Court Opinion

ID: 3214426
Source: CourtListenerOpinion
Date Created: 2016-06-17 20:01:26.381784+00
Date Added: 2024-06-11T09:19:22.392036
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                              JUN 17 2016

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

                            FOR THE NINTH CIRCUIT

In the Matter of: MARC LEE BASS,                 No. 14-56247

              Debtor,                            D.C. No. 2:13-cv-07707-JVS

BEACON TALENT AGENCY, Inc., AKA                  MEMORANDUM*
Marc Bass Agency, Inc.,

              Appellant,

  v.

MARC LEE BASS,

              Appellee.

                    Appeal from the United States District Court
                       for the Central District of California
                     James V. Selna, District Judge, Presiding

                        Argued and Submitted June 10, 2016
                               Pasadena, California

Before: GOULD and HURWITZ, Circuit Judges, and RESTANI,** Judge.

       At issue in this case is a bankruptcy court’s order granting summary

       *
        This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
       **
          The Honorable Jane A. Restani, Judge for the United States Court of
International Trade, sitting by designation.
judgment to Beacon Talent Agency (“Beacon”), holding that Beacon has a non-

dischargeable claim against a Chapter 7 debtor, Marc Lee Bass (“Bass”), based on

a California state court judgment. On appeal, the district court reversed and

remanded.

      We have jurisdiction under 28 U.S.C. § 1291 to review the district court’s

decision. We review that decision de novo; the bankruptcy court’s findings of fact

are reviewed for clear error and its conclusions of law are reviewed de novo.

Harmon v. Kobrin (In re Harmon), 250 F.3d 1240, 1245 (9th Cir. 2001). In

reviewing the summary judgment, we determine, “viewing the evidence in the light

most favorable to the nonmoving party, whether there are any genuine issues of

material fact and whether the bankruptcy court correctly applied the substantive

law.” Id.

      “[F]ederal courts . . . give preclusive effect to state-court judgments

whenever the courts of the State from which the judgments emerged would do so.”

Kremer v. Chem. Constr. Corp., 456 U.S. 461, 482 (1982) (quoting Allen v.

McCurry, 449 U.S. 90, 96 (1980)). California does not give preclusive effect to

judgments awarded in excess of the relief properly requested, including untimely

noticed punitive damages awards. See Greenup v. Rodman, 726 P.2d 1295, 1297

(Cal. 1986) (In Bank); Moffat v. Moffat, 612 P.2d 967, 972 (Cal. 1980) (In Bank);

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Burtnett v. King, 205 P.2d 657, 658–59 (Cal. 1949); see also Cal. Civ. Proc. Code

§§ 425.11, 580, 585. The district court thus properly refused to give preclusive

effect to the punitive damages award in the state court judgment. See Matera v.

McLeod, 51 Cal. Rptr. 3d 331, 343–45 (Ct. App. 2006).

      Without the punitive damages award, the default judgment did not satisfy

the requirements for non-dischargeability under either 11 U.S.C. §§ 523(a)(4) or

(a)(6). Under 11 U.S.C. § 523(a)(4), Beacon did not establish that Bass was acting

in a fiduciary capacity, see Cal-Micro, Inc. v. Cantrell (In re Cantrell), 329 F.3d

1119, 1125–26, 1128 (9th Cir. 2003), or that he acted with the requisite intent for

purposes of embezzlement, compare Transamerica Commercial Fin. Corp. v.

Littleton (In re Littleton), 942 F.2d 551, 555–56 (9th Cir. 1991) (holding that

embezzlement requires fraudulent intent), with Burlesci v. Petersen, 80 Cal. Rptr.

2d 704, 706 (Ct. App. 1998) (holding that in California, conversion does not

require intent to defraud). Additionally, under 11 U.S.C. § 523(a)(6), Beacon did

not establish a willful and malicious injury. See Peklar v. Ikerd (In re Peklar), 260

F.3d 1035, 1039 (9th Cir. 2001) (“A judgment for conversion under California law

. . . does not, without more, establish that a debt arising out of that judgment is

non-dischargeable under § 523(a)(6).”).

      AFFIRMED.

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