in re: ronald alvin neff, 9th cir. bap (2013)

7/25/2019 In re: Ronald Alvin Neff, 9th Cir. BAP (2013)

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* Thi s di sposi t i on i s not appr opr i at e f or publ i cat i on.Al t hough i t may be ci t ed f or what ever per suasi ve val ue i t mayhave ( see Fed. R. App. P. 32. 1) , i t has no pr ecedent i al val ue.See 9t h Ci r . BAP Rul e 8013- 1.

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

I n r e: ) BAP No. CC- 12- 1412- TaPaKi)

RONALD ALVI N NEFF, ) Bk. No. SV 11- 22424- VK)

Debt or . ) Adv. No. SV 12- 01101- VK ______________________________)

)MI CHAEL D. KWASI GROCH; LAW )OFFI CES OF MI CHAEL D. )KWASI GROCH, )

)Appel l ant s, )

)v. ) MEMORANDUM*)

DOUGLAS J . DENOCE, ))

Appel l ee. ) )

Ar gued and Submi t t ed on Mar ch 22, 2013at Pasadena, Cal i f or ni a

Fi l ed: May 7, 2013

Appeal f r om t he Uni t ed St at es Bankrupt cy Cour tf or t he Cent r al Di str i ct of Cal i f or ni a

The Honor abl e Vi ct or i a S. Kauf man, Bankrupt cy J udge, Pr esi di ng

Appear ances: Mi chael D. Kwasi gr och of t he Law Of f i ces ofMi chael D. Kwasi gr och on behal f of t he Appel l ant sand Pat r i ck Lai r d Swanst r om of t he Law Of f i ces ofPat r i ck Lai r d Swanst r om on behal f of t he Appel l ee.

Bef ore: TAYLOR, PAPPAS, and KI RSCHER, Bankr upt cy J udges.

FILED

MAY 07 2013

SUSAN M SPRAUL, CLERKU.S. BKCY. APP. PANELOF THE NINTH CIRCUIT


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28 2 Appar ent l y, t he Dent al Boar d of Cal i f or ni a r evokedDebt or s dent al l i cense i n J anuar y 2010.

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INTRODUCTION

Appel l ant s- Def endant s Mi chael D. Kwasi gr och and t he Law

Of f i ces of Mi chael D. Kwasi gr och ( j oi nt l y, Kwasi gr och) r emoved

a st at e cour t ci vi l act i on t o t he bankr upt cy cour t . Appel l ee-

Pl ai nt i f f Dougl as DeNoce ( DeNoce) sought r emand and r ecover y of

cost s and expenses under 28 U. S. C. 1447( c) ( 1447( c) ) . The

bankr upt cy cour t gr ant ed DeNoce s mot i on and awarded hi m

$3, 015. 62 i n cost s and expenses. Kwasi gr och appeal s onl y f r om

t he order awardi ng cost s and expenses. We AFFI RM.

Dur i ng the appeal , DeNoce separatel y moved f or sanct i ons

agai nst Kwasi gr och. We GRANT i n par t DeNoce s sanct i ons mot i on.Al so dur i ng t he appeal , Kwasi gr och moved t o suppl ement t he

r ecor d on appeal . We DENY t hi s request .

FACTS

DeNoce and Kwasi gr och have a l ong acr i moni ous hi st ory t hat

began when Kwasi gr och r epr esent ed a par t y i n unr el at ed l i t i gat i on

agai nst DeNoce. I t cont i nued as Kwasi gr och r epr esent ed debt or

Ronal d Nef f ( Debt or ) as a def endant i n a st at e cour t dent al

mal pr act i ce act i on and ot her l i t i gat i on i ni t i at ed by DeNoce and

i n t hr ee bankr upt cy cases and si x adver sar y pr oceedi ngs where

DeNoce was a cr edi t or or adverse par t y. The pr esent appeal

ar i ses i n t he most r ecent adver sary pr oceedi ng and i n Debt or s

t hi r d bankrupt cy case. I t i nvol ves cl ai ms DeNoce now asser t s

agai nst Kwasi gr och per sonal l y.

Debt or was a l i censed dent i st , 2 and DeNoce was one of hi s

pat i ent s. At some t i me pr i or t o t he bankrupt ci es, Debt or i nj ur ed


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3 The second act i on i nvol ved cl ai ms based on, among othert hi ngs, al l eged f r audul ent t r ansf er s. I t s di sposi t i on i s notr el evant t o t he di sput es her e.

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DeNoce dur i ng dent al surgery. DeNoce t hen f i l ed t wo act i ons

agai nst Debt or i n st at e cour t , t he f i r st f or dent al mal pr act i ce. 3

As t hi s l i t i gat i on cont i nued, Debt or i ni t i at ed a ser i es of

bankrupt cy cases. The bankrupt cy cour t di smi ssed t he f i r st case,

a chapt er 13 case, when Debt or f ai l ed t o appear at hi s 341( a)

meet i ng of credi t or s.

The Debt or prompt l y f i l ed a second chapt er 13 case, and

Kwasi gr och, on behal f of Debt or , r emoved DeNoce s s t ate cour t

act i ons t o t he bankr upt cy cour t . DeNoce i mmedi atel y sought

r emand. The bankr upt cy cour t r emanded t he dent al mal pr act i ce

act i on.Concur r ent l y, DeNoce moved t o di smi ss Debt or s second

bankrupt cy case as a bad f ai t h f i l i ng and r equest ed a 180- day bar

agai nst a subsequent f i l i ng. DeNoce al so commenced an adver sar y

pr oceedi ng agai nst Debt or and Kwasi gr och ( t he 2010 Adver sar y

Proceedi ng) . The 2010 Adver sar y Proceedi ng asser t ed cl ai ms

under bankrupt cy and st at e l aw. At some poi nt t her eaf t er , t he

bankrupt cy cour t i nst r uct ed or suggest ed that DeNoce di smi ss

Kwasi groch as a named def endant t o t he 2010 Adver sary Proceedi ng,

and DeNoce di d so. Kwasi gr och, however , cont i nued as Debt or s

counsel and moved t o di smi ss t he 2010 Adver sar y Pr oceedi ng.

Thi s mot i on t o di smi ss came bef or e t he bankr upt cy cour t on

J une 22, 2011. Kwasi groch r epresent ed Debt or at t he hear i ng.

The bankr upt cy cour t i ndi cat ed i t s i ntent t o di smi ss DeNoce s

bankr upt cy- based cl ai ms wi t h l eave t o amend and t o di smi ss hi s


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28 4 Anot her bankrupt cy j udge i ni t i al l y hear d mat t er s i n t hesecond bankr upt cy case and rel ated adver sar y pr oceedi ngs.

