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### NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT

In re: MARCUS DANIEL SILVER , Debtor

. BAP No. C C

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Bk. No. 2 : 2 1

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MEMOR AN DUM ∗ MARCUS DANIEL SILVER , Ap pell ant , v. PHH MORTGAGE CORP ORATION ; U.S. BANK NATIONAL ASSOCIATION, as Trustee for Greenpoint Mortgage Funding Trust Mortgage Pass

- Through Certificate s, Series 2006

- AR7; WESTERN PROGRESSIVE LLC , Interested Part ies

. Appeal from the United States Bankruptc y Court for the Cen tr al Distr ict of California Ernest M. Robles , Bankruptcy Judge, Pres i d ing

Before: LAFFER T Y, FARIS , and TAYLOR , Ban kruptcy Judges.

I N T R ODUCT ION
Marcus Silver ( “ Debtor ” ) appeals the bankruptcy court ’ s order denying his motion to convert his cas e from chapt er 7 1 t o chapter 13 and

∗ Th is d i s p o s it i on is n ot a ppro pr i at e f or pu blic ation

. Alt h ou g h i t may be cited fo r wh a t ever pe r su as i v e value it ma y h a ve, se e Fe d. R

. A p p

. P. 32

. 1, it has n o p recedent ial

v al u e , see 9t h C ir. BA P R u l e 8 0 24

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# FILED

DEC 1 9 2022

S USAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT2 the order denying his motion to reconsider. B y Debtor ’ s own admission, the sole reason he sought conversion was to stave off foreclosure and to litigate his state law claim s against his mortgage lender and others, even tho ugh the state court had already found t hat he would not succeed on the
merits of those claims

. The bankruptcy co ur t therefore found that Debtor sought conversion in bad faith and denied the motion to convert

. It also
denied reconsideration , finding that Debtor had demonstrat e d no error i n the court ’ s ini t ial ruling

. Seei ng no abuse of discretion in the bankruptcy

court ’ s rulings , w e AFFIRM.
FAC TS 2 In July 2021 , Debtor filed a lawsuit in Los Angeles County Superi or Court (the “ State Court Action ” ) against PHH Mor tgage Corpor a t ion , U.S.
Bank National As sociation ( “ U.S. Bank ” ) , and Western Progressive, LLC ( colle cti vely, “ Defendants ” )

. The complaint asse rted several state law
claims and sought , among other things, to stop a p ending foreclosure sale
of Debtor ’ s Los Angeles reside n ce ( the “ Property ” ) a nd to quiet title on the

1 Unl es s s p ec i fi e d o t her w ise, a ll ch a p te r a nd se cti on re f e re nces are to t h e B a nk r up tc y C ode , 1 1 U.S.C. §§ 10 1

– 1 5 3 2 , “ Rule ” reference s are t o the Fed eral R ules of Ban kruptcy Proc edure , and “ Civil Rule ” ref erences are to the Federal Rules of Civil Proc edu re

. 2 Appell ant pr ovided only a few documen ts in his excerpts of record. Accordingly, we ha ve exercised our discretion to take judicial n otice of the dockets and imaged paper s filed in debtor’s bankruptcy c as e and related adv ersary proceedings

. See Atw ood v. Chase Manhat tan Mortg. Co. (In re Atwood ) , 293 B.R. 227, 233 n.9 (9th Cir. BAP 2003).3 ground that the m ortgage loan is void

. 3 On August 16, 2021, t he state court
denied Debtor ’ s motion for a prel iminary injunction, finding that although the balance of harms weighed in Debtor ’ s fa vor, he had “ no t sho wn any likelihood of s uccess on the merits. ”
Th at same day , Debtor , acting pro se, filed a chapte r 7 petit ion

. He
scheduled a disputed claim for $ 2.2 million secured by the Property , a $205.31 priority unsecured d ebt, and $15,6 51.37 in nonpriority u nse cured
debts

. Although t he chapter 7 trustee file d a Report of N o Distribut ion , no discharge has been en tered : in November 2021, t he bankruptcy court
ordered that no discharge be entered until after the motion to convert has been adjudicated

. In October 2021, Debtor removed the State Court Action to the bankrup tcy court

