Court Opinion

ID: 4258009
Source: CourtListenerOpinion
Date Created: 2018-03-23 23:01:35.953686+00
Date Added: 2024-06-11T14:28:19.569901
License: Public Domain

FILED
                                                            MAR 23 2018
 1                         NOT FOR PUBLICATION
                                                        SUSAN M. SPRAUL, CLERK
                                                          U.S. BKCY. APP. PANEL
 2                                                        OF THE NINTH CIRCUIT

 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                        )      BAP Nos.    NC-17-1015-STaB
                                   )                  NC-17-1034-STaB
 6   LEONG PARTNERSHIP,            )                  (related appeals)
                                   )
 7                  Debtor.        )      Bk. No.     4:16-bk-42363
     ______________________________)
 8                                 )
     WARREN HAVENS,                )
 9                                 )
                    Appellant,     )
10                                 )
     v.                            )      MEMORANDUM*
11                                 )
     ARNOLD LEONG; UNITED STATES   )
12   TRUSTEE,                      )
                                   )
13                  Appellees.     )
     ______________________________)
14
                        Submitted Without Oral Argument
15                            on February 16, 2018
16                           Filed – March 23, 2018
17            Appeal from the United States Bankruptcy Court
                  for the Northern District of California
18
         Honorable Charles D. Novack, Bankruptcy Judge, Presiding
19
     Appearances:     Appellant Warren Havens, pro se, on brief; Jeremy
20                    V. Richards and Miriam Manning of Pachulski Stang
                      Ziehl & Jones LLP on brief for appellee Arnold
21                    Leong.
22
     Before: SPRAKER, TAYLOR and BRAND, Bankruptcy Judges.
23
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                              INTRODUCTION
 2        Warren Havens appeals from the bankruptcy court’s summary
 3   judgment dismissing the involuntary chapter 111 petition he filed
 4   against alleged debtor Leong Partnership.       Havens argues that
 5   Arnold Leong, one of three general partners Havens listed on the
 6   involuntary petition, lacked standing to oppose the involuntary
 7   bankruptcy.   Havens further argues that the evidence he submitted
 8   in opposition to Leong’s summary judgment motion was sufficient
 9   to justify its denial.   Because we disagree with Havens on both
10   counts, we AFFIRM.
11                                  FACTS
12        For more than fifteen years, Havens and Leong have litigated
13   over their respective interests in roughly 5500 radio licenses
14   issued by the Federal Communications Commission (“FCC”) and the
15   entities holding those licenses.       One of these entities was
16   Telesaurus - VPC, LLC, a Delaware limited liability company.2
17   Havens and Leong entered into a written agreement that formed
18   Telesaurus, gave Havens the majority interest, and gave Leong the
19   remaining minority interest.   Leong later claimed that he and
20   Havens had entered into a separate, oral agreement that required
21   Havens to equalize ownership of Telesaurus and the licenses.
22
23
          1
            Unless specified otherwise, all chapter and section
24   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and
     all "Rule" references are to the Federal Rules of Bankruptcy
25   Procedure, Rules 1001-9037. All "Civil Rule" references are to
26   the Federal Rules of Civil Procedure.
          2
27          We have seen a variety of spellings of this company’s
     name. We have adhered to the one used by Leong in his state
28   court complaint.

                                        2
 1   Havens, for years, has repeatedly and consistently denied the
 2   existence of this oral agreement.
 3   A. The State Court Litigation Involving Leong and Havens.
 4        As a result of the Telesaurus dispute, in 2002 Leong filed a
 5   lawsuit in the Alameda County Superior Court against Havens and
 6   others (the, “Leong Action”).   The Leong Action now includes as
 7   defendants Telesaurus and seven additional Havens-controlled
 8   companies that currently hold the disputed FCC licenses and
 9   additional, subsequently-purchased FCC licenses.   The parties
10   refer to these license holding entities as the pPNT companies.3
11   Havens is the founder and majority interest holder of the pPNT
12   companies.4
13        In 2005, the Alameda Superior Court ordered Leong and Havens
14   to arbitrate.   Ten years later, the arbitration still was
15   pending, and Leong moved for appointment of a receiver in the
16   Leong Action.   In November 2015, the Alameda Superior Court
17   appointed Susan Uecker to serve as the receiver of the pPNT
18   companies and to take control from Havens of the companies’
19   assets, including the FCC licenses.   The Alameda Superior Court
20   appointed a receiver in large part because of Havens’
21   recalcitrant conduct in proceedings before the FCC.   This conduct
22   is described in an April 2015 FCC administrative law judge’s
23   order calling into question Havens’ qualifications to hold the
24   FCC licenses, which in turn placed the the licenses at risk of
25
          3
26          The term “pPNT” refers to precise Position, Navigation and
     Timing.
27
          4
            Havens is the sole member of one of the pPNT companies,
28   the Skybridge Spectrum Foundation.

