 1124, 

1131 (9th Cir. 2010). Appellants make the tenuous argument 

that neither “arising under” nor “related to” jurisdiction 

empowered the bankruptcy court to rule on the Trustee’s 
IN RE POINT CENTER FINANCIAL 13

assumption motion after the purported rejection of the 

operating agreement. As this Court explains infra Section 

IV, however, where a bankruptcy court makes a finding of 

excusable neglect for the failure to seek a timely extension 

of a deadline pursuant to Fed. R. Bankr. P. 9006(b)(1)(2), it 

may retroactively extend its own deadline. See In re Chira, 

343 B.R. 361, 370–71 (Bankr. S.D. Fla. 2006), aff’d In re 

Chira, 367 B.R. 888 (S.D. Fla. 2007). And that is precisely 

what the bankruptcy court did in this case. Having once 

granted the Trustee an extension of the deadline to assume 

or reject the operating agreement, the bankruptcy court—

upon a showing of excusable neglect by the Trustee—

retroactively permitted a subsequent extension of that 

deadline through the date that it ultimately entered an order 

granting the Assumption Motion. The Trustee’s request that

the bankruptcy court extend the deadline to assume the 

operating agreement would “ha[ve] no independent 

existence outside of the bankruptcy court and could not be 

brought in another forum” and thus fell squarely within the 

bankruptcy court’s “arising under” jurisdiction in § 1334(b). 

Id.

The district court’s analysis of the jurisdictional question 

is brief and does not consider Appellants’ arguments 

regarding § 1334. Rather, the district court concluded that 

“the question of whether the Trustee can assume the 

Agreement is a core proceeding within the meaning of § 157, 

and the bankruptcy court had jurisdiction to hear the 

Assumption Motion.”

28 U.S.C. § 157 provides:

(a) Each district court may provide that any 

or all cases under title 11 and any or all 

proceedings arising under title 11 or arising 

in or related to a case under title 11 shall be 
14 IN RE POINT CENTER FINANCIAL

referred to the bankruptcy judges for the

district.

(b) (1) Bankruptcy judges may hear and 

determine all cases under title 11 and all core 

proceedings arising under title 11, or arising 

in a case under title 11, referred under 

subsection (a) of this section, and may enter 

appropriate orders and judgments, subject to 

review under section 158 of this title.

Appellants argue the district court’s holding is erroneous 

because § 157 is not a jurisdictional statute. In Stern v. 

Marshall, the Supreme Court explained, “[s]ection 157 

allocates the authority to enter final judgment between the 

bankruptcy court and the district court... . That allocation 

does not implicate questions of subject matter jurisdiction.” 

564 U.S. 462, 480 (2011) (internal citation omitted). The 

Court went on to explain, “the district courts of the United 

States have ‘original and exclusive jurisdiction of all cases 

under title 11.’” Id. at 473 (quoting 28 U.S.C. §1334(a)).

“The manner in which a bankruptcy judge may act on a 

referred matter depends on the type of proceeding involved. 

Bankruptcy judges may hear and enter final judgments in ‘all 

core proceedings arising under title 11, or arising in a case 

under title 11.’” Id. at 473–74 (emphasis added) (quoting 

28 U.S.C. § 157(b)(1)).

Section 157(b) clearly “is not the source of the 

bankruptcy court’s jurisdiction,” and it “applies only if there 

is jurisdiction in the first place under 28 U.S.C. § 1334.” 