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st at e l aw causes of act i on wi t h pr ej udi ce. I n doi ng so, t he

bankrupt cy cour t expr essl y st at ed t o t he par t i es:

[ T] hi s i s t he way we r e goi ng t o do i t . Thi s Cour t i sabst ai ni ng f r om any st at e l aw causes of act i on. I f youhave a st at e l aw cause of act i on, t hi s Cour t i sabst ai ni ng. Focus - - so i f i t s not based on aBankrupt cy Code pr ovi si on, don t i ncl ude i t i n yourcompl ai nt , because thi s Cour t s abst ai ni ng.

Hr g Tr . ( J une 22, 2011) at 37: 23- 25; 38: 1- 3.

I n r ei t er at i ng t hat t he bankrupt cy cour t was not t he pr oper

f or um f or st at e l aw causes of act i on, i t f ur t her st at ed:

The probl em i s when somebody who i s not a bankr upt cyl awyer . . . and doesn t under st and what t he Bankrupt cy

Code means, now want s t o act as t hough we weren t i n abankrupt cy case and want s t o asser t st at e l aw f r audcauses of act i on i n a compl ai nt f i l ed i n a bankrupt cycase, i t j ust - - i t j ust i sn t - - i t s j ust not r i ght .

I d. at 45: 1- 2; 4- 8.

DeNoce asser t ed hi s bel i ef t hat st at e l aw causes of act i on

were acceptabl e based on t he pendency of Debt or s adversar y

pr oceedi ng seeki ng recover y agai nst i nsurance compani es based on

st at e l aw cl ai ms. I n r esponse, t he bankrupt cy cour t st at ed: i f

i t had come t o t hi s j udge, t hi s Cour t mi ght have abst ai ned f r om

t hose t oo i f t hey wer e f i l ed her e. 4 I d. at 49: 2- 4.

DeNoce t her eaf t er compl i ed wi t h t he cl ear di r ect i ves f r om

t he bankr upt cy cour t ; he f i l ed an amended adver sar y compl ai nt

t hat sol el y al l eged causes of act i on ar i si ng under t he bankrupt cy

code. Debt or , st i l l r epr esent ed by Kwasi gr och, f i l ed hi s Answer

t o t he amended compl ai nt and i ncl uded a count ercl ai m agai nst

DeNoce and cross- cl ai ms agai nst Roe def endant s based on st ate l aw


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causes of act i on. DeNoce moved t o di smi ss . The bankr upt cy cour t

set t he di smi ssal mot i on f or hear i ng and r equi r ed t he par t i es t o

br i ef t he i mpact of St er n v. Mar shal l , 131 S. Ct . 2594 ( 2011) , on

t he bankr upt cy cour t s aut hor i t y i n r el at i on t o Debt or s st at e

l aw causes of act i on.

Meanwhi l e, DeNoce act i vel y par t i ci pat ed i n Debt or s second

bankrupt cy case; he f i l ed obj ect i ons t o Debt or s pr oposed

chapt er 13 pl an, Debt or s cl ai med exempt i ons, and var i ous

pr oposed set t l ement s between Debt or and other cr edi t ors.

Appr oxi matel y 14 mont hs af t er DeNoce i ni t i al l y moved to di smi ss,

t he bankr upt cy cour t ent er ed an or der di smi ssi ng Debt or s secondbankr upt cy case. The order cont ai ned a 180- day bar agai nst

f i l i ng under chapt er s 11 or 13, but di d not bar f i l i ng under

chapt er 7. The or der f ur t her pr ovi ded t hat al l pendi ng adver sary

pr oceedi ngs wer e di smi ssed, i ncl udi ng the 2010 Adver sary

Proceedi ng. Thus, t he bankrupt cy cour t di smi ssed t he 2010

Adver sar y Pr oceedi ng bef or e t he par t i es f i l ed br i ef s r egar di ng

St er n.

Bef ore the or der di smi ss i ng t he second bankr upt cy case was

ent er ed, Debt or , st i l l r epr esent ed by Kwasi gr och, f i l ed a t hi r d

bankrupt cy case under chapt er 7. DeNoce agai n commenced

adver sary pr oceedi ngs agai nst Debt or , one al l egi ng the

nondi schar geabi l i t y of hi s cl ai ms and t he ot her seeki ng a deni al

of Debt or s di schar ge. Pur suant t o t he bankrupt cy cour t s

i nst r uct i ons, DeNoce pur sued hi s st at e l aw causes of act i on

out si de of t he bankr upt cy cour t . He commenced an act i on i n st ate

cour t ( Tor t s Act i on) and sol el y named Kwasi gr och as t he

def endant . DeNoce asser t ed ni ne causes of act i ons agai nst


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5 Kwasi gr och al so f i l ed a t hi r d- par t y cr oss- compl ai ntagai nst Debt or f or i ndemni t y and decl ar at or y r el i ef . I naddi t i on, Kwasi gr och moved to consol i dat e t he r emoved act i on wi t h

DeNoce s adver sary pr oceedi ngs i n Debt or s t hi r d bankrupt cy case;t o i nt er vene on Debt or s behal f ; and f or compul sory j oi nder ofDebt or . He t hen r e- f i l ed hi s mot i on f or compul sor y j oi nder t or emove t he r equest f or consol i dat i on. On t he eve of t he r emandhear i ng, Kwasi gr och and Debt or f i l ed a thi r d- par t y cross-compl ai nt agai nst Debt or s bankrupt cy est at e f or i ndemni t y,cont r i but i on, and decl ar at or y rel i ef .

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Kwasi gr och: ( 1) def amat i on; ( 2) i nvasi on of pr i vacy; ( 3) f al se

l i ght ; ( 4) mal i ci ous pr osecut i on; ( 5) abuse of pr ocess; ( 6) f r aud

and decei t ; ( 7) i nt ent i onal and negl i gent i nt er f er ence wi t h

pr ospect i ve busi ness/ economi c advant age; ( 8) i nt ent i onal / r eckl ess

i nf l i ct i on of emot i onal di st r ess; and ( 9) pr el i mi nar y and

per manent i nj unct i on.

Kwasi gr och, not wi t hst andi ng t he bankrupt cy cour t s cl ear

i nst r uct i on and hi s knowl edge of t he pot ent i al i mpact of t he

St er n deci si on, i mmedi at el y removed t he Tor t s Act i on t o t he

bankrupt cy cour t and prompt l y moved t o di smi ss t he r emoved case. 5

I n r esponse, DeNoce moved f or r emand of t he Tor t s Act i on or , i nt he al t er nat i ve, f or t he bankrupt cy cour t s abst ent i on. He al so

moved f or cost s and expenses i ncur r ed as a resul t of t he removal

pur suant t o 1447( c) .

