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Blausey v. U.S. Trustee
552 F.3d 1124
9th Cir.
2009
Check Treatment
Docket

*1 1124 law fraud or de

case, See Anderson resemblance common latter inference. 255, Inc., 242, ception. public The test is whether the is 477 U.S. Liberty Lobby, v. deceived.”) (citations (1986) omitted); likely to be 2505, L.Ed.2d 202 91 106 S.Ct. Inc., People Sys., v. Dollar Rent-A-Car determinations, weighing (“Credibility 119, 191, Cal.Rptr. 211 259 197 Cal.App.3d evidence, legiti- drawing and the of the (1989) (“In order to under [the recover jury from the facts are mate inferences FAL], necessary only it is to show functions, judge, a he whe[n] not those of public likely are to be members ruling summary judg- on a motion for deceived.”); see also Lavie v. Procter & the non-movant ment .... The evidence of Co., 496, Cal.App.4th 129 Cal. Gamble believed, justifiable and all infer- be (2003) 486, (applying 492-93 Rptr.2d favor.”) (cita- in his ences are to be drawn standard). consumer” “reasonable omitted). tion Accordingly, genuine because a issue Hauk, all in favor of a Taking inferences respect material fact remains with jury could find Chase reasonable claims, FAL Hauk’s state law UCL and we have known about Hauk’s knew or should grant reverse the district court’s of sum- accepted he payment late to HCF before mary judgment in favor of Chase on those 248, See id. at 106 S.Ct. 2505 the BTO. above, claims. For the reasons stated (“[A genuine] if the evidence is dispute is however, we affirm the district court’s jury could return a such that reasonable grant summary judgment favor nonmoving party.”). As verdict for the on TILA claim. Chase Hauk’s As feder- concedes, dispute Chase this factual is ma- subject longer gives al claim no rise to FAL terial to Hauk’s UCL and claims and jurisdiction, recognize matter that the summary Hauk judg- enables to withstand may sup- district court decline to exercisе (a claims. fact is ment on those See id. plemental under 28 U.S.C. “might material affect outcome of 1367(c)(3). law”). governing the suit under the PART, AFFIRMED IN REVERSED Specifically, if knew or should Chase PART, IN AND REMANDED. payment, known about Hauk’s late have apply but waited to a Non-Preferred APR Each party shall bear its own costs. BTO, accepted until after he Chase’s may give

conduct rise to UCL claim. Casualty

See State Farm Fire & Co. v. Court, 1093,

Superior Cal.App.4th (1996) 229,

Cal.Rptr.2d (“asserting right may contractual one does not have” BLAUSEY; Blausey, John C. Deann J. practice), constitute an unfair business ab- Debtors-Appellants, rogated grounds by on other Cal-Tech Commc’ns, Inc., 548, Cal.Rptr.2d TRUSTEE, Trustee-Appellee. may P.2d at 564. The conduct also give No. 07-15955. rise to fraudulent and FAL UCL claims receiving because a cardholder the BTO Appeals, United States Court of likely believing could be deceived into Ninth Circuit. apply would not later а Non-Pre- Chase Argued and Submitted Dec. 2008. payment ferred APR based on a late it had Filed Jan. Cal.Rptr.2d waived. See id. at (“[T]he contemplated 973 P.2d 527 ‘fraud’ prong section 17200’sthird bears little *2 FLETCHER,

Before: B. M. McKEOWN, and NEIL M. MARGARET *, Judges. GORSUCH Circuit *3 PER CURIAM: Blausey appeal John and Deann bankruptcy peti- court’s dismissal of their Chapter bankruptcy. tion for The bank- ruptcy granted the U.S. Trustee’s pursuant motion to dismiss the case to 11 707(b)(2), provision U.S.C. Bankruptcy Prevention and Con- Abuse (“BAPC- Protection Act of 2005 sumer PA”), which allows the U.S. Trustee to statutory move for dismissal where presumption means test demonstrates a of bankruptcy court held that abuse. $4,000 per disability month in insur- Blausey ance benefits that Mrs. received from have private her insurer should been Blauseys’ monthly included in the current (“CMI”) income under the means included, test. With the benefits the Blau- seys’ high enough trigger CMI was Chandler, (argued), N. Jr. David David рresumption of abuse. Chandler, Sr., P.C., N. Chandler David N. Blauseys directly ‍​​‌‌‌​‌‌‌​​‌​‌​​‌​​‌​​​‌​‌‌​​​​‌‌‌‌​​​​‌‌​​‌​​​​‍appealed to this Rosa, CA, debtors-appel- Santa for the 158(d)(2), court under 28 U.S.C. lants. provision authorizing ap- BAPCPA direct Stephanie (argued), R. Peter D. Marcus peal bankruptcy from the courts to the Keisler, Kanter, Department William U.S. appeals. They argue courts of Justice, Division, Washington, Civil interpreted court should have D.C., DeAngelis, Roberta A. P. Matthew the word “income” as used in the definition Sutko, Levine, A. David Office of Gen- CMI, 101(10A), based on Counsel, eral Executive Office for U.S. meaning “gross income” under the Trustees, Justice, Department They Internal Revenue reason that Code. D.C.; Washington, Shepherd, James A. private disability because insurance bene- Trustee, Francisco, Office of the U.S. San income, gross fits are excluded from Mrs. CA, trustee-appellee.