. Defendants moved to remand , arguing that the bankruptcy court la cked ju risdiction , and if it had jurisdiction, it should
remand o n equitable grounds.
Debtor fil ed a n oppositi on to the m otion to remand and a motion to

convert his case to chapter 13 , which was unopposed

. I n his opposition to the motion to remand, Debtor stated that if the motion were granted, he

3 The c auses of action listed in the sta te court complaint included violations of
va rious California statutes, qui et title, slander of title, unfair business prac tic es, conspiracy, misreprese n tation, deceit , fra ud, a nd inten tional infliction of emotion al d istress. The c laims are based on allegations that the D efendant s mis represented the loan terms and that there were f raudulent assignmen ts creating an “ irretrievab le ” break in the chain of title . Debtor also alle ge d that the se cur itized trust that holds the note and deed of trust failed in 2007.4 would likely withdraw his state court complaint and r efile in the
b ankruptcy c ourt. After a hearing, t he bankruptcy court granted th e m otio n to remand

an d d eni ed the motion to convert. The b ankruptcy court fou nd that the conversion motion was brought in bad faith because Deb tor filed it solely
to def eat th e motion to re mand so he cou ld have his state law claims adj udicated in the bankrupt cy c ourt

. The court noted that Debtor removed
the S tate C ourt A ction shortly after suffering an adverse ruling and filed
his motion to convert only aft er De fendants filed their remand mo tion , showi ng t hat forum shopping was the underlying motivation for

co nver sion.
Debtor m oved for reconsideration of the order denyin g the motion to

convert , arguing that he did not act in bad faith because he was simply trying to save his home

. He also st ated that h e had requested dismissal of
the State Court Action and tha t hi s financial circumstances had changed so
tha t he was n ow able to pay all his “ legi timate ” creditors. 4 Th e bankruptcy

co urt den ied the motion , finding that Debtor had not shown error in th e

cour t ’ s initial ruling

. D ebtor timely appealed the denial of t he motion to convert and
motion for reconsideration

. 5 On the same day he filed his notice of appeal,

4 W hile the motion for reconsideration was p ending, Debtor filed a letter wi th the court statin g he had received $36,000 f rom the S tate of California for lost rental incom e relief assi stance.

5 N o appellee is participating in this appeal.5 Debtor filed an adversary proceeding ag ainst U.S. Bank (as Trustee for Greenpoint Mo rtgage Fund ing Trust Mortgage Pass

- Through Certi fica tes,
Series 2006

- AR7 ) a sserting claims for fraud, conspiracy, slander of tit le,
intentional infliction of emotional distress , violations of various Califor nia statutes, and violation of the automatic stay

. The b ankr uptcy court has stayed th at adver sary proceeding pending resolution of this appeal

. 6 J U RIS D ICTI ON
The ba nkru p tcy co urt h a d ju r is dicti o n un de r 28 U.S.C. § § 13 3 4 and
15 7 (b )( 2 ) ( A )

. W e h a ve ju r is d ic tion u nder 28 U .S .C

. § 15 8

. 7
I S SUE S
D id the bankr uptc y court abuse its discretion in denying Debt o r ’ s
motion to con vert ? Did the bankruptcy court abuse its disc retion in denying Deb tor ’ s motion for reconside ration?

6 Debtor incorrectly ass erts in his opening brief that U.S. B ank defaulted in that adversary proceeding. U.S. Ba nk timel y f il ed a motion to d ismiss the complain t , which has not yet b een heard because t h e matter is currently stayed

. 7 The U.S. Di strict Court for the Eastern District of California r ecently held that
a n order denying a c reditor ’ s mot ion to conver t from chapter 11 to chapter 7 without prejudice is not a final order , finding that the order did not determine a discrete issue and that another motion could be brought in the future

. U

. S. Bakery v. Sv enhard ’ s Swed ish Bakery , 632 B.R . 312, 3 20 (E.D. Cal. 20 21) , a ppe al file d , No. 21

- 16991 ( 9 t h Cir. Nov. 29, 2021)

. Under the flexible fina lity rule applicable in bankruptcy appeals, finality rests upon : “ (1) whether the bankruptcy court ’ s order fully and fi nally determined the discrete is sue or issues it addressed; an d ( 2) whether it resolve s and seriously affect s substantive rights.” Jue v. Liu (I n re Liu ) , 611 B. R. 864, 870 ( 9th Cir. BAP 2020) (citations and quotations omitted)

