Court Opinion

ID: 4192568
Source: CourtListenerOpinion
Date Created: 2017-08-03 17:01:43.738824+00
Date Added: 2024-06-11T14:40:18.939948
License: Public Domain

FILED
                                                             JUL 05 2017
 1                         NOT FOR PUBLICATION
                                                        SUSAN M. SPRAUL, CLERK
 2                                                        U.S. BKCY. APP. PANEL
                                                          OF THE NINTH CIRCUIT
 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                        )        BAP No. AZ-16-1213-JuLB
                                   )
 6   REGIONAL CARE SERVICES CORP., )        Bk. No. 14-01383-BMW
                                   )
 7                   Debtor.       )
     ______________________________)
 8   SCOTT B. DAVIS, Creditor      )
     Trustee of the Regional Care )
 9   Services Corp.,               )
                                   )
10                   Appellant,    )
                                   )
11   v.                            )        M E M O R A N D U M*
                                   )
12   ARMANDO BELLOC,               )
                                   )
13                   Appellee.     )
     ______________________________)
14
                      Argued and Submitted on May 18, 2017
15                             at Phoenix, Arizona
16                            Filed - July 5, 2017
17             Appeal from the United States Bankruptcy Court
                         for the District of Arizona
18
       Honorable Brenda Moody Whinery, Bankruptcy Judge, Presiding
19                _____________________________________
20   Appearances:     Michael J. Pankow of Brownstein Hyatt Farber
                      Schreck, LLP argued for appellant; Kyle J.
21                    Shelton of Shah and Associates, PLLC argued for
                      appellee.
22                   _____________________________________
23   Before:   JURY, LAFFERTY, and BRAND, Bankruptcy Judges.
24
25
26       *
          This disposition is not appropriate for publication.
27 Although it may be cited for whatever persuasive value it may
   have (see Fed. R. App. P. 32.1), it has no precedential value.
28 See 9th Cir. BAP Rule 8024-1.

                                      -1-
 1            Regional Care Services Corporation (RCSC), Casa Grande
 2   Regional Medical Center (Casa Grande), and other related
 3   entities (collectively, Debtors) each filed chapter 111
 4   petitions, which were jointly administered.     Appellee, Armando
 5   Belloc (Mr. Belloc), received medical care at Casa Grande.
 6   Prior to Debtors’ bankruptcy filings, Mr. Belloc commenced a
 7   malpractice lawsuit against the physicians and others who had
 8   provided him care, but did not name Casa Grande as a defendant.
 9   About a year later, Mr. Belloc filed another malpractice
10   lawsuit, this time naming Casa Grande as a defendant along with
11   those previously named.     At this time, Mr. Belloc learned that
12   Casa Grande was in bankruptcy and stopped prosecution of the
13   state court lawsuit.
14           He then filed a proof of claim (POC) and a motion for
15   relief from stay in Casa Grande’s bankruptcy case.     By that
16   time, the claims bar date had passed and Debtors’ second amended
17   joint chapter 11 plan had been confirmed.     Appellant, Scott B.
18   Davis, the creditor trustee (Creditor Trustee) appointed
19   pursuant to a Creditor Trust Agreement, which was created by the
20   confirmed plan to administer the assets and pay allowed claims,
21   objected to the POC, contending that Mr. Belloc had received
22   notice of the claims bar date and thus his late-filed POC was
23   barred.
24           At a preliminary hearing, Mr. Belloc’s attorney asserted
25
         1
26        Unless otherwise indicated, all chapter and section
   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532,
27 “Rule” references are to the Federal Rules of Bankruptcy
   Procedure, and “Civil Rule” references are to the Federal Rules
28 of Civil Procedure.

                                      -2-
 1   that Mr. Belloc did not receive notice of the claims bar date or
 2   of the bankruptcy filing.   The bankruptcy court noted that it
 3   appeared he had been served, but continued the matter to allow
 4   Mr. Belloc’s counsel to consider the service issue and to file a
 5   motion to allow a late-filed claim if appropriate.
 6        On the eve of the continued hearing, Creditor Trustee
 7   submitted a declaration from Kathryn Tran (Tran Declaration),
 8   the employee of the entity which had prepared the affidavit of
 9   service and served notice of the claims bar date on February 14,
10   2014.   Attached to that declaration was an affidavit of service
11   and a heavily redacted service list that showed Mr. Belloc’s
12   name and address.    An affidavit of service was also filed on the
13   public docket on February 14, 2014, but the service list of that
14   affidavit did not show Mr. Belloc’s name and address.
15        Counsel for Creditor Trustee argued that Mr. Belloc was
16   served with notice of the bar date and bankruptcy filing, but
17   that due to the federal Health Insurance Portability and
18   Accountability Act (HIPAA), the names and addresses of patients
19   who had potential malpractice claims, including Mr. Belloc, were
20   redacted on the service list which was filed on the public
21   docket.   Counsel further represented that the affidavit of
22   service with the attached unredacted service list was filed with
23   the bankruptcy judge’s chambers and showed that Mr. Belloc was
24   served.   He admitted however that his office had redacted the
25   service list attached to the declaration the night before the
26   continued hearing.   Therefore, the service list attached to the
27   declaration was not the unredacted list that had been allegedly
28   filed under seal or delivered to the judge’s chambers.   Due to