                                      3
 1   extinguishment.
 2        Many of Havens’ actions since November 2015 have been aimed
 3   at resisting Uecker’s receivership efforts.   For example, Havens
 4   filed both a motion to terminate the receivership and a notice of
 5   appeal from the receivership order in the Leong Action.    Havens
 6   also commenced a voluntary bankruptcy case in Delaware on behalf
 7   of one of the pPNT companies, Skybridge Spectrum Foundation.     The
 8   Delaware bankruptcy court dismissed that case, finding that it
 9   was filed in violation of the Alameda Superior Court’s
10   receivership order.
11   B. The Involuntary Petition Filing Against the Leong Partnership.
12        Shortly after the Delaware bankruptcy court dismissed the
13   Skybridge bankruptcy case, Havens filed an involuntary chapter 11
14   petition against an entity called the Leong Partnership.   The
15   involuntary petition was based on the premise that, by way of the
16   receivership, Leong and his “partners,” effectively sought to,
17   and did, take control of the pPNT Companies and their FCC license
18   assets.   Havens stated that he filed the involuntary petition to
19   address and remediate the deleterious effects of the receivership
20   and take control back from this alleged partnership.
21        1.   The Alleged Partners of the Leong Partnership.
22        In the petition, Havens identified the partners in the Leong
23   Partnership as Leong and two other individuals with similarly
24   lengthy litigation histories with Havens: Mark Griffith and
25   Channing Jones.   In 2012, Mark Griffith filed a separate lawsuit
26   against Havens, also in Alameda Superior Court, to recover
27   compensation from Havens and the pPNT companies.   There is an
28   email string reflecting that, in December 2013 and January 2014,

                                      4
 1   Griffiths and Leong attempted to coordinate some of their
 2   litigation efforts against Havens.    However, shortly thereafter,
 3   Griffith entered into a settlement agreement with Havens that
 4   supposedly fully resolved their dispute.    The settlement included
 5   a broad release of Griffith’s claims against Havens.      Havens
 6   contends that Griffith breached the settlement agreement by,
 7   among other things, not producing certain documents relating to
 8   Havens’ dispute with Leong.    On May 13, 2015, Havens and the pPNT
 9   companies sued Griffith, asserting various breach of contract and
10   tort claims related to the alleged breach of that settlement
11   agreement.
12        Channing Jones also sued Havens regarding investments he
13   made in Havens-controlled companies.    Jones, in addition,
14   initiated arbitration proceedings against Havens based on the
15   $1.3 million in funds he invested to enable Havens to purchase
16   FCC licenses.   According to Jones, at least a portion of these
17   funds were used to purchase licenses that ended up as assets of
18   the pPNT Companies.
19        In his arbitration proceeding, commenced in 2012, Jones
20   advocated for the consolidation of his arbitration with the Leong
21   arbitration.    In a letter dated March 9, 2012, to the arbitrator
22   in support of consolidation of his arbitration with Leong’s
23   arbitration, Jones claimed that his transactions with Havens were
24   “closely related . . . both factually and legally to Leong’s
25   transactions with Havens.”    The letter describes Jones’
26   relationship with Havens to be “like Mr. Leong, ... a long-time
27   co-venturer with Mr. Havens.”    As one example of this
28   interrelationship, Jones asserted that, in 1990, he and Leong

                                       5
 1   were both “partners” of Havens in a venture called SunCom
 2   Communications.   Notably though, SunCom Communications is not one
 3   of the pPNT Companies, and was not a named party in any of
 4   Leong’s litigation with Havens.
 5        Again relying on the March 2012 letter, Havens points out
 6   that Jones described both his and Leong’s entitlement to
 7   ownership interests in the pPNT Companies as    “interlocking.”
 8   However, a closer inspection reveals that Jones’ reference to
 9   interlocking interests simply meant that both he and Leong
10   claimed ownership interests in some of the pPNT Companies.    Jones
11   maintained that it would be difficult to untangle those interests
12   because Havens had created a maze of entities and transactions to
13   intentionally obfuscate the ownership entitlements of his
14   investors.
15        Similar to Griffith, Jones settled his litigation against
16   Havens by no later than December 2013, as reflected by Jones’
17   voluntary dismissal with prejudice of his state court lawsuit
18   against Havens, well before the Alameda Superior Court appointed
19   the receiver in the Leong Action.
20        2.   The Petitioning Creditors and the Claims Asserted
21             against the Leong Partnership.
22        The involuntary petition was signed by Havens and two
23   related creditors.   Havens asserted two different types of claims
24   against the Leong Partnership: a salary and rent claim in an
25   amount exceeding $460,000, and an unspecified tort claim in an
26   amount exceeding $100 million.    Havens maintained that some of
27   the pPNT Companies owed him for salary and rent, but he did not
28   explain how the so-called Leong Partnership became liable for

