Yousif Halloum v. Katzen & Schuricht
707 F. App'x 898
9th Cir.2017Background
- Debtor Yousif H. Halloum and non-debtor Iman Y. Halloum removed state-court claims to bankruptcy court and sought remand/abstention; bankruptcy court denied relief.
- Halloums appealed the denial of remand/abstention to the Bankruptcy Appellate Panel (BAP) and then to the Ninth Circuit in Case No. 16-60097.
- In a separate appeal (Case No. 16-60098), Halloum appealed the BAP’s affirmance of the bankruptcy court’s denial of his motion for leave to sue the Chapter 7 trustee in another forum.
- In Case No. 17-60005, Halloum appealed the BAP’s affirmance of the bankruptcy court’s dismissal of the trustee from the removed action; the bankruptcy court had cited Barton v. Barbour and alternatively entered judgment for the trustee on the merits.
- The Ninth Circuit considered jurisdictional limits on reviewing remand/abstention decisions, reviewed de novo the dismissal of the trustee, and reviewed for abuse of discretion the denial of leave to sue the trustee.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court may review denial of motion to remand or abstain | Halloum: bankruptcy court should have remanded/abstained | Trustee/defendant: denial of remand/abstention is not reviewable on appeal | Dismissed appeal for lack of jurisdiction (decision not reviewable under 28 U.S.C. § 1452(b)) |
| Whether bankruptcy court abused discretion denying leave to sue trustee in another forum | Halloum: not required to seek leave; should be permitted to sue trustee elsewhere | Trustee: claims arose from trustee’s administration of estate; bankruptcy court may retain jurisdiction | Denied leave was not an abuse of discretion; BAP affirmed |
| Whether dismissal of trustee under Barton was improper | Halloum: Barton inapplicable; trustee should not have been dismissed | Trustee: dismissal proper; alternatively, trustee entitled to judgment on the merits | Any Barton error was harmless because trustee prevailed on the merits; dismissal affirmed |
| Whether Halloum preserved/reasonably raised appellate issues (including contempt order) | Halloum raised multiple challenges on appeal | Trustee/BAP: many issues unbriefed or voluntarily dismissed | Court declined to consider issues not specifically and distinctly raised; contempt appeal voluntarily dismissed and thus not considered |
Key Cases Cited
- Aguon-Schulte v. Guam Election Comm’n, 469 F.3d 1236 (9th Cir. 2006) (jurisdiction to determine whether appellate court has jurisdiction)
- Sec. Farms v. Int’l Bhd. of Teamsters, 124 F.3d 999 (9th Cir. 1997) (decision not to remand under § 1452(b) is not reviewable)
- Blixseth v. Brown (In re Yellowstone Mountain Club, LLC), 841 F.3d 1090 (9th Cir. 2016) (abuse-of-discretion standard and factors for leave to sue trustee elsewhere)
- Turtle Rock Meadows Homeowners Ass’n v. Slyman (In re Slyman), 234 F.3d 1081 (9th Cir. 2000) (independent review of bankruptcy court decisions when appropriate)
- Greenwood v. FAA, 28 F.3d 971 (9th Cir. 1994) (appellate courts review only issues argued specifically and distinctly in opening brief)
- Padgett v. Wright, 587 F.3d 983 (9th Cir. 2009) (court will not consider arguments raised for first time on appeal)
- Barton v. Barbour, 104 U.S. 126 (U.S. 1881) (doctrine regarding suing a trustee without leave of the appointing court)