Blausey’s also benefits must be excluded from CMI.

We have to consider this Blausey’s hold that private case. We Mrs. disability insurance benefits were income * Gorsuch, designation. The Honorable Neil M. United States Circuit, Judge sitting by Circuit for the Tenth CMI, that should have been included in in disability payments benefit under her affirm bankruptcy court. policy. I. BACKGROUND B. Bankruptcy proceedings Blausey’s A. Deann policy insurance On November disability filed a petition Chapter 7 bankruptcy in the U.S. Bankruptcy Court Blausey purchased Deann for the private Northern disability District of policy, They insurance California. titled dis- “Disability Plus,” Income Pro-Inc closed petition that Blausey Mrs. John Mutual Hancock Life Insurance received disability $4,000 benefits of per *4 Company. Blausey’s Mrs. employer paid month, they but did not include these ben- none of the premiums fоr the insurance in efits their calculation of CMI. policy. By terms, its the policy pays dis- The U.S. Trustee moved to dismiss the ability up benefits to a specified “monthly Blauseys’ case § under 11 707(b)(1), income benefit amount” if insured the be- arguing that the case was presumptively comes unable to work due to sickness or an abuse of Chapter 707(b)(2) 7 under § injury and injury the caused a loss of or, in alternative, the that the totality of monthly earnings percent of 20 or more. the circumstances demonstrated abuse un- policy The “monthly earnings” defines 707(b)(3)(B).1 der The U.S. Trustee wages, salaries, commissions, fees, and de- urged the bankruptcy court to find that ferred The income. amount benefits Mrs. Blausey’s disability benefits should paid depends on the amount of income lost have been included in the Blauseys’ CMI due disability. to the If the insured losеs because the benefits constitute both “in- at percent least 75 of her monthly earn- come” and an paid by “amount any entity

ings, the policy pays percent of the other than the debtor ... on a regular monthly income benefit amount. basis for the household expenses of the Blausey Mrs. suffered an injury 101(10A)(A)- under debtor” 11 U.S.C. to her elbow that made her work as a (B).2 $4,000 With the per month added to certified reporter very court Af- painful. CMI, a presumption of abuse would arise ter she diagnosed was with permanent 707(b). under the means test of disability, she filed an claim insurance and began to receive benefits in December The bankruptcy court held the dis- 1996. $4,000 She now receives per month ability insurance payments “income” were 707(b)(2) 1. provides Section by receive) spouse means test rеgard without to whether which bankruptcy courts ...; determine whether a such income is taxable and income presumed case is Chapter (B) to be an abuse of any paid any entity includes amount by abusive, presumed If the case is it (or will be other than joint the debtor in a case the dismissed the "special unless debtor shows spouse), debtor and the debtor's regu- on a rebutting presumption. circumstances” the lar basis for expenses household the 707(b)(2)(B)(I). 11 U.S.C. presump- If the (and debtor or dependents the debtor's in a arise, tion does not the bankruptcy may court joint case spouse the debtor’s other- 707(b)(3) still find under abuse based on the dependent), wise a but excludes benefits totality of the circumstances. Act, received Security pay- under the Social ments to of war victims crimes or crimes 101(10A) 2. Section provides, in part, relevant against humanity on account of their status that the term monthly "current income”: crimes, as victims of such payments (A) average means the monthly income victims of international terrorism ... or (or from all that the sources debtor receives domestic ... on terrorism account joint in a case the debtor and the debtor's status as victims of such terrorism. with instructions bankruptcy court The bank- meaning of CMI. within appeal bank- argu- the notice Blauseys’ transmit rejected the ruptcy court to the district court. be defined record ruptcy should court “income” ment Revenue Code. that we argued lacked to the Internal Trustee reference “all sources” and that the words because Finding jurisdiction over income is to whether such regard per- “without file a Blauseys failed to statute demonstrat- income” days taxable after the within mission intent to define income Congress’s ed Blauseys’ grant of bankruptcy court’s Internal does the than expansively more request for certification. Code, Revenue July On to be the “sim- adopted what considered of in- definition expansive” most

plest and 158(d)(2). 28 U.S.C. pursuant bankruptcy court “receipts.” come: 23, 2007, they opposition filed an July On disability payments found that also Motion to Remand. Trustee’s to the U.S. entity than by an other paid were amounts (1) they argued opposition In their basis for house- regular on a debtor jurisdictional, limit was not 10-day time expenses under hold *5 (2) jurisdictional, if was even 101(10A)(B). § filed appeal of the notice court should treat 3, 2007, bankruptcy court the May On timely as a bankruptcy court by thе dismissing the case. entered its order appeal. permission to petition for appeal Proceedings on C. granted of this court panel A motions 10, 2007, Blauseys filed the a May permission On to Blauseys’ petition for the certify to request a a appeal, of notice panel’s the part, order appeal. relevant appeals, of and a to the appeal direct court stated: to the dis- appeal election to of statement ap- notice of May Appellant’s (rather bankruptcy than the court