Omicron Sys., Inc. v. Weiner (In re Weiner), 05-566, 2006 

WL 6659548, at *4 (Bankr. E.D. Pa. Apr. 19, 2006). And it 

may be the case post-Stern that “[w]hile a district court is 

authorized to refer matters to a bankruptcy court, see
IN RE POINT CENTER FINANCIAL 15

28 U.S.C. § 157(a), that provision [likewise] is not 

jurisdictional.” Potter v. Newkirk, No. 19-1728, 2020 WL 

549767, at *2 (3d Cir. Feb. 4, 2020) (citing Stern, 564 U.S. 

at 480).2 But, in any event, jurisdiction resided in the district 

court under § 1334(b) and in the bankruptcy court by 

reference from the district court under § 157(a) and its 

general order of reference. Thus, this Court concludes the 

district court did not err in finding the bankruptcy court had 

jurisdiction to hear the assumption motion. Even if the 

District Court incorrectly based jurisdiction on § 157, the 

bankruptcy court still had jurisdiction under § 1334(b) for 

the reasons stated above.

C. The bankruptcy court properly authorized the 

Trustee to exercise management rights over Dillon 

after the majority of Dillon’s members voted for the 

trustee to manage Dillon.

On January 30, 2014, the bankruptcy court granted the 

Trustee’s motion to extend the statutory deadline for 

assumption of the operating agreement through February 28, 

2014. As discussed above, the Trustee did not assume the 

agreement by that new deadline or move for an additional 

extension because of Harkey’s misrepresentations regarding 

the potential sale of real estate owned by Dillon. On May 31, 

2016, the Trustee filed a motion seeking an order 

(1) authorizing the Trustee to exercise management rights 

2 But see Celotex Corp. v. Edwards, 514 U.S. 300, 307 (1995) 

(“Here, the Bankruptcy Court’s jurisdiction . . . must be based on the 

‘arising under,’ ‘arising in,’ or ‘related to’ language of §§ 1334(b) and 

157(a).”); In re Am. Hardwoods, Inc., 885 F.2d 621, 623 (9th Cir. 1989) 

(“Similar to section 1334(b), section 157(a) grants to bankruptcy courts 

jurisdiction over ‘any or all cases under title 11 and any or all 

proceedings arising under title 11 or arising in or related to a case under 

title 11.’”).
16 IN RE POINT CENTER FINANCIAL

over Dillon pursuant to a majority vote of Dillon’s members, 

and alternatively (2) authorizing the Trustee to assume 

Dillon’s operating agreement. On June 29, 2016 the 

bankruptcy court approved both the Trustee’s election as 

manager and his assumption of the operating agreement. On 

October 9, 2018, the district court affirmed. With respect to 

the Trustee’s election as manager, the district court reasoned 

that because a majority of Dillon’s members voted for the 

Trustee to manage Dillon, the Trustee could exercise 

management authority over Dillon, and that authority was 

not affected by any rejection of the operating agreement. The 

court found: “Rejection did not cause Appellant Dan J. 

Harkey to become manager of Dillon, nor did it remove PCF 

as manager. Instead it constituted a breach of the Agreement 

and permitted creditors to file a claim.”

Appellants argue that confirming the Trustee’s election 

as the manager of Dillon, a non-debtor entity, presented no 

case or controversy for resolution because the Trustee 

contends the vote was valid with or without the bankruptcy 

court order confirming the election, and therefore, 

Appellants argue, there was nothing at stake when the 

Trustee moved for the bankruptcy court to confirm the vote.

The Trustee contends that after he did not assume the 

operating agreement by February 28, 2014, some members 

of Dillon thought PCF remained the manager while others 

thought there was no manager. To eliminate any dispute, 

approximately 60% of the membership interests in Dillon 

voted to appoint or reinstate PCF as the manager of Dillon. 

The majority of Dillon’s members voted for the Trustee to 

manage Dillon and had a vested interest in protecting their 

rights, and the bankruptcy court properly approved their 

vote.
IN RE POINT CENTER FINANCIAL 17

This Court finds Appellants’ jurisdictional claim that the 

bankruptcy court lacked the ability to approve the Trustee as 

manager of Dillon because the operating agreement was not 

part of the bankruptcy estate fails. Here, the Trustee was not 

elected as manager in his private capacity; he was elected to 

manage Dillon on behalf of the bankruptcy estate, to earn a 

management fee for that estate. As discussed above, the 

question whether the Trustee, acting on behalf of the 

bankruptcy estate, could exercise management authority 

over Dillon “related to” the bankruptcy proceeding. See 

28 U.S.C. § 1334(b); supra Part III.B.

Moreover, the bankruptcy court was within its authority 

to enter an order confirming the Trustee’s election as 

manager of Dillon. It is well established that bankruptcy 

courts have “considerable discretion” to approve motions 

authorizing resolutions appointing or removing managers of 

LLCs. See, e.g., In re Walter, 83 B.R. 14, 17 (B.A.P. 9th Cir. 