. This appeal is distinguishable from U.S. Bakery in that the order on appeal he re foreclose d D ebtor ’ s ability to convert his c ase to chapter 13 , thus6 S T A N DARD S OF R EVIE W
We review the ban kruptcy co urt ’ s denial of a motion to co nvert and
de nial of a m otion for reconsideration for abu se o f discretion

. Levesque v. Shapiro (I n re Levesque ) , 473 B.R. 331 , 335 (9th Cir. BAP 201 2 ) (conversion); Carruth v. Eutsler (In re Eutsler) , 585 B.R . 231, 235 (9th Cir. BAP 2017) (reconsideration)

. A bankruptc y court abu ses its discretion if it applies an
i n correct legal standard or its factual findings are illogical, implausible, or

w ithout support in the record. TrafficSchool.com , Inc. v. Edriver Inc. , 653 F.3d
82 0, 832 ( 9th Cir. 2011). A bankruptcy co urt ’ s findin g of bad faith is reviewed for clear error.
Khan v. Barton (In re Khan) , 846 F.3d 105 8, 10 6 5 ( 9 th Cir. 2 017 ) . U nder the clearly erroneous standard of review, if the bankruptcy court ’ s findings are pl ausib le in light of the record viewed in its entirety, we may not reverse even if we would have weigh ed t h e evidence differently. “Where the re are two permissible views of the evidence, the factfinder's choice between them cannot be clearly erroneous.” And erson v. City of Bessemer City , 470 U.S. 564, 574 (1985) (cita tions omitted). We may affirm on any b asis supported by the record. Caviata A ttached Homes, LLC v. U.S. B ank, N.A. (In re Caviata Attached Homes, LLC) , 481 B.R. 34, 44 (9th Cir. B AP 2012).

meeting the flexi ble finality standard. We have jurisdiction.7 D ISC USS I O N
A. The bankruptcy court did not abuse its discretion in de nying Debtor ’ s motion to convert. Sect ion 7 06 (a) of the Bankruptcy Code provides: “ The debtor may

convert a case under this chapter to a case under chapter 11, 12, or 13 of this title at any time, i f the case has not been c onverte d under section 1112 , 120 8, or 1307 of this title.

. . . ” Despit e th e seemingly unconditional language of this statute, the right to convert a chapter 7 c ase to one under chapter 13 is not absolute. See Marrama v . Citizen s Bank of Mass

. , 549 U.S.
365 , 372

- 74 (2007)

. T he re, the Cou rt held that the right to conve rt i s qualified by § 706 (d) , which provides: “ Notwithstanding an y other provision of this section, a case may not be converted to a case under

anot her chapter of this title unless the deb tor may be a debtor und er such chap ter

. ” A debtor seeking conv ersion to chapter 13 does not qualify under that chapter if he or she has engaged in bad faith or fraudulent conduct or
is o therwise ineligibl e for chapter 13 relief. Marrama , 549 U.S. at 3 72

- 74

. This is because bad fa i th is routine ly held to con stitute “cause” for
dism issal of a chapter 13 case under § 1307(c)

. Id. at 373.
Accordin gly, the Court concluded, the bankruptcy courts’ authority
“to take any action that is necessary or appropriate ‘to prevent an abuse of

p r ocess’ describ ed in § 105(a) of the Code” justi f ie s “immediate denial of a motion to convert filed under § 706 in lieu of a conversion orde r that merely postpones the allowance of e quivalent relief and may provide a8 d ebtor with an opportunity to take acti o n prejudicial to credi tors.” Id. at
375. In oth e r wo rds, if sufficient bad faith exists to justify dismissal of a
po t ential chapter 13 case, the bankruptcy court need not en g age in the pointl ess exercise of ordering con version and then dismissing the

conve r ted case.
To determine the existence of bad f a it h su fficient to order dismissal of a chapter 13 case , the bankruptcy c ourt must consider th e totalit y of the
circumstances. See L eavitt v. Soto (In re Leavitt) , 171 F.3d 1219, 1224 ( 9 th Cir. 1999)

. “A findi ng of bad fait h does not req uire fraudulent int e nt by the
debtor .” Id. Factors t o consider in determining the presence of bad faith
include : ( 1) wheth er the debtor misrepresented facts in his petition or plan, unfairly manipulated the Bankruptcy Code, or o therw ise f iled his Chapt er 1 3 petition or plan i n an i nequitable manner; ( 2) the debtor’s history of filings and dismissals; ( 3) whether the debt or on ly intended to defeat state court litigation; and, ( 4) whether egregious behavior is present. Id. (cl eaned up).
The se f actors are “ si mply factors to con s id er [ , ] ” and “ not every one of
them must be met.

