NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re:

PORTLAND INJURY INSTITUTE, LLC

Debtor.

BAP No. OR-21-1138-GTB

Bk. No. 3:21-bk-30158-DWH

MEMORANDUM*

BINH HUU DO,

Appellant,

v.

KENNETH S. EILER, Chapter 7 Trustee; 

VOLODYMYR GOLOVAN; PLATINUM 

MANAGEMENT, INC.; PORTLAND 

INJURY INSTITUTE, LLC,

Appellees.

Appeal from the United States Bankruptcy Court

for the District of Oregon

David W. Hercher, Bankruptcy Judge, Presiding

Before: GAN, TAYLOR, and BRAND, Bankruptcy Judges.

INTRODUCTION

Dr. Binh Huu Do, creditor and owner of chapter 71 debtor Portland 

Injury Institute, LLC (“Debtor”), appeals the bankruptcy court’s order 

* 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 Unless specified otherwise, all chapter and section references are to the 

FILED

JAN 27 2022

SUSAN M. SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT
2

authorizing chapter 7 trustee Kenneth Eiler (“Trustee”) to sell estate assets 

pursuant to § 363(b). The court granted Trustee’s motion to sell 

substantially all the estate’s tangible and intangible property, including 

Trustee’s powers to avoid transfers under the Bankruptcy Code, to creditor 

Platinum Management, Inc. (“Platinum”), an entity owned by Volodymyr 

Golovan. We AFFIRM.

FACTS2

A. Prepetition Facts

In December 2018, Dr. Do formed Debtor as a single member LLC to 

perform chiropractic services. After forming Debtor, he entered into an 

agreement with Platinum, under which Platinum would provide 

management and other services to Debtor. The exact nature of the 

agreement is disputed by the parties. Mr. Golovan asserts that as part of 

the agreement, he became a minority owner of Debtor and had a right to 

Dr. Do’s remaining interest in Debtor if he left the practice. Dr. Do 

contends that he was not obligated to transfer his interest and Mr. Golovan 

never had an ownership stake in Debtor.

Because of the dispute, Debtor informed its patients in October 2019 

that it would no longer provide services, and it ceased operations by 

Bankruptcy Code, 11 U.S.C. §§ 101–1532, and all “Rule” references are to the Federal 

Rules of Bankruptcy Procedure.

2 We exercise our discretion to take judicial notice of documents electronically 

filed in Debtor’s bankruptcy case and related adversary proceedings. See Atwood v. 

Chase Manhattan Mortg. Co. (In re Atwood), 293 B.R. 227, 233 n.9 (9th Cir. BAP 2003).
3

November 2019. Mr. Golovan alleges that after Debtor ceased operations, 

Dr. Do continued to collect payments and insurance reimbursements on 

behalf of Debtor and failed to account for over $200,000 of Debtor’s funds. 

Dr. Do claims that after Debtor ceased operations, Mr. Golovan 

attempted to initiate an improper purchase of Dr. Do’s ownership in 

Debtor, filed documents with state authorities indicating that he was the 

sole owner of Debtor, and took possession of all Debtor’s property, 

including patient records.

B. The Bankruptcy Case And Trustee’s § 363 Motion

In January 2021, Debtor filed a chapter 7 petition. Debtor’s only 

scheduled assets consisted of office equipment—repossessed prepetition

and having an unknown value—and accounts receivable, which Debtor 

valued at $0. Debtor included Platinum and Mr. Golovan as unsecured 

creditors but listed their claims at $0. Debtor also scheduled Mr. Golovan 

as owner of a 49% interest in Debtor but indicated that the interest was 

disputed.

In April 2021, Trustee file a motion for authority to sell property

pursuant to § 363. Trustee attached a proposed asset purchase agreement

(“APA”) which contemplated a sale of all Debtor’s personal and intangible 

property, and all causes of action against third parties, including Trustee’s 

avoidance powers under the Bankruptcy Code. The APA excluded from 

assets to be sold the unused retainer held by Debtor’s bankruptcy counsel 

and Debtor’s medical records.
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Trustee proposed to sell the assets by private sale to Platinum for 

$15,000 and set a date for submission of competing bids. Trustee stated in 

the motion: “The buyer claims that it already owns the debtor’s assets. This 

sale is intended to remove any doubt. In addition, this sale will give the 

buyer the right to pursue the debtor’s former principal for any avoidable 

transfers made while that principal controlled the debtor.”

