united states bankruptcy court central district of...

United States Bankruptcy CourtCentral District of California

Judge Neil Bason, PresidingCourtroom 1545 Calendar

Los Angeles

Tuesday, September 29, 2020 1545 Hearing Room

10:00 AMWilliam Salvatore Weber2:19-14247 Chapter 13

#1.00 Hrg re: Motion for relief from stay [RP]

REVERSE MORTGAGE SOLUTIONS, INC.vsDEBTOR

39Docket

Grant as set forth below. Appearances are not required.

Proposed order: Movant is directed to lodge a proposed order via LOU within 7 days after the hearing date. See LBR 9021-1(b)(1)(B).

TerminationTerminate the automatic stay under 11 U.S.C. 362(d)(1).To the extent, if any, that the motion seeks to terminate the automatic

stay in other past or pending bankruptcy cases, such relief is denied on the present record. See In re Ervin (Case No. 14-bk-18204-NB, docket no. 311).

Effective date of reliefDeny the request to waive the 14-day stay provided by FRBP 4001(a)

(3) for lack of sufficient cause shown.

Co-debtor stayAny co-debtor stay (11 U.S.C. 1301(c)) has not been shown to have

any basis for any different treatment from the stay under 11 U.S.C. 362(a), so the tentative ruling is to grant the identical relief regarding any co-debtor stay.

If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are

Tentative Ruling:

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10:00 AMWilliam Salvatore WeberCONT... Chapter 13

appropriate for disposition at this hearing. Pursuant to Judge Bason's COVID-19 procedures, all appearances are telephonic via CourtCall at (888) 882-6878.

Party Information

Debtor(s):

William Salvatore Weber Represented ByEric Bensamochan

Movant(s):

REVERSE MORTGAGE Represented BySean C Ferry

Trustee(s):

Kathy A Dockery (TR) Pro Se

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10:00 AMBianca Marie Aranda2:19-16545 Chapter 13


PENNYMAC LOAN SERVICES, LLCvsDEBTOR

52Docket

Appearances required.

There is no tentative ruling, but the parties should be prepared to address (a) whether the alleged arrears have been brought current and/or (b) whether they will agree to the terms of an adequate protection order (see the debtor's response, dkt. 54).

If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing. Pursuant to Judge Bason's COVID-19 procedures, all appearances are telephonic via CourtCall at (888) 882-6878.

Tentative Ruling:

Party Information

Debtor(s):

Bianca Marie Aranda Represented ByWilliam G Cort

Movant(s):

PennyMac Loan Services, LLC Represented ByMegan E LeesRobert P Zahradka

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10:00 AMBianca Marie ArandaCONT... Chapter 13

Christina J KhilJosephine E Salmon

Trustee(s):


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10:00 AMRamon Joel Dominguez2:19-20379 Chapter 13


CALIBER HOME LOANS, INC.vsDEBTOR

48Docket


Proposed order: Movant is directed to lodge a proposed order via LOU within

7 days after the hearing date. See LBR 9021-1(b)(1)(B).








Tentative Ruling:

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10:00 AMRamon Joel DominguezCONT... Chapter 13


Party Information

Debtor(s):

Ramon Joel Dominguez Represented ByGuy R Bayley

Movant(s):

Caliber Home Loans, Inc. Represented ByCassandra J RicheyJennifer C Wong

Trustee(s):


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10:00 AMWilliam Harris Treadway2:20-11722 Chapter 13


REVERSE MORTGAGE FUNDING LLCvsDEBTOR

30Docket










Tentative Ruling:

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10:00 AMWilliam Harris TreadwayCONT... Chapter 13


Party Information

Debtor(s):

William Harris Treadway Represented BySam Benevento

Movant(s):

Reverse Mortgage Funding LLC Represented ByMerdaud JafarniaJennifer C Wong

Trustee(s):


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10:00 AMHideko Charlene Zuniga2:20-15858 Chapter 13


WAYNE C ROWELL, TRUSEE OF THE WAYNEC ROWELL REVOCABLE TRUST vsDEBTOR

21Docket




Tentative Ruling:

Party Information

Debtor(s):

Hideko Charlene Zuniga Represented ByBrad Weil

Movant(s):

Wayne C Rowell, Trustee of the Represented ByJulian K Bach

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10:00 AMHideko Charlene ZunigaCONT... Chapter 13

Trustee(s):


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10:00 AMBrenda Kay Turner2:18-23757 Chapter 13

#6.00 Hrg re: Motion for relief from stay [PP]

WELLS FARGO BANK, NAvsDEBTOR

66Docket




Tentative Ruling:

Party Information

Debtor(s):

Brenda Kay Turner Represented ByBarry E Borowitz

Movant(s):

Wells Fargo Bank, N.A., d/b/a Wells Represented ByJosephine E Salmon

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10:00 AMBrenda Kay TurnerCONT... Chapter 13

Trustee(s):


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10:00 AMSteven M. Martinez and Lorraine Martinez2:20-13997 Chapter 13

#7.00 Hrg re: Motion for relief from stay [PP]

CAB WEST, LLCvsDEBTOR

24Docket



TerminationTerminate the automatic stay under 11 U.S.C. 362(d)(1). To the extent, if any, that the motion seeks to terminate the automatic


Effective date of reliefGrant the request to waive the 14-day stay provided by FRBP 4001(a)

(3).