                                       6
 1   obligations incurred by different entities (that Havens had
 2   controlled).   He only stated that this liability flowed to the
 3   Leong Partnership because it assumed de facto ownership and
 4   control of the pPNT Companies when the receiver was appointed.
 5   With respect to the $100 million tort claim, Havens indicated
 6   that the claim arose from the value of his equity and control
 7   interests in the pPNT Companies, which interests he asserts the
 8   Leong Partnership now possesses, de facto, as a result of the
 9   appointment of the receiver.
10        One of the other two petitioning creditors was Polaris PNT
11   PBC, a Delaware Public Benefit Corporation formed in July 2016,
12   which Havens controls.     Polaris’ alleged claim against the Leong
13   Partnership resulted from Havens’ assignment of $100,000 of his
14   personal claims to Polaris.5
15        The third petitioning creditor was Skybridge Spectrum
16   Foundation, the pPNT entity that Havens had placed into
17   bankruptcy in Delaware.    Skybridge’s claims against the Leong
18   Partnership were also the result of Havens’ assignment of his
19   personal claims.   Havens later withdrew Skybridge as a
20   petitioning creditor, presumably because the injunctive relief
21   contained in the receivership order prohibited Havens from acting
22   on behalf of Skybridge.6
23
24        5
            Because of the derivative nature of Polaris’ claim against
     Leong, for ease of reference, all future references herein to
25   Havens’ claim also are meant to refer to Polaris’ claim.
26        6
            The withdrawal of Skybridge calls into question the
27   sufficiency of the involuntary petition as three creditors are
     required to commence an involuntary petition unless there are
28                                                      (continued...)

                                        7
 1   C. The Motion for Summary Judgment.
 2        After an unsuccessful attempt to obtain dismissal of the
 3   involuntary petition, Leong filed a summary judgment motion.     To
 4   support his summary judgment motion, Leong relied on the
 5   restriction in § 303(b) limiting the filing of involuntary
 6   petitions to only those creditors whose claims are “not . . . the
 7   subject of a bona fide dispute as to liability or amount.”    Leong
 8   asserted that the claims of the petitioning creditors were the
 9   subject of bona fide dispute for a number of reasons.   First,
10   there was little or no evidence that the Leong Partnership
11   actually existed.   Second, there was no evidence that the Leong
12   Partnership had incurred any salary or rent obligations, which
13   actually were disputed liabilities allegedly owed by some of the
14   pPNT Companies that Havens had controlled.   Leong pointed out
15   that the documents on which Havens relied to support the
16   existence of the salary and rent claim identified some of the
17   pPNT Companies as the obligors and not the Leong Partnership.
18        Similarly, Leong noted that Havens’ $100 million tort claim
19   supposedly was based on the Leong Partnership’s alleged “de
20   facto” control of the pPNT Companies.   Leong argued that Havens
21   could only demonstrate that Leong had been successful in
22   convincing the Alameda Superior Court to appoint a receiver in
23   the Leong Action.   The stated purpose of the receivership is to
24   preserve the value of the FCC license assets of the pPNT
25
          6
26         (...continued)
     fewer than 12 qualifying creditors. §§ 303(b)(1) and (2).
27   However, the parties have not addressed this issue on appeal. We
     need not address the issue as it would not affect the disposition
28   of the case.

                                      8
 1   companies and not to transfer control to Leong (or anyone else).
 2        To support his summary judgment motion, Leong submitted many
 3   of the same documents Havens had referenced in and relied upon in
 4   his attachments to the involuntary petition, but Leong posited
 5   much different explanations regarding the significance and
 6   meaning of these documents.   Leong contended that the documents
 7   evidenced nothing more than a hotly-contested dispute over the
 8   respective ownership and control interests in the FCC licenses
 9   and the pPNT Companies.   Both Leong and Griffith submitted
10   declarations in which they denied the existence of the Leong
11   Partnership or having heard of any such entity until after Havens
12   filed the involuntary petition.   Both Leong and Griffith further
13   maintained that they never acted in any concerted fashion that
14   could have resulted in the formation of a partnership, either
15   express or implied.
16        Though Havens filed the involuntary petition in pro per, he
17   retained counsel to file an opposition to the summary judgment
18   motion.   Havens insisted that additional time for discovery was
19   necessary to “confirm the existence of the ‘Leong Partnership’”
20   and to obtain evidence “directly relevant to the validity of the
21   Petitioning Creditors’ claims.”   Opposition to Motion for Summary
22   Judgment (Dec. 2, 2016) at 4:5-6, 4:11.
23        Havens contended that, based on the admissible evidence, the
24   bankruptcy court could not possibly conclude either that the
25   Leong Partnership did not exist or that his claims were invalid.
26   Havens further contended that the conduct of Leong, Jones and
27   Griffith established an “actual partnership” or a “partnership by
28   estoppel.”   Yet, Havens provided no legal authority to support

