SANGHA V. SCHRADER
- Summarized by Michael Myers , Ballard Spahr LLP
- 10 months 1 week ago
- Case Type:
- Consumer
- Case Status:
- Affirmed
- Citation:
- 24-4548 (9th Circuit, Apr 15,2025) Not Published
- Tag(s):
-
- Ruling:
- The Ninth Circuit Court of Appeals affirmed the District Court and Bankruptcy Court application of issue preclusion on the "maliciousness" prong under 11 USC 523(a)(6).
- Procedural context:
- The Bankruptcy Appellate Panel and Ninth Circuit had previously vacated the bankruptcy court's decision to apply issue preclusion to the "willfulness" prong of 523(a)(6). The bankruptcy court then considered "willfulness" de novo, permitting discovery and conducting a trial on that issue, but it applied issue preclusion to the "maliciousness" prong.
- Facts:
- The creditor had obtained a $1.3 million state court default judgment against the debtor prior for defamation per se where the state court had awarded punitive damages. The bankruptcy court applied the California standard for issue preclusion to find malicious intent by the debtor based on the state court judgment. The Ninth Circuit held that the bankruptcy court properly applied California's issue preclusion to "maliciousness" and properly considered the "willfulness" and "maliciousness" prongs separately.
- Judge(s):
- Bade, Sung, and Kane
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