Gens v. Kaelin

Filing 9

ORDER DENYING 8 DEBTOR'S MOTION FOR RECONSIDERATION OF ORDER DENYING STAY PENDING APPEAL. Signed by Judge Beth Labson Freeman on 7/19/2017.(blflc1S, COURT STAFF) (Filed on 7/19/2017)

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1 2 3 4 5 UNITED STATES DISTRICT COURT 6 NORTHERN DISTRICT OF CALIFORNIA 7 SAN JOSE DIVISION 8 9 LAURA A. GENS, Appellant, 10 United States District Court Northern District of California 11 v. 12 DORIS KAELIN, 13 Case No. 17-cv-03601-BLF Appellee. ORDER DENYING DEBTOR’S MOTION FOR RECONSIDERATION OF ORDER DENYING STAY PENDING APPEAL [Re: ECF 8] 14 15 On July 14, 2017, Debtor filed an “Ex Parte Emergency Application for a Temporary 16 Restraining Order Pending Appeal of Orders Authorizing and Confirming Sale of Appellant’s 17 Residence Free and Clear of Lis Pendens,” which the Court construed as a motion for stay pending 18 appeal of the bankruptcy court’s Order Granting Trustee’s Motions to (1) Sell Real Property and 19 Pay Fees, Costs, Taxes, and Commissions, Other than the Lien of Wells Fargo, and (2) Sell Free 20 and Clear of Claims, Liens, and Interests (“Sale Order”); and Order Granting Trustee’s Motion to 21 Expunge, or, Alternatively, Sell Real Property Free and Clear of Lis Pendens (“Expungement 22 Order”). See Stay Motion, ECF 4. The Court denied that motion on July 18, 2017. See Order 23 Denying Debtor’s Motion for Stay Pending Appeal, ECF 7. 24 On July 19, Debtor filed a “Revised Ex Parte Emergency Application for a Temporary 25 Restraining Order Pending Appeal of Orders Authorizing and Confirming Sale of Appellant’s 26 Residence Free and Clear of Lis Pendens, which the Court construes as a motion for 27 reconsideration. See Motion for Reconsideration, ECF 8. The motion for reconsideration is 28 DENIED for the reasons discussed below. 1 In order to obtain reconsideration of an interlocutory order, the moving party “must 2 specifically show reasonable diligence in bringing the motion” and also must show one of the 3 following: (1) “a material difference in fact or law exists from that which was presented to the 4 Court before entry of the interlocutory order for which reconsideration is sought”; (2) “[t]he 5 emergence of new material facts or a change of law occurring after the time of such order”; or 6 (3) “[a] manifest failure by the Court to consider material facts or dispositive legal arguments 7 which were presented to the Court before such interlocutory order.” Civ. L.R. 7-9(a), (b). 8 9 Debtor has not identified any material difference in fact or law as required under the first prong, or the emergence of new material facts or a change of law as required under the second prong. Debtor does appear to argue that the Court failed to consider material facts or dispositive 11 United States District Court Northern District of California 10 legal arguments as required under the third prong. The Court addresses those arguments below. 12 Debtor asserts that the Court denied her Stay Motion because of her failure to analyze the 13 abuse of discretion standard. Motion for Reconsideration at 2, ECF 8. Debtor’s failure to analyze 14 the correct legal standard was not the basis for the Court’s ruling. To the contrary, the Court set 15 forth the applicable abuse of discretion standard, explaining that the Court reviews the bankruptcy 16 court’s conclusions of law de novo and its factual findings for clear error. See Order Denying 17 Debtor’s Motion for Stay Pending Appeal at 3, ECF 7. The Court expressly determined that the 18 bankruptcy court has applied the correct legal standards and had not committed clear error in its 19 factual findings. See id. at 3-5. Importantly here, the Court concluded that the bankruptcy court 20 made a factual finding that Debtor’s stay motion filed in the bankruptcy court was a rehash of 21 arguments previously made and rejected; the bankruptcy court’s factual finding was supported by 22 the record and thus was not clearly erroneous; and the bankruptcy court’s factual finding provided 23 a sufficient legal basis for the bankruptcy court’s determination that Debtor had not established a 24 likelihood of success on the merits. See id. at 5. The Court’s ruling was based on those 25 substantive determinations and not on the procedural deficiencies in Debtor’s Stay Motion. 26 Debtor has not presented any factual or legal basis for reconsideration of the substantive 27 determinations upon which the Court’s denial of her Stay Motion was based. 28 While the above conclusion is determinative of Debtor’s motion for reconsideration, the 2 1 Court briefly addresses Debtor’s argument that the bankruptcy court lacked jurisdiction to 2 expunge the lis pendens which Debtor had recorded with the County Clerk. That jurisdictional 3 argument was presented to and expressly rejected by the bankruptcy court prior to its issuance of 4 the Expungement Order. See Tr. of Hearing on Motion to Expunge 20:1 – 23:22, Exh. to Motion 5 for Reconsideration, ECF 8. Thus Debtor’s reiteration of the jurisdictional argument in moving 6 the bankruptcy court for a stay pending appeal properly was rejected by the bankruptcy court as a 7 rehash of arguments previously made and rejected. 8 Moreover, Debtor’s jurisdictional argument is incorrect as a matter of law. Under 9 California law, which Debtor asserts applies (and which the bankruptcy court did apply), a party who asserts a real property claim in any action may record a lis pendens, that is, a notice of 11 United States District Court Northern District of California 10 pendency of action, “in the office of the recorder of each county in which all or part of the real 12 property is situated.” Cal. Civ. P. Code § 405.20. “At any time after notice of pendency of action 13 has been recorded, any party, or any nonparty with an interest in the real property affected thereby, 14 may apply to the court in which the action is pending to expunge the notice.” Cal. Civ. P. Code § 15 405.20. Debtor argues that the “court in which the action is pending” is the district court, and that 16 as a result the bankruptcy court lacks authority to expunge a lis pendens. However, the “action” at 17 issue is the bankruptcy case which was commenced in the bankruptcy court and will remain 18 “pending” until final determination on appeal. See In re Thatcher, 24 B.R. 764, 765 (E.D. Cal. 19 1982). Consequently, the bankruptcy court retains jurisdiction to expunge a lis pendens, even 20 where the lis pendens was recorded after the filing of an appeal. Id.; see also In re Weston, 110 21 B.R. 452, (E.D. Cal. 1989) (same). 22 Debtor’s motion for reconsideration is DENIED. 23 24 25 26 Dated: July 19, 2017 ______________________________________ BETH LABSON FREEMAN United States District Judge 27 28 3

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