                                       9
 1   these arguments.   Rather, he asserted that the Leong
 2   Partnership’s liability for his claims flowed from the
 3   appointment of the receiver and the effective control the
 4   receivership gave Leong over the pPNT Companies.    In addition, in
 5   his supplemental declaration, he maintained that, under tax law,
 6   the type of control that the Leong Partnership allegedly obtained
 7   could result in pass-through tax liability.
 8        At the hearing on the summary judgment motion, the court
 9   heard the parties’ oral argument and took the matter under
10   submission.   The court also ruled on Havens’ evidentiary
11   objections, overruling most of them.
12        The bankruptcy court entered its order granting the motion
13   for summary judgment on December 29, 2016.    In the order, the
14   bankruptcy court gave a detailed recitation of the uncontroverted
15   facts in the record and carefully analyzed why, in light of those
16   facts, Leong was entitled to summary judgment.    In essence, the
17   court held that none of the statements Havens relied upon
18   necessarily suggested any recent concerted effort by Leong, Jones
19   and Griffith against Havens.
20        As for Havens’ claims, the bankruptcy court determined based
21   on the uncontroverted facts that both claims were subject to
22   bona fide dispute.   The bankruptcy court particularly was
23   concerned regarding Havens’ assertion that the Leong Partnership
24   was liable for Havens’ $468,000 salary and rent claim because of
25   its de facto control over the pPNT Companies.    As the bankruptcy
26   court noted, there was no evidence of such de facto control.      To
27   the contrary, it was uncontroverted that the state court receiver
28   was in control of the pPNT Companies.   Furthermore, Havens failed

                                     10
 1   to present any viable legal theory how the Leong Partnership’s
 2   alleged control would cause the liability for the salary and rent
 3   claim to flow from the pPNT Companies to the Leong Partnership.
 4        The bankruptcy court further held that Havens’ unliquidated
 5   $100 million tort claim suffered from the same types of defects.
 6   Like the salary and rent claim, the tort claim was founded on the
 7   unsupported allegation that the Leong Partnership had taken over
 8   de facto control of the pPNT Companies.     Additionally, Havens’
 9   summary judgment opposition papers were bereft of any legal
10   explanation as to what type of tort could have arisen from the
11   alleged de facto control.
12        The court entered summary judgment dismissing the
13   involuntary petition on January 18, 2017.     Havens timely appealed
14   the order granting the motion for summary judgment (NC-17-1015)
15   and the summary judgment of dismissal (NC-17-1034).7
16                               JURISDICTION
17        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
18   §§ 1334 and 157(b)(2)(A) and (O).     See Marciano v. Fahs (In re
19   Marciano), 459 B.R. 27, 34 (9th Cir. BAP 2011), aff'd, 708 F.3d
20   1123 (9th Cir. 2013).   We have jurisdiction under 28 U.S.C.
21   § 158.
22
23
          7
            Several months after the bankruptcy court entered its
24   summary judgment of dismissal, the bankruptcy granted Leong’s
     motion to recover attorneys’ fees and costs under § 303(i) and
25   entered judgment against Havens and Polaris, jointly and
26   severally, for $262,070.50 in fees and $562.60 in costs. Havens
     timely appealed the fee order, but the fee order appeal is not
27   before this Panel; Havens elected to have his fee order appeal
     heard by the United States District Court for the Northern
28   District of California.

                                      11
 1                                   ISSUES
 2   1.   Did Leong have standing to oppose the involuntary petition?
 3   2.   Did the bankruptcy court err when it entered summary
 4        judgment dismissing the involuntary petition?
 5                           STANDARDS OF REVIEW
 6        We review summary judgment rulings de novo.   See In re
 7   Marciano, 459 B.R. at 35.   Whether the Code permitted Leong, a
 8   named general partner of the debtor, to oppose the involuntary
 9   petition is a question of standing, which we also review de novo.
10   Veal v. Am. Home Mortg. Servicing, Inc. (In re Veal), 450 B.R.
11   897, 906 (9th Cir. BAP 2011).
12        We can affirm on any ground supported by the record.
13   Campidoglio LLC v. Wells Fargo & Co., 870 F.3d 963, 973 (9th Cir.
14   2017).
15                               DISCUSSION
16   A.   Leong’s Standing to Challenge the Involuntary Petition.
17        Before we consider whether Leong met his summary judgment
18   burden, there is a threshold question we must address: whether
19   Leong had standing to oppose the involuntary petition.   See
20   Warth v. Seldin, 422 U.S. 490, 498 (1975) (holding that Article
21   III standing is a “threshold issue in every federal case,
22   determining the power of the court to entertain the suit.”).
23   Here, there is no real question that Leong met the relatively
24   minimal requirements of constitutional standing, which include
25   injury in fact, causation, and redressability.   In re Veal,
26   450 B.R. at 906.   With respect to injury in fact and causation,
27   it is beyond cavil that the filing of an involuntary bankruptcy
28   petition against a partnership directly and significantly impacts

