Field v. RNI-NV Limited Partnership et al
Filing
46
ORDER DENYING 30 APPELLANT RNI-NV LIMITED PARTNERSHIP'S MOTION FOR RECONSIDERATION PURSUANT TO RULE 59(E), F.R.CIV.P.; GRANTING APPELLANT'S 37 MOTION FOR LEAVE TO FILE LATE PETITION FOR REHEARING OR MOTION FOR RECONSIDERATION OF ORDER D ISMISSING APPEAL OF NOVEMBER 30, 2011, OR, IN THE ALTERNATIVE, MOTION TO RETROACTIVELY EXTEND THE TIME TO FILE PETITION FOR REHEARING OR MOTION FOR RECONSIDERATION OF ORDER DISMISSING APPEAL PURSUANT TO RULE 26(B) AND RULE 40(A) F.R.APP.P.; GRANTING APPELLEE DANE S. FIELD, TRUSTEE'S 41 MOTION TO STRIKE A PORTION OF APPELLANT'S REPLY TO APPELLEE'S OPPOSITION TO MOTION FOR RECONSIDERATION; AND GRANTING TRUSTEE'S 44 MOTION TO STRIKE A PORTION OF APPELLANT'S REPLY TO APP ELLEE'S OPPOSITION TO MOTION FOR LEAVE TO FILE LATE PETITION FOR REHEARING. Signed by District JUDGE LESLIE E. KOBAYASHI on February 27, 2012. (bbb, )CERTIFICATE OF SERVICEParticipants registered to receive elec tronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
Case No. 10-00235 (Chapter 7) )
In re MAUI INDUSTRIAL LOAN & )
FINANCE CO.,
)
)
Debtor.
)
_____________________________ )
)
DANE S. FIELD, Trustee,
)
Plaintiff-Appellee, )
)
)
vs.
)
RNI-NV LIMITED PARTNERSHIP, a )
)
Nevada Limited Partnership,
)
and MAUI INDUSTRIAL LOAN &
)
FINANCE COMPANY, INC., a
)
Hawaii corporation,
)
)
Defendants)
Appellant.
_____________________________ )
CIVIL NO. 11-00364 LEK-BMK
(Adv. No. 10-90069)
ORDER DENYING APPELLANT RNI-NV LIMITED PARTNERSHIP’S MOTION FOR
RECONSIDERATION PURSUANT TO RULE 59(E), F.R.CIV.P. [DKT. NO. 30];
GRANTING APPELLANT’S MOTION FOR LEAVE TO FILE LATE PETITION FOR
REHEARING OR MOTION FOR RECONSIDERATION OF ORDER DISMISSING
APPEAL OF NOVEMBER 30, 2011, OR, IN THE ALTERNATIVE, MOTION TO
RETROACTIVELY EXTEND THE TIME TO FILE PETITION FOR REHEARING OR
MOTION FOR RECONSIDERATION OF ORDER DISMISSING APPEAL PURSUANT TO
RULE 26(B) AND RULE 40(A) F.R.APP.P. [DKT. NO. 37];
GRANTING APPELLEE DANE S. FIELD, TRUSTEE’S MOTION TO STRIKE
A PORTION OF APPELLANT’S REPLY TO APPELLEE’S OPPOSITION
TO MOTION FOR RECONSIDERATION [DKT. NO. 41]; AND
GRANTING TRUSTEE’S MOTION TO STRIKE A PORTION OF
APPELLANT’S REPLY TO APPELLEE’S OPPOSITION TO MOTION
FOR LEAVE TO FILE LATE PETITION FOR REHEARING [DKT. NO. 44]
Before the Court are four matters in this bankruptcy
appeal: (1) Appellant RNI-NV Limited Partnership’s (“Appellant”
or “RNI-NV”) Motion For Reconsideration Pursuant to Rule 59(e),
F.R.Civ.P. (“Motion for Reconsideration”), filed on December 21,
2011 [dkt. no. 30]; (2) Appellant’s Motion for Leave to File Late
Petition for Rehearing or Motion for Reconsideration of Order
Dismissing Appeal of November 30, 2011, or, in the Alternative,
Motion to Retroactively Extend the Time to File Petition for
Rehearing or Motion for Reconsideration of Order Dismissing
Appeal Pursuant to Rule 26(b) and Rule 40(a) F.R.App.P., filed
January 26, 2011 (“Motion for Leave”) [dkt. no. 37]; (3) Appellee
Dane S. Field, Trustee’s (“Appellee” or “the Trustee”) Motion to
Strike a Portion of Appellant’s Reply to Appellee’s Opposition to
Motion for Reconsideration (“First Motion to Strike”), filed on
February 8, 2012 [dkt. no. 41]; and (4) the Trustee’s Motion to
Strike a Portion of Appellant’s Reply to Appellee’s Opposition to
Motion for Leave (“Second Motion to Strike”), filed on
February 15, 2012 [dkt. no. 44].
