Stennis v. Davis (In re Davis), 486 B.R. 182

On September 10, 2012, the court held a hearing on the parties' motions for summary judgment; a prior memorandum decision granted part of plaintiffs' motion and denied defendant's motion.
The October 12, 2012 Memorandum Decision found evidentiary gaps in determining what portion of the attorney fee award was nondischargeable.
The court held a further hearing on January 14, 2013, to address the attorney's fee issue and nondischargeability.
The court now amends the October 12, 2012 decision and determines that Defendant’s obligation to Zelma Stennis in the amount of $270,648.18 is nondischargeable.
Zelma Stennis sued in Los Angeles Superior Court for multiple claims; a jury returned a verdict in her favor on July 22, 2010, and the state court awarded attorney fees and costs totaling $213,499.62.
Defendant filed Chapter 7 on December 13, 2010; the dischargeability action was filed December 15, 2011 and amended thereafter.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether state court IED judgment has collateral estoppel effect under §523(a)(6).	IED elements identical to §523(a)(6) elements; final on merits.	Not precluded from re-litigating disputed issues.	Collateral estoppel applies; IED debt nondischargeable.
Whether state court intentional misrepresentation judgment is collateral estoppel under §523(a)(2)(A).	Fraud elements align with §523(a)(2)(A); identical issues.	Arguments to defeat reliance and damages not addressed.	Collateral estoppel applies; misrepresentation debt nondischargeable.
Whether state court concealment judgment is collateral estoppel under §523(a)(2)(A).	Concealment constitutes actual fraud; elements align with §523(a)(2)(A).	Concealment not properly established or identical.	Collateral estoppel applies; concealment debt nondischargeable.
Whether the fiduciary breach under §523(a)(4) is nondischargeable based on state court fiduciary duty finding.	State court found fiduciary duty; breach nondischargeable under §523(a)(4).	No trust res or statutory/express fiduciary capacity; not nondischargeable.	Not nondischargeable; lack of express/technical trust means fiduciary breach is dischargeable.
Whether remaining claims are nondischargeable or subject to collateral estoppel.	Collateral estoppel should render more nondischargeable.	Collateral estoppel does not blanket nondischargeability for all remaining claims.	Some claims not established as nondischargeable; remaining contested.

Celotex Corp. v. Catrett, 477 U.S. 317 (Supreme Court, 1986) (rules for summary judgment burden and evidence)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (Supreme Court, 1986) (materiality and genuine dispute standard)
Matsushita Electrical Industrial Co. v. Zenith Radio Corp., 475 U.S. 574 (Supreme Court, 1986) (truth of inferences in summary judgment)
Grogan v. Garner, 498 U.S. 279 (Supreme Court, 1991) (collateral estoppel in bankruptcy dischargeability)
In re Honkanen, 446 B.R. 373 (9th Cir. BAP, 2011) (fiduciary capacity requirement in § 523(a)(4))
In re Harmon, 250 F.3d 1240 (9th Cir., 2001) (elements for collateral estoppel in bankruptcy)
Kawaauhau v. Geiger, 523 U.S. 57 (Supreme Court, 1998) (willful and malicious standard under § 523(a)(6))
In re Jercich, 238 F.3d 1202 (9th Cir., 2001) (willful misconduct sufficient for § 523(a)(6))
In re Evans, 181 B.R. 508 (Bankr.S.D. Cal., 1995) (actual fraud via concealment under § 523(a)(2)(A))
In re Sasson, 424 F.3d 864 (9th Cir., 2005) (scope of 'any debts' under § 523(a)(6) and related damages)