trict erroneously transmitted which peal, was (“BAP”)) with the bank- panel appellate bankruptcy court the court’s to this with 22, 2007, May the bank- On ruptcy court. of approving certification direct order certifying its order court entered ruptcy 22, 2007, May is construed appeal on court on our the appeal direct to the pur- appeal to a for permission of questions that the case “involves ground 158(d)(2). § So con- to 28 suant U.S.C. controlling au- there is no for which law to strued, permission the impor- public thority and are matter 158(d)(2) to 28 pursuant U.S.C. appeal day same as it certified the On the tance.” granted. bankruptcy court transferred appeal, bankruptcy our record to court. II. DISCUSSION transfer. it made this erred when court have sent bankruptcy court should A. Jurisdiction granted until we record to our court appeal. to See petition for appeals jurisdiction over direct Our 8001; Bankrupt- Bankruptcy Rule Interim granted bankruptcy court is from the Nevertheless, the Ninth Rule 8007. cy 158(d)(2). jurisdic have We U.S.C. on appеal clerk June docketed Circuit have juris to whether tion determine 1, 2007. See, bankruptcy appeal. over a diction Canter, 299 F.3d 1152-53 e.g., In re 27, 2007, the U.S. Trustee On June Cir.2002). (9th this court to remand moved 1. Relevant statutes and rules to the district court or to the BAP. Bank- 8001(e). ruptcy Rule The bankruptcy 158(d)(2) provides U.S.C. direct court is then directed to transmit the rec- ‍​​‌‌‌​‌‌‌​​‌​‌​​‌​​‌​​​‌​‌‌​​​​‌‌‌‌​​​​‌‌​​‌​​​​‍orders, appeals of judgments, or decrees of ord to the relevant district court or BAP. bankruptcy court to the of ap- courts 8007(b). Bankruptcy Rule peals. The grants statute the courts of appeals direct appellate jurisdiction in a meantime, In the parties may con- bankruptcy if case court3 sider request whether to the bankruptcy (1) that: certifies the order involves a grant certification for a direct question of law as to which there is no appeal to the court appeals. statute, By controlling decision of the court appeals parties up have days request Court, for the circuit or Supreme of the or certification after the bankruptcy court en- if it public importance; involves matter of ters judgment. its (2) the order question involves a of law 158(d)(2)(E). Under the temporary that requires resolution conflicting deci- rules in effect until December 2008, a (3) sions; or immediate from the party must follow the normal appeals pro- may order materially advance progress plans cedure even it request certifica- of the case or proceeding. tion. 8001(f)(1). Interim Bankruptcy Rule 158(d)(2)(A). The parties request must Thus, even if party requests certification certification no later days than 60 after the within 10-day filing window for a no- entry judgment, order, or decree tice of appeal, the party must still file the 158(d)(2)(E). being appealed. Id. If notice of in the bankruptcy court. met, these conditions are of ap- If the bankruptcy court grants the certi- peals has discretion to authorize the direct *6 fication, “a petition requesting permission 158(d)(2)(A). appeal. §Id. appeal to ... shall be filed with the circuit 1233(b) § specified BAPCPA temporary clerk not later days than 10 after the procedural for rules these appeals. direct certification entered on the docket” of 1233(b), § Pub.L. No. 109-8 as 28 codified bankruptcy the § court. 28 U.S.C. § Congress 158 note. intended the (4)(A). note The petition permission for temporary apply rules to only until “such to appeal “shall be taken in thе manner time of practice as rule and procedure prescribed (a)(1), in (b), (c), subdivisions to such relating provision and appeals such (d) and of rule 5 of the Federal Rules of promulgated chapter under of title (3). Appellate Procedure.” Id. (1). 28.” Id. Because the final rules 1, went into effect on December the governs Rule 5 appeals by permission. temporary rules at in issue this case ex- petition The permission for to appeal must pired by the time we argument. heard include: the necessary facts to understand question the itself; presented; question the rules, the temporary bankruptcy