The Trustee filed his
memorandum in opposition to the Motion for Reconsideration on
January 9, 2012, and Appellant filed its reply on January 26,
2012.
The Trustee filed his memorandum in opposition to the
Motion for Leave on February 8, 2012, and Appellant filed its
reply on February 14, 2012.
Appellant filed its response to the
First Motion to Strike on February 14, 2012 and its response to
the Second Motion to Strike on February 16, 2012.
The Court finds these matters suitable for disposition
without a hearing pursuant to Rule LR7.2(d) of the Local Rules of
2
Practice of the United States District Court for the District of
Hawai`i (“Local Rules”).
After careful consideration of the
motions, supporting and opposing memoranda, and the relevant
legal authority, Appellant’s Motion for Reconsideration is HEREBY
DENIED for the reasons set forth below.
The Court HEREBY GRANTS
Appellant’s Motion for Leave and the Trustee’s First and Second
Motions to Strike.
BACKGROUND
Appellant seeks reconsideration of the Court’s
November 30, 2011 Order Dismissing Appeal (“Order”).
The parties
and the Court are familiar with the factual and procedural
background of this case.
The Court therefore will only discuss
the background that is relevant to the instant motions.
In the Chapter 7 proceedings below, the Trustee brought
an adversary proceeding against RNI-NV seeking to recover funds
that the debtor, Maui Industrial Loan & Finance Company, Inc.
(“Maui Industrial”), paid to RNI-NV (Adv. Pro. No. 10-90069).
The complaint in the adversary proceeding alleged four counts,
including: (1) violation of the Hawaii Business Corporations Act,
Haw. Rev. Stat. § 414-111(c) (Count I); (2) violation of the
Hawaii Uniform Fraudulent Transfer Act, Haw. Rev. Stat. Chapter
651C (Count II); (3) violation of 11 U.S.C. § 548 (Count III);
and (4) transferee liability pursuant to 11 U.S.C. § 550 (Count
IV).
The Trustee sought summary judgment on Counts I, II, and
3
IV.
The bankruptcy judge granted the Trustee’s motion for
summary judgment in a May 16, 2011 Memorandum of Decision.
On
June 1, 2011, the parties stipulated to dismiss Count III.
RNI-
NV filed its Notice of Appeal on May 27, 2011 (“Notice of
Appeal”), appealing the May 16, 2011 Decision (“Appeal”).
The
bankruptcy court entered final judgment on June 3, 2011.
In its Order, this Court dismissed the Appeal for lack
of appellate jurisdiction, concluding that the Notice of Appeal
was untimely pursuant to Fed. R. Bankr. P. 8002 and 8003.
Judgment issued on November 30, 2011.
The instant motions
followed.
I.
Appellant’s Motion for Reconsideration
Appellant initially seeks reconsideration pursuant to
Fed. R. Civ. P. 59(e), arguing that the dismissal of the Appeal
must be reconsidered, vacated, or the entire appellate case
remanded to the bankruptcy court for the entry of a Report and
Recommendation by the Article I Judge.
for Recon. at 1.]
[Mem. in Supp. of Motion
Appellant repeats its previous arguments that
the bankruptcy court did not have the authority to enter a final
judgment based on the United States Supreme Court decision in
Stern v. Marshall, 131 S. Ct. 2594 (2011), and argues that Stern
constitutes an “intervening change in the controlling law” for
Rule 59(e) purposes.
It also argues for the first time that its
Notice of Appeal was timely under applicable Ninth Circuit
4
precedent, including In re Bonham, 229 F.3d 750 (9th Cir. 2000).
A.
The Trustee’s Opposition
The Trustee first argues that Appellant’s Motion for
Reconsideration was filed on December 21, 2011, seven days after
the deadline for filing such a motion.
He argues that, although
Appellant asserts it filed the Motion for Reconsideration
pursuant to Fed. R. Civ. P. 59(e), the rule does not apply to a
district court sitting as an appellate court in bankruptcy
proceedings.
Rather, the Trustee argues that Fed. R. Bankr. P.
8015 applies, which provides in pertinent part: “Unless the
district court . . . by local rule or by court order otherwise
provides, a motion for rehearing may be filed within 14 days
after entry of the judgment of the district court[.]”
Opp. to Motion for Recon. at 3-4.]
[Mem. in
The Trustee asserts that a
motion improperly filed pursuant to Rule 59(e) should be “treated
as a motion for rehearing under Bankruptcy Rule 8015.”