. . . [W]hat matters is the totality of the circumstanc es. ”
In re Khan , 846 F.3d at 10 6 6 (cleaned up)

. F iling a bankruptcy case to defeat or delay state court litigation, ev e n if that is not the onl y pu rpose for the
filin g , cons titutes bad faith. See i d. ; E isen v. Curry (In re Eisen ) , 14 F.3d 469,9 470

- 71 ( 9 th Cir. 1 994) ; C hinichian v. Campolongo (In re Chinichian ) , 784 F.2d 1440, 1445 ( 9 th Cir. 1986). As noted, the bankrupt c y court found that D ebtor ’s sole motivation
fo r se eking conversi on was forum sh opping. This Panel has held that such a finding constitutes bad fai th sufficient to warrant dismissal of a chapter
11 case. S t. Paul Self Sto rage L td. P ’ ship v. Port Authori ty of the City of St. Pa ul (In r e St. Paul Self St or ag e Ltd. P ’ ship) , 185 B.R. 580 , 583 ( 9 th Cir . BAP 1995). In that case, the BAP affirmed the bankru ptcy court ’ s dismissal of a chapter 11 case based upon f inding s that the case had been filed not to effect uat e a
reorg ani z ation bu t solely as a litigatio n t acti c , i.e., “ to gain a mo re convenient forum ” for its litigation with the appellee. Id. Th e BAP agreed, concluding that the bankruptcy court ’ s findings established cause f or dismissal , noting that “ [ t ] he timi ng of the petit ion an d the unsuccessfu l
p ro gr ess of the [state court] litigation strongly suggest s Deb tor ’ s intent to use the bankruptcy code as a means to escape to a forum which it perceived to be more friendly

. ” Id. (citations omitted)

. A s in St. Paul Self Storage , D ebtor filed for bankrup t cy pro tection shortly after an a dverse ruling in the State Court Action . He admi ts he filed
the case s olely to address the state l aw claims . And by filing his chapter 7 petition, he invoked the protection of the auto matic stay t o circumv ent t h e
state cour t ’ s ord er denying his motion for a prel iminary injunction.
Conversion would have extended the automatic stay and given Debtor

mor e time to litigate claims that the state court had already found10 essent ially mer itless

. The moti on t o convert was thus simply a n ot her

avenue for delay. On appeal, Debtor attempts to distinguish St. Paul S e lf Storage
because there the litigation was in its final sta ges and there was no danger
of foreclosure. But th os e f actual differen ces are not meaningful given the
BAP ’ s ultimate holdi n g tha t forum shopping is a ground for den ying
conversion on b ad faith grounds

. Although Debtor is correct that the
record do es not reflect any fraudulent or dishonest beh av ior , th at is not a

re quirement for a b ad faith finding in t his context. A lthough he cla ims that he sought conversion so he could reorganize his de bts, he did not file a proposed plan or any explanation of how he would pay the secured debt
on his home should he not prevail in the litiga tion. Th e funds he claimed to
have received from t he stat e w o uld have been sufficient to pay all the
unsecured claims listed in his petition, so the only debt le ft would have
be en the disputed mortgage. With respect to the Leavitt fact ors , he argu es that t here i s no evidence
he misr epresented facts in h is peti tion

. While true, this is not a requirement
for dismissal on bad faith g rounds. The bankrup tcy court found, and we

a gree, that Debtor ’ s conversion motion was an attempt to unfairly
mani pulate the Cod e . Debto r also contends that he did not seek conversion

to defeat state court litigation because he di smissed the S tate C ourt A ction , but that is of no moment given the filing of the adversary proceeding

a gains t U.S. Bank: clearly, Debtor ’ s goal is to have the ban kruptcy court11 hear th e claims that the state court has alr eady determined have little to no chan c e of su cce ss

. Finally , Debtor points out that no party objected to the motion to convert, and he specula tes that the bankruptcy court denied the motio n becaus e it did not want to increase its c ase load