Dr. Do filed an objection to Trustee’s motion, arguing that the 

proposed sale would violate the Health Insurance Portability and 

Accountability Act (“HIPAA”). He maintained that a sale of accounts 

receivable would necessarily include individually identifiable health 

information and was thus subject to HIPAA requirements regarding 

disclosure of protected health information. He also argued that Trustee 

could not sell the avoidance actions to Platinum unless it was pursuing 

interests common to all creditors and would exercise those powers for the 

benefit of the remaining creditors. Dr. Do additionally filed a motion to 

extend the deadline for overbids until seven days after the court ruled on 

his objection and contended that if his objection were overruled, he 

anticipated filing a higher bid.

Platinum responded to Dr. Do’s objection and confirmed its intent to 

comply with HIPAA under the terms of the proposed sale. It attached a 

proposed order that would amend the APA to specifically exclude 

individually identifiable health information or protected health 

information as those terms are used in HIPAA. Platinum further argued 
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that Ninth Circuit precedent permitted Trustee to sell his avoidance actions

“to one who would not exercise the powers for the benefit of all creditors,”

citing Duckor Spradling & Metzger v. Baum Trust (In re P.R.T.C., Inc.), 177 

F.3d 774, 781 (9th Cir. 1999).

In May 2021, the bankruptcy court held an initial hearing on 

Trustee’s motion and instructed the parties to confer regarding dates and 

times for an evidentiary hearing. Prior to a continued status hearing, 

Platinum filed a supplemental response and argued that the court should 

approve the sale without an evidentiary hearing. Platinum attached an 

amended APA which it asserted made clear that no protected health 

information would be included in the sale absent patient consent. It argued 

that the court’s only role was to determine whether Trustee properly 

exercised his business judgment in executing the amended APA. 

At the status hearing, the bankruptcy court questioned whether, in 

light of the amended APA, an evidentiary hearing was still necessary and 

set an argument on whether the sale could be approved based on the 

documents. After the argument, the bankruptcy court determined that the 

amended APA did not violate HIPAA because it expressly excluded 

protected health information and, therefore, an evidentiary hearing was 

unnecessary.

Turning to Dr. Do’s second basis for objection, the bankruptcy court 

stated that it agreed with Simantob v. Claims Prosecutor, LLC (In re Lahijani), 

325 B.R. 282, 288 (9th Cir. BAP 2005), in which we reasoned that an 
6

avoidance action could be sold to a creditor because the purchase price 

would benefit all remaining creditors.

Finally, the bankruptcy court denied Dr. Do’s motion to extend the 

overbid deadline. The court noted that the overbid provision was not 

required and was included by Trustee for his convenience. Trustee 

opposed the extension, and the court reasoned that it cannot remake 

Trustee’s deal and must defer to Trustee’s reasonable business judgment.

The bankruptcy court entered an order granting Trustee’s motion to sell 

the assets, and Dr. Do timely appealed.

JURISDICTION

The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334 and 

157(b)(2)(N). We have jurisdiction under 28 U.S.C. § 158.

ISSUE

Did the bankruptcy court abuse its discretion by granting Trustee 

authority to sell assets under § 363(b)?

STANDARD OF REVIEW

We review for abuse of discretion a bankruptcy court’s decision to 

approve a sale of property under § 363. In re Lahijani, 325 B.R. at 287. A 

bankruptcy court abuses its discretion if it applies an incorrect legal 

standard or its factual findings are illogical, implausible, or without 

support in the record. TrafficSchool.com, Inc. v. Edriver Inc., 653 F.3d 820, 832 

(9th Cir. 2011).
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DISCUSSION

Dr. Do makes three principal arguments on appeal. First, he claims 

that the APA was ambiguous, and the court should have held an 

evidentiary hearing to understand how the sale might violate HIPAA. 