1988) (“The bankruptcy court has considerable discretion in 

deciding whether to approve or disapprove the use of estate 

property by a debtor in possession.”). And Appellants cite 

no case law to support their argument that there is somehow 

no case or controversy presented when the bankruptcy court 

confirmed the Trustee’s election as manager of Dillon. They 

claim the Trustee admits there is no controversy when he 

acknowledges “[t]he vote of Dillon’s members was 

conducted independent of the assumption of the operating 

agreement and is valid with or without an order of the 

bankruptcy court.” But the fact that members of Dillon voted 

to authorize the Trustee to exercise PCF’s managements 

rights in Dillon does not mean the bankruptcy court lacked 

jurisdiction to enter an order approving the vote. The 

Trustee’s contention that the vote was “valid” is not akin to 

conceding that it was not subject to court approval.
18 IN RE POINT CENTER FINANCIAL

D. The bankruptcy court properly extended its own 

deadline for assumption of the operating agreement 

pursuant to Fed. R. Bankr. P. 9006(b)(1)(2).

Our decision does not hinge on the bankruptcy court’s 

order confirming the Trustee’s election as manager of 

Dillon, however, because an alternative ground supports the 

district court’s judgment. Even if the Trustee had not been 

elected as manager, the bankruptcy court could properly 

extend the deadline for the Trustee to assume the operating 

agreement under the Federal Rules of Bankruptcy 

Procedure.

Whether the bankruptcy court properly extended the 

deadline for assumption of the operating agreement is 

governed by Fed. R. Bankr. P. 9006(b)(1)(2). We conclude 

that Rule 9006(b)(1)(2)’s plain language permitted the 

bankruptcy court to extend the deadline.

Federal Rule of Bankruptcy Procedure 9006(b)(1) and 

(2) provide:

(1) In General. Except as provided in 

paragraphs (2) and (3) of this subdivision, 

when an act is required or allowed to be done 

at or within a specified period by these rules 

or by a notice given thereunder or by order of 

court, the court for cause shown may at any 

time in its discretion (1) with or without 

motion or notice order the period enlarged if 

the request therefor is made before the 

expiration of the period originally prescribed 

or as extended by a previous order or (2) on 

motion made after the expiration of the 

specified period permit the act to be done 
IN RE POINT CENTER FINANCIAL 19

where the failure to act was the result of 

excusable neglect.

(2) Enlargement Not Permitted. The court 

may not enlarge the time for taking action 

under Rules 1007(d), 2003(a) and (d), 7052, 

9023, and 9024.

The bankruptcy court’s extension fits within Rule 

9006(b)’s plain language. “[A]n act [was] required . . . to be 

done at or within a specified period by . . . order of court,” 

because the bankruptcy court’s order extending the initial 

deadline established a new deadline for the Trustee to 

assume or reject the operating agreement. The Trustee 

moved for an extension “after the expiration of the specified 

time period,” and the district court found that his failure to 

act by the deadline “was the result of excusable neglect” 

based on Harkey’s dishonest statements. Therefore, the 

bankruptcy court properly extended its own deadline under 

Rule 9006(b), and the Trustee’s assumption of the operating 

agreement was valid.

Although 11 U.S.C. § 365(d)(1) establishes a statutory 

60-day deadline for assuming or rejecting executory 

contracts, the bankruptcy court’s order extending the 

Trustee’s deadline did not run afoul of this provision. 