Under the sought; relief why the reasons the party must file a notice of appeal appeal should be allowed and a bankruptcy order of the statement court within that it days rule; is authorized entry of the the statute or the order. Bank- and an ruptcy order, Rule 8002. copy This notice of attached of both the appeal is the bankruptcy judgment, court. or sepa- subject In decree is the rate document filed with bankruptcy application any opinion related or court, party 5(b)(1). elects whether appeal to R.App. Fed. P. memorandum. 158(d)(2) 3. Section also plicity, only enables a district bankruptcy we refer court certify court appeal. or BAP to opinion. For sim- in this July Instead, petition on they filed their have attached” “shall addition, petition the certi- months after nearly two court’s certifica- bankruptcy copy (4)(B). bankruptcy on the § 158 note fication was entered tion. 28 U.S.C. court docket. permission appeals grants If the court of appeals assumes the court was not appeal, although there conclude We case. statute, over the compliance with technical 158(d)(2)(A). and the the certification transmission of satisfy in this case sufficient record was Statutory jurisdiction requirement. any statutory jurisdictional that we argues Trustee must, however, ourselves also concern We appeal this jurisdiction over not have do adequate compli- there was with whether Blauseys filed because R.App. Fed. P. 5. ance with than 10 more may sus- RApp. P. we Under Fed. certified bankruptcy court days after the Appel- the Rules of any provision of pend disagree. appeal. We proceedings order late Procedure and the bank- Preliminarily, we note direct, providеd except as otherwise appeal. this properly certified ruptcy 26(b)(1) 26(b). P. R.App. Fed. under Rule the Blau- granted may permit an act to be that we provides because seys’ request for certification in the rules prescribed the time done after for which questions of law case “involves the time to may not extend expires, but we authority are a controlling there is no or a file a notice of Because no importance.” public matter of result, appeal. To avoid permission to ad- Court case Supreme or Ninth Circuit panel exercised its discretion the motions “income” the word dresses whether under Rule procedural errors forgive inter- monthly income” should be “current the notice of and construed —which as defined “gross to mean income” preted bankruptcy court Blauseys filed in the Code, the condi- Internal Revenue in the then bankruptcy court and which the in 28 U.S.C. tion for certification peti- valid to this court—as a transferred 158(d)(2)(A)© is met. *7 the appeal. to Because permission tion for that the Blau- dispute parties do court’s and the district appeal notice of appeal was seys’ permission for to petition in this appeal the were filed certification of procedural untimely temporary filed. The 1, 2007, the effective result on June court permis- a for required petition that rules to treat the case panel’s the order was of filed with the circuit appeal sion to be permission appeal for petition as if the days the certi- later than 10 after clerk no by the time limits set had been filed within the docket of the fication is entered on (4)(A). note 28 U.S.C. 158 note 158 bankruptcy court. the notice argues Trustee The U.S. (4)(A). Blauseys the filed Because sufficiently complete to was not appeal bankruptcy court appeal with the notice of permission. for petition as be construed bankruptcy the May on and however, panel, motions agree with the We on appeal of direct issued its certification the appeal notice of and that because the 22, 2007, Blauseys required May were in our record were filed bankruptcy court appeal petition permission to file a for deadline, 10-day statutory court within the 6, 2007. See Fed. no later than June Rule our discretion under may we exercise (exclude 26(a)(2) “intermediate P. R.App. of Rule 5 requirements suspend 2 to holidays legal Saturdays, Sundays, and Here, bankruptcy cause. days”). good for less than period when the court’s mistaken transfer of the appeal record to together sion as constituting a our court and our court’s docketing of the timely petition for to appeal appeal were sufficient to create the ap under the Act, Class Action Fairness pearance that appeal was appropriate 1453(c)(1)).4 U.S.C. by