The bankrupt cy cour t hear d DeNoce s r emand mot i on on May 16,

2012. Af t er ar gument , i t order ed r emand and an award of cost s

and expenses t o DeNoce under 1447( c) . Pr i or t o est abl i shi ng

t he amount of t he awar d, i t r equi r ed evi dence f r omDeNoce as t o

t he amount of hi s cost s and expenses and pr ovi ded Kwasi gr och wi t h

an oppor t uni t y t o r espond. The bankrupt cy cour t l at er ent er ed


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6 The r emand order vacat ed t he schedul ed hear i ngs onKwasi gr och s mot i on t o di smi ss t he removed act i on and hi s mot i onst o i nt er vene and j oi n. Whi l e i t i s not ent i r el y cl ear , i tappear s t hat , f ol l owi ng r emand, t he bankrupt cy cour t di d not r ul eon Kwasi gr och s cr oss- cl ai ms.

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t he or der r emandi ng the Tor t s Act i on. 6

The bankrupt cy cour t hear d t he 1447( c) r ecover y r equest on

J ul y 11, 2012. Pr i or t o t he hear i ng, DeNoce f i l ed a decl ar at i on

wi t h exhi bi t s and Kwasi gr och f i l ed an opposi t i on and evi dent i ar y

obj ect i ons t o DeNoce s decl ar at i on and exhi bi t s. On J ul y 31,

2012, t he bankrupt cy cour t ent ered a memorandum opi ni on and order

( Award Or der) awardi ng DeNoce $915. 62 i n cost s and $2, 100 i n

f ees, f or a t ot al awar d of $3, 015. 62. I n i t s or der , t he

bankrupt cy cour t al so over r ul ed Kwasi gr och s evi dent i ar y

obj ect i ons as l acki ng mer i t .

Kwasi gr och t i mel y f i l ed hi s appeal f r om t he Awar d Or der .JURISDICTION

The bankrupt cy cour t had j ur i sdi ct i on pur suant t o 28 U. S. C.

1334 and 157( b) ( 2) ( A) . We have j ur i sdi ct i on under 28 U. S. C.

158.

ISSUE

Di d t he bankr upt cy cour t err i n awardi ng cost s and expenses

under 1447( c) ?

STANDARD OF REVIEW

We r evi ew t he bankrupt cy cour t s l egal concl usi ons de novo,

and i t s f i ndi ngs of f act f or cl ear err or . Al l en v. US Bank, N. A.

( I n r e Al l en) , 472 B. R. 559, 564 ( 9t h Ci r . BAP 2012) . We r evi ew

an awar d of cost s and expenses f or abuse of di scr et i on.

Lussi er v. Dol l ar Tr ee St or es, I nc. , 518 F. 3d 1062, 1065


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( 9t h Ci r . 2008) .

An abuse of di scr et i on eval uat i on i nvol ves a t wo- pr ong t est ;

f i r st , we determi ne de novo whether t he bankr upt cy cour t

i dent i f i ed t he cor r ect l egal r ul e f or appl i cat i on. See Uni t ed

St at es v. Hi nkson, 585 F. 3d 1247, 1261- 62 ( 9t h Ci r . 2009) ( en

banc) . I f not , t hen t he bankrupt cy cour t necessari l y abused i t s

di scr et i on. See i d. at 1262. Ot her wi se, we next revi ew whet her

t he bankrupt cy cour t s appl i cat i on of t he cor r ect l egal r ul e was

cl ear l y er r oneous; we wi l l af f i r m unl ess i t s f i ndi ngs wer e

i l l ogi cal , i mpl ausi bl e, or wi t hout suppor t i n t he r ecor d. See

i d.DISCUSSION

A. An Award of Costs and Expenses Under 1447(c) is Availablein a Bankruptcy Case.

Kwasi gr och cont ends t hat t he bankr upt cy cour t err ed as a

mat t er of l aw by awardi ng cost s and expenses under 1447( c) and

r el i es on Bi l l i ngt on v. Wi nogr ade ( I n r e Hot el Mt . Lassen,

I nc. ) , 207 B. R. 935, 938 ( Bankr. E. D. Cal . 1997) t o suppor t hi s

posi t i on. We di sagr ee. I t i s wel l set t l ed t hat 1447( c)

appl i es t o bankrupt cy r emoval s and r emands. Mi l l er v. Car di nal e

( I n r e Devi l l e) , 280 B. R. 483, 494 ( 9t h Ci r . BAP 2002) ( ci t at i on

omi t t ed) , af f d on ot her gr ounds, 361 F. 3d 539 ( 9t h Ci r . 2004) .

Cont r ar y t o Kwasi gr och s asser t i on, 28 U. S. C. 1452 i s not t he

excl usi ve sour ce of r el i ef f or a r emand i n a bankrupt cy case.

I d. I n r e Hot el Mt . Lassen does not compel a di f f er ent r esul t

and, i n f act , suppor t s t he same r esul t . See 207 B. R. at 942- 43

( bankrupt cy cour t r emanded f i ve ci vi l act i ons r emoved under 28

U. S. C. 1452 back t o st at e cour t pur suant t o 1447( c) ) . Thus,


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we rej ect t he ar gument t hat t he bankr upt cy cour t coul d not award

f ees and cost s under 1447( c) .

B. The Bankruptcy Court Did Not Abuse Its Discretion inAwarding Costs and Expenses Under 1447(c).

I n r el evant par t , 1447( c) pr ovi des t hat an or der r emandi ng

a case t o st ate cour t may i ncl ude an award f or cost s and expenses

i ncur r ed ( i ncl udi ng at t or ney s f ees) t hat r esul t ed f r om t he

r emoval . Under 1447( c) , whet her t he r emoval was i mpr oper or

def ect i ve i s nei t her di sposi t i ve nor t he pr oper i nqui r y.

Gar dner v. UI CI , 508 F. 3d 559, 562 ( 9t h Ci r . 2007) . I nst ead, t he

pr oper i nqui r y t ur ns on t he r easonabl eness of t he r emoval .Mar t i n v. Frankl i n Capi t al Cor p. , 546 U. S. 132, 141 ( 2005) .

Absent unusual ci r cumst ances, t he cour t may award cost s and

expenses under 1447( c) onl y i f t he removi ng par t y l acks an

obj ect i vel yr easonabl e basi s f or seeki ng r emoval . I d.

Conver sel y, i f t he r emovi ng par t y has an obj ect i vel y reasonabl e

basi s f or r emoval , cost s and expenses shoul d be deni ed. I d.

Here, t he bankr upt cy cour t determi ned t hat Kwasi gr och coul d

not have r easonabl y bel i eved t hat t he bankr upt cy cour t had

j ur i sdi ct i on over t he Tor t s Act i on. The bankrupt cy cour t f ur t her

det er mi ned t hat , even i f i t had j ur i sdi ct i on, Kwasi gr och coul d

not have r easonabl y bel i eved t hat i t woul d exer ci se j ur i sdi ct i on

based on t he bankrupt cy cour t s pr i or st at ement s t o the par t i es.