Section 365(d)(1) permits the bankruptcy court to grant a 

trustee “additional time . . . for cause” within that 60-day 

period, and the bankruptcy court did so here. Thus, when the 

bankruptcy court later extended the deadline again, it was 

extending a period specified by “order of court,” see Fed. R. 

Bankr. P. 9006(b)(1), not extending a deadline mandated by 

statute.
20 IN RE POINT CENTER FINANCIAL

Appellants argue that the relief the Trustee sought 

constituted Fed. R. Bankr. P. 9023 (Fed. R. Civ. P. 59) and 

Fed. R. Bankr. P.9024 (Fed R. Civ. P. 60(b)) motions, which 

they argue the bankruptcy court was barred from extending 

under the exception in Rule 9006(b)(2). They contend that, 

contrary to the district court’s opinion, the Trustee sought to 

“reconsider,” or modify, the extension order, arguing “[a] 

motion that seeks to alter the relief granted in a prior order 

necessarily seeks to modify the prior order.”

The Trustee argues that the bankruptcy court did not 

extend the statutory deadline under § 365(d) or Fed. R. Civ. 

P. 60, but its own deadline established in its January 30, 2014 

order. This, he argues, is permitted by Rule 9006(b)(1)(2). 

The Trustee agrees with the district court that “given that a 

Rule 60 motion is an exception to the general rule of 

9006(b)(1)...a request to extend a date under it cannot 

generally be considered a Rule 60 motion or the exception 

would swallow the rule.” See In re Chira, 343 B.R. at 370–

71 (retroactively extending court-ordered deadline to 

assume executory contract and explaining that “[o]nce the 

court has taken control of the § 365 deadline by extending it 

once or more, the new deadline is one governed by the 

general rules governing enlargement of time under Rule 

9006(b)(1)”), aff’d In re Chira, 367 B.R. 888 (S.D. Fla. 

2007); see also In re Pan Am. Hosp. Corp., No. 06-CIV21593, 2006 WL 8434254, at *5 (S.D. Fla. Sept. 6, 2006) 

(stating that the court “concur[s] entirely with [the] 

reasoning in [the Chira] opinion).

The district court explained the Assumption Motion 

sought to extend the court-ordered deadline, not the statutory 

deadline. It found “Appellants offer no authority supporting 

the proposition that the bankruptcy court lacked authority to 

retroactively extend the deadline in its order pursuant to 
IN RE POINT CENTER FINANCIAL 21

9006(b) and the plain language of the rule supports that 

authority in this circumstance.” The lower court explained:

Appellee did not seek to vacate or reconsider 

the original order extending the deadline to 

assume the Agreement. Appellee made a 

motion for an entirely new order extending 

the deadline set in the previous order... given 

that a Rule 60 motion is an exception to the 

general rule of Rule 9006(b)(1), see Rule 

9006(b)(1)–(2), a request to extend a date 

under it cannot generally be considered a 

Rule 60 motion or the exception would 

swallow the rule.

We affirm the district court’s holding that the bankruptcy 

court had authority under Rule 9006(b)(1)(2) to modify its 

order extending the deadline to accept or reject the operating 

agreement upon a finding of excusable neglect. The cases 

Appellants rely on do not deal with a court’s ability to extend 

a deadline established by its own order. See Bd. of Trs. of W. 

Conference of Teamsters Pension Tr. Fund v. P & H 

Distrib., 2 F.3d 1156 (9th Cir. 1993) (vacating and 

remanding district court decision that permitted a Rule 60(b) 

motion to be filed beyond the one year deadline imposed by 

the rule); Nevitt v. United States, 886 F.2d 1187, 1188 (9th 

Cir. 1989) (finding Rule 60(b) motion untimely and one-year 

limitation period not tolled during appeal).