ly received this court. We decline the Discretion to exercise suggestion punish U.S. Trustee’s that we docketing activity by for the Once it is juris- established we have court, bankruptcy this and the both diction to hear a direct from a implementing faced with transition rules. court, bankruptcy we must decide whether conсlude that in We these limited circum to exercise our discretion to hear the ap- stances, where there otherwise effec was 158(d)(2)(A). peal. compliance tive courts themselves agree We with the panel’s motions responsible in part posture were for the accept decision to First, this appeal. procedural that created the ambiguity, issue presented by this is important good there is cause require to excuse the because the calculation part of CMI is a However, ments of Rule 5. bankruptcy pe every petition Chapter for 7 bankruptcy. titioners and bankruptcy courts should (“Current See Schedule I Income of Indi be potential now on notice of pitfall. this Debtor(s)”). Second, vidual this appeal Consequently, timely future failure file law, presents question making it un petition in these circumstances likely that further proceedings in the dis unlikely to be given the benefit of the trict court will east more light on the issue. good exception. Finally, cause because we Trustee, See Weber U.S. 484 F.3d petition filed, construe the timely (2d Cir.2007). Third, the bankruptcy are not improperly extending the time for courts lack a precedent clear interpret filing petition for permission to appeal. ing CMI. Although several Rather, “waiving requirements we are courts and bankruptcy appellate panels Rule timely [of that the 5] ... be interpreted have CMI and court, found that it is this it explain the de not defined reference to the Internal appeal, tails that plaintiffs file Code,5 Revenue there are proper no cirсuit court copies.” number of Amalgam interpreting decisions provision. ated Transit All Union 1309 v. Laidlaw Local Servs., Inc., of these Transit factors lead us to 435 F.3d conclude that (9th Cir.2006) (exercising judicial efficiency discretion under will be best served if we timely Rule to construe a ap notice of decide issue now than rather remand it peal and an untimely permis- court, for consideration in district *8 argument, 4. At oral argued the U.S. Trustee concepts Code determining for taxable in- that because the Blauseys inapplicable themselves did not come are to a determination of court, income”); Zahn, file the notice of in our monthly current In re 391 statutory requirements 840, (8th 2008) (hold- were B.R. 845-46 Cir. BAP note, § not met. Section 4 of U.S.C. 28 158 ing that distributions from IRAs should be however, requires only petition that “shall money excluded frоm income because the de- be filed.” require It does not that the posited prior into an IRA is received for use by parties. be filed one of the IRA, finding to the distribution from it "irrelevant to our decision that funds in an See, 238, e.g., Wiegand, tax”); 5. In re 386 B.R. 242 IRA are excluded from federal income (9th 2008) 88, (holding (Bankr.N.D.Ill. Cir. phrase Royal, BAP that the In re 397 B.R. 100 Nov.7, regard 2008) (CMI "without to whether such income is gross is not based on in- 101(10A)(A) § taxable income” in 11 U.S.C. come and includes income tax cred- earned its). congressional reflects "clear intent that Tax consent, 707(b) con- or, § with debtor’s our then be taken to could which See id. Chapter 13. vert court. (b)(1). 707(b)(2)(A), §§ Monthly Income” B. “Current Blauseys’ argument chief The court’s bankruptcy review the We of CMI in the definition that “income” de Bankruptcy Code interpretation consistent with interpreted as should be findings for clear er and its factual novo in Internal defined “gross income” as (9th Salazar, F.3d ror. re all income means “Gross Revenue Code. Cir.2005) Bunyan, 354 F.3d In re (citing ” whatever source derived.... income from Cir.2004)). (9th 1149, 1150 61(a). income,” § how “Gross 26 U.S.C. monthly average “the defined as CMI is ever, include “amounts expressly does not the debtor all sources income from health insur through accident or received to whether regard ... without receives injuries or sickness personal ... ance income”, including taxable income is such (other by an em amounts received than entity other than by any “any paid amount (A) that such amounts to the extent ployee, for the regular basis ... on a the debtor by the to contributions are attributable or the of the debtor expenses household in the which were not includible employer 11 U.S.C. dependents.” debtor’s (B) or are employee, gross income of (B). 101(10A)(A), statute excludes The employer.)” 26 U.S.C. by the paid “ben- CMI: types payments three 104(a)(3). Blauseys argue that Mrs. The Security the Social under efits received disability ben Blausey’s private insurance crimes or Act, of war payments to victims efits, to contri not attributable which were humanity on account against crimes employer, “gross are not butions her crimes, and victims of such their status as Revenue Code. income” under the Internal ter- of international to victims payments if the benefits Blauseys reason The ... terrorism on ... domestic rorism or gross income under are not included as victims of such their status account of Code, they likewise Revenue Internal 101(10A)(B). terrorism.” in income when not be included should “in- does not define Bankruptcy The Code calculating CMI. come.” See U.S.C. of the Bank plain language The of a component is a CMI however, Code, support does not ruptcy use to bankruptcy courts means test Lamie v. U.S. interpretation. See a debtor’s determine whether Trustee, S.Ct. an abuse of presumed is to be (“It (2004) is well estab 157 L.Ed.2d 1024 707(b)(2). Chapter 7. See U.S.C. language is that when the statute’s lished only the debtor’s applied means test is the courts—at the sole function of plain, amount set the safe harbor CMI is above by the disposition required least where the 707(b)(7). If the debt- in 11 forth it accord ‍​​‌‌‌​‌‌‌​​‌​‌​​‌​​‌​​​‌​‌‌​​​​‌‌‌‌​​​​‌‌​​‌​​​​‍ to enforce text is not absurd—is specified expenses minus certain or’s CMI (internal marks quotation ing to its terms.” collec- Internal Revenue Service’s in the omitted)). regard to phrase “without (1) multiplied by 60 is either tion standards is taxable income” whether such income *9 $6,575 per- or 25 equal than or greater 101(10A)(A) Congress’ reflects nonpriority the debtor’s secured cent of Internal Revenue judgment that (2) debts, greater greater, is or whichever in determining taxable method Code’s $10,950, the case is equal to then than or Bankruptcy apply not to the come does the bank- to be an abuse and presumed Moreover, calculation of CMI. it under Code’s may either dismiss ruptcy court in Congress employment, investments, wishes to define a term royal- where by Bankruptcy ties, code reference to the gifts, and the like. Code, clearly Internal Revenue