Thi s i ncl uded not j ust t he bankr upt cy cour t s cl ear st at ement s at

t he hear i ng di smi ssi ng t he 2010 Adver sary Pr oceedi ng, but al so

t he r equi r ement t hat Kwasi gr och br i ef t he i mpact of St er n on

st at e l aw- based count er - and cr oss- cl ai ms.

I n so hol di ng, t he bankrupt cy cour t r ecogni zed t hat i t s


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deci si on t ur ned on t he r easonabl eness of Kwasi gr och s r emoval .

Thi s encapsul at es t he proper st andar d f or awar di ng cost s and

expenses pur suant t o 1447( c) : whether Kwasi gr och had an

obj ect i vel y r easonabl e basi s f or r emovi ng t he Tor t s Act i on.

Al t hough t he bankrupt cy cour t st at ed t hat i t s det er mi nat i on was

based an i mpr oper r emoval , on t hi s r ecor d, i t i s a di st i nct i on

wi t hout a di f f er ence. The r ecor d cl ear l y suppor t s t hat i t

assessed the reasonabl eness of Kwasi gr och s r emoval i n the

cont ext of awardi ng t he cost s and expenses. Thus, t he bankr upt cy

cour t appl i ed t he cor r ect l egal r ul e.

The bankrupt cy cour t t hen made several f i ndi ngs i n r ender i ngi t s deci si on t o awar d cost s and expenses. Fi r st , i t f ound t hat

DeNoce compl i ed wi t h i t s pr i or i nst r uct i ons wi t h r espect t o st at e

l aw causes of act i on; DeNoce f i l ed an amended adversar y compl ai nt

i n t he 2010 Adver sar y Pr oceedi ng based sol el y on bankr upt cy l aw

cl ai ms. DeNoce t her eaf t er separ at el y pur sued hi s st at e l aw

cl ai ms i n st at e cour t and t hr ough t he Tor t s Act i on. I t t hen

f ound t hat Kwasi gr och, i n t he t eet h of i t s pr i or i nst r uct i on and

di r ect i on, r emoved t he Tor t s Act i on, and di d so despi t e t he f act

t hat Debt or was not a named def endant i n t he act i on and despi t e

t he f act t hat i t sol el y consi st ed of st at e l aw causes of act i on.

I n doi ng so, t he bankrupt cy cour t det er mi ned t hat Kwasi gr och s

r emoval t ypi f i ed t he:

[ L] at est st ep i n what has become a pat t er n of del ayi ng

t he r esol ut i on of mat t er s pr oper l y i ni t i at ed i n st at ecour t and at t empt i ng t o l i t i gat e bef or e [ t he bankrupt cycour t ] st at e l aw cl ai ms t hat , as t he [ bankrupt cy cour t ]has r ei t er at ed, bel ong i n st at e cour t .

Award Or der at 11.

The bankrupt cy cour t deter mi ned t hat i t s pr i or st at ement s as


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t o st at e l aw causes of act i on wer e cl ear : i t woul d not hear any

causes of act i on sol el y pr edi cat ed on st at e l aw. We agr ee and

not e t hat i t s r equi r ement of br i ef i ng on i ssues ar i si ng under

St er n under scor ed t he bankrupt cy cour t s i nst r uct i on. I t i s not

si gni f i cant t hat t he bankrupt cy cour t made t hese st at ement s i n a

pr i or adver sary pr oceedi ng.

At oral argument , Kwasi gr och poi nt ed out t hat he was no

l onger a par t y t o t he 2010 Adver sary Pr oceedi ng at t he per t i nent

hear i ng and ar gued t hat , consequent l y, t he bankrupt cy cour t s

di r ect i ves di d not appl y t o hi m. Whi l e i t i s t r ue t hat

Kwasi gr och was no l onger a par t y, he repr esent ed Debt or i n t he2010 Adver sary Pr oceedi ng and act i vel y par t i ci pat ed at t he J une

2011 hear i ng. Kwasi gr och s cont ent i on i s di si ngenuous. We

r ej ect i t . The i ssue her e i s not whet her Kwasi gr och vi ol at ed a

cour t or der ; i t i s whet her , gi ven t he bankrupt cy cour t s

unambi guous di r ect i ve, a l i t i gant i n Kwasi gr och s posi t i on coul d

have r easonabl y bel i eved t hat t he bankrupt cy cour t woul d pr esi de

over t he Tor t Act i on af t er r emoval .

The bankrupt cy cour t al so suppor t ed i t s cost and expenses

awar d wi t h a det er mi nat i on t hat i t l acked j ur i sdi ct i on over t he

Tor t s Act i on. Kwasi groch emphat i cal l y cont ends t hat t he

bankrupt cy cour t possessed r el at ed t o j ur i sdi ct i on based on

i ndemni t y pr ovi si ons i n r et ent i on agr eement s execut ed by Debt or .

He asser t s t hat t he i ndemni t y pr ovi si on r equi r es Debt or t o

i ndemni f y Kwasi gr och f or any l i abi l i t i es i ncur r ed as a r esul t of

r epr esent i ng Debt or . DeNoce al l eges t hat t he r et ent i on

agr eement s al l egedl y pr ovi di ng i ndemni t y t o Kwasi gr och were back-

dat ed and manuf act ured.


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A cur sory revi ew of t he recor d suppor t s t he bankrupt cy

cour t s det er mi nat i on t hat i t l acked r el at ed t o j ur i sdi ct i on

over t he Tor t s Act i on. Bankr upt cy j ur i sdi ct i on i ncl udes al l

ci vi l pr oceedi ngs t hat ar e r el at ed t o bankrupt cy cases. See 28

U. S. C. 1334( b) . A ci vi l pr oceedi ng i s r el at ed t o a

bankr upt cy case i f t he out come of t he pr oceedi ng coul d

concei vabl y have any ef f ect on t he admi ni st r at i on of t he

bankr upt cy est at e. Fi et z v. Gr eat W. Sav. ( I n r e Fi et z) , 852

F. 2d 455, 457 ( 9t h Ci r . 1988) ( adopt i ng t he t est i n Pacor , I nc.

v. Hi ggi ns, 743 F. 2d 984, 994 ( 3d Ci r . 1984) ( her eaf t er ,

Fi et z/ Pacor )) .Her e, t he bankrupt cy cour t r ej ect ed Kwasi gr och s al l eged

i ndemni t y cl ai m agai nst Debt or and t he bankrupt cy est at e as a

basi s f or j ur i sdi ct i on. I t f ound t hat t he possi bi l i t y of an

i ndemni t y or cont r i but i on cl ai m agai nst Debt or or t he est at e,

whi ch exi st ed onl y t o t he extent t hat Kwasi gr och was f i r st

det er mi ned l i abl e, was i nsuf f i ci ent t o est abl i sh j ur i sdi cti on.