Tentative Ruling:

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10:00 AMSteven M. Martinez and Lorraine MartinezCONT... Chapter 13


Party Information

Debtor(s):

Steven M. Martinez Represented ByTom A Moore

Joint Debtor(s):

Lorraine Martinez Represented ByTom A Moore

Movant(s):

Cab West, LLC Represented BySheryl K Ith

Trustee(s):


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10:00 AMTea Station Investment Inc.2:20-14175 Chapter 11

#8.00 Cont'd hrg re: Motion for relief from stay [UD]fr. 7/7/20, 8/18/20

SUN RICH DEVELOPMENT I, LLCvsDEBTOR

10Docket *** VACATED *** REASON: This matter is scheduled to be heard at a different time. See # 18 at 1:00 p.m.

Tentative Ruling:

Party Information

Debtor(s):

Tea Station Investment Inc. Represented ByLeslie A Cohen

Movant(s):

Sun Rich Development I, LLC Represented ByDavid Brian Lally

Trustee(s):

John-Patrick McGinnis Fritz (TR) Pro Se

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10:00 AMRene E Quintanilla and Lidia D Sanchez2:18-19277 Chapter 13

#9.00 Cont'd hrg re: Motion for relief from stay [PP]fr. 9/1/20

TOYOTA MOTOR CREDIT CORPORATIONvsDEBTOR

28Docket

Tentative Ruling for 9/29/20:Appearances required.

This matter was continued at Movant's request to allow time for it to review its accounting. There is no tentative ruling, but the parties should be prepared to address (a) whether the alleged arrears have been brought current and/or (b) whether they will agree to the terms of an adequate protection order (see the debtor's response, dkt. 30).



Pursuant to Judge Bason's COVID19 Procedures, ONLY TELEPHONIC APPEARANCES WILL BE PERMITTED until further notice. Please contact CourtCall at (888) 882-6878 to make arrangements for any telephonic

Tentative Ruling:

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10:00 AMRene E Quintanilla and Lidia D SanchezCONT... Chapter 13

appearance. There is no need to contact the Court for permission. Parties who are not represented by an attorney will be able to use CourtCall for free through 9/30/20. Attorneys will receive a 25% discount (for more information, see www.cacb.uscourts.gov, "Judges," "Bason, N.," "Telephonic Instructions").


If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear telephonically without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.

Party Information

Debtor(s):

Rene E Quintanilla Represented ByDaniela P Romero

Joint Debtor(s):

Lidia D Sanchez Represented ByDaniela P Romero

Movant(s):

Toyota Motor Credit Corporation Represented ByAustin P NagelKirsten Martinez

Trustee(s):


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10:00 AMBryan C Woods and Donna P Woods2:19-17441 Chapter 13

#10.00 Cont'd hrg re: Motion for relief from stay [RP]fr. 5/12/20, 6/16/20, 9/1/20

WILMINGTON SAVINGS FUND SOCIETY, FSBvsDEBTOR

31Docket


This matter was continued to this date to allow time to determine the status of any loan modification negotiations with Debtor. There is no tentative ruling, but the parties should be prepared to provide an update on the status of those investigations.



Pursuant to Judge Bason's COVID19 Procedures, ONLY TELEPHONIC APPEARANCES WILL BE PERMITTED until further notice. Please contact CourtCall at (888) 882-6878 to make arrangements for any telephonic appearance. There is no need to contact the Court for permission. Parties

Tentative Ruling:

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10:00 AMBryan C Woods and Donna P WoodsCONT... Chapter 13

who are not represented by an attorney will be able to use CourtCall for free through 9/30/20. Attorneys will receive a 25% discount (for more information, see www.cacb.uscourts.gov, "Judges," "Bason, N.," "Telephonic Instructions").

At the 6/16/20 hearing, this Court stated that it would take up the issue of an adequate protection order at this continued hearing. There is no tentative ruling, but the parties should be prepared to address whether they will agree to the terms of an adequate protection order.


Tentative Ruling for 6/16/20:Continue this hearing to 8/24/20 at 10:00 a.m., in view of the three month

forbearance agreement (see dkt. 35). Appearances are not required on

6/16/20.