                                     -3-
 1   the inconsistencies in the record regarding service on
 2   Mr. Belloc, the bankruptcy court found that his POC should be
 3   deemed timely filed and granted Mr. Belloc’s motion for relief
 4   from stay to proceed with the state court litigation.
 5           Creditor Trustee filed a motion for reconsideration under
 6   Civil Rule 59(e) to alter or amend the judgment along with an ex
 7   parte motion to file the unredacted affidavit of service and
 8   service list, showing Mr. Belloc’s name and address, under seal.
 9   The bankruptcy court granted the ex parte motion and later
10   issued a ruling and order denying the reconsideration motion
11   since there were no grounds to alter or amend the judgment.       The
12   bankruptcy court found that the service list with the unredacted
13   affidavit of service was not newly discovered evidence since it
14   was available to Creditor Trustee at the time of the prior
15   hearing.
16           Creditor Trustee appeals from the bankruptcy court’s order
17   denying his motion for reconsideration.     For the reasons set
18   forth below, we AFFIRM.
19                                 I. FACTS2
20           Mr. Belloc received care at Casa Grande.   On June 25, 2013,
21   he filed a malpractice complaint in the Arizona state court
22   against the physicians and others at Casa Grande that provided
23   him care (Case No. CV2-01300466).
24           On February 4, 2014, RCSC, Casa Grande and other related
25   entities filed for relief under chapter 11.     The cases were
26
         2
27        We borrow heavily from the facts set forth in the
   bankruptcy court’s June 29, 2016 decision which denied Creditor
28 Trustee’s motion to alter or amend the judgment.

                                      -4-
 1   assigned to Judge Hollowell.    By order, Debtors’ cases were
 2   jointly administered under the initial case filed by RCSC.
 3   A.   The Bar Date Order
 4        At Debtors’ request, the bankruptcy court approved the
 5   appointment of Epiq Bankruptcy Solutions, LLC (Epiq) as agent
 6   for receiving proofs of claim and providing notices in the case.
 7   On February 12, 2014, the bankruptcy court entered an order
 8   fixing April 15, 2014, as the deadline for filing proofs of
 9   claim (Bar Date Order).
10        Epiq mailed notice of the Bar Date Order to potential
11   creditors on February 14, 2014, and filed an affidavit of
12   service on February 20, 2014, reflecting service of the Bar Date
13   Order as well as notice of the chapter 11 cases (2/17/14
14   Affidavit).   Because Debtors were obligated to maintain strict
15   patient privacy under HIPPA, the service list filed on the
16   public docket omitted the names and addresses of patients who
17   might assert personal injury or medical malpractice claims
18   against Debtors.    Exhibit B to the 2/17/14 Affidavit is a
19   forty-five page service list which did not include Mr. Belloc’s
20   name and address.
21   B.   Confirmation Of Debtors’ Plan
22        On May 15, 2014, the bankruptcy court entered an order
23   confirming Debtors’ second amended joint chapter 11 plan of
24   reorganization dated March 28, 2014 (Plan).    The Plan provided
25   for the sale of Debtors’ assets to Banner Health with the
26   distribution of the sale proceeds to creditors.    Secured and
27   priority claims — including secured claims of bondholders — and
28   costs of administration were to be paid on the effective date of