I t noted t hat Kwasi gr och s ar gument was pr eci sel y t he ar gument

r ej ect ed by the Pacor cour t .

I n Pacor , t he cour t determi ned t hat an act i on between non-

debt or t hi r d par t i es had no ef f ect on t he debt or s bankrupt cy

est at e. 743 F. 2d at 995. I t concl uded t hat al t hough t he out come

of t he subj ect act i onpotentially gave r i se t o an i ndemni t y cl ai m

agai nst t he est at e, i n t he absence of cont r actual l i abi l i t y on

t he debt or s par t , t he out come i n t he act i on woul d not

def i ni t i vel y bi nd t he debt or or det er mi ne i t s r i ght s,

l i abi l i t i es , or next course of act i on. I d.

As t he bankrupt cy cour t her e f ur t her not ed, demonst r at i ng


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t hat Debt or was cont r act ual l y obl i gat ed to i ndemni f y Kwasi gr och

mi ght have est abl i shed r el at ed t o j ur i sdi ct i on. Kwasi gr och,

however , never pr esent ed t he bankr upt cy cour t wi t h evi dence of

t he r et ent i on agr eement s est abl i shi ng such cont r act ual l i abi l i t y.

He ref er enced t he pot ent i al i ndemni t y cl ai m i n var i ous paper s,

but di d not r ef er t o or at t ach any such r et ent i on agr eement s.

At t he J ul y 2012 hear i ng on t he 1447( c) award, Kwasi gr och

st ated t hat he had a retent i on agr eement wi t h an i ndemni t y

pr ovi si on. The r ecor d shows t hat he f i l ed an amended pr oof of

cl ai m i n Debt or s t hi r d bankr upt cy case on t he same day as t he

hear i ng, and he at t ached t hr ee copi es of r et ent i on agr eement sexecut ed by Debt or . Kwasi gr och i ncl uded t he same copi es i n hi s

excer pt s of r ecor d. At t he hear i ng, Kwasi gr och advi sed t he

bankr upt cy cour t t hat he amended hi s cl ai m. The r ecor d, however ,

est abl i shes t hat he never pr esent ed t he bankrupt cy cour t wi t h t he

r et ent i on agr eement s di r ect l y and never ot her wi se pr ovi ded

evi dence of t hei r speci f i c t er ms. Thus, not wi t hst andi ng t hat t he

r et ent i on agr eement s ar e par t of Kwasi gr och s excer pt s of r ecor d,

we do not consi der t hem on appeal because Kwasi gr och di d not

pr oper l y pr esent t hem t o t he bankrupt cy cour t . See Har ki ns

Amusement Ent ers. , I nc. v. Gen. Ci nema Corp. , 850 F. 2d 477, 482

( 9t h Ci r . 1988) ( onl y document s pr oper l y pr esent ed t o t he t r i al

cour t ar e par t of t he recor d on appeal and, t hus, subj ect t o

consi der at i on on appeal ) . Ther ef or e, t he bankrupt cy cour t

cor r ect l y concl uded based on the onl y act ual evi dence bef or e i t

t hat Kwasi gr och s al l eged i ndemni t y cl ai m was i nsuf f i ci ent t o

est abl i sh r el at ed t o j ur i sdi ct i on under Fi et z/ Pacor as t her e

was no evi dence est abl i shi ng act ual cont r act ual l i abi l i t y.


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The bankrupt cy cour t al so det er mi ned, and we agr ee, t hat t he

Tor t s Act i on excl usi vel y consi st ed of st at e l aw causes of act i on

sol el y between non- debt or par t i es. Onl y one cause of act i on -

f or mal i ci ous pr osecut i on cont ai ned al l egat i ons i nvol vi ng

Kwasi gr och s act s i n t he bankr upt cy pr oceedi ngs. That cause of

act i on, however , i s based on st at e l aw, not bankr upt cy l aw, and

r el at ed t o an adver sary pr oceedi ng i n Debt or s second bankrupt cy

case. Thi s does not , i n and of i t sel f , sat i sf y t he t est f or

r el at ed t o j ur i sdi ct i on under Fi et z/ Pacor . Nei t her does the

f act t hat DeNoce i s a per sonal i nj ur y cr edi t or of Debt or or t hat

Kwasi gr och i s Debt or s bankrupt cy counsel . Ther ef or e, t he r ecor dsuppor t s t he bankrupt cy cour t s det er mi nat i on t hat i t l acked

j ur i sdi ct i on over t he Tor t s Act i on.

Even i f j ur i sdi ct i on exi st ed, however , t he r esul t under

t hese f act s woul d be the same; and t he bankr upt cy cour t expr essl y

so st at ed. Kwasi gr och er r oneousl y equat es bankrupt cy

j ur i sdi ct i on wi t h an obj ect i vel y r easonabl e basi s f or r emoval .

I n many i nst ances, j ur i sdi ct i on may suppl y an obj ect i vel y

r easonabl e basi s f or seeki ng r emoval . Her e, however , r el at ed

t o j ur i sdi ct i on woul d not j ust i f y r emoval . Kwasi gr och i s an

at t or ney. He was an act i ve par t i ci pant at t he hear i ng wher e t he

bankrupt cy cour t expr essl y st at ed t hat i t woul d not hear st at e

cour t cl ai ms. He was awar e of t he St er n deci si on. The Tor t s

Act i on i nvol ved onl y non- debt or par t i es and onl y st at e cour t

causes of act i on. On t hi s r ecor d, we f i nd not hi ng i l l ogi cal ,

i mpl ausi bl e, or unsuppor t ed by the r ecor d i n r el at i on t o t he

bankr upt cy cour t s det ermi nat i on t o award a modest amount of f ees

and cost s under 1447( c) . Ther ef or e, we af f i r m t he Awar d Or der .


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C. Kwasigroch Waived Issues and Arguments By Failing ToAdequately Advance Them In His Opening Brief.

I n hi s openi ng br i ef , Kwasi gr och made one br i ef r ef er ence t o

t he bankrupt cy cour t s evi dent i ar y r ul i ng. He st at es t hat

DeNoce s decl ar at i on and exhi bi t s wer e not pr oper l y

aut hent i cat ed and [ t hat ] t he decl ar at i on [ was] f ul l of ar gument ,

conj ect ur e, specul at i on, and compl et el y unf ounded and l acki ng i n

per sonal knowl edge as t o t he char ges cl ai med. Apl t Op. Br . at

20- 21. He di d not el abor at e on t hi s poi nt .

We do not consi der mat t er s not speci f i cal l y and di st i nct l y

r ai sed and argued i n an openi ng br i ef , or argument s andal l egat i ons r ai sed f or t he f i r st t i me on appeal . See Padget t v.

