Flores v. Salven (In re DDJ, Inc.)

Summarized by Lars Fuller , BakerHostetler
10 years 9 months ago

Citation:

Flores v. Salven (In re DDJ, Inc.), BAP Nos. EC-13-1409-KuPaJu & EC-13-1410-KuPaJu (BAP 9th Cir. May 29, 2015)

Tag(s):

Ruling:

The BAP for the 9th Circuit affirmed the bankruptcy court's (ED Cal.) order overruling creditors' objection to chapter 7 trustee's final report. Creditors failed to comply with vexatious litigants order restrictions. BAP rejected appellants' argument that order was void because bankruptcy court did not have jurisdiction because appellants were separately appealing other previous orders of bankruptcy court. Notwithstanding pending appeals, bankruptcy court retained jurisdiction to preside over administration of estate. Other appeals did not affect final report ruling. Dismissal of appellants other appeals did not vacate vexatious litigant order that was issued because of appeals. Further, all of appellants other appeals were dismissed prior to bankruptcy court's ruling on final report. Appellants separate appeal of order approving fee application was untimely, and BAP did not consider arguments.

Procedural context:

Chapter 7 trustee filed final report, and creditors objected. Bankruptcy court (E.D. Cal.) overruled objection, and creditors appealed to Ninth Circuit.

Facts:

In 2004, appellants obtained a judgment against entities DDJ, Inc. and DDJ, LLC. In 2005, both entities filed bankruptcy under chapter 7. Salven was appointed trustee of DDJ, Inc. Appellants commenced a host of suits against various individuals and entities related to DDJ, Inc. and DDJ, LLC, none of which resulted in collection on the original judgment. The trustees of the estates asserted that certain of the claims were property of the respective bankruptcy estates. Appellants and the trustees entered into a settlement that the bankruptcy court approved in 2007. The settlement provided that all the disputed claims would be property of DDJ, Inc. Appellants subsequently sought to vacate the order approving the settlement, which bankruptcy court denied. Appellants escalated disputes with Salven as trustee with extensive and repetitive filings. Salven sought and obtained from bankruptcy court an order declaring appellants to be vexatious litigants, and setting forth restrictions on their future filings. Salven then filed final report. Appellants objected to final report, failing to comply with vexatious litigants order.

Judge(s):

Kurtz, Pappas, Jury

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