                                     -5-
 1   the plan or shortly after allowance.   The remainder of the sale
 2   proceeds were subject to pro rata distribution to general
 3   unsecured creditors with reserves for disputed claims in the
 4   full face amount of the claim (except that insured personal
 5   injury claims required reserves only for the deductible amount).
 6        The Plan provided for the creation of a Creditor Trust and
 7   appointment of a trustee who would, among other things, analyze,
 8   object to and resolve claims, prosecute, abandon, and resolve
 9   causes of action, make distributions to holders of allowed
10   claims and wind-down the estates.
11        On June 30, 2014, the bankruptcy court granted Debtors’
12   motion to approve the Creditor Trust Agreement.    Pursuant to the
13   agreement, Mr. Davis was appointed Creditor Trustee.
14   C.   Mr. Belloc’s POC And First Motion For Relief From Stay
15        On July 16, 2014, Mr. Belloc filed a new malpractice
16   complaint in the Arizona state court, this time naming Casa
17   Grande as a defendant along with the physicians and others that
18   had provided him care (Case No. CV2-01401737).    After this
19   filing, Mr. Belloc learned that Casa Grande was in bankruptcy
20   and stopped prosecuting the case.
21        On August 1, 2014, Mr. Belloc filed a POC in Casa Grande’s
22   bankruptcy case, designated as Claim No. 45.   On the same date,
23   he filed a motion for relief from stay to continue the state
24   court litigation (First Relief Motion).   Creditor Trustee
25   objected, contending that Mr. Belloc’s POC was time barred since
26   he was served with the Bar Date Order.    Creditor Trustee further
27   argued that Mr. Belloc had not established cause for relief from
28   stay and allowing him to proceed would have an adverse impact on

                                   -6-
 1   the bankruptcy estate and creditors.
 2        On August 19, 2014, Debtors’ cases were transferred from
 3   Judge Hollowell to Judge Whinery due to Judge Hollowell’s
 4   retirement from the bench.
 5        On October 15, 2014, the bankruptcy court held a
 6   preliminary hearing on the First Relief Motion.    The court noted
 7   that Mr. Belloc missed the bar date and apparently was served.
 8   Counsel for Creditor Trustee asserted that Mr. Belloc had
 9   received notice of the case and the Bar Date Order as set forth
10   in the 2/17/14 Affidavit.    The bankruptcy court continued the
11   hearing to November 18, 2014, to allow Mr. Belloc’s counsel to
12   consider the service issue and to file a motion to allow a
13   late-filed claim if appropriate.
14   D.   The November 18, 2014 Hearing
15        On October 17, 2014, Creditor Trustee’s counsel sent a
16   letter to Mr. Belloc’s counsel explaining that the filed copy of
17   the 2/17/14 Affidavit and service list would not show any
18   information relating to Mr. Belloc due to HIPPA regulations.
19        On November 5, 2014, Mr. Belloc filed his motion for an
20   order approving the late filing of his POC and for relief from
21   the automatic stay so that he could continue his lawsuit against
22   Casa Grande and the other defendants.    The motion denied that
23   Mr. Belloc received notice of the bankruptcy cases or the Bar
24   Date Order.   It also contended that the bankruptcy court should
25   permit Mr. Belloc to file a late POC based on his excusable
26   neglect.
27        In opposition, Creditor Trustee argued that Mr. Belloc had
28   provided no basis for the court to consider his late-filed POC,

                                     -7-
 1   other than his denial that he received the notice of the Bar
 2   Date Order.     Creditor Trustee next argued that Mr. Belloc
 3   provided no evidence to rebut the presumption that the Bar Date
 4   Order was mailed to his address and received.      Last, Creditor
 5   Trustee asserted that the standards for excusable neglect were
 6   not met because Mr. Belloc offered no reason for the delay and
 7   if his claim were deemed timely filed it would prejudice
 8   Debtors’ estates.
 9           In a supporting declaration, Creditor Trustee explained
10   that the negotiated purchase price for Debtors’ assets would
11   result in a full or close to full payout to creditors.
12   According to Creditor Trustee, Debtors solicited votes from
13   creditors based on this analysis.      He also declared that
14   Mr. Belloc was served with notice of the Bar Date Order and the
15   bankruptcy cases on February 14, 2014.      Finally, he stated that
16   in his opinion, allowing the late-filed POC would cause
17   administration of the Creditor Trust to become impracticable and
18   the ultimate wind-down of the estates unreasonably protracted.
19           On November 17, 2014, the day before the continued hearing,
20   Creditor Trustee filed the declaration of Kathryn Tran (Tran
21   Declaration), a senior consultant of Epiq.      She declared that
22   she mailed notice of the Bar Date Order on February 14, 2014, as
23   indicated on the 2/17/14 Affidavit at Exhibit A.3     She further
24   declared that Mr. Belloc was served and that his mail was not
25   returned.     Attached as Exhibit B was the 45 page service list.
26
         3
27        The filed proof of service was signed by Christina
   Siguenza, not Ms. Tran. Nothing in Creditor Trustee’s papers
28 explains this discrepancy.