Wr i ght , 587 F. 3d 983, 985 n. 2 ( 9t h Ci r . 2009) ( per cur i am) . As

such, we do not consi der t he bankrupt cy cour t s evi dent i ar y

r ul i ng because Kwasi gr och di d not speci f i cal l y or di st i nct l y

r ai se and ar gue t hat i ssue i n hi s openi ng br i ef . We al so not e

t hat much of t he br i ef i ng and r ecor d on appeal i nvol ve a

concer t ed ef f or t by bot h par t i es t o make i r r el evant poi nt s about

t he nef ar i ous nat ur e of t he ot her par t y. Not hi ng i n t he r ecor d

shows t hat t he bankrupt cy cour t r el i ed on such evi dence i n

r el at i on t o t he Awar d Or der . As a r esul t , any er r or i n t hi s

r egard woul d be harml ess. See Van Zandt v. Mbunda ( I n r e

Mbunda) , 484 B. R. 344, 355 (9t h Ci r . BAP 2012) .

Kwasi gr och al so advances a number of argument s i n hi s r epl y

br i ef t hat he di d not r ai se i n hi s openi ng br i ef . We deem t hose

ar gument s wai ved. See Al aska Ct r . f or t he Env t v. U. S. For est

Ser v. , 189 F. 3d 851, 858 n. 4 (9t h Ci r . 1999) ( Ar gument s not

r ai sed i n [ an] openi ng br i ef ar e wai ved. ) .


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7 Af t er consi der i ng t he mot i on and f i l ed r esponses, t hi sPanel i ssued an or der advi si ng t hat t he Sanct i ons Mot i on woul d beconsi der ed wi t h t he mer i t s of t he pr esent appeal .

8 I n addi t i on, DeNoce moved f or sanct i ons under 28 U. S. C. 1927. We do not consi der sanct i ons under t hi s st at ut e.Pur suant t o I n r e DeVi l l e, 361 F. 3d at 546, bankrupt cy cour t s arenot cour t s of t he Uni t ed St at es. Consequent l y, we do not havet he aut hor i t y to i mpose sanct i ons under 28 U. S. C. 1927.

9 Al l Rul e ref er ences ar e t o t he Feder al Rul es ofBankrupt cy Pr ocedur e and al l Appel l at e Rul e r ef er ences ar e t ot he Feder al Rul es of Appel l at e Pr ocedur e.

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D. Motions Filed by the Parties During the Appeal.

Af t er Kwasi gr och f i l ed hi s r epl y br i ef , DeNoce f i l ed a

separ at e mot i on seeki ng sanct i ons ( Sanct i ons Mot i on) 7 agai nst

Kwasi gr och under var i ous t heor i es, 8 i ncl udi ng Rul e 8020. 9

Kwasi gr och t i mel y opposed t he Sanct i ons Mot i on, and DeNoce

r epl i ed.

On March 20, 2013, onl y t wo days pr i or t o oral argument ,

Kwasi gr och f i l ed a mot i on t o suppl ement t he r ecor d on appeal

( Mot i on t o Suppl ement ) . He at t ached 14 exhi bi t s t o t hi s

mot i on, i ncl udi ng document s f i l ed i n Debt or s adver sary

pr oceedi ngs and document s f i l ed i n st ate cour t . DeNoce opposedpr i or t o or al ar gument , and Kwasi gr och r epl i ed t her eaf t er on

March 26, 2013.

Thi s appeal was deemed submi t t ed on Mar ch 22, 2013.

Fol l owi ng submi ssi on, DeNoce f i l ed a suppl ement al mot i on f or

sanct i ons t o i ncl ude f ees i ncur r ed i n r espondi ng t o the Mot i on t o

Suppl ement . Kwasi gr och t hen f i l ed an opposi t i on, and DeNoce

f i l ed a r epl y. I n r esponse, t hi s Panel ent er ed an or der on Apr i l

11, 2013, bar r i ng ei t her par t y f r om f i l i ng any addi t i onal paper s.


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We addr ess t hese mot i ons as f ol l ows.

1. Kwasigrochs Motion to Supplement the Record on Appeal.

Par t i es t o an appeal may suppl ement t he r ecord i f t her e i s a

newl y di scover ed f act or i f i t assi st s i n cl ar i f yi ng t he cl ai ms

on appeal . See Morgan v. Saf eway St ores, I nc. , 884 F. 2d 1211,

1213 ( 9t h Ci r . 1989) ; Pl . s Cl ass Cl ai mant s i n N. J . Act i on v.

El si nor e Cor p. ( I n r e El si nor e Cor p. ) , 228 B. R. 731, 733 n. 1 ( 9t h

Ci r . BAP 1998) .

Kwasi gr och cont ends t hat he f i l ed t he Mot i on t o Suppl ement

i n r esponse t o DeNoce s opposi t i on br i ef ( pr esumabl y, DeNoce s

openi ng br i ef ) and t he Sanct i ons Mot i on. Kwasi gr och, however ,had t he opport uni t y to r espond t o DeNoce s openi ng br i ef and t o

t he Sanct i ons Mot i on. I n f act , Kwasi gr och di d so. The exhi bi t s

at t ached t o hi s Mot i on t o Suppl ement do not cont ai n newl y

di scover ed evi dence or document s t hat assi st us i n cl ar i f yi ng

hi s ar gument s on appeal . The document s si mpl y r e- hash t he

l i t i gat i on hi st or y bet ween t he par t i es. Mor eover , Kwasi gr och

f i l ed hi s mot i on and exhi bi t s j ust t wo days pr i or t o or al

argument . There was nothi ng i n t he mot i on or exhi bi t s t hat

Kwasi gr och coul d not have addr essed i n hi s r epl y br i ef or i n hi s

opposi t i on t o t he Sanct i ons Mot i on. Ther ef or e, we deny

Kwasi gr och s Mot i on t o Suppl ement .

2. DeNoces Request for Sanctions Under Rule 8020.

DeNoce pr i mar i l y moves f or sanct i ons based on t he f r i vol ous

natur e of Kwasi gr och s appeal and pur suant t o Rul e 8020 and

Appel l at e Rul e 38. He cont ends t hat a r easonabl e pr act i t i oner

woul d know t hat an appeal chal l engi ng t he Award Or der under an

abuse of di scr et i on st andar d woul d f ai l . Thus, he ar gues that


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10 Rul e 8020 i s based on Appel l ate Rul e 38. See Advi sor y

Commi t t ee Not es t o Rul e 8020, 1997 Amendment ( by conf or mi ng t ot he Appel l ate Rul e 38 l anguage, Rul e 8020 r ecogni zes t hat t he BAPhas aut hor i t y t o award damages and cost s i n connect i on wi t hf r i vol ous appeal s) . Thus, we consi der DeNoce s r equest underRul e 8020 and not Appel l at e Rul e 38. See Mar i no v. Cl assi c Aut oRef i ni shi ng, I nc. ( I n r e Mar i no) , 234 B. R. 767, 770 ( 9t h Ci r . BAP1999) .