[Id. at 4
(citing ECC Sys., Inc. v. Mallinckrodt Inc. (In re ECC Sys.,
Inc.), 2009 WL 1028061, at *1 (9th Cir. 2009)).]
Because
Appellant filed its motion twenty-one days after entry of this
Court’s Order and judgment, the Trustee argues that the Motion
for Reconsideration was filed beyond the fourteen-day time limit
set forth in Rule 8015 and is untimely.
[Id. at 4.]
With respect to the merits, the Trustee argues that
5
Stern is not an “intervening change in the law,” because it was
decided on June 23, 2011, before the parties filed their briefs
in the instant Appeal, and was expressly raised in the briefing
and oral argument before this Court.
[Id. at 5-7.]
He also
argues that Appellant did not previously raise its arguments
regarding the Ninth Circuit’s “pragmatic and flexible finality”
standard, and has therefore waived them, but in any event, the
standard does not apply to bankruptcy adversary proceedings.
[Id. at 8-9.]
B.
Appellant’s Reply
In its reply, Appellant argues that its Motion for
Reconsideration may be considered on its merits as this Court can
waive or excuse strict compliance with the “practice and
pleading” Rule 8015.
[Reply to Motion for Recon. at 4-9.]
It
argues that the seven-day delay did not impede an expeditious
resolution of this litigation or prejudice the Trustee, and that
public policy favors disposition on the merits.
[Id. at 11-15.]
Appellant also argues that the Court erred in
dismissing the Appeal, which constitutes either a Fed. R. Bankr.
P. 9023 “manifest error of law,” or a Fed. R. App. P. 40(a)(2)
“misapprehension” of a point of law.
C.
[Id. at 22.]
The Trustee’s First Motion to Strike
In its First Motion to Strike, the Trustee argues that,
in its reply memorandum, Appellant asserts six pages of argument
6
that this Court misapplied In re Jack Raley Construction, Inc.,
17 F.3d 291 (9th Cir. 1994), but that such argument is not
responsive to the Trustee’s opposition memorandum, nor did
Appellant raise the argument in its memorandum in support of its
Motion for Reconsideration.
He also argues that, when Appellant
filed its Motion for Reconsideration, it argued that the Trustee
calculated the pre-judgment interest and therefore is judicially
estopped from claiming any other amount.
In its reply, however,
when belatedly raising its analysis of In re Jack Raley
Construction, Inc., Appellant argues that the parties
stipulated to the amount of the pre-judgment interest.
The
Trustee asks the Court to strike these matters raised for the
first time in Appellant’s reply.
[First Motion to Strike at 1-
4.]
In response to the First Motion to Strike, Appellant
states that its discussion in its reply regarding the application
of In re Jack Raley Construction, Inc. was to show that this
Court committed a manifest error of law or a misapprehension of
law.
[Mem. in Opp. to First Motion to Strike at 2-3.]
Alternatively, if the Court is inclined to strike these
arguments, Appellant asks the Court to authorize the Trustee to
file a pleading responding to the allegedly “new” arguments.
[Id. at 3.]
The Court HEREBY GRANTS the First Motion to Strike, and
7
does not consider matters raised for the first time in
Appellant’s reply to the Motion for Reconsideration.
II.
Appellant’s Motion for Leave
Appellant’s Motion for Leave asks the Court for
permission to file a late petition for rehearing pursuant to Fed.
R. App. P. Rules 26(b) and 40(a)(1).
Alternatively, it seeks to
retroactively extend the time for filing a petition for rehearing
pursuant to the applicable rules.
Leave at 1-2.]
[Mem. in Supp. of Motion for
Appellant acknowledges that:
Where the district court is adjudicating a
bankruptcy appellate proceeding pursuant to 28
U.S.C. § 158, rather than 28 U.S.C. § 157(d), then
either the 14 day period of Rule 8015 F.R.Bk.P.
for a Motion for Reconsideration, or, if
appropriate, the 14 day period of Rule 40(a)(1),
F.R.App.P, for a petition for rehearing, might be
the relevant time periods to file a motion for
reconsideration or petition for [re]hearing.
[Motion for Leave, Declaration of Jerrold Guben (“1/26/12 Guben
Decl.”) at ¶ 11.]
Appellant also repeats its arguments set forth
in its reply to the Motion for Reconsideration.
A.
The Trustee’s Opposition
In his opposition, the Trustee argues that neither Fed.
R. Bankr. P. 9023 nor Fed. R. Civ. P. 59(e) apply to Appellant’s
Motion for Reconsideration; rather, Fed. R. Bankr. P. 8015
applies.