                                      -8-
 1   Mr. Belloc’s name and address was listed on page 4 of 45.
 2        At the November 18, 2014 hearing, the bankruptcy court
 3   noted that the 2/17/14 Affidavit at Docket #111 did not show
 4   Mr. Belloc.   Counsel for Creditor Trustee explained that a list
 5   of personal injury claimants was not filed on the public docket
 6   but filed under seal or delivered to Judge Hollowell’s chambers
 7   and that list would reflect service on Mr. Belloc.   Counsel also
 8   referenced the Tran Declaration and acknowledged that the
 9   service list originally attached to the 2/17/14 Affidavit had
10   been altered by his office prior to its filing the night before.
11   Therefore, that service list was not actually the unredacted
12   list that had allegedly been filed under seal or delivered to
13   Judge Hollowell’s chambers.   Counsel informed the bankruptcy
14   court that he would provide an unredacted version of the list
15   that was filed.   The bankruptcy court noted that Judge Hollowell
16   had approved one filing under seal, but the court was not aware
17   of any affidavits of service filed under seal.
18        In the end, the court found that the evidence submitted was
19   not sufficient to show that service was provided to Mr. Belloc.
20   The court further found that even if service was provided, the
21   excusable neglect standard was met.   The bankruptcy court deemed
22   the POC timely filed and granted Mr. Belloc relief from stay to
23   proceed in state court.   The bankruptcy court entered an order
24   consistent with its ruling on December 8, 2014.
25   E.   Creditor Trustee’s Motion For Reconsideration
26        On December 22, 2014, Creditor Trustee filed an Ex-Parte
27   Motion to File Unredacted Affidavits of Service Under Seal to
28   Comply with HIPAA, which requested authority to file unredacted

                                    -9-
 1   Affidavits of Service relating to the notice of case filings and
 2   the Bar Date Order.    The ex parte motion explained that Epiq
 3   prepared two affidavits of service - one which was filed with
 4   the court that redacted the names and addresses of the 817
 5   employees and 16 patients such that there was no evidence of
 6   them being served and one unredacted affidavit of service that
 7   included the names and addresses of the 817 employees and 16
 8   patients.    The unredacted affidavit however was never made part
 9   of the record under seal or otherwise.    The court granted the ex
10   parte motion by order entered on January 15, 2015, and the
11   unredacted affidavit of service was filed under seal the next
12   day.
13          Creditor Trustee also filed a motion for reconsideration
14   under Rule 9023, which incorporates Civil Rule 59, on
15   January 15, 2015.    There, he maintained that the bankruptcy
16   court’s previous findings regarding service and excusable
17   neglect were made without taking evidence.    Creditor Trustee
18   explained that he investigated the service issue further and
19   found that the unredacted copy of the affidavit of service and
20   mailing list, although prepared contemporaneously with the
21   filing of the 2/17/14 Affidavit at Docket #111, was not provided
22   to Judge Hollowell’s chambers or filed under seal.
23          Creditor Trustee also informed the court that he learned
24   that Mr. Belloc had previously commenced a lawsuit on his
25   medical malpractice claim well before the bankruptcy filing of
26   Casa Grande, but did not sue the hospital at that time.
27   According to Creditor Trustee, these facts showed that
28   Mr. Belloc made a conscious decision, as opposed to an alleged

                                     -10-
 1   failure of notice, not to assert a claim against Casa Grande.
 2   Creditor Trustee argued:     “This new information calls into
 3   question [Mr.] Belloc’s representations and highlights the need
 4   for an evidentiary record in this matter.”
 5           Creditor Trustee also asserted that he could demonstrate
 6   that Mr. Belloc was served with the Bar Date Order and
 7   “apologize[d] for the error in describing this point in earlier
 8   hearings.”     Creditor Trustee further argued that the bankruptcy
 9   court’s decision to rule without taking evidence was erroneous
10   and in this case would result in manifest injustice.     Creditor
11   Trustee contended that as offered at the November 18, 2014
12   hearing on this matter, the Epiq claims agent would be available
13   to provide testimony to substantiate both underlying service and
14   the preparation of the full certificate of service with respect
15   to the unredacted service list.
16           Attached to the motion was the letter that was sent to
17   Belloc’s counsel, the unredacted Affidavit of Service with
18   Belloc’s name and address, and the complaint that Mr. Belloc
19   filed against the defendant-doctors in February 25, 2013.
20           Almost a year and a half later,4 on June 29, 2016, the
21   bankruptcy court issued a ruling and order denying Creditor
22   Trustee’s motion for reconsideration.     The bankruptcy court
23   noted that Creditor Trustee failed to submit a credible
24   affidavit of service to the court prior to the November 18, 2014
25
26       4
          The court did not rule on the motion for reconsideration
27 until Creditor Trustee set it for hearing after it went
   unresolved for more than a year. Meanwhile, the state court
28 litigation between Mr. Belloc and Debtor progressed.