                                       12
 1   those alleged to be general partners of that partnership.      That
 2   is why alleged partners historically have been permitted to
 3   oppose such petitions.     See Advisory Committee Note accompanying
 4   Rule 1011 (noting possible consequences to alleged general
 5   partners and citing cases); Kennedy, Partnerships and Partners
 6   Under the Bankruptcy Reform Act and the New (Proposed) Rules, 27
 7   St. Louis U.L.J. 507, 553-55 & n.239 (1983).     As for
 8   redressability, successfully opposing the involuntary petition
 9   would remedy the potential impact of the petition by preventing
10   the entry of the order for relief.
11        Havens has not seriously challenged Leong’s constitutional
12   standing.     Instead, Havens construes Rule 1011(a) as excluding
13   alleged partners from standing to contest an involuntary petition
14   against a partnership.8    Rule 1011(a) specifically permits
15   alleged partners to oppose an involuntary petition against a
16   partnership, but the reference within that rule is directed
17   towards involuntary petitions filed against a partnership under
18   Rule 1004.9    Havens argues that this is problematic because Rule
19
20        8
            Havens first raised his Rule-based standing argument in a
     motion he filed in the bankruptcy court requesting entry of the
21   order for relief. Havens maintained that, because Leong lacked
22   standing, the involuntary petition against the Leong Partnership
     effectively was unopposed, so an order for relief should have
23   been immediately entered under § 303(h). Havens’ standing
     argument appears to be derived from the concept of statutory
24   standing. Statutory standing is a prudential, nonjurisdictional
     variant of the standing doctrine. In re Godon, Inc., 275 B.R.
25   555, 564 (Bankr. E.D. Cal. 2002).
26        9
              Rule 1011(a) provides:
27
          (a) Who may contest petition
28                                                         (continued...)

                                       13
 1   1004, which governs involuntary petitions against partnerships,
 2   references only § 303(b)(3), the statutory provision governing
 3   involuntary petitions against partnerships filed by fewer than
 4   all of the partners of that partnership.10   Havens points out
 5   that he filed his involuntary petition under § 303(b)(2) as an
 6   alleged creditor of the Leong Partnership.   Neither Rule 1011(a),
 7   nor Rule 1004, specifically address who may defend an involuntary
 8   petition filed against a partnership by creditors under
 9   § 303(b)(2).
10        Havens argues that the reference in Rule 1011(a) to alleged
11   partners applies only in those involuntary bankruptcy cases
12   commenced by the partnership itself.   As a consequence of Rules
13   1011(a) and 1004, he argues that an alleged partner lacks
14   standing to contest an involuntary petition commenced by
15   creditors.   Havens’ restrictive reading of Rule 1011(a)
16
17        9
           (...continued)
          The debtor named in an involuntary petition may contest
18
          the petition. In the case of a petition against a
19        partnership under Rule 1004, a nonpetitioning general
          partner, or a person who is alleged to be a general
20        partner but denies the allegation, may contest the
          petition.
21
          10
            Rule 1004 specifically applies to involuntary petitions
22
     but references only those petitions filed under § 303(b)(3) by a
23   petitioning partner:

24        After filing of an involuntary petition under
          § 303(b)(3) of the Code, (1) the petitioning partners
25        or other petitioners shall promptly send to or serve on
26        each general partner who is not a petitioner a copy of
          the petition; and (2) the clerk shall promptly issue a
27        summons for service on each general partner who is not
          a petitioner. Rule 1010 applies to the form and
28        service of the summons.

