1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re: ) BAP No. CC-14-1333-KuDKi

)

JEANETTE DRYER, ) Bk. No. 14-13018

)

Debtor. )

______________________________)

)

EARSEY GREENWOOD, )

)

Appellant, )

)

v. ) MEMORANDUM*

)

UNITED STATES TRUSTEE; )

JEANETTE DRYER; TIMOTHY J. )

YOO, Chapter 7 Trustee, )

)

Appellees. )

______________________________)

Argued and Submitted on February 19, 2015

at Los Angeles, California

Filed – February 27, 2015

Appeal from the United States Bankruptcy Court

for the Central District of California

Honorable Ernest M. Robles, Bankruptcy Judge, Presiding

 

Appearances: Appellant Earsey Greenwood argued pro se; Ron

Maroko argued for Appellee United States Trustee;

Appellee Jeanette Dryer, on brief, pro se.

 

Before: KURTZ, DUNN and KIRSCHER, Bankruptcy Judges.

FILED

FEB 27 2015

SUSAN M. SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT

*This disposition is not appropriate for publication. 

Although it may be cited for whatever persuasive value it may

have (see Fed. R. App. P. 32.1), it has no precedential value. 

See 9th Cir. BAP Rule 8024-1.
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

INTRODUCTION

Appellant Earsey Greenwood, who is not an attorney, admitted

to assisting debtor Jeanette Dryer in preparing the forms she

filed to commence her chapter 71 bankruptcy case. The bankruptcy

court fined Greenwood under § 110 for not complying with the

restrictions and requirements § 110 imposes on non-attorney

bankruptcy petition preparers.

Greenwood appealed the bankruptcy court’s ruling. In both

the bankruptcy court and on appeal, Greenwood only has offered

one argument why he should not be fined under § 110. He has

argued that he was unaware of the statute’s requirements and was

unaware that the statute applied to him. But § 110 does not

condition the imposition of fines on the non-attorney petition

preparer’s knowledge of the statute or its applicability. In any

event, the bankruptcy court found Greenwood’s claimed ignorance

of § 110 not credible, and we hold that this finding was not

clearly erroneous.

Accordingly, we AFFIRM.

FACTS

In February 2014, without the assistance of a licensed

attorney, Dryer commenced her bankruptcy case. Roughly one month

later, the United States Trustee convened the § 341(a) meeting of

creditors for Dryer’s case, and Dryer duly appeared at the

creditor’s meeting for examination pursuant to § 343. At that

1Unless specified otherwise, all chapter and section

references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and

all "Rule" references are to the Federal Rules of Bankruptcy

Procedure, Rules 1001-9037.

2
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

time, the United States Trustee’s representative directed Dryer

to complete a standard form Declaration for Debtors Without

Attorney, which asks debtors whether and to what extent they were

assisted in filing their bankruptcy papers by someone other than

an attorney. In her declaration, Dryer disclosed that she paid

$1,000 to Greenwood to assist her in preparing her bankruptcy

papers. Dryer further disclosed that Greenwood advised her:

(1) whether or not to file a bankruptcy petition; (2) the

difference between chapter 7, 11, 12 and 13 of the bankruptcy

code; (3) whether she would be able to retain her home, car or

other property after the bankruptcy filing; and (4) how her debts

should be listed in her bankruptcy schedules as either priority,

secured or unsecured debts.2 Dryer subsequently provided the

United States Trustee with copies of two cancelled checks

totaling $1,000 that she paid to Greenwood. The reverse side of

each check shows what appears to be Greenwood’s signature as an

endorsement. 

Based on Dryer’s declaration and the contents of her

bankruptcy filings, the United States Trustee filed and served a

motion against Greenwood pursuant to § 110(h)(3) seeking

disgorgement of the $1,000 in fees that Greenwood collected from

Dryer and seeking the imposition of fines against Greenwood based

on his violations of § 110. The United States Trustee pointed

2Greenwood included with his appeal papers a new declaration

signed by Dryer in which she recanted many of the statements she

had made in her Declaration for Debtors Without Attorney. This

new declaration, dated August 14, 2014, was not part of the

record before the bankruptcy court. Therefore, we will not

consider it. See Castro v. Terhune, 712 F.3d 1304, 1316 n.5 (9th

Cir. 2013).

3
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

out that Greenwood: (1) had not signed any of Dryer’s bankruptcy

filings (in violation of § 110(b)(1)); (2) had not filed the

required Bankruptcy Petition Preparer’s form declaration and

notice (Bankruptcy Official Form B19) regarding his fees and the

limited scope of non-attorney services he was permitted to

perform for debtors (in violation of § 110(b)(2) and (h)(2)); and

(3) had not placed his social security number on Dryer’s

bankruptcy filings (in violation of § 110(c)).