Second, he contends that the bankruptcy court violated Ninth Circuit 

precedent because: (1) it did not determine whether Platinum was a good 

faith purchaser under § 363(m); (2) it did not analyze the sale under the 

“fair and equitable” settlement standard of Rule 9019; and (3) it approved a 

sale of avoidance actions to a creditor who would not pursue the claims on 

behalf of the estate or provide the estate with a share of its potential 

recovery. Finally, Dr. Do argues that the bankruptcy court erred by 

declining to extend Trustee’s bid deadline after granting Trustee’s motion 

for authority to sell assets to Platinum.

A. Legal Standards Involved In § 363 Sales 

Pursuant to § 363(b), a trustee may sell property of the estate, outside

the ordinary course of business, after notice and a hearing. Property of the 

estate which Trustee may sell includes causes of action owned by Debtor 

on the petition date and property recovered by Trustee pursuant to 

avoiding powers. 11 U.S.C. §541(a)(1), (3). In the Ninth Circuit, a 

bankruptcy trustee may also sell or transfer a bankruptcy-specific avoiding 

power. In re Lahijani, 325 B.R. at 288 (citing In re P.R.T.C., Inc., 177 F.3d at 

781; Briggs v. Kent (In re Pro. Inv. Props. of Am.), 955 F.2d 623, 625-26 (9th 

Cir. 1992)).
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Trustee’s obligation in selling property, and the bankruptcy court’s 

obligation in approving a motion under § 363(b), “is to assure that optimal 

value is realized by the estate under the circumstances.” In re Lahijani, 325 

B.R. at 288. We defer to Trustee’s position “where business judgment is 

entailed in the analysis or where there is no objection.” Id. at 289.

B. The Bankruptcy Court Correctly Determined The Sale Would Not 

Violate HIPAA.

We agree with the bankruptcy court that an evidentiary hearing was 

unnecessary because, after Trustee amended the APA, there was no factual 

question about whether the proposed sale involved protected health

information. The amended APA specifically excluded from assets to be 

sold, “any protected health information or other information . . . covered by 

[HIPPA]” and further stated, “[f]or avoidance of doubt, Seller is not selling, 

and Buyer is not buying, any Protected Health Information and no such 

Protected Health Information will be transferred as a result of this 

Transaction.” And the bankruptcy court’s order authorizing the sale 

contained a provision that “the Purchased Assets do not include any 

individually identifiable health information or protected health 

information, as those terms are used in [HIPPA].”

Dr. Do argues that Platinum, Mr. Golovan, and Trustee

misunderstand what information is protected under HIPAA and which 

assets may contain protected health information. But Dr. Do does not 

explain how the bankruptcy court abused its discretion by approving a sale 
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that expressly excludes protected health information, regardless of the 

parties’ alleged confusion about its definition.

If Trustee conveyed to Platinum protected health information, as Dr. 

Do fears, he would not do so under the authority of the bankruptcy court’s 

order. The bankruptcy court has an obligation to ensure that its sale order 

complies with law, but it is not required, as a condition of approving a sale, 

to anticipate and protect against actions taken in contravention of its 

orders. We see no abuse of discretion in the bankruptcy court’s decision to 

approve the sale without an evidentiary hearing about potential violations 

of HIPAA.

C. The Bankruptcy Court Applied The Correct Analysis In Approving 

The Sale.

Dr. Do misapprehends the legal framework involved in a bankruptcy 

court’s authorization of a sale under § 363(b). First, he argues that the 

bankruptcy court was required to conduct a good faith and fair dealing 

analysis before approving the sale, but we have previously held “an actual 

finding of ‘good faith’ is not an essential element for approval of a sale 

under § 363(b).” Thomas v. Namba (In re Thomas), 287 B.R. 782, 785 (9th Cir. 

BAP 2002). A good faith finding is relevant to the safe harbor provisions of 

§ 363(m), but Trustee did not request a § 363(m) determination and the 

court was not required to make a factual finding of good faith to approve 

the sale under § 363(b). DeBilio v. Golden (In re DeBilio), BAP No. CC-13-

1441-TaPaKi, 2014 WL 4476585, at *6 (9th Cir. BAP Sept. 11, 2014). 
10

Second, Dr. Do claims that the bankruptcy court should have 

evaluated the sale under the “fair and equitable” settlement standard as 

described in Goodwin v. Mickey Thompson Entertainment Group (In re Mickey 

Thompson Entertainment Group), 292 B.R. 415 (9th Cir. BAP 2003). Dr. Do did 

not raise this argument in the bankruptcy court and, thus, has waived the 

issue. See Mano-Y & M, Ltd. v. Field (In re Mortg. Store, Inc.), 773 F.3d 990, 

998 (9th Cir. 2014).