                                     14
 1   completely ignores § 303(d), which provides:
 2        (d) The debtor, or a general partner in a partnership
          debtor that did not join in the petition, may file an
 3        answer to a petition under this section.
 4        Havens identified Leong as a general partner of the Leong
 5   Partnership.    Pursuant to Rule 1004, Havens obtained and served
 6   summonses upon each of the general partners, including Leong.
 7   Having been named by the petitioning creditors as a general
 8   partner in the involuntary petition and issued a summons, Leong
 9   clearly had standing to defend against the petition under
10   § 303(d).11    That his defense to the involuntary petition
11   included denial of the partnership is irrelevant to his standing
12   to assert that defense given the petition.    To hold otherwise
13   would be to deny Leong due process.12    To the extent that his
14
          11
15          Under prior law, individuals alleged to be partners were
     permitted to oppose the involuntary petition against the
16   partnership even if they denied the allegation that they were
     partners and regardless of whether the involuntary petition was
17   filed by creditors or by another partner. See Former Bankruptcy
     Rule 112; Kennedy, supra, at 554 & n.239. In short, when
18
     Congress enacted § 303(d), it was not writing on a clean slate.
19   As a rule of statutory construction, we typically presume that
     Congress did not intend to change existing pre-Code bankruptcy
20   practice unless the Code or the legislative history makes that
     intent to change clear. Dewsnup v. Timm, 502 U.S. 410, 419
21   (1992); Kelly v. Robinson, 479 U.S. 36, 47 (1986).
22        12
            The Fifth Amendment provides: “No person shall be
23   deprived of life, liberty, or property, without due process of
     law.” U.S. Const. amend. V. “The fundamental requirement of due
24   process is the opportunity to be heard ‘at a meaningful time and
     in a meaningful manner.’” Mathews v. Eldridge, 424 U.S. 319, 333
25   (1976). If we were to interpret § 303(d) to exclude Leong
26   because he challenges the underlying partnership we would
     effectively foreclose any challenge to the involuntary petition.
27   Under the doctrine of constitutional avoidance, when faced with
     two competing plausible interpretations of a statute, we
28                                                      (continued...)

                                       15
 1   standing conflicts with Rule 1011(a), which we believe it does
 2   not, it is well established that “any conflict between the
 3   Bankruptcy Code and the Bankruptcy Rules must be settled in favor
 4   of the Code.”   Am. Law Ctr. PC v. Stanley (In re Jastrem),
 5   253 F.3d 438, 441–42 (9th Cir. 2001).
 6   B.   The Bankruptcy Court’s Summary Judgment Ruling.
 7        Having concluded that Leong had standing, we review the
 8   bankruptcy court’s summary judgment dismissing the involuntary
 9   petition.   Under § 303(b)(1) and (2), only certain creditors may
10   file an involuntary petition against an alleged debtor.   To be
11   qualified to file the involuntary petition, the creditors must,
12   among other things, hold a claim that is not subject to bona fide
13   dispute.    Liberty Tool & Mfg. v. Vortex Fishing Sys., Inc. (In re
14   Vortex Fishing Sys., Inc.), 277 F.3d 1057, 1064 (9th Cir. 2001).
15   More specifically, the statute provides that the claims of each
16   petitioning creditor must be neither contingent as to liability
17   nor subject to “bona fide dispute as to liability or amount.”
18   § 303(b)(1).
19        Whether a bona fide dispute exists is a question of fact,
20   and “[t]he burden is on the petitioning creditors to show that no
21   bona fide dispute exists.”   In re Vortex Fishing Sys., Inc.,
22   277 F.3d at 1064 (citing Rubin V. Belo Broad. Corp. (In re
23   Rubin), 769 F.2d 611, 615 (9th Cir. 1985)).   A claim is subject
24   to “bona fide dispute” if “there is an objective basis for either
25
26        12
           (...continued)
27   generally must presume that Congress did not intend the
     interpretation that would raise serious constitutional doubts.
28   Clark v. Martinez, 543 U.S. 371, 380–82 (2005).

                                      16
 1   a factual or a legal dispute as to the validity of the debt.”
 2   Id. (citation omitted).   Put another way, “if there is either a
 3   genuine issue of material fact that bears upon the debtor's
 4   liability, or a meritorious contention as to the application of
 5   law to undisputed facts, then the petition must be dismissed.”
 6   Id. (citation omitted).
 7        Summary judgment required Leong to establish that there was
 8   no genuine dispute that Havens’ claims were disputed.13    For
 9   summary judgment purposes, an issue is genuine only if the trier
10   of fact could find in favor of the non-moving party.   Far Out
11   Prods., Inc. v. Oskar, 247 F.3d 986, 992 (9th Cir. 2001).    Thus,
12   Leong was entitled to summary judgment if no reasonable trier of
13   fact could have found, on the record presented, that Havens’
14   claims were beyond bona fide dispute.    When, as here, the non-
15   moving party would bear the burden of proof at trial to establish
16   an essential element of his or her case, the moving party can
17   meet his or her summary judgment burden by pointing to the
18   absence of evidence to support an essential element of the non-
19   moving party’s claim.   See Celotex Corp. v. Catrett, 477 U.S.
20   317, 323-25 (1986).
21        Havens’ contention that the Leong Partnership took control
22   of the pPNT companies and thereby assumed liability for Havens’
23   rent and salary claim against the pPNT companies was not
24
25        13
            Applying the standard for summary judgment is somewhat
26   confusing in this contest: Leong was required to prove that there
     was no genuine dispute that Haven’s claims were subject to a bona
27   fide dispute, which required evidence that there was a genuine
     issue of material fact as to the partnership’s liability or
28   damages.

