In re: WESTWOOD PLAZA NORTH

Case Type:
Business
Case Status:
Affirmed
Citation:
BAP No. CC-21-1046-GHL (9th Circuit, Oct 22,2021) Not Published
Tag(s):
Ruling:
The bankruptcy court did not abuse its discretion in denying a debtor's motion to reconsider the bankruptcy court's decision not to reopen a bankruptcy case that was dismissed in 1984 when the debtor failed to raise any new arguments and the debtor was a vexatious litigant.
Procedural context:
The procedural context of this case is found in the Facts section.
Facts:
The debtor, Westwood Plaza North, a California general partnership, filed a chapter 11 petition in 1984 (yes, you read that right). The bankruptcy case was dismissed five months after it was filed. The appellant, Shmuel Erde, asserts that he was the general partner of Westwood. After Westwood's bankruptcy case was dismissed, Westwood failed and Erde "lost everything." In 2012, Erde moved to reopen the Westwood bankruptcy case and to have Westwood's assets administered by the bankruptcy court. Erde argued that reopening the case was proper because he never received notice of its dismissal. The bankruptcy court disagreed with Erde's assertion and denied the motion to reopen. Erde then filed a motion to alter or amend under Fed. R. Bankr. P. 9024 (Fed. R. Civ. P. 60(a)). The bankruptcy court denied that motion and the district court affirmed. Rather than pursuing an appeal of the denial, Erde filed new bankruptcy cases (plural) and at least 19 adversary proceedings. In 2016, Erde asked the district court to allow him to file a motion to correct errors in the dismissal order pursuant to Fed. R. Civ. P. (6)(b)(4) and (b)(6). The district court denied the motion and further ruled on Erde's "no notice" argument, holding that the 1984 dismissal order was not void because at least one partner received notice of the dismissal. That partner's notice was imputed to all partners under California law. Erde file a personal chapter 11 case in 2018 and, in that case, filed a motion to vacate the 1984 dismissal order and to consolidate the Westwood case with his personal case. In support of the motion to vacate, Erde argued that his lack of notice of the dismissal violated his due process rights. The bankruptcy court denied the motion. The BAP and the United States Court of Appeals each affirmed the bankruptcy court. Erde, nonetheless, persisted. In December 2020, Erde filed another motion to vacate the 1984 dismissal order and again argued that the dismissal was void for lack of due process. On January 5, 2021, the bankruptcy court entered an order denying Erde's motion with prejudice. The bankruptcy court held that Erde had been abusing the judicial system with his multiple motions. Six days later, Erde filed a motion to reconsider. The bankruptcy court denied the motion. Seven days after filing the first motion, Erde filed a second motion to reconsider. The bankruptcy court denied Erde's second motion only two days later. On January 28, 2021, Erde filed a third motion to reconsider. Erde then filed a motion to disqualify the bankruptcy judge. On February 25, 2021, the bankruptcy court denied Erde's third motion to reconsider and denied Erde's motion to disqualify. Erde then appealed the bankruptcy court's denial of Erde's December 2020 motion to vacate. The district court refused to accept Erde's appeal under its vexatious litigant order. Erde appealed the district court's decision to the Ninth Circuit. The Court of Appeals denied Erde's appeal as frivolous. On March 5, 2021, Erde appealed the motion denying his third motion to reconsider.
Judge(s):
GAN, HESTON,** and LAFFERTY, Bankruptcy Judges

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