Appellants argue that In re Tompkins, 95 B.R. 722 

(B.A.P. 9th Cir. 1989) is on point, but that case deals with 

the expiration of a statutory deadline that was not previously 

extended by the court. In Tompkins, the debtors entered into 

a lease-option agreement with appellants during their 

Chapter 11 case. After the case was converted to Chapter 7, 
22 IN RE POINT CENTER FINANCIAL

the trustee failed to seek an extension of the deadline to 

assume or reject the agreement (60 days after the 

conversion) or to file a motion requesting the assumption of 

the agreement. The deadline to assume the agreement having 

expired, the debtors filed a motion asking the bankruptcy 

court to extend the time for the trustee to assume or reject 

the agreement, and the court granted the motion. Id. at 723. 

The Bankruptcy Appellate Panel reversed, holding that the 

motion was untimely because it was not filed within 60 days 

of the conversion of the debtors’ case to Chapter 7. Id. at 

724. The BAP rejected the debtors’ argument that the 60-

day deadline should not apply because the trustee became 

aware of the agreement only at the meeting of creditors. 

According to the BAP, “[o]nce the 60 day period expired 

without any action taken by the trustee, the lease was 

deemed rejected and the court had no authority to revive the 

lease.” Id. But the BAP reached this conclusion in the 

context of a deadline to assume or reject that was never 

extended by court order until after the deadline expired, and 

the BAP did not even reach the issue of excusable neglect 

under Rule 9006(b)(1)(2).

In short, none of the decisions on which Appellants rely 

addressed the precise issue in this case, and so this is an issue 

of first impression in this Circuit. This Court agrees with 

Chira based on the plain language of the Federal Rules of 

Bankruptcy Procedure. In Chira, the bankruptcy court, 

before the expiration of the § 365(d) 60-day statutory 

deadline, extended the deadline for assumption of an 

executory contract an additional 45 days. 343 B.R. at 369. 

After the court-imposed deadline expired, the court then 

granted the Trustee’s motion for retroactive extension of the 

deadline upon a finding of excusable neglect under Fed. R. 

Bankr. P. 9006(b)(1)(2). Id. The court in Chira explained the 

distinction between cases where “the court is powerless to 
IN RE POINT CENTER FINANCIAL 23

modify the deadline in an ex post facto manner” once the 

initial 60-day period has expired, and cases where “the court 

has taken control of the § 365 deadline by extending it once 

or more.” Id. at 371. This case falls into the latter category, 

and therefore is governed by the enlargement rules of Rule 

9006(b)(1), not the exception in 9006(b)(2).

Appellee contends that Mr. Harkey’s misrepresentations 

about the status of Dillon—namely, failure to disclose a 

pending multimillion-dollar sale—was the basis for 

Appellee’s delay in assuming the operating agreement. The 

district court found that “the affirmative misconduct of Mr. 

Harkey was the reason for the delay in assuming the 

Agreement,” and therefore the bankruptcy court did not 

abuse its discretion in finding excusable neglect. Appellants 

have not challenged the excusable neglect finding on this 

appeal. While Appellants express concerns about the 

unpredictability of such a rule, 9006(b)(1)(2) is limited to 

circumstances in which the bankruptcy court makes a 

finding of excusable neglect, and this high bar is sufficient 

to limit the rule’s effect.

E. The Court need not reach the question of equitable 

mootness because it affirms the district court on other 

grounds.

Appellees also argue the Court should exercise its 

discretion to find the appeal equitably moot. This Court has 

held that a court may dismiss an appeal as equitably moot 

when there has been a “comprehensive change of 

circumstances” so “as to render it inequitable for this court 

to consider the merits of the appeal.” In re Roberts Farms, 

Inc., 652 F.2d 793, 798 (9th Cir. 1981). “[E]quitable 

mootness” is a “judge-made abstention doctrine unrelated to 

the constitutional prohibition against hearing moot appeals.”