 Greenwood filed an opposition to the motion in which he

admitted that he helped prepare Dryer’s bankruptcy papers by

inputting or typing in the relevant information into the forms,

but he claimed that he was unaware that he qualified as a

bankruptcy petition preparer or that he needed to comply with

§ 110. The United States Trustee then filed a reply. In

relevant part, the United States Trustee countered Greenwood’s

assertion that he did not know he qualified as a bankruptcy

petition preparer and did not know of § 110's requirements. The

United States Trustee presented evidence demonstrating that, in

2013, the bankruptcy court had fined Greenwood in another

bankruptcy case for violating § 110.

At the hearing on the United States Trustee’s motion, the

bankruptcy court ruled in favor of the United States Trustee and

against Greenwood. The court found that Greenwood was a

bankruptcy petition preparer within the meaning of the statute. 

The bankruptcy court also found that Greenwood committed four

separate violations of § 110(b)(1) by not signing Dryer’s

petition, her schedules, her statement of financial affairs and

her statement of intention. The bankruptcy court further found

4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

that Greenwood committed three separate violations of § 110(c)(1)

by not putting his social security number or other “identifying

number” on Dryer’s petition, her schedules and her statement of

financial affairs. According to the court, Greenwood also

violated § 110(b)(2) by not filing the required form notice to

the debtor regarding the limitations and restrictions on his

services and violated § 110(h)(2) by not signing and filing a

declaration regarding the fees Dryer paid him.

Finally, the bankruptcy court found Greenwood was not

credible when he claimed he was not aware of the above-referenced

requirements. The court pointed out that Greenwood previously

had been fined for similar violations. The court additionally

pointed out that the petition Greenwood filled out for Dryer

contained a prominent signature block for non-attorney petition

preparers. In any event, the court reasoned, even if Greenwood

had not been aware of § 110's requirements, lack of knowledge of

the requirements is not a valid excuse for noncompliance.

On account of its findings, the court imposed $4,000 in

fines based on eight separate violations of § 110 at $500 per

violation (see § 110(l)(1)) and then trebled the $4,000 in

accordance with § 110(l)(2)(D), thereby bringing the total fines

imposed to $12,000. The court also ruled that Greenwood had

forfeited the $1,000 in fees he collected from Dryer pursuant to

§ 110(h)(3)(B) because of his violation of § 110's other

provisions. The court ordered Greenwood to reimburse the $1,000

5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

to Dryer.3

On June 30, 2014, the bankruptcy court entered its order

imposing the $12,000 in fines and directing Greenwood to disgorge

the $1,000 in fees, and Greenwood timely appealed.

JURISDICTION

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

§§ 1334 and 157(b)(2)(A). We have jurisdiction under 28 U.S.C.

§ 158.

ISSUE

Did the bankruptcy court err when it fined Greenwood for

violating § 110?

STANDARDS OF REVIEW

We review the bankruptcy court's imposition of fines under

§ 110 for an abuse of discretion. See Frankfort Digital Servs.,

Ltd. v. U.S. Trustee (In re Reynoso), 315 B.R. 544, 550 (9th Cir.

BAP 2004), aff'd, 477 F.3d 1117 (9th Cir. 2007).

The abuse of discretion standard of review first requires us

to consider whether the bankruptcy court identified the correct

legal rule to apply. Berger v. Home Depot USA, Inc., 741 F.3d

1061, 1067 (9th Cir. 2014). And second, if the court identified

the correct legal rule to apply, we then must determine whether

3Greenwood claimed that he used a portion of the $1,000 from

Dryer to pay Dryer’s filing fees. The bankruptcy court found

that Greenwood’s claim was not as credible as Dryer’s statement

in her Declaration for Debtors Without Attorney that she

separately paid her bankruptcy filing fees. In any event, as the

court noted, § 110(g) prohibited Greenwood from collecting the

court fees from Dryer, and Greenwood’s violation of this

prohibition served as a separate and independent basis for

Greenwood’s forfeiture of the entire $1,000.

6
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the court's findings of fact, and its application of those

findings to the law, were illogical, implausible, or without

support in the record. Id.

DISCUSSION

Perceiving a need to curtail widespread fraud, abuse and the

unauthorized practice of law, Congress enacted legislation in

1994 seeking to restrict the activities of non-attorney

bankruptcy petition preparers. See Ferm v. U.S. Trustee

(In re Crawford), 194 F.3d 954, 957 (9th Cir. 1999). The

centerpiece of that legislation was § 110. Id. As indicated in

the facts section above, § 110 imposes a number of requirements

and restrictions on bankruptcy petition preparers and also

imposes fines for noncompliance. See In re Branch, 504 B.R. 634,

639 (Bankr. E.D. Cal. 2014)(explaining requirements, restrictions

and fines). In the 2005 amendments to the Bankruptcy Code,

Congress went even further and enhanced the restrictions, added

further requirements, and streamlined the procedures for imposing

fines for noncompliance. See H.R. Rep. No. 109-31(Pt. 1), at 62,

as reprinted in 2005 U.S.C.C.A.N. 88, 132.