Under Fed. R. Bankr. P. 9006(b)(1), the Court may grant
Appellant leave to file its Motion for Reconsideration late, but
only if Appellant meets its burden of showing excusable neglect
8
for failing to timely file the motion.
The Trustee argues that
Appellant fails to meet that burden and, therefore, the Motion
for Leave should be denied.
2-5.]
[Mem. in Opp. to Motion for Leave at
The Trustee also asserts that Appellant’s conduct has not
been in good faith, has been dilatory over the course of the
Appeal, and that Appellant has repeatedly flouted basic
procedural rules.
B.
[Id. at 18-20.]
Appellant’s Reply
In its reply, Appellant argues that Court can employ
the Fed. R. Bankr. P. 9006(b) “excusable neglect” standard and
that it should be applied with leniency here.
Appellant
indicates that it erroneously relied on Fed. R. Civ. P. 59(e) as
the basis for its Motion for Reconsideration.
for Leave at 6-7.]
[Reply to Motion
Appellant nevertheless urges the Court to
adopt its own alternative framework for authorizing a waiver of
time limits under the five-factor test of Ghazali v. Moran, 46
F.3d 52, 53 (9th Cir. 1995).
[Id. at 4-5.]
Appellant also states that there is authority “for
bankruptcy courts to entertain the filing of a Rule 9023/Rule 59
motion to be treated as a F.R.Bk.P, Rule 9024/F.R.Civ.P. Rule 60
motion, where the motion was filed more that 14 days after the
entry of the order [and] raises a legitimate Rule 60(b) issue.”
[Id. at 10.]
Appellant acknowledges that “the filing of a motion for
9
[re]consideration in the federal courts presents a patch-work of
procedures. . . . there are several ‘reconsideration rules,” and
Appellant simply chose the wrong one, not from a lack of good
faith.”
[Reply to Motion for Leave, Declaration of Jerrold Guben
(“2/14/12 Guben Decl.”) at ¶¶ 29-30.]
It also asserts that, when
a district court “functions as an appellate court, or in the
bankruptcy appellate panel, a motion for reconsideration does not
proceed by Rule 9023, F.R.Bk.P. or Rule 59, F.R.Civ.P., but by
Rule 8015 F.R.Bk.P.”
C.
[Id. at ¶ 34.]
The Trustee’s Second Motion to Strike
The Trustee asks the Court to strike Appellant’s reply
filed in support of its Motion for Leave.
The Trustee notes that
on January 27, 2012, this Court issued a minute order on
Appellant’s Motion for Leave, stating: “No Reply Memorandum is
allowed.”
[Second Motion to Strike at 1 (quoting Minutes, filed
1/27/12, [dkt. no 39]) (emphasis in original).]
The Court HEREBY
GRANTS the Second Motion to Strike.
DISCUSSION
I.
Motion for Leave
The parties agree that Appellant’s request that the
Court reconsider its Order is not governed by Fed. R. Civ. P.
59(e), but by Fed. R. Bankr. P. 8015.
Rule 8015 provides:
“Unless the district court . . . by local rule or by court order
otherwise provides, a motion for rehearing may be filed within 14
10
days after entry of the judgment of the district court[.]”
Appellant filed its Motion for Reconsideration twenty-one days
after the entry of judgment, rather than the fourteen days set
forth in the rule.
Fed. R. Bankr. P. 9006(b)(1) governs extensions of time
to file a motion pursuant to Fed. R. Bankr. P. 8015.
See In re
Blinder, Robinson & Co., Inc., 124 F.3d 1238, 1240 n.3 (10th Cir.
1997) (“The district court properly extended the time for filing
a motion to reconsider pursuant to Fed. R. Bankr. P. 8015 and
9006(b)(1).”).
It provides, in pertinent part:
[W]hen an act is required or allowed to be done at
or within a specified period by these rules
. . . , the court for cause shown may at any time
in its discretion . . . (2) on motion made after
the expiration of the specified period permit the
act to be done where the failure to act was the
result of excusable neglect.
Fed. R. Bankr. P. 9006(b)(1).
This district court recognizes the
following standard for considering extensions pursuant to the
rule:
Bankruptcy Rule 9006 allows a court to permit
a movant’s late filing if the movant’s failure to
meet the specified deadline “was the result of
excusable neglect.” Fed. R. Bank. P. 9006(b)(1).
Interpreting this provision, the U.S. Supreme
Court articulated a four-part test to determine
whether a party’s failure to meet a deadline
constitutes excusable neglect. See Pioneer Inv.
Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507
U.S. 380, 395 (1993). Specifically, courts must
examine: (1) the danger of prejudice to the
opposing party; (2) the length of the delay and
its potential impact on the proceedings; (3) the
reason for the delay; and (4) whether the movant
11
acted in good faith. Id. The determination of
“what sorts of neglect will be considered
‘excusable’ . . . is at bottom an equitable one,
taking account of all relevant circumstances
surrounding the party’s omission.” Pioneer, 507
U.S. at 395; see also Lemoge v. United States, 587
F.3d 1188, 1195 (9th Cir. 2009) (stating that the
four enumerated Pioneer factors are “‘not an
exclusive list’”) (quoting Briones v. Riviera
Hotel & Casino, 116 F.3d 379, 381 (9th Cir. 1997)
(per curiam)).
The Ninth Circuit has expounded upon the
Pioneer test, and adopted it in other contexts,
including Federal Rules of Civil Procedure
(“Rule”) 6(b) and 60(b) as well as Federal Rules
of Appellate Procedure (“Appellate Rule”) 4(a)(5).
See, e.g., Briones, 116 F.3d at 381 (adopting the
Pioneer test for consideration of Rule 60(b)
motions); Comm. for Idaho’s High Desert, Inc. v.
Yost, 92 F.3d 814, 825 n.4 (9th Cir. 1996)
(concluding that the Pioneer test is applicable to
Rule 6(b) and noting the Ninth Circuit’s prior
holding that the Pioneer analysis applies to
Appellate Rule 4(a)(5)) (citing Reynolds v.
Wagner, 55 F.3d 1426, 1429 (9th Cir. 1995)).
Although the Ninth Circuit initially took a narrow
approach to the Pioneer excusable neglect
analysis, see Kyle v. Campbell Soup Co., 28 F.3d
928, 931–32 (9th Cir. 1994) (concluding that an
attorney’s mistake in interpreting and applying
unambiguous rules did not constitute excusable
neglect under Pioneer), the clear trend since
Pincay v. Andrews, 389 F.3d 853 (9th Cir. 2004)
(en banc)[,] is to afford the movant more lenience
when applying the Pioneer factors, see, e.g.,
Lemoge, 587 F.3d at 1195–98 (determining that the
district court abused its discretion in not
finding excusable neglect within Rule 60(b) when
the plaintiffs’ attorney, due to serious medical
issues, failed to timely serve the summons and
complaint, but seven months later, moved to set
aside the district court’s dismissal of the case);
In re Zilog, Inc., 450 F.3d 996, 1006–07 (9th Cir.
2006) (concluding that the bankruptcy court abused
its discretion in failing to find excusable
neglect pursuant to Bankruptcy Rule 9006(b)(1)
when pro se employees failed to timely file proofs
12
of claim); Pincay, 389 F.3d at 858–60 (affirming
the district court’s finding of excusable neglect
within the meaning of Appellate Rule 4(a)(5) when
the defendants filed their notice of appeal
twenty-four days late due to a calendaring mistake
caused by attorneys and paralegals misapplying a
clear legal rule). Indeed, the Ninth Circuit has
recently reiterated that “[e]xcusable neglect
‘encompass[es] situations in which the failure to
comply with a filing deadline is attributable to
negligence,’ and includes ‘omissions caused by
carelessness.’” Lemoge, 587 F.3d at 1192 (quoting
Pioneer, 507 U.S. at 394).
In re Hawaiian Airlines, Inc., Cv. No. 08–00405 DAE–BMK, 2011 WL
1483923, at *2-3 (D. Hawai‘i Apr. 18, 2011).
Examining the Pioneer factors, the Court finds that
Appellant has made a sufficient showing for the purpose of its
Motion for Leave.
Taking account of all the relevant
circumstances, the first factor weighs in favor of Appellant,
because the Court concludes that the prejudice to the Trustee is
nominal; “allowing [Appellant] to file an untimely [Motion for
Reconsideration] would merely mean that [the Trustee] ‘would have
lost a quick victory,’ which is not sufficiently prejudicial to
deny relief.”
Id. at *4.
Second, the seven day delay in filing
the Motion for Reconsideration is a minor delay when compared to
other delays deemed reasonable by the Ninth Circuit.
See id.
(citing Lemoge, 587 F.3d at 1197 (concluding that the plaintiffs’
Rule 60(b) motion, filed seven months after the case had been
dismissed, was brought within a reasonable amount of time)).
As to the third factor, the reason for the delay, it is
13
not entirely clear to the Court why Appellant filed its Motion
for Reconsideration pursuant to Fed. R. Civ. P. 59(e), rather
than the applicable Bankruptcy Rule.
Appellant acknowledges that
“different rules may apply where the District Court is exercising
its appellate jurisdiction over a bankruptcy case.”