Pursuant to Judge Bason's COVID19 Procedures, ONLY TELEPHONIC APPEARANCES WILL BE PERMITTED until further notice. Please contact CourtCall at (888) 882-6878 to make arrangements for any telephonic appearance. There is no need to contact the Court for permission. Parties who are not represented by an attorney will be able to use CourtCall for free through 6/30/20. Attorneys will receive a 25% discount (for more information, see www.cacb.uscourts.gov, "Judges," "Bason, N.," "Telephonic Instructions").

If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear telephonically without adequately

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10:00 AMBryan C Woods and Donna P WoodsCONT... Chapter 13

resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.

Party Information

Debtor(s):

Bryan C Woods Pro Se

Joint Debtor(s):

Donna P Woods Pro Se

Movant(s):

Wilmington Savings Fund Society, Represented ByNichole GlowinArnold L Graff

Trustee(s):


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10:00 AMJoyce Elaine Durden2:19-22055 Chapter 13

#11.00 Cont'd hrg re: Motion for relief from stay [RP]fr. 7/28/20, 91/20

REVERSE MORTGAGE FUNDING, LLCvsDEBTOR

34Docket *** VACATED *** REASON: APO

Tentative Ruling:

Party Information

Debtor(s):

Joyce Elaine Durden Represented ByThomas B Ure

Movant(s):

Reverse Mortgage Funding LLC Represented ByJosephine E Salmon

Trustee(s):


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11:00 AMCristina Magana2:18-11536 Chapter 7

#1.00 Hrg re: Chapter 7 Trustee's Motion for Authority to Ratifythe Previous Compromise of Personal Injury Action and for Disposition of Proceeds, Including Payment of ContingencyAttorneys Fees and Costs

49Docket

Grant. Appearances are not required.



Tentative Ruling:

Party Information

Debtor(s):

Cristina Magana Represented ByPeter L Nisson - SUSPENDED BK -

Trustee(s):

Sam S Leslie (TR) Represented ByCarolyn A Dye

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11:00 AMLake Mathews Mineral Properties, LTD2:16-16363 Chapter 7

Merritt, an individual v. PECAS LLC, a Delaware Limited Liability Adv#: 2:20-01160

#2.00 Status conference re: Complaint for 1) Declaratory reliefto quiet title; 2) Violation of California Business and professions code section 17200 for an unlawful businesspractice 3) Actual fraudulent transfer

1Docket *** VACATED *** REASON: Continued to 3/23/21 at 11:00 a.m. (adv. dkt. 6)

- NONE LISTED -

Tentative Ruling:

Party Information

Debtor(s):

Lake Mathews Mineral Properties, Represented ByMichael Jay BergerCassandra J RicheyShirley Smith - SUSPENDED -

Defendant(s):

PECAS LLC, a Delaware Limited Pro Se

Chabad Temple Inc Pro Se

Plaintiff(s):

Paul Merritt, an individual Pro Se

Trustee(s):

Elissa Miller (TR) Represented ByFranklin C AdamsJuliet Y Oh

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11:00 AMChristian Rossil2:19-10153 Chapter 7

Rossil v. Ruan Partida et alAdv#: 2:19-01138

#3.00 Hrg re: Defendant Sergio Salgado's motionto dismiss regarding lack of prosecutionpursuant to FRCP 41(b) and FRBP 7041

29Docket

Please see the tentative ruling for the adversary status conference (Calendar No. 4, 9/29/20 at 11:00 a.m.).

Tentative Ruling:

Party Information

Debtor(s):

Christian Rossil Represented ByTodd B Becker

Defendant(s):

Daniel Ruan Partida Represented ByLazaro E Fernandez

Sergio Salgado Represented ByMichael F Chekian

Plaintiff(s):


Trustee(s):

David M Goodrich (TR) Pro Se

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11:00 AMChristian Rossil2:19-10153 Chapter 7

Rossil v. Ruan Partida et alAdv#: 2:19-01138

#4.00 Cont'd Status Conference re: Complaint for a Determination of the Validity, Priority or Extent of Liens and SecurityInterests fr. 07/30/19, 9/24/19, 12/17/19, 02/18/20, 3/3/20, 4/21/20

1Docket

Tentative Ruling for 9/29/20:Grant Defendant's motion to dismiss (adv. dkt. 29) for the reasons stated therein. Appearances are not required.

Proposed Order: Defendant is directed to lodge a proposed order via LOU within 7 days after the hearing date. See LBR 9021-1(b)(1)(B).


Tentative Ruling for 4/21/20:Appearances required, but pursuant to Judge Bason's COVID19 Procedures, telephonic appearances are REQUIRED until further notice.