                                     17
 1   supported by any evidence or any concrete legal theory.      Indeed,
 2   it is contradicted by the state court receivership.      There is
 3   simply nothing to support the contention that the Leong
 4   Partnership owed Havens rent and salary.      While Havens argues
 5   that the bankruptcy court erroneously determined that the Leong
 6   Partnership did not owe him rent and salary, he misstates the
 7   question.    The bankruptcy court did not decide that there were no
 8   claims against the Leong Partnership for rent or salary, only
 9   that there was no genuine dispute that such claims were the
10   subject of a bona fide dispute and could not support the
11   involuntary petition.    The record amply supports this
12   determination.
13        The same is true regarding Havens’ tort claims, which remain
14   unliquidated.    This alone precluded Havens from using them to
15   support an involuntary petition.      Moreover, Havens failed to
16   identify the specific conduct qualifying as tortious or the
17   particular types of torts that allegedly occurred.
18        Given the absence of any evidence to suggest that the Leong
19   Partnership was liable to Havens for rent and salary, or for any
20   tort, the bankruptcy court correctly ruled that Havens failed to
21   establish a genuine issue that his claims were beyond bona fide
22   dispute.    See Celotex Corp., 477 U.S. at 323-25.    Havens contends
23   that the bankruptcy court ignored his evidence, incorrectly
24   determined that his claims were invalid, and improperly
25   relinquished its jurisdiction in favor of proceedings in the
26   Alameda Superior Court.    Havens’ arguments betray a fundamental
27   misunderstanding of the controlling issue concerning the
28   existence of a bona fide dispute.      The bankruptcy court granted

                                      18
 1   summary judgment because Leong was able to point to viable
 2   factual and legal issues calling into question the validity and
 3   existence of Havens’ claims.   This negated an element essential
 4   to Havens’ involuntary petition: the absence of a bona fide
 5   dispute as to the claims of the petitioning creditors.
 6   Consequently, all of the above-referenced arguments, which Havens
 7   characterizes as demonstrating reversible error, actually
 8   demonstrate no error at all.
 9   C.   Existence of the Leong Partnership.
10        The parties and the bankruptcy court invested much time and
11   effort addressing the existence of the Leong Partnership.
12   Because Havens’ claims were subject to bona fide dispute, our
13   analysis of the existence of the partnership is not essential to
14   our resolution of this appeal.   Even so, we note our agreement
15   with the bankruptcy court’s assessment of the partnership issue.
16   The litigant statements that Havens relied upon to fashion the
17   existence of the Leong Partnership were, themselves, equivocal at
18   best.   But, this is exactly the point; the very equivocal nature
19   of the evidence Havens presented demonstrated the existence of a
20   bona fide dispute as to the existence of the partnership and, by
21   extension, the existence of any claims against such entity.
22        Havens claims that the bankruptcy court used too narrow a
23   definition of partnership and only considered the absence of a
24   formal written partnership agreement.      We disagree.   The
25   bankruptcy court acknowledged that a partnership can arise solely
26   from the conduct of the parties.      Conduct that would lead a
27   reasonable person to believe that a partnership has been formed
28   is a foundational requirement for both of Havens’ alternate

                                      19
 1   partnership theories – actual partnership and partnership by
 2   estoppel.   See In re Lona, 393 B.R. 1, 14-17 (Bankr. N.D. Cal.
 3   2008) (summarizing and applying Cal. partnership law).14
 4        Here, the paucity of evidence of conduct that reasonably
 5   could have led a third party to believe that the Leong
 6   Partnership had been formed afforded Leong with an objective
 7   factual basis for disputing the existence of the Leong
 8   Partnership.   This, in turn, was sufficient to support the
 9   bankruptcy court’s determination that the existence of the Leong
10   Partnership was subject to bona fide dispute.15
11   D.   Havens’ Other Arguments.
12        Havens makes three additional arguments on appeal that
13
14        14
            In the bankruptcy court, Havens argued that Delaware law
15   should be used to determine the partnership issue. The
     bankruptcy court disagreed and instead applied California law
16   given that two of the three alleged general partners resided in
     California and the events allegedly leading to the supposed
17   formation of the Leong Partnership mostly occurred in California.
     Havens has not challenged on appeal the bankruptcy court’s choice
18
     of law determination, so we also have applied California
19   partnership law.
          15
20          Under the doctrine of ostensible partnership or
     partnership by estoppel, an individual can be estopped from
21   denying that they are a partner of a partnership if, by their
     words or conduct, they held themselves out to be a partner of
22
     that partnership or consented to being represented as such by
23   others. See Cal. Corp. Code § 16308(a); Armato v. Baden, 71 Cal.
     App. 4th 885, 898 (1999). The statute and case law indicate that
24   this doctrine is a means of imposing partnership liability on one
     or more persons when a formal partnership might not, in fact,
25   have existed. See J & J Builders Supply v. Caffin, 248 Cal. App.
26   2d 292, 297–98 (1967). It is far from clear that this doctrine
     is sufficient to support the existence of a partnership for
27   purposes of filing an involuntary partnership petition under the
     Code. In light of our resolution of this appeal, we do not need
28   to reach this issue.