In re Mortgages Ltd., 771 F.3d 1211, 1214 (9th Cir. 2014) 
24 IN RE POINT CENTER FINANCIAL

(quotation omitted). Because the Court affirms the district 

court’s opinion on the merits, it declines to reach the 

question of equitable mootness.

CONCLUSION

For the foregoing reasons, the opinion of the district 

court is AFFIRMED.

CHRISTEN, Circuit Judge, concurring in part, dissenting in 

part:

I concur in the result reached by the majority. I agree 

with the majority’s conclusion that appellants have standing 

to pursue this appeal, and that the bankruptcy court had 

jurisdiction pursuant to 28 U.S.C. § 1334(b). The district 

court erred by relying on 28 U.S.C. § 157 as a basis for 

jurisdiction. Section 157 allocates authority between 

bankruptcy courts and district courts, but cannot serve as a 

basis for the assertion of subject matter jurisdiction. See 

Stern v. Marshall, 564 U.S. 462, 480 (2011).

I part ways with the majority’s decision that the 

bankruptcy court permissibly reopened the statutory period 

for the Trustee to accept Dillon, LLC’s operating agreement. 

Pursuant to 11 U.S.C. § 365(d), Congress allowed a 60-day 

window for Chapter 7 trustees to assume or reject executory 

contracts or unexpired leases. During that 60-day window, 

the Trustee in this proceeding requested and received an 

extension of time. No one disputes that it was within the 

bankruptcy court’s authority to grant an extension of the 60-

day window “for cause” before the 60-day period expired. 

11 U.S.C. § 365(d)(1). But the bankruptcy court’s extended 

deadline also passed without the Trustee taking any action to 
IN RE POINT CENTER FINANCIAL 25

accept the operating agreement. Accordingly, by operation 

of § 365(d), the LLC’s operating agreement was deemed 

rejected. The majority relies on Federal Rule of Bankruptcy 

Procedure 9006(b)(1), a general provision that allows 

bankruptcy courts to extend their own deadlines, to conclude 

that the bankruptcy court had the authority to allow the 

Trustee to retroactively assume Dillon’s operating 

agreement two and a half years after it was deemed rejected 

by operation of law. Because I am not persuaded that the 

bankruptcy court had the authority to retroactively reopen 

the period Congress specified for accepting an executory 

contract, and because it appears the majority’s reasoning 

would allow the bankruptcy court to reopen and extend any 

deadline without limit, I do not join section III(d) of the 

majority’s opinion. I would affirm the district court’s 

alternative holding, that the appeal of the bankruptcy court’s 

order is equitably moot. See Rev Op Grp. v. ML Manager 

LLC (In re Mortgs. Ltd.), 771 F.3d 1211, 1214–15 (9th Cir. 

2014).

The doctrine of equitable mootness is alive and well in 

our circuit. See id.; see also Motor Vehicle Cas. Co. v. 

Thorpe Insulation Co. (In re Thorpe Insulation Co.), 

677 F.3d 869 (9th Cir. 2012). It has been recognized by our 

case law since at least 1981. See Trone v. Roberts Farms, 

Inc. (In re Roberts Farms, Inc.), 652 F.2d 793 (9th Cir. 

1981). The doctrine applies in Chapter 7 proceedings, see, 

e.g., Fitzgerald v. Ninn Worx SR, Inc. (In re Fitzgerald), 

428 B.R. 872, 881–82 (B.A.P. 9th Cir. 2010); Darby v. 

Zimmerman (In re Popp), 323 B.R. 260, 271 (B.A.P. 9th Cir. 