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t he appeal i s f r i vol ous and t hat sanct i ons ar e war r ant ed. I n hi s

i ni t i al t i mel y opposi t i on, Kwasi gr och st at es t hat t he appeal i s

not f r i vol ous i n a si ngl e headi ng and t hat he st ands on hi s

br i ef s on appeal .

Rul e 802010 provi des t hat we may awar d damages and si ngl e

or doubl e cost s t o t he appel l ee upon determi ni ng t hat an appeal

i s f r i vol ous. An appeal i s f r i vol ous when t he r esul t i s obvi ous

or t he appel l ant s ar gument s of er r or whol l y l ack mer i t . Geor ge

v. Ci t y of Mor r o Bay ( I n r e Geor ge) , 322 F. 3d 586, 591 ( 9t h Ci r .

2003) ( ci t at i on omi t t ed) .

Sanct i ons ar e al so appr opr i at e wher e the appel l ant si mpl yseeks t o r e- l i t i gat e t he t r i al cour t s f actual f i ndi ngs wi t hout

mount i ng a mer i t or i ous appeal . See DeWi t t v. W. Pac. R. R. Co. ,

719 F. 2d 1448, 1451 ( 9t h Ci r . 1983) ; Conver gence Corp. v. Sony

Cor p. of Am. , 681 F. 2d 622, 623 ( 9t h Ci r . 1982) ( per cur i am) ;

Uni t ed St at es ex. r el . I ns. Co. of N. Am. v. Sant a Fe Eng r s,

I nc. , 567 F. 2d 860, 861 ( 9t h Ci r . 1978) ( per cur i am) . Sanct i ons

may al so be appr opr i ate where the appel l ant pur sues appeal f or an

i mpr oper pur pose. Thi s i ncl udes usi ng t he appel l at e pr ocess as a

means t o har ass t he appel l ee, see Ol i ver v. Mer cy Med. Ct r . ,

I nc. , 695 F. 2d 379, 382 ( 9t h Ci r . 1982) ; Franchi se Tax Bd. v.

Rober t s ( I n r e Rober t s) , 175 B. R. 339, 345 ( 9t h Ci r . BAP 1994) ;


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Young v. Beugen ( I n r e Beugen) , 99 B. R. 961, 966 ( 9th Ci r . BAP

1989) , or as a di l at or y t act i c. See DeWi t t , 719 F. 2d at 1451;

Sant a Fe Eng s, 567 F. 2d at 861.

Fi nal l y, sanct i ons may be appr opr i at e based on submi ssi on of

a subst ant i vel y def i ci ent appel l at e br i ef . Thi s i ncl udes an

i ncompr ehensi bl e br i ef , see Hambl en v. Cnt y. of Los Angel es, 803

F. 2d 462, 464 ( 9t h Ci r . 1986) ( per cur i am) , or ci t at i ons t o

aut hor i t y t hat f ai l t o suppor t t he appel l ant s ar gument . See Mi r

v. Li t t l e Co. of Mar y Hosp. , 844 F. 2d 646, 653 ( 9t h Ci r . 1988) .

We determi ne that sanct i ons under Rul e 8020 are appr opr i ate.

Kwasi gr och s br i ef s on appeal ar e subst ant i vel y def i ci ent .Por t i ons ar e i ncompr ehensi bl e. Kwasi gr och makes al l egat i ons wi t h

l i t t l e or no r ef er ence t o t he r ecor d or r el evant l egal aut hor i t y.

He copi ed and past ed sever al sect i ons of a bankrupt cy t r eat i se

i nt o hi s openi ng br i ef wi t hout l egal anal ysi s of t he past ed

pr ovi si ons. He pr esent ed sever al ar gument s f or t he f i r st t i me i n

hi s r epl y br i ef and at t ached f our exhi bi t s; document s t hat wer e

not par t of t he r ecor d on appeal and ar e not r el evant t o t he

appeal . Af t er f i l i ng t i mel y document s t hat wer e def i ci ent , he

appar ent l y at t empt ed t o r ect i f y t he si t uat i on by f i l i ng t he

Mot i on t o Suppl ement t wo days pr i or t o or al ar gument . I t

at t ached 14 exhi bi t s, consi st i ng of 219 pages. The l engt hy

Mot i on t o Suppl ement al so di d not compl y wi t h t he appl i cabl e

r ul es and di d not cont ai n newl y di scover ed evi dence or aut hor i t y.

Kwasi gr och has al so mi schar act er i zed Debt or s i nvol vement i n

t he r emoved Tor t s Act i on and i n t he pr esent appeal . Some of hi s

document s appear t o i ndi cate that Debt or was a co- def endant i n

t he r emoved Tor t s Act i on or a co- appel l ant i n t he i nst ant


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11 The Not i ce of Appeal i dent i f i es t he par t i es appeal i ng asMi chael D Kwasi gr och and Ronal d Nef f .

12 We al so r ecogni ze DeNoce s cont ent i on t hat Kwasi gr ochot her wi se mi sr epr esent ed t he r ecor d on appeal i n hi s r epl y br i ef .Whi l e t her e may be a basi s f or hi s asser t i on, i t i nvol ves amat t er i n Debt or s second bankrupt cy case. Nei t her t he per t i nentor der nor hear i ng t r anscr i pt ar e par t of t he r ecor d on appeal .Whi l e we coul d exer ci se our di scr et i on to revi ew t hose document s,we choose not t o.

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appeal . 11 But nei t her asser t i on i s t r ue. 12

Wer e Kwasi gr och a pr o se l i t i gant , hi s wor k pr oduct mi ght be

expl ai nabl e. But Kwasi gr och i s a l i censed at t or ney. He, i ndeed,

acknowl edges t hat he i s a seasoned at t orney of 25 year s wi t h no

pr i or di sci pl i nar y i ssues. Accept i ng t hi s asser t i on as t r ue, we

concl ude t hat t her e i s no excuse f or t he def i ci enci es i n

Kwasi gr och s f i l i ngs.

Taken t oget her , t hese f act s suggest t hat Kwasi groch f i l ed

t he pr esent appeal , as t he bankrupt cy cour t apt l y not ed, as

anot her st ep i n a per si st ent pat t er n of i mpr oper l i t i gat i on

t act i cs. We do not make any det er mi nat i on as t o t he cul pabi l i t yof ei t her par t y i n any of t he bankrupt cy pr oceedi ngs or st at e

cour t mat t er s. Our det er mi nat i on, however , i s not made i n a

vacuum and, by def i ni t i on, a pat t er n i s a combi nat i on of act s or

event s f ormi ng a consi st ent arr angement . The qual i t y of

Kwasi gr och s f i l i ngs bef or e us f al l s bel ow t hat of a seasoned

at t or ney who genui nel y seeks t o avai l hi msel f of t he pr ot ect i on

of t he l aw. I t i s cl ear t hat Kwasi gr och s goal was not t o

pr oper l y pr osecut e an appeal i n r el at i on t o a smal l cost and f ees

awar d, but t o i nf l i ct cost s of appeal on DeNoce. The f i l i ng of

t he Mot i on t o Suppl ement , i n par t i cul ar , evi dences such i nt ent .