                                      -11-
 1   hearing that reflected that Mr. Belloc was served with the Bar
 2   Date Order.     The court further noted that the 2/17/14 Affidavit
 3   filed at Docket #111, “clearly does not list Mr. Belloc as
 4   having received notice.”    The court also observed that the Tran
 5   Declaration, while stating that Mr. Belloc was on the service
 6   list, attached and referenced the 2/17/14 Affidavit or what
 7   looks like it, with the exception that Exhibit B lists
 8   Mr. Belloc and contains significant redactions.
 9           The court further found that Creditor Trustee had access to
10   the unredacted affidavit of service long before the November 18,
11   2014 hearing, and thus it was not new evidence that would
12   justify the granting of his motion.     Finally, the court found
13   that none of the other elements for granting a motion to alter
14   or amend a judgment were met in the case; there was no
15   intervening law or manifest error of law or fact and no manifest
16   injustice to be corrected.     In the end, the court concluded that
17   Creditor Trustee failed to meet his burden to establish a basis
18   for altering or amending the order under Civil Rule 59(e).     Due
19   to its decision on the notice issue, the court found it
20   unnecessary to address whether the standards for excusable
21   neglect had been met.
22           On July 12, 2016, Creditor Trustee filed a timely notice of
23   appeal of the bankruptcy court’s ruling and order denying his
24   motion for reconsideration.5
25
         5
26        Although the notice of appeal refers only to the order
   denying Creditor Trustee’s motion for reconsideration, the appeal
27 of the order denying a Rule 9023 motion is sufficient to bring up
   the merits of both the underlying order and the Rule 9023 motion
28                                                    (continued...)

                                      -12-
 1                                II.   JURISDICTION
 2        The bankruptcy court had jurisdiction over this proceeding
 3   under 28 U.S.C. §§ 1334 and 157(b)(2)(B).         We have jurisdiction
 4   under 28 U.S.C. § 158.
 5                                  III.    ISSUES
 6        A.   Did the bankruptcy court err in granting Mr. Belloc’s
 7   Motion to Approve Late-Filed Proof of Claim and for Relief from
 8   the Automatic Stay based on the evidence submitted at the
 9   November 18, 2014 hearing?
10        B.   Did the bankruptcy court err in overruling Creditor
11   Trustee’s Motion for Reconsideration?
12        C.   Did the bankruptcy court err by not holding an
13   evidentiary hearing?
14                          IV.    STANDARDS OF REVIEW
15        To the extent certain facts regarding service of process
16   are disputed, those facts are reviewed under the clearly
17   erroneous standard.    See Keys v. 701 Mariposa Project, LLC
18   (In re 701 Mariposa Project, LLC), 514 B.R. 10, 14 (9th Cir. BAP
19   2014) (citing S.E.C. v. Internet Sols. for Bus. Inc., 509 F.3d
20   1161, 1165 (9th Cir. 2007)).        Findings of fact are clearly
21   erroneous if they are “illogical, implausible, or without
22   support in the record.”       Retz v. Samson (In re Retz), 606 F.3d
23   1189, 1196 (9th Cir. 2010).
24        We review the bankruptcy court’s denial of a motion under
25
          5
26       (...continued)
   since the Rule 9023 motion was filed within fourteen days after
27 entry of the underlying order. See Watson v. Shandell
   (In re Watson), 192 B.R. 739, 742 n.3 (9th Cir. BAP 1996), aff’d,
28 116 F.3d 488 (9th Cir. 1997)(table).

                                           -13-
 1   Civil Rule 59(e) under the abuse of discretion standard.
 2   Ta Chong Bank Ltd. v. Hitachi High Techs. Am., Inc., 610 F.3d
 3   1063, 1066 (9th Cir. 2010).
 4        We also review the bankruptcy court’s decision not to
 5   conduct an evidentiary hearing under the abuse of discretion
 6   standard.    Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133, 1139
 7   (9th Cir. 2004).
 8        Under the abuse of discretion standard, we first “determine
 9   de novo whether the [bankruptcy] court identified the correct
10   legal rule to apply to the relief requested.”      United States v.
11   Hinkson, 585 F.3d 1247, 1261-62 & n.21 (9th Cir. 2009)
12   (en banc).   If the bankruptcy court identified the correct legal
13   rule, we then determine under the clearly erroneous standard
14   whether its factual findings and its application of the facts to
15   the relevant law were: “(1) illogical, (2) implausible, or
16   (3) without support in inferences that may be drawn from the
17   facts in the record.”    Id.
18                              V.   DISCUSSION
19   A.   The bankruptcy court did not err in granting Mr. Belloc’s
          Motion to Approve Late-Filed Proof of Claim and for Relief
20        from the Automatic Stay.
21        There is no question that Mr. Belloc’s POC was filed after
22   the claims bar date.    The crux of this appeal is whether
23   Mr. Belloc received notice of the Bar Date Order.      It is a
24   fundamental principle of due process that known creditors of a
25   debtor are entitled to actual notice of a claims bar date before
26   their claims can be extinguished.       City of New York v. New York,
27   N.H. & H.R. Co., 344 U.S. 293 (1953).      This is true in
28   chapter 11 cases even where the creditor may have actual