Please contact CourtCall at (888) 882-6878 to make arrangements for any telephonic appearance. There is no need to contact the Court for permission. Parties who are not represented by an attorney will be able to use CourtCall for free through 4/30/20. Attorneys will receive a 25% discount (for more information, see www.cacb.uscourts.gov, "Judges," "Bason, N.," "Telephonic

Tentative Ruling:

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11:00 AMChristian RossilCONT... Chapter 7

Instructions").

This Court has reviewed the parties' joint status report (adv.dkt. 18) and the other filed documents and records in this adversary proceeding.

(B) Standard requirementsThe following are Judge Bason's standard requirements for status

conferences. (To the extent that the parties have already addressed these issues in their status report, they need not repeat their positions at the status conference.)

(1) Venue/jurisdiction/authorityMatters of venue, jurisdiction, and authority have been determined

and/or waived or forfeited (docket number 18).

(2) MediationIs there is any reason why this Court should not order the non-settling

parties (i.e. Plaintiff/Trustee and Defendant Salgado) to mediation before one of the volunteer mediators (not a Bankruptcy Judge), and meanwhile set the deadlines set forth below? The tentative ruling is to set a deadline of 5/5/20for the parties to lodge a proposed mediation order (the parties are directed to use the time between now and that deadline to find a mutually agreeable mediator whose schedule can accommodate the needs of this matter; and if the parties cannot even agree on a mediator they may lodge separate orders and Judge Bason will chose among them, or issue his own order).

(3) DeadlinesThis adversary proceeding has been pending since 5/10/19. Pursuant

to LBR 9021-1(b)(1)(B), plaintiff is directed to lodge a proposed order via LOU within 7 days after the status conference, attaching a copy of this tentative ruling or otherwise memorializing the following.

Joinder of parties/amendment of pleadings: 7/17/20 deadline. Discovery cutoff (for completion of discovery): 7/31/20.Expert(s) - deadline for reports: 8/7/20.Expert(s) - discovery cutoff (if different from above): 8/14/20.Dispositive motions to be heard no later than: 9/29/20 at 11:00 a.m.Joint Status Report: 9/14/20.

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11:00 AMChristian RossilCONT... Chapter 7Continued status conference: 9/29/20 at 11:00 a.m.Lodge Joint Proposed Pre-Trial Order: 10/27/20.Pretrial conference: 11/10/20 at 2:00 p.m.Deliver trial exhibits to other parties and chambers (2 copies to

chambers), including direct testimony by declaration unless excused: 11/10/20 (for the format of exhibits and other trial procedures, please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "Trial Practice")

Trial commencement: 11/17/20 at 9:00 a.m.

If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.

[PRIOR TENTATIVE RULINGS OMITTED]

Party Information

Debtor(s):


Defendant(s):

Daniel Ruan Partida Represented ByLazaro E Fernandez

Sergio Salgado Pro Se

Plaintiff(s):


Trustee(s):

David M Goodrich (TR) Pro Se

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11:00 AMChristian RossilCONT... Chapter 7

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11:00 AMZeta Graff2:19-14137 Chapter 7

Vaatete v. GraffAdv#: 2:19-01218

#5.00 Cont'd Status Conference re: Complaint to Determine Non-Dischargeability of Debt Pursuant to 11 U.S.C. Section 523(a)(6) and 11 U.S.C. Section 727(c)fr. 9/24/19, 11/12/19, 12/17/19, 1/14/20, 02/18/20, 4/7/20, 6/30/20

1Docket

Tentative Ruling for 9/29/20:Continue as set forth below, in view of Plaintiff's status report (adv.dkt.39). Appearances are not required on 9/29/20.

(A) Current issuesThis Court has no issues to raise sua sponte.

(B) Standard requirementsThe following are Judge Bason's standard requirements for status

conferences. (To the extent that the parties have already addressed these issues in their status report, they need not repeat their positions at the status conference.)

(1) Venue/jurisdiction/authorityMatters of venue, jurisdiction, and authority have been determined

and/or waived or forfeited (adv. dkt. 11).

(2) Mediation [Intentionally omitted]

(3) DeadlinesThis adversary proceeding has been pending since 7/12/19. Joinder of parties/amendment of pleadings: N/ADiscovery cutoff (for completion of discovery): N/AExpert(s) - deadline for reports: N/AExpert(s) - discovery cutoff (if different from above): N/A Dispositive motions to be heard no later than: N/A

Tentative Ruling:

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11:00 AMZeta GraffCONT... Chapter 7Joint Status Report: 1/12/21Continued status conference: 1/26/21 at 11:00 a.m.Lodge Joint Proposed Pre-Trial Order: N/APretrial conference: N/ADeliver trial exhibits to other parties and chambers (2 copies to

chambers), including direct testimony by declaration unless excused: N/ATrial commencement: N/A



