Court Opinion

ID: 4257378
Source: CourtListenerOpinion
Date Created: 2018-03-22 20:00:34.234554+00
Date Added: 2024-06-11T09:36:39.780248
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                       MAR 22 2018
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

In re: PACIFIC THOMAS                           No.    17-15052
CORPORATION,
                                                D.C. No. 3:15-cv-06321-MMC
             Debtor,
______________________________
                                                MEMORANDUM*
KYLE EVERETT, Chapter 11 Trustee,

                Plaintiff-Appellee,

 v.

THOMAS CAPITAL INVESTMENTS,

                Defendant-Appellant.

                   Appeal from the United States District Court
                      for the Northern District of California
                   Maxine M. Chesney, District Judge, Presiding

                            Submitted March 15, 2018**
                             San Francisco, California

Before: PAEZ and IKUTA, Circuit Judges, and ADELMAN,*** District Judge.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
      ***
             The Honorable Lynn S. Adelman, United States District Judge for the
Eastern District of Wisconsin, sitting by designation.
      Thomas Capital Investments (“TCI”) appeals a judgment of the district court

affirming a judgment of the bankruptcy court allowing the Chapter 11 trustee to

avoid $341,059.51 in preferential, fraudulent, and post-petition transfers. The

bankruptcy court entered its judgment after finding that TCI, by failing to respond

to the trustee’s requests for admissions within thirty days, was deemed to have

admitted all of the facts necessary to show that the transfers were avoidable. See

Fed. R. Bankr. P. 7036 (stating that Fed. R. Civ. P. 36 applies in adversary

proceedings).

      TCI contends that the bankruptcy court erred by giving preclusive effect to a

judgment it entered in a related adversary case between the trustee and an entity

known as Pacific Trading Ventures.         However, the bankruptcy did not give

preclusive effect to the prior judgment. Instead, it found that the trustee had proved

the elements of his case through the requests for admission. Thus, TCI’s argument

about the preclusive effect of the prior judgment is irrelevant.

      TCI argues in its reply brief that the bankruptcy court erred in relying on the

requests for admission because the trustee never filed a motion to deem the

admissions admitted. Because this argument is raised for the first time in TCI’s

reply brief, it is waived. See, e.g., Rowland v. Chappell, 876 F.3d 1174, 1193 n.6

(9th Cir. 2017). Moreover, the argument is contrary to how Rule 36 operates. Rule

36 is self-executing, meaning that a party admits a matter by failing to serve a

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response to the request within thirty days; the opposing party does not have to file a

motion to deem the matter admitted. See Fed. R. Civ. P. 36(a)(3).

      TCI also argues that the trustee should be penalized for not filing an answering

brief in the district court. However, the district court resolved the appeal on the

merits even though the trustee did not file a brief. The trustee has filed a brief in this

court and does not raise any issues that the district court did not discuss in its ruling.

We see no reason to penalize the trustee for not filing a brief in the district court.

      Finally, TCI asserts that if this court determines in the related appeal between

the trustee and Pacific Trading Ventures that the trustee did not prove that a certain

lease was invalid, then the court must also reverse the judgment against TCI in this

appeal. However, TCI does not develop a legal argument in support of this assertion,

and therefore we deem the issue forfeited. See, e.g., Indep. Towers of Wash. v. Wash.,

350 F.3d 925, 929–30 (9th Cir. 2003). Moreover, the bankruptcy court’s order in

this case was based on TCI’s admissions, which were not at issue in the related case.

Even if the court were to reverse the judgment in the related case, TCI’s admissions

would stand as an independent basis for the bankruptcy court’s finding that the

transfers to TCI involved avoidable transfers of the debtor’s property.

      AFFIRMED.

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