. He also questions the

court ’ s impartia lity b ecause it wo uld be a c ting in a “ dual capacity ” in presiding over both the bankruptcy and the adversary proceeding

. But

n othing in the record su ggests that the bankrupt cy court was biased, and we reject these argumen ts. Th e bankru ptcy court was well wi thin its
d iscreti on t o deny the motion to convert , regardless of whethe r any party objected. See Nunez v. Nunez (In re Nunez) , 196 B.R. 150 , 156 ( 9 th Cir. BAP 1996) ( “ The g ranting of an unconte sted motion is not an empty ex erc ise but requires that the court find merit to the motion. ” )

. B. The bankruptc y court did not abuse its d iscretion in de nying reconsideration. Debtor ’ s m otion for reconsideration was filed within fourteen da ys of the order denying his mo tio n for co nversion. It was therefore governed by
Civil Rule 59 (e) , incorporated via Rule 9023. See Am. Ironworks & Erectors, Inc. v. N. Am. Constr. Corp. , 248 F.3d 892, 89 8

- 99 (9th Cir. 2001)

. Reconsideration under this rul e is appropriate if the bankr upt cy court “( 1) is presented with n ewly discovered evidence, (2) committed clear error
or the initial deci sion was manifestly unjust, or (3) if there is an intervening change in controlling law. There may also be other, highly u nusual ,12 circumstances warran tin g r econside ration.” School Distri ct No. 1J v. AC and S,
Inc. , 5 F.3d 1255, 1263 ( 9 th Cir. 1993) ( citation omitted). Motion s for reconsideration that merely revisit the same i ssues already ruled on by the
ba nkruptcy court , or that advance facts otherwise a vai lab le when the initial
motion was briefed , will generally not be granted. Negrete v. Bleau (In re Negret e) , 183 B.R. 195, 197 ( 9 th Cir. BAP 1995), aff ’ d , 103 F.3d 139 (9 th Cir. 1996).
I n his motion for r econside ration, Deb tor simply disag reed with the
ban kru ptcy cou rt ’ s bad faith finding , arguing tha t he filed his bank ruptcy

case to “ save his home from illegal foreclosure ” and had not engaged in
any deceptive or egregious b ehavior

. A s noted, he stated tha t he had requeste d dismissal of the State Court A cti on and his financial
circumstances had chan ged. The bankruptcy court denied the moti on . It wa s not moved by the
fact that Debtor was dismiss ing the S tate C ourt A ction bec ause Deb tor
admit ted th at h is so le reason for see ki ng bankruptcy protection was t o

c ont est the validity of the loan secur ed by the Property. It noted that , by
Debtor ’ s own admission, the bankruptcy was filed to provide him a further opportunity to continue to assert his sta te law claims. We agree with the bankruptcy court that [ a ] llow ing th e Debtor to convert to C hapter 13 would enable him to continue to benefit from the automatic stay while pursuing the claims against the Defendants that the State Co u r t h as already found that he is u nli kely to prevail upo n . The13 primary p urpose of the Mot ion to Conv ert is to further de lay the ability of the Defendants to exercise their rights with respect to the P roperty. On appeal, Deb tor argues that recon sideration was w arranted
because of his changed circumstances . He c ontends th a t con version w as mandated because the funds he had received from the state meant that h e

“ no longer qualified ” for chapter 7. But he cites no authority for th at premi se , and he has not otherwise show n that the bankruptcy court abused
its discret ion in it s initial ruling

. De bto r also state s in his appellate brief that rental income is in the process of being generated , and h e has launched a new business since the bankruptcy court denied conversio n. E ven assuming th ese unsupport ed
facts would have changed the bankruptcy cour t ’ s de cision, he di d not present th e m to th at court, and we will not consider them here. See In re Mercury Interactive Corp. Sec. Litig. , 618 F.3d 988, 992 (9th Cir. 2010) (an
i ssue is generally deemed wa ived on appeal if the ar gument was not raised
suffic ien tly for the tria l court to rule on it).
C O N C L US ION
F o r these reasons, the b ank ruptcy c ourt ’ s finding that Debtor sought
conversion in bad faith was not clearl y erroneous. Th e court thus did not
abus e its d iscre tion in denyin g the motion to convert or t he mot ion for

recon sideration. W e th ere fo re AF FIRM

.