knows Black’s Dictionary, Law 8th ed. 778 example, Congress how to do so. For (2004). imported Internal Revenue Service’s The ask us to find that expenses Local and National Standards fоr disability payments insurance benefit are into calculation. the means test See not “income” under these definitions be- 707(b)(2)(A)(ii)(I). U.S.C. cause the benefits are not derived from addition, specifically the statute but, instead, labor as compensation serve payments, excludes certain such as Social ability for the loss of her to work as a Security payments payments to vic reporter. argument This is unavail- terrorism, tims of war crimes and from ing. By the terms of her insurance policy, 101(10A)(B). gen CMI. The Mrs. Blausey’s disability insurance bene- eral rule of construction is that were triggered fits when her earnings lost specific the enumeration of exclusions from twenty percent exceeded original of her operation of a statute is indication monthly earnings. monthly The benefits that apply the statutе should to all cases payment under the policy is based on the specifically 2A excluded. See Suther amount of income lost. If Blausey Mrs. (dis Statutory land Construction 47:23 job paid were to find a as much as her cussing the rule of expressio unius est reporter job would pay, she would no alterius). Here, exclusio the statute longer receive insurance benefits because specific makes several exclusions from longer she would no have lost income. It specifically pri CMI but does not exclude is clear that purpose thus of the dis- disability vate insurance benefits. This in ability plan insurance to replace Congress dicates that meant for the bene Blausey income that Mrs. lost due to her fits to be included CMI. disability. Blauseys argue that even CMI is Finally, history of BAPCPA indi- by not defined referenсe to the Internal cates that excluding Blausey’s Mrs. disabil- Code, Revenue standard “in- definitions of ity insurance benefits from CMI would support excluding Blausey’s come” Mrs. purpose contravene the of the means test. benefits. Webster’s Third New Interna- According Report to the House on BAPC- Dictionary, tional for example, defines PA, heart of the bill’s consumer “[t]he “income” as: bankruptcy reforms consists of imple- gain or recurrent benefit mentation of an income/expense screening usu[ally] money measured in and for (‘needs-based time, mechanism given bankruptcy re- period capi- derives from tal, labor, both, testing’), or a combination of in- lief or ‘means which is intended gains capital cludes from transactions in repay to ensure that debtors creditors the assets, but excludes unrеalized advances they Rep. maximum can afford.” H.R. in value ... goods value of 109-31(1) reprinted at services received an individual in a 2005). (April U.S.C.C.A.N. given period of time. purpose “help of the means test is to Webster’s Third New courts determine who can and who cannot International Dictio- (1993). nary and, repay Black’s Law Dictio- im- perhaps their debts most meanwhile, nary, defines “income” as: portantly, they much can how afford to (dai- S1726-01, pay.” Cong. Rec. money payment or other form of S1786 2005) (statement receives, usu[ally] periodically, ly one ed. Feb. of Sen. *10 158(d)(2)(A), § Hatch). $4,000 under 28 U.S.C. Con- per ing month Excluding the petition request- that “a gress CMI would has directed income from replacement in accurately ... does not to shall be figure ing permission that result in ability repay their than 10 Blauseys’ the circuit clerk not later reflect the with that a determination on Congress’s days debts. after the certification entered should not be taxed court,” income type certain of the docket sheet of the that the a determination not reflect does further directed that the debts. repay available to income is not pre- in the manner appeal “shall be taken (a)(1), (b), (c), in scribed subdivisions reasons, hold that Mrs. For these (d) Appel- of rule 5 of the Federal Rules of disability ben- insurance Blausey’s private § 158 Note at late Procedure.” 28 U.S.C. Bankruptcy under the are income efits added).1 us, 4,§ Before (emphasis in included have been and should Code they did not file a Blauseys concede Blauseys’ calculation of CMI.6 requesting permission CONCLUSION much days, the circuit clerk within 10 with requirements of conforming one to the less appeal, this jurisdiction over We have of Rule 5. That specified subdivisions Blauseys re- were and we find appeal. concession should end this Blausey’s private to include Mrs. quired calcu- benefits their disability insurance Supreme The Court’s discussion monthly income” under “current lation of Russell, 205, 127 v. 551 U.S. S.Ct. Bowles 101(10A). AF- We therefore (2007), requires 168 L.Ed.2d 96 bankruptcy court’s dismissal of FIRM the that, There, clarified much. the Court Blauseys’ bankruptcy petition. Congress govern- is the of because branch constitutionally vested with the au- ment GORSUCH, J., Judge, Circuit jurisdiction of the thority regulate dissenting: courts, to en- powerless federal courts are the court’s agree I admire and with statutory time limitations. Id. at large of treatment of the merits this thoughtful Congress “forbids federal 2365. When merits, reaching the howev- case. Before adjudicating an otherwise le- courts from er, lack I would dismiss a certain gitimate ‘class of cases’ after Blauseys’s jurisdiction. argument The elapsed judgment,” from final period has ” may appeal, even that we entertain ‘jurisdictional’ than its decision is “no less it, ultimately reject runs afoul subject it confers or denies matter when the re- directions about Supreme Court’s resulting jurisdiction. Id. at 2366. jurisdic- limits on our spect due jurisdictional hurdle is one that a court split. tion and exacerbates a circuit matter may litigants not lower for the —no matter deserving litigants how and no complied with have seeking a equitable how their reason for unambiguous statutory preconditions one, delay may be. Id. Even aside from this appeal, like this aris- appeal. For Note, 1233(b), disability as 28 U.S.C. insur- 6. Because we hold that the codified Blausey carry Mrs. receives are in- ance benefits the full force of statute. See 1 U.S.C. 101(10A)(A), we do (statutes come under 11 U.S.C. large legal at “shall be evi- they question whether are not reach the ... in all the courts of the dence of laws 101(10A)(B). income under also States”); Nat’l Bank United United States Inc., Oregon Indep. Agents Am. Ins. parly majority agrees, and neither con- 1. The 439, 448, L.Ed.2d 113 S.Ct. tests, procedural require- temporary (1993). ments set forth in Pub.L. No. 109-8 *11 H35 jurisdictional imperative, paus- gress expressly it is worth incorporated various of Rule by reference, 5’s subdivisions any ing respecting Congress’s to note differently. mandates the nature and content of about simply not a mat- Section 158 Second, 2 even Rule did imbue us with following

