Court Opinion

ID: 1037816
Source: CourtListenerOpinion
Date Created: 2013-08-16 20:04:16.273358+00
Date Added: 2024-06-11T09:18:36.597008
License: Public Domain

FILED
                           NOT FOR PUBLICATION                             AUG 16 2013

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

In re: SAMUEL E. FANDAY,                         No. 12-60017

              Debtor,                            BAP No. 10-1199

BARRY COE,                                       MEMORANDUM*

              Appellant,

  v.

SAMUEL E. FANDAY,

              Appellee.

                           Appeal from the Ninth Circuit
                            Bankruptcy Appellate Panel
             Kirscher, Pappas, and Dunn, Bankruptcy Judges, Presiding

                           Submitted August 13, 2013**
                             San Francisco, California

Before: HAWKINS, THOMAS, and McKEOWN, Circuit Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
      Barry Coe appeals the decision of the Ninth Circuit Bankruptcy Appellate

Panel (“BAP”) affirming the bankruptcy court’s judgment in favor of Samuel

Fanday on Coe’s claims of nondischargeability under 11 U.S.C. § 523 and 11

U.S.C. § 727. We have jurisdiction under 28 U.S.C. § 158(d). Because the parties

are familiar with the history of the case, we need not recount it here. We affirm.

                                           I

      The bankruptcy court did not err in rejecting Coe’s claim that the default

judgment he secured against Fanday was nondischargeable under 11 U.S.C. §

523(a)(6).

      There was no clear error in the bankruptcy court’s finding that the break-up

of Pellu Systems, Inc. was the result of poor planning and undercapitalization

rather than a malicious intent on the part of Fanday. See Brawders v. Cnty. of

Ventura (In re Brawders), 503 F.3d 856, 859 n.1 (9th Cir. 2007) (reviewing the

bankruptcy court’s factual findings for clear error). Coe presented no facts in

support of a finding that Fanday’s decision to halt participation in the business was

motivated by a subjective intent to injure him. See Carrillo v. Su (In re Su), 290

F.3d 1140, 1142 (9th Cir. 2002) (“[Section] 523(a)(6)’s willful injury requirement

is met only when the debtor has a subjective motive to inflict injury or when the

debtor believes that injury is substantially certain to result from his own

                                          -2-
conduct.”). As to Coe’s characterization of the evidence,“[w]here there are two

permissible views of the evidence, the factfinder’s choice between them cannot be

clearly erroneous.” Anderson v. Bessemer City, 470 U.S. 564, 574 (1985).1

      Coe argument as to that Fanday’s alleged commercialization of the Pellu

formula is waived because Coe did not present it to the bankruptcy court. El Paso

v. Am. W. Airlines, Inc. (In re Am. W. Airlines, Inc.), 217 F.3d 1161, 1165 (9th Cir.

2000).

                                          II

      The bankruptcy court did not err in rejecting Coe’s claim that Fanday is not

entitled to a discharge due to alleged violations of 11 U.S.C. §§ 727(a)(4)(A) and

727(a)(4)(D).

      There was no clear error in the bankruptcy court’s finding that Fanday did

not make a false oath at the creditors meeting. Coe produced no evidence

supporting the claimed falsehoods. Because the bankruptcy court did not clearly

err in finding that Coe failed to prove, by a preponderance of the evidence, that

      1
        Coe argues that the bankruptcy court did not afford him enough time to
address Pellu Systems’s poorly developed business model. But the bankruptcy
court’s management of Coe’s questioning was far from an abuse of discretion. See
FTC v. Enforma Natural Prods., Inc., 362 F.3d 1204, 1212 (9th Cir. 2004)
(reviewing lower courts’ litigation management decisions for abuse of discretion);
Gen. Signal Corp. v. MCI Telecomms. Corp., 66 F.3d 1500, 1508 (9th Cir. 1995)
(“Generally, a district court may impose reasonable time limits on a trial.”).

                                         -3-
Fanday “made a false oath in connection with the case,” the bankruptcy court

properly rejected Coe’s claim that Fanday should be denied a discharge under §

727(a)(4)(A). See Retz v. Samson (In re Retz), 606 F.3d 1189, 1197 (9th Cir. 2010)

(explaining the requirements for denying a debtor a discharge under §

727(a)(4)(A)).2

      Likewise, there was no clear error in the bankruptcy court’s finding that

Fanday did not omit a material fact—namely, intellectual property rights in the

Pellu formula—from his bankruptcy schedules. Because the bankruptcy court did

not clearly err in finding that Fanday did not omit material facts from his

bankruptcy schedules, it did not err in rejecting Coe’s claim that Fanday should be

denied a discharge under § 727(a)(4)(A) or in rejecting Coe’s claim that Fanday

violated 11 U.S.C. § 727(a)(4)(D) by knowingly and fraudulently withholding

documentation relating to his property.

                                          III

      Because the bankruptcy court properly rejected Coe’s claims of

nondischargeability, the wage garnishment issue is moot—the previously-

      2
       Coe’s allegation for the first time on appeal that Fanday made a false
statement regarding Wastech is waived. Am. W. Airlines, Inc., 217 F.3d at 1165.

                                          -4-
garnished wages are in Fanday’s possession, and Coe is no longer entitled to

collect them.

      AFFIRMED.

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