                                      -14-
 1   knowledge of the pendency of the bankruptcy.    Id. at 297.    A
 2   creditor in a reorganization has a “right to assume” that he
 3   will receive all required notices before his claim will be
 4   forever barred.    Id.; see also Levin v. Maya Constr. Co.
 5   (In re Maya Constr. Co.), 78 F.3d 1395, 1399 (9th Cir. 1996)
 6   (known creditors are entitled to official or formal notice of a
 7   debtor’s bankruptcy filing and claims bar date).
 8        1.   The Mailbox Presumption
 9        Rule 9006(e) provides that “[s]ervice of process and
10   service of any paper other than process or of notice by mail is
11   complete on mailing.”    While the language suggests that actual
12   receipt of the notice may be unnecessary, courts in this Circuit
13   have applied the mailbox presumption to bankruptcy cases to
14   support a finding of receipt.    See Moody v. Bucknum
15   (In re Bucknum), 951 F.2d 204, 206 (9th Cir. 1991) (applying
16   presumption to dischargeability of debt complaint); Cuna Mutual
17   Ins. Group v. Williams (In re Williams), 185 B.R. 598 (9th Cir.
18   BAP 1995) (same).    In the common law, “proof that a letter
19   properly directed was placed in a post office creates a
20   presumption that it reached its destination in usual time and
21   was actually received by the person to whom it was addressed.”
22   Hagner v. U.S., 285 U.S. 427, 430 (1932) (citing Rosenthal v.
23   Walker, 111 U.S. 185, 193 (1884)).     “The rule is a key support
24   of the bankruptcy system’s notice by mail.”    In re Williams,
25   185 B.R. at 599.    A presumption of receipt is established by a
26   showing of proper mailing.    Lewis v. U.S., 144 F.3d 1220, 1222
27   (9th Cir. 1998); Herndon v. De La Cruz (In re De la Cruz),
28   176 B.R. 19, 22 (9th Cir. BAP 1994).

                                     -15-
 1        2.   Analysis
 2        At the preliminary hearing and the November 18, 2014
 3   hearings, Mr. Belloc maintained in his pleadings - albeit not by
 4   declaration - that he received no notice of the Bar Date Order.
 5   At the November 18, 2014 hearing, the bankruptcy court noted
 6   that the 2/17/14 Affidavit and service list filed in the
 7   bankruptcy court at Docket #111 did not show Mr. Belloc’s name
 8   and address.   Counsel for Creditor Trustee argued that in order
 9   to comply with HIPPA, a redacted affidavit of service was filed
10   on the public docket but he thought an unredacted affidavit of
11   service and service list was filed under seal or with Judge
12   Hollowell’s chambers and that this unredacted version would show
13   Mr. Belloc had been served with notice of the Bar Date Order.
14   However, this unredacted version that he spoke about was clearly
15   not the one attached to the Tran Declaration.
16        As the bankruptcy court noted, counsel acknowledged that
17   the service list attached as Exhibit B to the 2/17/14 Affidavit
18   had been heavily redacted by his office the night before it was
19   filed in the bankruptcy court.    The bankruptcy court found that
20   the redaction of Exhibit B which contained Mr. Belloc’s name and
21   address destroyed the integrity and credibility of the Tran
22   Declaration.
23        Therefore, since there was no corroborating evidence
24   showing that Mr. Belloc had been served with notice of the Bar
25   Date Order, the mailbox presumption did not arise and there was
26   nothing for Mr. Belloc to rebut.    While Creditor Trustee
27   complains that Mr. Belloc provided no evidence, it was Creditor
28   Trustee’s burden to show that Epiq had served Mr. Belloc by mail