Guben Decl. at ¶ 10.]
[1/26/12
To the extent Appellant relied on the
wrong rule, the Court finds that, absent further explanation,
this factor does not weigh in favor of Appellant.
The Court
notes, however, that “the Ninth Circuit has found excusable
neglect when experienced law firms and attorneys have missed
filing deadlines.”
In re Hawaiian Airlines, Inc., 2011 WL
1483923, at *5 (citing cases).
Accordingly, under the
circumstances presented, this will not preclude the Court from
finding excusable neglect.
Finally, as to the fourth factor, the
Court cannot conclude that Appellant acted in bad faith.
See
Bateman v. United States Postal Serv., 231 F.3d 1220, 1225 (9th
Cir. 2000) (concluding that the movant acted in good faith
because “[h]is errors resulted from negligence and carelessness,
not from deviousness or willfulness”).
In sum, three of the Pioneer factors—prejudice, length
of delay, and good faith—weigh in favor of Appellant, and
although the Trustee is rightfully frustrated by Appellant’s
failure to follow applicable rules and deadlines, that will not
preclude the Court from finding that this error was the product
14
of excusable neglect.
See Pioneer, 507 U.S. at 388 (“Congress
plainly contemplated that the courts would be permitted, where
appropriate, to accept late filings caused by inadvertence,
mistake, or carelessness, as well as by intervening circumstances
beyond the party’s control.”).
Thus, “considering all relevant
circumstances,” id. at 395, the Court concludes that Appellant’s
neglect was “excusable” under Fed. R. Bankr. P. 9006(b)(1).
The Court, exercising its discretion, HEREBY GRANTS
Appellant’s Motion for Leave, and, pursuant to Fed. R. Bankr. P.
9006(b)(1), permits the late filing of Appellant’s Motion for
Reconsideration.
The Court next turns to the merits of that
motion.
II.
Motion for Reconsideration
Appellant seeks reconsideration of the Court’s Order on
the grounds that the bankruptcy court did not have the authority
to enter a final judgment based on the United States Supreme
Court’s decision in Stern, and that its Notice of Appeal was
timely.
As discussed above, the Court treats the Motion for
Reconsideration as a petition for rehearing pursuant to Fed. R.
Bankr. P. 8015.
This rule does not provide a standard of review
for granting a rehearing. The Ninth Circuit has
upheld the application of Rule 40 of the Federal
Rules of Appellate Procedure to a rehearing motion
since Rule 8015 was derived from Rule 40. See In
re Fowler, 394 F.3d 1208, 1214 (9th Cir. 2005);
15
Fed. R. Br. P. 8015 Advisory Committee Notes.
Rule 40 of the Federal Rules of Appellate
Procedure requires the petitioner to “state with
particularity the points of law or fact which in
the opinion of the petitioner the court has
overlooked or misapprehended.” Fed. R. App. P.
40(a). “A petition for rehearing was not designed
to be a ‘crutch for dilatory counsel, nor, in the
absence of a demonstrable mistake, to permit
reargument of the same matters.’” Olson v. United
States, 162 B.R. 831, 834 (D. Neb. 1993) (quoting
United States v. Vasquez, 985 F.2d 491, 497 (10th
Cir. 1993)). “‘Whether or not to grant
reconsideration is committed to the sound
discretion of the court.’” In re Fowler, 394 F.3d
at 1214 (quoting Navajo Nation v. Norris, 331 F.3d
1041, 1046 (9th Cir. 2003)).
In re Personal Elec. Transp., Inc., Cv. No. 07-00198 DAE/LEK,
2007 WL 2363381, at *1 (D. Hawai‘i Aug. 13, 2007).
If the court “finds that it has not considered an
important aspect of the case, then a rehearing is warranted.”
McMullen v. Schultz, 443 B.R. 236, 241 (D. Mass. 2011).
“A
motion for rehearing ‘is not a means by which to reargue a
party’s case or to assert new grounds for relief.’”
Forrest v.
Spicewood Dev., LLC, Civil No. 1:10cv096, 2011 WL 915174, at *1
(W.D.N.C. Mar. 3, 2011) (citation omitted).
A.
Application of Stern v. Marshall
Appellant previously argued that Stern prohibits the
bankruptcy court from entering final judgment in this matter.
Although the issue was raised in the course of the Appeal, the
Court concluded that it did not have subject matter jurisdiction
over the Appeal, and did not decide whether Stern applied to the
16
bankruptcy court’s June 3, 2011 final judgment.
The Court
confirms that, to the extent Appellant argues that the bankruptcy
court had no authority to issue a final judgment, this argument
is not properly before this Court, which is without jurisdiction
to decide the substantive issues raised in the Appeal.