Party Information

Debtor(s):

Zeta Graff Represented ByMichael F Chekian

Defendant(s):

Zeta Graff Represented ByZachary D Schorr

Plaintiff(s):

Olivia Vaatete Represented ByScott D DinsmoreBrennan Mitch

Trustee(s):

Sam S Leslie (TR) Represented ByElissa Miller

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11:00 AMZeta GraffCONT... Chapter 7

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11:00 AMZeta Graff2:19-14137 Chapter 7

#6.00 Cont'd hrg re: Objection to Claim Number 5-1of Pensco Trust Companyfr. 5/5/20, 6/30/20

172Docket


On 7/2/20 this Court entered an order granting the motion of Pensco Trust Company ("Pensco") to compel arbitration to resolve Debtor's objection to its claim (dkt. 209). Pensco's status report (dkt. 270) states that (i) there has been no communication between Debtor and Pensco regarding arbitration and (ii) arbitration proceedings have not been instituted.

There is no tentative ruling, but Debtor should be prepared to address why this Court should not deny her objection to Pensco's proof of claim (dkt. 172) for lack of prosecution.



Tentative Ruling:

Party Information

Debtor(s):

Zeta Graff Represented ByMichael F Chekian

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11:00 AMZeta GraffCONT... Chapter 7

Trustee(s):

Sam S Leslie (TR) Represented ByElissa Miller

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1:00 PMUnified Protective Services, Inc.2:19-16482 Chapter 11

#1.00 Hrg re: Application for payment of interim feesand/or expenses for Jennifer M Liu, Accountant

195Docket

Please see the tentative ruling for the status conference (Calendar No. 3, 9/29/20 at 1:00 p.m.).

Tentative Ruling:

Party Information

Debtor(s):

Unified Protective Services, Inc. Represented ByMichael Jay Berger

Movant(s):

Jennifer M Liu Pro Se

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#2.00 Hrg re: Third Interim Application For Compensation andReimbursement Of Expenses Of Michael Jay Berger

193Docket


Tentative Ruling:

Party Information

Debtor(s):


Movant(s):


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#3.00 Cont'd Status Conference re: Chapter 11 Casefr. 7/2/19, 08/06/19, 8/20/19, 10/29/19, 12/10/19,12/17/19, 1/14/20, 2/4/20, 3/3/20, 6/2/20, 8/18/20

1Docket

Tentative Ruling for 9/29/20:Continue as set forth below. Appearances are not required on 9/29/20.

(1) Current issues(a) Jennifer M. Liu's application for payment of interim fees (dkt. 195),

no opposition is on fileThe tentative ruling is to grant the application and allow interim fees of

$13,650 and expenses of $360, for a total award of $14,010.

(b) Law Offices of Michael J. Berger's application for payment of interim fees (dkt. 193), no opposition is on file

The tentative ruling is to grant the application and allow interim fees of $25,971 and expenses of $601.75, for a total award of $26,572.75.

Proposed orders: Debtor is directed to lodge proposed orders on each of the foregoing motions via LOU within 7 days after the hearing date. See LBR 9021-1(b)(1)(B).

(2) Deadlines/dates. This case was filed on 6/1/19.(a) Bar date: 9/6/19 (timely served 7/18/19, dkt. 31, 32)(b) Procedures order: dkt. 3 (timely served 6/18/19, dkt. 16).(c) Plan/Disclosure Statement*: set for hearing 10/27/20 at 1:00 p.m.

(dkt.189).(d) Continued status conference: 10/27/20 at 1:00 p.m. No written

status report required.*Warning: special procedures apply (see order setting initial status conference).

Tentative Ruling:

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1:00 PMUnified Protective Services, Inc.CONT... Chapter 11



Party Information

Debtor(s):


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1:00 PMSchaefer Ambulance Service, Inc2:19-11809 Chapter 11

#4.00 Hrg re: Omnibus Objection to Claims for Amounts Inconsistent with the Debtor's Books and Records

Claim no Claimants

29 Andrew Batley Roman

33 Erica Lopez

35 Hector A. Meza

39 Derek Hughes

65 Joshua Paddock

66 Daniel McCarthy

103 Henry Mussenden

688Docket


Tentative Ruling:

Party Information

Debtor(s):

Schaefer Ambulance Service, Inc Represented ByCraig G MarguliesMonserrat Morales

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1:00 PMSchaefer Ambulance Service, IncCONT... Chapter 11

Movant(s):Schaefer Ambulance Service, Inc Represented By

Craig G MarguliesCraig G MarguliesCraig G MarguliesMonserrat MoralesMonserrat MoralesMonserrat Morales

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#5.00 Hrg re: Omnibus Objection to Duplicate Proofs of Claim

