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