2005), and it allows the dismissal of bankruptcy appeals if 

there has been a “comprehensive change of circumstances” 

that would render it inequitable for our court to consider the 

merits of an appeal. In re Mortgs., 771 F.3d at 1214 (quoting 

In re Thorpe, 677 F.3d at 880).
26 IN RE POINT CENTER FINANCIAL

Equitable mootness is a judge-made abstention doctrine, 

rather than a determination that our court lacks Article III 

subject matter jurisdiction. Id. A bankruptcy appeal is 

equitably moot “if the case presents ‘transactions that are so 

complex or difficult to unwind’ that ‘debtors, creditors, and 

third parties are entitled to rely on [the] final bankruptcy 

court order.’” Id. at 1215 (alteration in original) (quoting In 

re Thorpe, 677 F.3d at 880). We employ this doctrine 

because “public policy values the finality of bankruptcy 

judgments,” In re Thorpe, 677 F.3d at 880, and because 

bankruptcy proceedings “often implicate parties besides the 

debtor and its creditors,” In re Mortgs., 771 F.3d at 1216.

For these reasons, where bankruptcy proceedings have 

continued in the wake of a bankruptcy court order that a 

litigant wishes to challenge, we consider as a threshold 

inquiry whether the party challenging the bankruptcy court 

ruling sought a stay pending appeal. Id. at 1215. The 

requirement for seeking a stay is grounded in equity; it 

signals to third parties that any transactions they enter into 

with the bankruptcy estate may not be final. Id. at 1216. “If 

the disagreeing party fails to seek a stay, any third parties 

who purchased property or extended a loan may later have a 

transaction undone without sufficient notice.” Id. Where a 

stay was requested, the appellate court considers the 

remaining three Thorpe factors before entertaining the 

appeal: whether “substantial consummation” of the 

bankruptcy plan has occurred; “the effect a remedy may 

have on third parties not before the court”; and whether the 

court “can fashion effective and equitable relief without 

completely knocking the props out from under the plan and 

thereby creating an uncontrollable situation.” 677 F.3d 

at 881.
IN RE POINT CENTER FINANCIAL 27

This case is a prime candidate for application of the 

equitable mootness doctrine, not because the appellants’ 

argument lacks merit, but because they slept on their right to 

raise it. The original deadline to accept or reject Dillon’s 

operating agreement was 60 days from the date the case was 

converted to Chapter 7: October 28, 2013. See In re 

Tompkins, 95 B.R. 722, 724 (B.A.P. 9th Cir. 1989). Within 

the 60-day timeframe imposed by § 365(d), the Trustee 

timely requested and received an extension until February 

28, 2014 to assume the operating agreement. The new 

deadline came and went, but the Trustee took no action and 

the operating agreement was deemed rejected by operation 

of § 365(d). Two and a half years later, on June 30, 2016, 

the bankruptcy court retroactively reopened the expired 

February 2014 deadline and allowed the Trustee to assume 

Dillon’s operating agreement as of the original February 

2013 petition date.1

In July 2016, appellants timely sought a stay of the order 

that authorized the Trustee to assume the Dillon operating 

agreement nunc pro tunc. The motion for a stay was to be 

heard in October 2016, but appellants voluntarily withdrew 

the motion a month before the hearing. This allowed the 

Trustee to proceed with his plan to wind up Dillon’s affairs. 

The Trustee foreclosed on Dillon’s real property and, in 

November 2017, sought an order approving the liquidation 

of Dillon’s assets and distribution of the sales proceeds. The 

bankruptcy court allowed the Trustee to proceed with 

1 The district court’s decision includes the statement that “the 

affirmative misconduct of Mr. Harkey was the reason for the [Trustee’s] 

delay in assuming the Agreement,” but the bankruptcy court did not 

make that finding or decide whether Harkey’s conduct prevented the 

Trustee from acting. Neither our court nor the district court acting in its 

appellate capacity are empowered to make factual findings. See Forest 

Grove Sch. Dist. v. T.A., 638 F.3d 1234, 1238 (9th Cir. 2011).
28 IN RE POINT CENTER FINANCIAL

liquidation and distribution, and the Trustee entered into 

individual settlement agreements with Dillon’s members. 