                                      -16-
 1   with notice of the Bar Date before the presumption of receipt
 2   would arise.    He failed to meet that burden at the November 18,
 3   2014 hearing.   No documents or other objective evidence
 4   effectively contradicted Mr. Belloc’s contention that he did not
 5   receive notice of the Bar Date Order.     Given the absence of such
 6   evidence, we cannot say the trial court’s interpretation of the
 7   facts is implausible on its face.      Accordingly, the bankruptcy
 8   court did not err in granting Mr. Belloc’s Motion to Approve
 9   Late-Filed Proof of Claim and for Relief from the Automatic
10   Stay.
11   B.   The bankruptcy court did not err in denying Creditor
          Trustee’s Motion for Reconsideration.
12
13        Creditor Trustee filed his motion for reconsideration under
14   Rule 9023, which incorporates Civil Rule 59(e).     Civil
15   Rule 59(e) motions “may not be used to raise arguments or
16   present evidence for the first time when they could reasonably
17   have been raised earlier in the litigation.”     Marlyn
18   Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co., 571 F.3d 873,
19   880 (9th Cir. 2009); Carroll v. Nakatani, 342 F.3d 934, 945
20   (9th Cir. 2003).   Civil Rule 59(e) “does not provide a vehicle
21   for a party to undo its own procedural failures [or] allow a
22   party to introduce new evidence or advance new arguments that
23   could and should have been presented to the [bankruptcy] court
24   prior to the judgment.”   DiMarco–Zappa v. Cabanillas, 238 F.3d
25   25, 34 (1st Cir. 2001).   Matters that were not presented in the
26   first instance by a well-represented party are not considered on
27   a motion for reconsideration.   See 389 Orange St. Partners v.
28   Arnold, 179 F.3d 656, 665 (9th Cir. 1999).     Although Civil

                                     -17-
 1   Rule 59(e) permits a bankruptcy court to reconsider and amend a
 2   previous order, the rule offers an “extraordinary remedy, to be
 3   used sparingly in the interests of finality and conservation of
 4   judicial resources.”   Kona Enters., Inc. v. Estate of Bishop,
 5   229 F.3d 877, 890 (9th Cir. 2000).    “Indeed, a motion for
 6   reconsideration should not be granted, absent highly unusual
 7   circumstances, unless the [bankruptcy] court is presented with
 8   newly discovered evidence, committed clear error, or if there is
 9   an intervening change in the controlling law.”    Id.
10        As the bankruptcy court found, Creditor Trustee presented
11   no newly discovered evidence, nor did he establish that the
12   court had made a manifest error of law or fact.    While Creditor
13   Trustee filed the unredacted affidavit of service showing
14   service upon Mr. Belloc, this evidence was not “newly
15   discovered” for purposes of Civil Rule 59(e) if it “could have
16   been discovered with reasonable diligence” at the time of trial.
17   Coastal Transfer Co. v. Toyota Motor Sales, U.S.A., 833 F.2d
18   208, 211 (9th Cir. 1987).   Creditor Trustee made no showing, or
19   even any argument, why he could not have obtained the unredacted
20   affidavit prior to the November 18, 2014 hearing.    Therefore, it
21   was “well within” the bankruptcy court’s discretion not to
22   consider it.   See Wallis v. J.R. Simplot Co., 26 F.3d 885, 892
23   n. 6 (9th Cir. 1994) (Where the moving party does not make any
24   showing that an affidavit was unavailable at the time of trial,
25   rejection of such a tardy affidavit is “well within” a court's
26   discretion.)   Likewise, Creditor Trustee made no showing that he
27   did not nor could not have discovered Mr. Belloc’s 2013 lawsuit
28   until after the November 18, 2014 hearing.

                                    -18-
 1            In short, the court concluded that there was no basis for
 2   granting his motion.      That conclusion was not an abuse of
 3   discretion.
 4   C.       The bankruptcy court properly exercised its discretion to
              not hold an evidentiary hearing.
 5
 6            Creditor Trustee also argues that the bankruptcy court
 7   erred by not holding an evidentiary hearing.       A bankruptcy
 8   court’s decision on whether to conduct an evidentiary hearing is
 9   reviewed for an abuse of discretion.       Murphy v. Schneider Nat’l,
10   Inc., 362 F.3d at 1139.
11            As an initial matter, many of Creditor Trustee’s
12   contentions regarding an evidentiary hearing are directed
13   towards the bankruptcy court’s lack of specific findings
14   regarding Mr. Belloc’s excusable neglect.       However, in its
15   decision denying Creditor Trustee’s motion for reconsideration,
16   the bankruptcy court rested its final decision on the issue of
17   notice and not excusable neglect.        Therefore, we consider only
18   whether an evidentiary hearing was warranted on the issue of
19   notice in connection with the November 18, 2014 hearing.6
20            Creditor Trustee argues on appeal that he submitted
21
22        6
            We observe that Creditor Trustee did not file his motion
23   for reconsideration under Civil Rule 59(a). Under that
     subsection, a court has the discretion to reopen a judgment if
24   one has been entered, take additional testimony, amend findings
     of fact and conclusion of law, or make new findings and
25   conclusions. See Civil Rule 59(a). Therefore, we cannot find
26   the bankruptcy court abused its discretion by not holding an
     evidentiary hearing in connection with the motion for
27   reconsideration based on Creditor Trustee’s attempt to introduce
     evidence to rebut what it considered were “unsupported
28   conclusions” of the bankruptcy court.