Moreover,
Stern is not an “intervening change in the law,” because it was
decided on June 23, 2011, before the parties filed their briefs
in the instant Appeal, and was expressly raised in the briefing
and oral argument before this Court.
On this issue, Appellant
fails to established that the Court has “not considered an
important aspect of the case,” and that a rehearing is warranted.
McMullen, 443 B.R. at 241.
B.
Ninth Circuit’s Finality Standard
Appellant argues that the Court erred in dismissing the
Appeal because it failed to apply the Ninth Circuit’s “pragmatic
and flexible finality” standard in determining when a judgment of
a bankruptcy court is final for appeal purposes.
Appellant
states that:
This Court’s error in dismissing RNI’s appeal
because RNI allegedly failed to file a timely
Notice of Appeal within 14 days of the Bankruptcy
Court’s “Final Judgment,” is based on the Court’s
failure to apply the Ninth Circuit’s “Pragmatic
and Flexible Finality” standard pursuant to 28
U.S.C. § 158(a) in determining when a “judgment”
of a bankruptcy court is “final” for appeal
purposes. This Court simply failed to evaluate
whether the Bankruptcy Court’s “Final Judgment” of
June 3, 2011, as docketed on June 5, 2011, was a
28 U.S.C. § 158(a) final judgment for appeal
17
purposes, given the Decision and Order of May 16,
2011, ruling on Counts I, II and IV, the
Stipulation of June 1, 2011, dismissing Count III,
and the Final Judgment of June 3, 2011,
liquidating the principal judgment $1,040,000.00
and pre-judgment interest of $337,934.18.
[Mem. in Supp. of Motion for Recon. at 11.]
First, Appellant did not raise the issue of the
finality of the June 3, 2011 final judgment on Appeal.
Second,
to the extent Appellant requests the Court employ the Ninth
Circuit’s “pragmatic and flexible finality” standard, Appellant
fails to demonstrate that this standard applies to district court
appeals from bankruptcy adversary proceedings.
Rather,
“[a]dversary proceedings are merely federal civil actions under
another name, and do not ordinarily present the types of
uncertainties that necessitate ‘flexible finality’ analysis.”
re Belli, 268 B.R. 851, 854 (9th Cir. BAP 2001).
In
“[F]inality for
purposes of jurisdiction over ‘as of right’ appeals under 28
U.S.C. § 158(a)(1) in adversary proceedings does not differ from
finality in ordinary federal civil actions under 28 U.S.C. §
1291.”
Id. at 855.
Finally, regardless of whether the Court applies the
“pragmatic and flexible finality” standard, the outcome is the
same.
Appellant acknowledges that all the parties “believed the
Final Judgment of June 3, 2011 was an effective enforceable final
judgment. . . .”
[Mem. in Supp. of Motion to Recon. at 18.]
Court did not rule to the contrary.
18
The Court’s Order stated
The
that “Appellant filed a notice of appeal from the bankruptcy
court’s interlocutory Decision, but it failed to file any notice
of appeal from the bankruptcy court’s final judgment – timely or
otherwise.”
[Order at 27.]
That is, there is no dispute that
the June 3, 2011 final judgment is, in fact, final.
Nor is there
any dispute that Appellant did not timely file a notice of appeal
from that final judgment, leaving this Court without appellate
jurisdiction.
The Court’s Order ruled as follows:
The Court emphasizes that it is constrained
by Ninth Circuit precedent, and CONCLUDES that the
safe harbor provision of Fed. R. Bankr. P. 8002(a)
does not apply here to the prematurely filed
Notice of Appeal. Although the Court accepts that
the Appellant reasonably believed the prematurely
filed Notice of Appeal was timely and effective,
the federal rules regarding the time of appeals
are strictly construed. Malone v. Avenenti, 850
F.2d 569, 572 (9th Cir. 1988). The Court
recognizes that jurisdictional filing requirements
“necessarily operate harshly and arbitrarily with
respect to individuals who fall just on the other
side of them[.]” Houston v. Lack, 487 U.S. 266,
282 (1988) (citation omitted). This Court,
however, may only proceed within the boundaries
previously set before it.
The Court also concludes that Fed. R. Bankr.