                                     20
 1   perhaps exist independently of the controlling bona fide dispute
 2   question.    Havens, first, argues that the bankruptcy court should
 3   have dismissed the involuntary petition pursuant to § 303(j)(1)
 4   based on a notice of voluntary dismissal he filed in December
 5   2014, shortly before the bankruptcy court entered its order
 6   granting Leong’s motion for summary judgment.    Section 303(j)
 7   sets forth the requirements for obtaining a voluntary dismissal
 8   of an involuntary petition.    Because Havens’ notice of voluntary
 9   dismissal patently contravened § 303(j)’s requirements, the
10   bankruptcy court’s refusal to dismiss the petition under § 303(j)
11   was not reversible error.    See generally 2-303 Collier on
12   Bankruptcy ¶ 303.34 (16th ed. 2017).
13        Havens next argues that the bankruptcy court committed
14   reversible error when it erroneously commented in its post-
15   judgment order granting Leong’s § 303(i) fee motion that Jones
16   specifically denied the existence of the Leong Partnership.
17   While Leong and Griffith submitted declarations denying the
18   existence of the partnership, Jones did not.    The bankruptcy
19   court’s apparent mistake regarding the Jones denial was part of
20   an order entered several months after entry of the summary
21   judgment dismissing the involuntary petition.    As such, it is not
22   entitled to any bearing in our review of the summary judgment
23   ruling.    See Castro v. Terhune, 712 F.3d 1304, 1316 n.5 (9th Cir.
24   2013).    The fee appeal is not before the Panel; furthermore,
25   there is no indication in the record that the bankruptcy court
26   was suffering from a similar misapprehension at the time it
27   entered summary judgment or that such a misapprehension, if it
28   existed at that time, would have materially altered the

                                      21
 1   bankruptcy court’s bona fide dispute determination.   Indeed, such
 2   statement has no bearing on the bona fide dispute of the
 3   underlying claims themselves.
 4        Havens’ third argument concerns the denial of his request
 5   that the summary judgment motion be continued or denied so that
 6   he could have a lengthier opportunity to conduct further
 7   discovery.   Nothing in Havens’ opposition papers explained:
 8   (1) what specific facts he expected to obtain through further
 9   discovery; (2) how those facts would have helped him establish a
10   genuine issue of material fact regarding the bona fide dispute
11   issue; or (3) why he was unable to obtain the same information
12   during the years of litigation between him and Leong preceding
13   the filing of the involuntary petition.   Without such
14   explanations, Havens was not entitled to a continuance or denial
15   of the summary judgment motion.    See Moss v. U.S. Secret Serv.,
16   572 F.3d 962, 966 n.3 (9th Cir. 2009); see also 14-C Rutter Group
17   Prac. Guide Fed. Civ. Pro. Before Trial ¶ 14:114 (listing and
18   explaining full requirements for obtaining postponement or denial
19   of a summary judgment motion based on alleged need for further
20   discovery).16
21
22
          16
23          It is unclear whether Havens meant to challenge on appeal
     the bankruptcy court’s overruling of his evidentiary objections
24   to the declarations of Leong and Griffith. Havens has not
     brought to our attention any particular error in the bankruptcy
25   court’s evidentiary rulings. Even if there were such error, it
26   could not have prejudiced Havens’ rights. On this record, we are
     convinced that the evidentiary rulings did not affect the outcome
27   of the summary judgment motion. See Orr v. Bank of America,
     285 F.3d 764, 773 (9th Cir. 2002). Any such evidentiary error
28   was not reversible error. See id.

                                       22
 1                               CONCLUSION
 2        For the reasons set forth above, we AFFIRM the bankruptcy
 3   court’s summary judgment dismissing Havens’ involuntary petition
 4   against the Leong Partnership.17
 5
 6
 7
 8
 9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
          17
24          On February 7, 2018, Havens filed a motion to supplement
     his briefs, and to suspend this appeal pending the outcome of
25   other litigation, as well as a request for judicial notice. All
26   relief Havens sought by way of his motion is ORDERED DENIED.
     None of the issues Havens discusses in his motion are relevant to
27   our analysis and resolution of this appeal, or to the dispositive
     issue in this appeal: the fact that Havens’ claims against the
28   Leong Partnership are subject to bona fide dispute.

                                        23