                                       -19-
 1   evidence that Mr. Belloc was properly mailed notice and that
 2   Mr. Belloc offered nothing in return.   According to Creditor
 3   Trustee, the bankruptcy court gave greater weight to nonexistent
 4   evidence from Mr. Belloc than a sworn statement indicating the
 5   name and address to which notice was sent:   “To have weighed
 6   such evidence without an evidentiary hearing was error.”
 7   Creditor Trustee also maintains that his counsel “offered live
 8   evidence twice during the November 18, 2014 hearing.”   We are
 9   not persuaded by these arguments.
10        Civil Rule 43(c), which is applicable to contested matters
11   under Rule 9017, provides:   “When a motion relies on facts
12   outside the record, the court may hear the matter on affidavits
13   or may hear it wholly or partly on oral testimony or on
14   depositions.”   Under this rule, bankruptcy courts have “wide
15   discretion” in deciding whether to take oral testimony at an
16   evidentiary hearing.   United Commercial Ins. Serv., Inc. v.
17   Paymaster Corp., 962 F.2d 853, 858 (9th Cir. 1992); accord
18   Garner v. Shier (In re Garner), 246 B.R. 617, 624 (9th Cir. BAP
19   2000).   Further, Local Rule 9014-2 sets out the procedures
20   governing hearings on contested matters in the bankruptcy court
21   for the District of Arizona.   Local Rule 9014-2(a) states that
22   “all hearings scheduled on contested matters will be conducted
23   without live testimony except as otherwise ordered by the court.
24   If, at such a hearing, the court determines that there is a
25   material factual dispute, the court will schedule a continued
26   hearing at which live testimony will be admitted.”
27   Alternatively, subsection (b) of the rule sets forth the
28   procedure for a party to request that the court take live

                                    -20-
 1   testimony.7
 2           Here, while counsel for Creditor Trustee made some generic
 3   comments during the November 18, 2014 hearing regarding live
 4   testimony, he did not invoke the procedures available under
 5   Local Rule 9014-2(b) to request that Creditor Trustee be allowed
 6   to present live testimony, nor do we see anywhere in the record
 7   that an evidentiary hearing was requested before Creditor
 8   Trustee filed his motion for reconsideration.    Creditor
 9
10       7
             Subsection (b) provides:
11
   (1) Any party filing a motion, application, or objection who
12 reasonably anticipates that its resolution will require live
   testimony may file an accompanying motion for an evidentiary
13 hearing, stating:
14       (A)   The estimated time required for receipt of all
15       evidence, including live testimony;
         (B)   When the parties will be ready to present such
16       evidence;
         (C)   The estimated time required to complete all
17       formal and informal discovery;
         (D)   Whether a Bankruptcy Rule 7016 Scheduling
18       Conference should be held; and,
19       (E)   Whether any party who may participate at the
         evidentiary hearing is appearing pro se.
20
   (2) The party requesting an evidentiary hearing shall accompany
21 the motion with a form of order.
22
   (3) Any response     to a motion for an evidentiary hearing shall be
23 served and filed     within seven days of service of the motion. The
   time computation     and enlargement provisions of Rule 9006 shall
24 not apply to the     response deadline, except that the responding
   party shall have     an additional 3 days to respond if the motion is
25 served by mail.
26
   (4) Based upon the motion and any responses, the court will
27 either finalize the order setting the matter for hearing or
   request that the parties appear for a Bankruptcy Rule 7016
28 Scheduling Conference.

                                        -21-
 1   Trustee’s contention that an evidentiary hearing was necessary
 2   on the merits, made for the first time after the bankruptcy
 3   court had ruled, came too late:     he had already waived his right
 4   to an evidentiary hearing.      In sum, the bankruptcy court did not
 5   abuse its discretion by failing to hold an evidentiary hearing;
 6   an evidentiary hearing was neither asked for nor required given
 7   the evidence presented.
 8                             VI.    CONCLUSION
 9        For the reasons stated, we AFFIRM.
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