Claim No. Claimants

61 Angelina Diaz

9 David Jon Lundeen

43 Michael Mendez

40 Victor Sandoval

689Docket


Tentative Ruling:

Party Information

Debtor(s):


Movant(s):

Schaefer Ambulance Service, Inc Represented ByCraig G MarguliesCraig G MarguliesCraig G MarguliesMonserrat MoralesMonserrat MoralesMonserrat Morales

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#6.00 Cont'd Status Conference re: Post confirmationfr. 02/28/19, 03/12/19, 03/26/19, 04/09/19, 5/21/19,05/21/19, 06/04/19, 6/18/19, 7/30/19; 08/06/19, 8/20/19, 9/24/19, 10/15/19, 11/5/19, 12/10/19, 12/17/19,1/14/20, 1/28/20, 02/18/20, 3/10/20, 03/31/20, 4/21/20,5/2/20, 7/28/20

1Docket


(1) Current issues(a) Debtor’s objection to claims 29, 33, 25, 39, 65, 66 & 103 (dkt. 688)

and related notices (dkt. 690-696), no opposition is on fileThe tentative ruling is to grant the claim objection for the reasons

stated in the objection. Proposed order: Debtor is directed to lodge a proposed order via LOU

within 7 days after the hearing date. See LBR 9021-1(b)(1)(B).

(b) Debtor’s objection to claims 9, 40, 43, & 61 (dkt. 689) and related notices (dkt. 697-700), no opposition is on file

The tentative ruling is to grant the claim objection for the reasons stated in the objection.


(2) Deadlines/dates. This case was filed on 2/20/19. A Plan (dkt.562) was confirmed on 5/15/20 (dkt.630). A post-confirmation status conference presently is set for 11/20/20 at 1:00 p.m., with a brief status report due 10/27/20.

If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances

Tentative Ruling:

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1:00 PMSchaefer Ambulance Service, IncCONT... Chapter 11

required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing. Pursuant to Judge Bason's COVID-19 procedures, all appearances are telephonic via CourtCall at (888) 882-6878.


Party Information

Debtor(s):


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1:00 PMParvin Jamali2:20-12732 Chapter 11

#7.00 Hrg re: Motion to Be Relieved as General Insolvency Counselfor Debtor / Debtor-in-Possession

131Docket *** VACATED *** REASON: Withdrawn (dkt. 145)

- NONE LISTED -

Tentative Ruling:

Party Information

Debtor(s):

Parvin Jamali Represented ByYevgeniya LisitsaW. Derek May

Movant(s):


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#8.00 Hrg re: Application by debtor and debtor in possession to employ Joshua Barre' and Westside Property Management,Inc as property managers for estate property

117Docket


Tentative Ruling:

Party Information

Debtor(s):


Movant(s):


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#9.00 Order to Show Cause re: Why This Case Should Not Be Dismissed With a Bar to Being a Debtor in Bankruptcy,Converted to Chapter 7, or Other Remedies Imposed

133Docket

Please see the tentative ruling for the Status Conference (Calendar No. 10, 9/29/20 at 1:00 p.m.).

Tentative Ruling:

Party Information

Debtor(s):


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#10.00 Cont'd Status Conference re: Chapter 11 Casefr. 4/7/20, 5/5/20, 5/12/20, 6/2/20, 7/28/20, 9/1/20

6Docket

Tentative Ruling for 9/29/20:Appearances are not required.

(1) Current issues(a) Order to show cause ("OSC") re dismissal with a bar, or conversion

to chapter 7, or other remedies (dkt. 133); response of the United States Trustee ("UST") (dkt. 144); response by Debtor (dkt. 146) [and additional, untimely responses, dkt.154, 157]

The tentative ruling - for the reasons stated in the OSC, the UST's response, the Procedures Order (dkt.10, 22), and in this tentative ruling - is to convert this case to chapter 7 so that the chapter 7 trustee can explore whether to (i) sell the subject property for its highest and best price, presumably with an agreed carve-out for professional fees, (ii) sell/settle the bankruptcy estate's claims against U.S. Bank, if appropriate, (iii) abandon the estate's assets to Debtor, or (iv) take other appropriate action. Alternatively, the tentative ruling is to dismiss this case, and impose a bar under 11 U.S.C. 109(g)(1) for willful failure to appear in proper prosecution of this bankruptcy case.

This Court recognizes that Debtor and her family are in an awful situation: they face the likelihood of losing their rental property through foreclosure, after a series of failures in the State Courts, while also apparently facing medical calamities and other dire circumstances. This is tragic for Debtor, and similar circumstances all too familiar in bankruptcy cases.

But Debtor has not prosecuted this bankruptcy case in any way that would lead to a realistic, good faith use of the bankruptcy system. Even at this late stage, she continues to press highly unrealistic strategies.

