Case Type:
Case Status:
21-1265 (9th Circuit, Jul 12,2022) Not Published
The Bankruptcy Appellate Panel of the Ninth Circuit (BAP) affirmed the decision of the U.S. Bankruptcy Court for the Eastern District of California (BC) not to hold a state court non-debtor defendant in contempt for their post-remand actions as the debtor (DR) had not appealed the original remand order and the order allegedly violated had found excusable neglect to justify a late notice of appeal, but said nothing as to staying the remand order, a request made by the DR solely in the caption and prayer of the very motion whose every other aspect involved a plea for more time to appeal.
Procedural context:
In the short period after a DR's removal, but before the remand of, an action commenced by the DR in the Superior Court for Sacramento County asserting causes of action based on alleged violations of her rights under Keep Your Home California (the State Court Action), the DR filed a motion for contempt against SPS based on the latter's purported attempts to collect a "void" debt. The BC denied this motion. While the DR failed to timely appeal this order, the DR did "promptly" file a motion to extend her time to appeal captioned as a "Motion for Extension of Time to File Notice of Appeal, For Leave of Court to File Notice of Appeal, and to Stay Remand." (Extension Motion). In the prayer and caption, the Extension Motion referenced the DR's request for a stay of the remand order; no discussion of the stay request otherwise appeared in the DR's documents. Naturally, the BC the therefore "focused solely on the request for an extension of time.," though the order itself stated: "[T]he motion is granted based on the findings stated on the record.” While the Extension Motion was pending, both parties made moves in the state court. First, the DR moved for dismissal. Next, SPS tendered a motion to vacate the dismissal and for a judgment. When the DR insisted that the state court could not act due the remand stay she claimed to have been issued by the BC, the state court disagreed, set aside the dismissal, and entered judgment in favor of SPS. Upon that defeat, the DR sought $100 million in sanctions and alleged contempt because SPS took post-remand actions in the state court before the BC. When the BC denied this motion, the DR timely appealed this denial--and, despite her protestations to the contrary, only this final denial.
The DR filed her chapter 7 petition and received her discharge in 2010. Eight years later, she filed a complaint against Select Portfolio Servicing, Inc. (SPS) in the Superior Court for Sacramento County asserting causes of action based on alleged violations of her rights under Keep Your Home California (the State Court Action). After almost two years of litigation, the state court granted SPS's motion for summary judgment. In response, the DR , removed the State Court Action to the BC, which remanded after SPS had filed a motion so requesting. Before the remand order was entered, the machinations destined to come before the BAP commenced.
Laura S. Taylor; William J. Lafferty III; and Julia W. Brand

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