As of February 2019, the Trustee represented that he had 

entered 97 settlement agreements and distributed funds 

pursuant to those agreements, including one with the statecourt-appointed receiver who held approximately 40% of 

Dillon’s ownership interests. On appeal, appellants object 

that the Trustee was retroactively given an extra 854 days to 

assume Dillon’s operating agreement. More to the point, 

they argue that the bankruptcy court lacked the authority to 

reopen the § 365 deadline and accept an operating agreement 

that had been deemed rejected by operation of law. 

Appellants raised a serious objection, but it has been three 

and a half years since they sought, and affirmatively 

withdrew, their motion for a stay pending appeal. 

Appellants do not explain why they withdrew their motion 

for a stay and allowed the Trustee to go forward with the sale 

and liquidation of Dillon’s assets. Whatever the reason, at 

this point it would be entirely inequitable to grant relief and 

risk disrupting the 97 distributions and allocations made to 

third parties not before us. See In re Mortgs., 771 F.3d 

at 1217.

The district court gave two alternative reasons for 

affirming the bankruptcy court’s order reopening the § 365 

deadline. First, the district court decided the bankruptcy 

court properly applied Rule 9006(b)(1) to extend its own 

deadline for the Trustee to assume the operating agreement. 

Alternatively, the district court applied the four-part Thorpe

test, correctly determined that all parts of the test were 

satisfied, and decided that this appeal was equitably moot. 

The majority approves the retroactive extension of § 365’s 

60-day window, but leaves unanswered what limits are to be 

placed on the bankruptcy court’s new-found authority to 

extend statutory deadlines dictated by Congress.
IN RE POINT CENTER FINANCIAL 29

The single out-of-circuit case the majority cites offers 

only anemic support for its holding. See In re Chira, 

343 B.R. 361 (Bankr. S.D. Fla. 2006). Chira involved a sale 

of real property to a third-party buyer, and a Chapter 7 

trustee’s motion to assume a purchase agreement. Id. at 363. 

The court granted an initial extension of the § 365 deadline. 

Thereafter, the trustee and the purchaser agreed several

times to extend the court-extended deadline for assumption 

of the real estate contract. Id. at 370. The most recently 

extended deadline passed without an additional motion 

requesting another extension, but it was uncontested that the 

parties and the court intended that the court’s extended 

deadline was to be reextended before it expired. Id. at 369, 

371. Something—perhaps an oversight or clerical error—

prevented the trustee from receiving notice of the bankruptcy 

court’s most recent deadline for accepting or rejecting the 

contract. Id. at 371. The trustee’s motion explained that she 

had not been served with the court’s order announcing the 

most recent deadline, and had not learned of the order until 

a court hearing two days before she sought relief. Id. at 370. 

The bankruptcy court made factual findings that no party of 

interest would be prejudiced, and that the “duration of the 

delay and its effects upon the orderly and efficient 

administration of this case are de minimis,” before invoking 

its equitable power to enter an order extending its own 

expired deadline. Id. at 371. It was in this context that the 

Chira court held that “[o]nce the court has taken control of 

the § 365 deadline by extending it once or more, the new 

deadline is one governed by the general rules governing 

enlargement of time under Rule 9006(b)(1).” Id. at 371. 

Chira is neither binding nor persuasive; it is an extreme 

outlier and the circumstances in Chira, including the 

bankruptcy court’s finding that no party would be prejudiced 

by the trustee’s failure to act, are entirely distinguishable 

from the two-and-a-half-year interval that occurred here.
30 IN RE POINT CENTER FINANCIAL

I take no issue with a bankruptcy court’s ability to extend 

the § 365 deadline within the 60-day window, or to further 

extend a court-granted extension before the extended 

deadline has expired. Where § 365 deadlines are extended 

within § 365’s 60-day window, parties are not disadvantaged 

because they are on notice that the deadline has been 

extended and can rely on the new date. In contrast, the 

majority’s new rule will leave parties guessing about 

whether expired deadlines will be revived years after the 

fact. Because this case is an easy fit for the doctrine of 

equitable mootness, I would affirm on that basis alone.