Debtor suggests that she may seek to employ a broker "to see if the Subject Property can be sold and the proceeds used to fund a [chapter 11] Plan" (dkt.146, p.3:23-25) (emphasis added), which might provide an

Tentative Ruling:

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1:00 PMParvin JamaliCONT... Chapter 11

"increased [sic] payout to the unsecured creditors" (id., p.3:16-17) (emphasis added), who "mainly" include (apart from possibly underwater junior lienholders) "attorneys that worked on the state court matters over the past several years and creditors related to maintenance of the Debtor’s primary asset [the subject rental property]." Id., p.2:8-11. This outline of a chapter 11 plan is nothing but wishful thinking.

Selling property that is underwater will not generate any "proceeds" to "fund" a plan; and as the UST points out Debtor is losing a substantial amount of money every month, so there is no apparent source for anypayment to unsecured creditors, let alone any "increased" payments.

True, Debtor hopes that, despite a string of losses in the State Courts, she might be able to pull a rabbit out of a hat by raising a new theory. But, first, Debtor cannot simply ignore the disputed lien meanwhile, and use the proceeds from selling the property to "fund" a chapter 11 plan. At best, any disputed proceeds would have to be held in a disputed claims reserve.

Second, on this record this Bankruptcy Court can only conclude that Debtor's hope of any recovery on her claims against the lienholder is a highly unlikely outcome. Debtor's claims are not a basis on which to "park" in bankruptcy, and gain the benefits of the automatic stay, despite ongoing and substantial financial losses.

Debtor's new theory, as this Bankruptcy Court understands it, is that the meets and bounds description in the deed of trust of senior lienholder U.S. Bank was not simply negligently omitted or misstated but was fraudulently altered, and that this alleged alteration would void the lien. This new theory appears very unlikely to succeed for two reasons.

First, based on what has been described to this Court, the Superior Court's reasoning was that anything to do with the meets and bounds description was immaterial. The rest of the loan documents apparently made it clear what property the parties meant to encumber, and the funds were advanced and used by Debtor, so (the Superior Court apparently ruled) there is no cognizable harm or claim. See, e.g., MTC Fin. v. Cal. Dept. of Tax & Fee Admin., 41 Cal.App.5th 742, 747 (2019) ("To be sufficient the description must be such that the land can be identified or located on the ground by use of the same.") (citation and internal quotation marks omitted; emphasis added).

Second, assuming solely for the sake of discussion that Debtor's new theory might have persuaded the Superior Court to reach a different

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conclusion if that argument had been raised sooner, the problem remains that Debtor's new theory almost certainly will be precluded at this late stage. This Court takes judicial notice that Debtor's counsel admits Debtor's fear that the California Court of Appeal will bar Debtor from raising this new theory based on "collateral estoppel or res judicata," and will only accept new theories if they are based on "facts that have come to light after the [State Court's] order [sustaining the demurrer] was issued." See Shemtoub Decl. (included in dkt.147), p.4:1-10 (PDF p.13) (emphasis added).

This Court also takes judicial notice that Debtor's counsel admits that this was the reason to recommend proceeding in this Bankruptcy Court rather than before the California Courts. Id. See also Claim Obj. (dkt.139), p.4:8-11. Although Debtor's counsel vehemently denies forum shopping, the tentative ruling is that this is the very definition of forum shopping.

To be clear, this Bankruptcy Court is not actually deciding any of the issues being litigated in State Court. To the contrary, as Debtor notes, this Court has already ruled that the Rooker-Feldman doctrine prevents this Bankruptcy Court from reviewing the State Court's rulings. The point is only that, for bankruptcy purposes, the preponderance of the evidence (indeed, the clear and convincing evidence) is that Debtor lacks "a reasonable likelihood of rehabilitation" and there is a "substantial" and "continuing" loss to or diminution of the estate (the statute requires only that the loss or diminution be one or the other - either substantial or continuing - and both are established in this case). 11 U.S.C. 1112(b)(4)(A) (emphasis added).

For all of these reasons, the tentative ruling is that dismissal or conversion is appropriate under 11 U.S.C. 1112. The tentative ruling is that conversion to chapter 7 is the most appropriate disposition, because a chapter 7 trustee can prosecute this case in the ways that Debtor has failed to do and shows no signs of being willing to do, and alternatively the chapter 7 trustee can abandon the assets of the estate and leave Debtor and all creditors to their remedies outside of bankruptcy.

Finally, the tentative ruling is that the history of this case establishes that Debtor has willfully failed to appear in proper prosecution of this case within the meaning of 11 U.S.C. 109(g)(1). Therefore, if this case were to be dismissed (rather than converted), it would be appropriate to impose a 180-day bar against being a debtor in any future bankruptcy case.