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13 DeNoce submi t t ed t he decl ar at i on of appel l at e counsel andcounsel s t i me i nvoi ces, whi ch det ai l t he f ees i ncur r ed i ndef endi ng the appeal .

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Kwasi gr och, as a sel f - r epr esent ed at t or ney, was i n a posi t i on t o

cause DeNoce si gni f i cant cost s and expenses i n r el at i on t o t hi s

appeal . Ther ef or e, sanct i ons under Rul e 8020 ar e appr opr i at e.

Havi ng determi ned t hat sanct i ons are warr ant ed, we award

DeNoce damages i n the f orm of at t orneys cost s and expenses

i ncur r ed i n def endi ng agai nst t he appeal . See I n r e Rober t s,

175 B. R. at 345. He seeks appr oxi matel y $38, 475 i n at t orneys

f ees, pl us cost s. 13 We decl i ne t o award t he f ul l amount

r equest ed gi ven t he smal l award amount at i ssue on t hi s appeal ,

and t he f act t hat DeNoce al so i ncl udes si gni f i cant i r r el evant

mat er i al i n hi s document s. Ther ef or e, sanct i ons i n t he amount of$10, 000 are appr opr i at e.

3. DeNoces Request for Sanctions for Noncompliance withProcedural Rules.

DeNoce al so moves f or sanct i ons based on Kwasi gr och s

f ai l ur e t o compl y wi t h var i ous f eder al r ul es of pr ocedur e,

i ncl udi ng t he Rul es, t he BAP Rul es, and t he Appel l at e Rul es.

I n r el evant par t , Rul e 8006 pr ovi des t hat an appel l ant must

f i l e a desi gnat i on of i t ems t o be i ncl uded i n t he r ecor d on

appeal ; t he recor d on appeal t hen i ncl udes t hese desi gnat ed i t ems

and cer t ai n i t ems del i neat ed i n t he r ul e. Rul e 8009 r equi r es the

appel l ant t o pr ovi de an excer pt of r ecor d as an appendi x t o i t s

br i ef . Fed. R. Bankr . P. 8009( b) ; see al so 9t h Ci r . R. 30- 1

( descr i bi ng cont ent s of excer pt of r ecor d) . Once t he r ecor d on

appeal i s compl ete, t he part i es t o t he appeal may suppl ement t he


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r ecor d onl y by mot i on or f or mal r equest . Lowr y v. Bar nhar t ,

329 F. 3d 1019, 1025 ( 9t h Ci r . 2003) . A part y t o t he appeal may

not uni l at er al l y suppl ement t he r ecor d, par t i cul ar l y wi t h

document s that wer e not present ed t o t he t r i al cour t . I d.

Fai l ur e t o compl y wi t h t he r ul es t ypi cal l y r esul t s i n

st r i ki ng t he ext r aneous document s. I d. I n cases i nvol vi ng

par t i cul ar l y ser i ous vi ol at i ons, however , t he cour t may i mpose

monet ar y sanct i ons. I d. ( ci t i ng 9t h Ci r . R. 30- 2( d) ) .

I n Lowr y, t he Ni nt h Ci r cui t i mposed monet ar y sanct i ons on

t he appel l ee when i t i ncl uded a document i n i t s excer pt s of

r ecor d t hat di d not exi st when t he t r i al cour t r ender ed i t sdeci si on or when t he appel l ant f i l ed hi s openi ng br i ef . I d. at

1025. I n doi ng so, t he cour t noted t hat monetary sanct i ons may

not be pr oper f or l ess ser i ous vi ol at i ons. I d. at 1026 n. 7.

Thi s i ncl udes vi ol at i ons wher e t he document i mproper l y i ncl uded

ent ai l s a ver y smal l por t i on of t he excer pt s of r ecor d or t he

i ssue i s one of f i r st i mpr essi on. I d. ( ci t at i ons omi t t ed) . But

see N/ S Cor p. v. Li ber t y Mut . I ns. Co. , 127 F. 3d 1145, 1146

( 9t h Ci r . 1997) ( appel l ant s br i ef s wer e st r uck and appeal was

di smi ssed based on appel l ant s f ai l ur e t o compl y wi t h br i ef i ng

r ul es) ; Kano v. Nat l Consumer Coop. Bank, 22 F. 3d 899, 899 ( 9t h

Ci r . 1994) ( monet ar y sanct i on f or non- compl i ance wi t h f or mat t i ng

rul es) .

I n hi s Desi gnat i on of Recor d on Appeal ( Desi gnat i on of

Recor d) , Kwasi gr och i dent i f i ed a number of paper s and exhi bi t s,

i ncl udi ng most of t he docket i n t he removed adver sar y pr oceedi ng,

cer t ai n pr oof s of cl ai m, and var i ous document s and or der s ent er ed

i n t he other bankr upt cy cases and adver sar y pr oceedi ngs. None of


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t he f our exhi bi t s at t ached t o Kwasi gr och s r epl y br i ef , however ,

wer e i ncl uded i n hi s Desi gnat i on of Recor d. Two of t he exhi bi t s

were ent ered i n Debt or s second bankr upt cy case. The other t wo

exhi bi t s have absol ut el y no bear i ng on t he appeal . Kwasi gr och

di d not pr oper l y request l eave t o suppl ement t he recor d pr i or t o

at t achi ng t he document s t o hi s r epl y br i ef .

We agr ee that t hi s behavi or war r ant s sanct i ons.

Nonet hel ess, gi ven t hat we ar e i mposi ng sanct i ons agai nst

Kwasi gr och under Rul e 8020, we decl i ne t o i mpose addi t i onal

monet ar y sanct i ons f or i mpr oper l y suppl ement i ng t he recor d.

I nst ead, t he exhi bi t s at t ached t o hi s r epl y br i ef ar e st r i cken,and we det er mi ne that t hi s behavi or pr ovi des a f ur t her basi s f or

t he sanct i ons al r eady assessed.

CONCLUSION

Based on t he f or egoi ng, we AFFI RM t he bankr upt cy cour t s

order awar di ng cost s and expenses under 1447( c) . We GRANT i n

par t DeNoce s mot i on f or sanct i ons under Rul e 8020, and we DENY

Kwasi gr och s mot i on t o suppl ement t he r ecor d on appeal .

in re: ronald alvin neff, 9th cir. bap (2013)

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