ter of “form for its esthetics”— authority Congress’s statute, to revise instead, Congress’s mandates servе a sub- empower still would not us to excuse the Blauseys’s function, procedural ensuring stantive default. Rule 2 au- departures thorizes from the Federal “designed whose contents are to answer Appellate Rules of Procedure when “good question of whether an ... shown, 26(b)(1) cause” is but Rule trumps materially will ... litigation.” advance the 2 Rule when it comes to extensions of Services, Inc., Aucoin v. Matador 749 F.2d time, providing “may that we not extend (5th Cir.1985) 1180, (Higginbotham, 1181 the time to file ... a petition permis- J.). A notice of appeal, bare like the one appeal.” 26(b)(1); sion to Fed.R.App.P. by Blauseys, surely “expresses an (“[A] see also 2 Fed.R.App.P. ap- court of appellant’s ruling wish for such a but it peals may ... suspend any provision of because,” misfires function unlike a stat- these rules ... except as рrovid- otherwise utorily compliant petition, “it does not 26(b).”). ed in Rule And an extension of timely inform the court in appellate a man- time to functionally file is what the Blau- ner which allows it promptly respond.” seys seek Blauseys from us. The ask us to Id.2 treat their compliant petition, filed over three statutory deadline, months after the Blauseys’s 2 invocation of FRAP as if it had been filed within does not problem solve the for two inde- period, ground and do so on the they First, pendently compelling reasons. eoncededly filed a non-compliant notice of terms, its 2Rule states that the “court of appeal within that period. Every other appeals may expedite its decision or —to circuit to have request faced such a has good for other suspend any provi- cause— it, rejected however, recognizing that sion particular these rules in a case.” granting request such a would be the func- added). 2 Fed.R.App.P. (emphasis But in equivalent tional of affording impermis- an Congress the statute before us specifically sible extension of time. As the Eleventh incorporated select subdivisions of Rule 5 Circuit has explained materially identi- preconditions as for a petition, valid 28 circumstances, cal granting request such a 3, Note at 158 and whatever “would be too much of a stretch and would 2 authority provides Rule for overcoming purpose undermine both the of Rule 5 and rules, it authority does not imbue us with prohibition of Rule 26. A notice of suspend provisions Surely of a statute. appeal contains ... compo- none of the we would not be willing suspend 5(b)(1) required by nents Rule and does requirements of if Congress Rule 5 had permit an opposing answer from the them, word, copied word-for into the stat- 5(b)(2).” party contemplated in Rule ute. apparent offer us no Healthcare, Drug, Main Inc. v. Aetna U.S. (11th statute, Inc., Cir.2007).3 reason to treat our in which Con- 475 F.3d Lake, Aparicio (cit- proceed interlocutory appeal”) See also v. Swan 643 F.2d with the (5th Cir.1981) (stating, 205.03(2), ing in the con- 9 Moore's Federal Practice P at (2d interlocutory ap- ed.1980)). text of 28 U.S.C. 5-9 peals, "ten-day period that Rule 5's limitation largely Crystal functions to assure that the district 3. See Clear also Comm. Southwest Bell, (10th Cir.2005); certify court will exercise its discretion to ern 415 F.3d Wecht, contemporaneously Allegheny County ... with this Inmates Jail v. Aucoin, (3rd 1989); discretionary grant court's 873 F.2d Cir. *12 Amalgamated unique of considerations simply a matter this rеsult Neither cases like pertains to routine circuit law. court faced widespread ‍​​‌‌‌​‌‌‌​​‌​‌​​‌​​‌​​​‌​‌‌​​​​‌‌‌‌​​​​‌‌​​‌​​​​‍common sense Co., files a notice appellant one Scavenger 487 this where v. Oakland In Torres required than Rule 5 2405, appeal of rather 101 L.Ed.2d 285 312, 108 S.Ct. starters, unlike in the CAFA petition. For held that Rule (1988), Court Supreme context, could not have been Congress a courts to correct permit 2 did not that Rule in 28 U.S.C. 158 Note appeal of clearer a notice party’s clerical error any 158 for applies to Section accidentally forgotten party by adding Next, time-limi- appeal. Using permission appeal elapsed. after the time for held, in the statute has not been tation set forth would way, 2 in this the Court Rule Finally, the Blau- modified the court. “[p]er