In the bankruptcy court and on appeal, Greenwood contends

that he did not know that he qualified as a bankruptcy petition

preparer. According to Greenwood, he should not have been fined

under § 110 when he was unaware that the statute applied to him

or of the statute’s requirements. Interpreting Greenwood’s pro

se contentions liberally as we must, see Keys v. 701 Mariposa

Project, LLC (In re 701 Mariposa Project, LLC), 514 B.R. 10, 12

(9th Cir. BAP 2014), we will first consider the bankruptcy

court’s determination that Greenwood qualified as a bankruptcy

7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

petition preparer, and then we will address Greenwood’s argument

regarding his lack of knowledge.

The statute defines the term “bankruptcy petition preparer”

broadly, as follows:

(a) In this section –

(1) “bankruptcy petition preparer” means a person,

other than an attorney for the debtor or an employee of

such attorney under the direct supervision of such

attorney, who prepares for compensation a document for

filing; and

(2) “document for filing” means a petition or any other

document prepared for filing by a debtor in a United

States bankruptcy court or a United States district

court in connection with a case under this title.

11 U.S.C. § 110; see also In re Reynoso, 477 F.3d at 1123

(broadly construing § 110's definition of bankruptcy petition

preparers).

Under the statute’s broad definition of the term “bankruptcy

petition preparer,” the record here amply supports the bankruptcy

court’s determination that Greenwood qualified as a bankruptcy

petition preparer. Greenwood admitted that Dryer compensated him

for inputting information into the relevant forms to assist Dryer

in filing her bankruptcy documents. Under these circumstances,

we perceive no error regarding the court’s bankruptcy petition

preparer determination.

As for Greenwood’s asserted lack of knowledge, § 110 does

not condition the imposition of fines for noncompliance on the

violator’s state of mind. When it wants to do so, Congress knows

how to limit the consequences for noncompliance with the

Bankruptcy Code to violators who acted knowingly and/or wilfully. 

See, e.g., §§ 111(g)(2), 362(k)(1), 363(n), 524(i),

8
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1141(d)(6)(B)(ii). Congress included no such limitation in

§ 110, and we know of no rationale that would permit us to read

into the statute such a limitation. See generally Lamie v. U.S.

Trustee, 540 U.S. 526, 534 (2004) (when interpreting statute that

is clear on its face, the court’s only task is to apply the

statute in accordance with its non-absurd plain meaning). Our

reading of § 110 also is consistent with the general principle

that ignorance of the law is no excuse. See Antonio-Martinez v.

INS, 317 F.3d 1089, 1093 (9th Cir. 2003).

Furthermore, as the United States Trustee has pointed out,

§ 110 previously contained language that directed the court to

excuse noncompliance when there was a “reasonable cause” for the

violator’s noncompliance. However, when Congress amended the

bankruptcy code in 2005, it deleted the “reasonable cause”

language from § 110 and thereby removed it as an exception to the

imposition of fines under § 110. See In re Woodward, 314 B.R.

201, 205 (Bankr. N.D. Iowa 2004) (pre-2005 case explaining former

reasonable cause exception). Simply put, Congress’ 2005 deletion

of the reasonable cause exception from § 110 bolsters our

conviction that there is no excuse available to Greenwood based

on his asserted ignorance of § 110.

Even if there existed some exception to § 110's fines based

on Greenwood’s ignorance of the statute, the bankruptcy court

found that Greenwood’s asserted ignorance was not credible. The

basis for the court’s credibility determination was twofold. 

First, the court pointed out that the bankruptcy forms Greenwood

filled out for Dryer contained conspicuous signature blocks for

bankruptcy petition preparers to complete. Given that Greenwood

9
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

was confronted with these signature blocks when he filled out the

forms for Dryer, the court reasoned that Greenwood’s asserted

ignorance of § 110's requirements was feigned. Second, according

to the court, Greenwood previously was fined under § 110 in

another bankruptcy case, and thus the court could not accept

Greenwood’s claim to have been unaware of § 110 and its

requirements. 

Greenwood has not offered any explanation or argument why

the bankruptcy court’s finding that he was aware of § 110 was

illogical, implausible or without support in the record. Nor is

any such deficiency evident to us. Accordingly, we have no

grounds to overturn the bankruptcy court’s finding on this point.

Greenwood does not challenge or dispute any other aspect of

the bankruptcy court’s decision. Moreover, having reviewed the

record, we cannot say that any of the bankruptcy court’s other

findings were illogical, implausible or unsupported by the

record. Consequently, there are no grounds here that would

justify our reversing the bankruptcy court’s decision.

CONCLUSION

For the reasons set forth above, we AFFIRM the bankruptcy

court’s order against Greenwood based on his violation of § 110.

10