P. 8003(c) does not cure the prematurely filed
Notice of Appeal. Appellant argues that the fact
that Count III had not been disposed of when the
Notice of Appeal was filed on May 27, 2011, is
covered by Rule 8003(c), providing for the filing
of a motion for leave to appeal, which states as
follows:
(c) Appeal Improperly Taken Regarded as a
Motion for Leave to Appeal. If a required
motion for leave to appeal is not filed, but
notice of appeal is timely filed, the
district court or bankruptcy appellate panel
19
may grant leave to appeal or direct that a
motion for leave to appeal be filed. The
district court or the bankruptcy appellate
panel may also deny leave to appeal but in so
doing shall consider the notice of appeal as
a motion for leave to appeal. Unless an
order directing that a motion for leave to
appeal be filed provides otherwise, the
motion shall be filed within 14 days of entry
of the order.
to
as
of
I,
Appellant seeks the discretion of the Court
administer the May 27, 2011 Notice of Appeal,
a Motion for Leave to File a Notice of Appeal
the resolved counts as of May 27, 2011, Counts
II and IV.
The Trustee argues that Appellant’s reliance
on Rule 8003(c) is misplaced. Appellant filed a
notice of appeal from the bankruptcy court’s
interlocutory Decision, but it failed to file any
notice of appeal from the bankruptcy court’s final
judgment – timely or otherwise. As such, the
final judgment is not before this Court. Thus,
the Trustee argues that, even if this Court were
to grant Appellant leave to file its interlocutory
appeal from the Decision, the bankruptcy court’s
final judgment would remain in full force and
effect. The Court agrees with the Trustee on this
point, and FINDS that Fed. R. Bankr. P. 8003(c)
does not apply.
[Order at 25-27.]
The Court finds no point of law that was overlooked or
misapprehended with respect to the application of Fed. R. Bankr.
P. 8002 and 8003.
Appellant has not demonstrated that the Court
should reconsider its ruling on the issue of its appellate
jurisdiction.
Accordingly, the Court DENIES the Motion for
Reconsideration and reiterates that it is without jurisdiction to
hear the Appeal.
20
CONCLUSION
On the basis of the foregoing, Appellant RNI-NV Limited
Partnership’s Motion For Reconsideration Pursuant to Rule 59(e),
F.R.Civ.P., filed on December 21, 2011 [dkt. no. 30] is HEREBY
DENIED.
The following motions are HEREBY GRANTED: Appellant’s
Motion for Leave to File Late Petition for Rehearing or Motion
for Reconsideration of Order Dismissing Appeal of November 30,
2011, or, in the Alternative, Motion to Retroactively Extend the
Time to File Petition for Rehearing or Motion for Reconsideration
of Order Dismissing Appeal Pursuant to Rule 26(b) and Rule 40(a)
F.R.App.P., filed January 26, 2011 [dkt. no. 37]; Appellee Dane
S. Field, Trustee’s Motion to Strike a Portion of Appellant’s
Reply to Appellee’s Opposition to Motion for Reconsideration,
filed on February 8, 2012 [dkt. no. 41]; and Appellee Dane S.
Field, Trustee’s Motion to Strike a Portion of Appellant’s Reply
to Appellee’s Opposition to Motion for Leave, filed on
February 15, 2012 [dkt. no. 44].
IT IS SO ORDERED.
21
DATED AT HONOLULU, HAWAII,February 27, 2012.
/S/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge
DANE S. FIELD V. RNI-NV LIMITED PARTNERSHIP, ET AL; CIVIL NO. 1100364 LEK-BMK; ORDER DENYING APPELLANT RNI-NV LIMITED
PARTNERSHIP’S MOTION FOR RECONSIDERATION PURSUANT TO RULE 59(E),
F.R.CIV.P. [DKT. NO. 30]; GRANTING APPELLANT’S MOTION FOR LEAVE
TO FILE LATE PETITION FOR REHEARING OR MOTION FOR RECONSIDERATION
OF ORDER DISMISSING APPEAL OF NOVEMBER 30, 2011, OR, IN THE
ALTERNATIVE, MOTION TO RETROACTIVELY EXTEND THE TIME TO FILE
PETITION FOR REHEARING OR MOTION FOR RECONSIDERATION OF ORDER
DISMISSING APPEAL PURSUANT TOP MOTION FOR RECONSIDERATION OF
ORDER DISMISSING APPEAL PURSUANT TO RULE 26(B) AND RULE 40(A)
F.R.APP.P. [KT. NO. 37]; GRANTING APPELLEE DANE S. FIELD,
TRUSTEE’S MOTION TO STRIKE A PORTION OF APPELLANT’S REPLY TO
APPELLEE’S OPPOSITION TO MOTION FOR RECONSIDERATION [DKT NO. 41];
AND GRANTING TRUSTEE’S MOTION TO STRIKE A PORTION OF APPELLANT’S
REPLY TO APPELLEE’S OPPOSITION TO MOTION FOR LEAVE TO FILE LATE
PETITION FOR REHEARING [DKT NO. 44]
22
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?