Furthermore, it is appropriate for a bankruptcy court to analyze a 

sale of an estate cause of action under the settlement standard when the 

purchaser of the action is also the potential defendant of the cause of 

action. See Fitzgerald v. Ninn Worx Sr, Inc. (In re Fitzgerald), 428 B.R. 872, 884 

(9th Cir. BAP 2010); In re Lahijani, 325 B.R. at 290. This analysis “rest[s] on 

the common-sense proposition that a ‘sale’ of claims to a defendant has the 

same effect as a settlement of those claims, so such ‘sales’ should be 

evaluated both as sales and as settlements.” Rogers v. Gladstone (In re 

Bardos), BAP No. CC-15-1217-FDKu, 2016 WL 1161225, at *10 (9th Cir. BAP 

Mar. 23, 2016). But the potential avoidance actions at issue here are against 

Dr. Do, not Platinum. There is no basis for the court to analyze the sale of 

claims against Dr. Do under the settlement standard when such claims are 

sold to a third party who is not a potential defendant.

Finally, Dr. Do contends that under the holding of P.R.T.C., the 

avoidance actions could be sold only to a third party who would pursue 

interests common to all creditors and would exercise the avoidance powers 
11

for the benefit of all creditors. We specifically rejected this argument in 

Lahijani:

We reject appellants’ argument that the avoiding power 

causes of action should not have been sold to one who would 

not exercise the powers for the benefit of all creditors.

The difficulty with this argument is that, under the law of 

the circuit, trustee avoiding powers may be transferred for a 

sum certain. P.R.T.C., 177 F.3d at 781–82; Briggs, 955 F.2d at 

625–26. The benefit to the estate in such circumstances is the 

sale price, which might or might not include a portion of future 

recoveries for the estate. Thus, P.R.T.C. and Briggs do not

mandate, as appellants contend, that the avoidance powers can 

only be sold to a creditor who agrees to pursue those avoidance 

powers for the benefit of all creditors.

325 B.R. at 288.

The bankruptcy court did not abuse its discretion by authorizing the 

sale of avoidance actions to Platinum for a sum certain.

D. The Bankruptcy Court Did Not Err By Denying Dr. Do’s Motion To 

Extend The Overbid Deadline.

Dr. Do’s motion to extend the overbid deadline is essentially an 

objection to Trustee’s sale procedures. “A trustee’s selection of bidding and 

sale procedures is a matter committed to the trustee’s business judgment, 

to which the bankruptcy court and this Panel give deference.” Bonnett v. 

Gillespie (In re Irish Pub-Arrowhead, LLC), BAP Nos. AZ-13-1024-PaKuD, 

AZ-13-1043-PaKuD, 2014 WL 486955, at *10 (9th Cir. BAP Feb. 6, 2014). 
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Here, Trustee exercised his business judgment by proposing a private 

sale of assets to Platinum with a procedure for interested parties to submit 

higher bids. Dr. Do argues that the bankruptcy court should not have 

relied on Trustee’s business judgment because the court has the ultimate 

responsibility to ensure that estate assets are sold for optimal value. Dr. Do 

had notice of the proposed sale and overbid deadline, but he did not 

submit a competing bid or object that the proposed sale provided 

insufficient value. See In re Lahijani, 325 B.R. at 287 (“Objections to sale that 

are based on inadequacy of price are often resolved by the court ordering 

an auction, which may occur in open court.”). Instead, he sought to 

conditionally modify Trustee’s bid procedures without any evidence that 

an extension would yield a higher bid. The bankruptcy court appropriately 

deferred to Trustee’s business judgment and did not abuse its discretion by 

denying Dr. Do’s motion.

CONCLUSION

Based on the foregoing, we AFFIRM the bankruptcy court’s order 

authorizing the sale under § 363(b).