mandatory time limits: “vitiate[]” us with no reason whatsoever seys provide over mitting courts to exercise Rule comply failure to with filing explain after the time for parties unnamed good anything approaching equivalent to 5—let alone passed has appeal notice of it, any timely they As would have the time for cause. courts to extend permitting substitute for appeal filed notice of will appeal. Because filing a notice of 5-compliant petition. See also 16A courts the latter Rule grant not Rules do Wright, Arthur R. Miller & Alan that the Rules likewise Charles power, we hold 315, 108 Cooper, H. Federal Practice Id. at S.Ct. Edward the former.” withhold (4th ed.2008) (explaining Procedure Exactly might the same be said 2405. treating of the notice approach 2 in that “[t]he Rule the manner employing here: as a Blauseys would vitiate the urged by the ... Amalgamated is one appeal [in ] time lim mandatory nature of the statute’s rejected by courts in other has been other of Rule 26. its and do so defiance litigants contexts and that should Union Local Amalgamated Transit cases”). upon in future count Serv., Transit v. Laidlaw AFL-CIO (9th Cir.2006), scope to narrow the Inc., does not The court seeks F.3d 1140 by stressing its view that Amalgamated, ruling this its result. alter this Blauseys “good Rule 2’s cause” only Rule 5 have met compliance with court excused “our dock- requirement court[] the stat because the court had “construed because Maj. appeal.” Op. ... at 1130- Fairness Act et[ed] ute Class Action [the (“CAFA”) no But the themselves make procedural frame require to ] argument along good these lines—and for readily apparent from the work that is not of the clerk’s office legislative history, and reason. decision statutory text or its this panel accept or a motions deadline changed ha[d] the Blau- bearing has no on the cause of opposite to the what seeking to says.” seys’s comply failure to with Section 158. language of the statute plain Neither, course, the decisions of the unusual cir do Id. at 1146. In these most panel excuse us cumstances, compliance clerk’s office or motions the court excused our au- considering independently unfair avoid the serious “[t]o with Rule 5 (as case, where thority especially to hear a process due violation potential ness and here) authority challenged. has been applying holdings our to this case Indeed, that a decision of long it is settled at 1146-47. None of the might raise.” Id. 1181; Cooper, Federal Practice Corp., Miller & Edward H. F.2d at In re La Providencia Dev. Cir.1975); (1st ed.2008) (4th Hanson v. (noting 515 F.2d 95-96 and Procedure Co., (8th F.2d 71-72 Cir. Hunt Oil circuits). widespread agreement among 1973); Wright, Alan Arthur R. 16A Charles panel Corporation, a motions does not control a subse Taco Bell Plaintiff- panel Appellant, or us of the quent merits absolve authority proceed. need to assess our Co., See Morrison-Knudsen Inc. v. CHG Chiat/Day Inc., TBWA Defendant- (9th Int’l, Inc., 811 F.2d Cir. Appellee. *13 1987) (“A panel previ motions of this court ously jurisdiction ruled that had 07-56532, Nos. 08-55441. however, agree, here.... cannot We United Appeals, States Court of are to note a in appellate bound defect Ninth Circuit. cert, appears.”), whenever one dismissed sub nom. Federal Sav. & Loan Argued and Submitted Dec. 2008. Assoc., Corp. Ins. v. Stevenson 488 U.S. Filed Jan. 2009. (1988). 109 S.Ct. 102 L.Ed.2d 349 The court’s reluctance to shift the ‍​​‌‌‌​‌‌‌​​‌​‌​​‌​​‌​​​‌​‌‌​​​​‌‌‌‌​​​​‌‌​​‌​​​​‍course understandable, yet

of this appellant

under its rule an who files statutory period,

notice 5-compliant petition,

rather than a Rule procedurally hearing. barred from a

Bowles does not authorize this Nor result. problem

does Rule allow it. The

Supreme Court and our sister circuits have

foreseen has materialized here: a manda

tory effectively limit has been “vitiated.”

I respectfully dissent. F.Supp.2d See also 51 CORPORATION, BELL

TACO Plaintiff-Appellant, INC., Erroneously

TBWA CHIAT/DAY Inc.,

Sued TBWA Worldwide

Defendant-Appellee.

Case Details

Case Name: Blausey v. U.S. Trustee
Court Name: Court of Appeals for the Ninth Circuit
Date Published: Jan 23, 2009
Citation: 552 F.3d 1124
Docket Number: 07-15955
Court Abbreviation: 9th Cir.
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