In sum, although this Court recognizes how awful it is for anyone to lose their assets, that does not justify a misuse of the bankruptcy system.

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Debtor cannot gain the benefits of the automatic stay while incurring substantial and continuing lossess without any reasonable likelihood of rehabilitation.

Supplemental tentative ruling regarding untimely responses to OSC:The tentative ruling is to strike the untimely responses to the OSC filed

by U.S. Bank (dkt.154) and alleged secured creditor Natasha Espinal (dkt.157). Alternatively, the tentative ruling is that those responses only reinforce this Court's tentative ruling set forth above.

U.S. Bank points out that, just like Debtor's claims, Ms. Espinal's claims are the subject of a pending action in State Court. Dkt.154, pp.2:24-3:2. That reinforces this Bankruptcy Court's conclusion that the parties' disputes are properly determined in State Court.

Ms. Espinal asserts in her conclusion that the "issue before the Court is a core issue and not beholden to the bar of Rooker Feldman." [Dkt.157, p.12:5-7] She offers no analysis or citation to authority, and her bare assertion is not persuasive.

U.S. Bank also reiterates:Although the USB DoT lacks a legal description, it nevertheless contains the correct common street address and correct Assessor's Parcel No. ("APN") for the Subject Property. (RJN ¶ 1). [U.S. Bank Response to OSC (dkt.154), p.3:25-27 (citing RJN in Adv. No. 2:20-ap-01068-NB, dkt.5)]

Throughout this bankruptcy case, nobody has disputed these assertions. This Bankruptcy Court has also verified that the Deed of Trust includes, as part of the property description, an APN (5561-007-032) and a current property address of "9219 Robin Dr., Los Angeles, California 90069" (capitalization omitted). RJN (Adv. No. 2:20-ap-01068-NB, dkt.5) p.9 (Ex.A to RJN). The street address matches the one asserted by Ms. Espinal. Seedkt.157, p.13:9-10.

Under the authority cited by Debtor and Ms. Espinal themselves, this appears to be more than sufficient. "To be sufficient the description must be such that the land can be identified or located on the ground by use of the same." MTC Fin. v. Cal. Dept. of Tax & Fee Admin., 41 Cal.App.5th 742, 747 (2019) (citation and internal quotation marks omitted; emphasis added). Similarly, the California Evidence Code provides:

The party producing a writing as genuine which has been altered,

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or appears to have been altered, after its execution, in a part material to the question in dispute, must account for the alteration or appearance thereof. He may show that the alteration was made by another, without his concurrence, or was made with the consent of the parties affected by it, or otherwise properly or innocently made, or that the alteration did not change the meaning or language of the instrument. If he does that, he may give the writing in evidence, but not otherwise. [Cal. Evid. Code § 1402 (quoted in Espinal Reply (dkt.157, p.8:8-14)) (emphasis added).]

The tentative ruling is that arguments by Debtor and Ms. Espinal are entirely without merit, and that even if they had some remote chance of success that would be an insufficient basis on which to "park" in bankruptcy while attempting to litigate their claims. The supplemental papers only reinforce the conclusion that this case must be converted to chapter 7 or dismissed with a 180-day bar.

(b) Application to employ Joshua Barre and Westside Property Management, Inc. (dkt. 117, the "Management Application"), Order setting hearing (dkt. 135)

The tentative ruling is to deny the Management Application in view of the foregoing tentative ruling to convert this case to chapter 7 (or, alternatively, dismiss this case).

(c) Application to employ Law Offices of W. Derek May (dkt. 143)The tentative ruling is to deny this employment application in view of

the foregoing tentative ruling to convert this case to chapter 7 (or, alternatively, dismiss this case).

Proposed orders: The UST is requested to lodge proposed orders on each of the foregoing motions via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling to the proposed order on the OSC, thereby adopting it as this Court's final ruling, subject to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).

(2) Deadlines/dates. This case was filed on 3/9/20.(a) Bar date: 6/15/20 (timely served, dkt. 68).

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1:00 PMParvin JamaliCONT... Chapter 11(b) Procedures order: dkt. 10 (timely served, dkt. 22)(c) Plan/Disclosure Statement*: N/A.(d) Continued status conference: N/A.*Warning: special procedures apply (see order setting initial status

conference).



Party Information

Debtor(s):


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1:00 PMTatung Company of America, Inc.2:19-21521 Chapter 11

#11.00 Hrg re: Application of Debtor and Debtor In PossessionTo Employ Law Office of David Agler As Special Tax Counsel

363Docket


Tentative Ruling:

Party Information

Debtor(s):

Tatung Company of America, Inc. Represented ByRon BenderLindsey L SmithJuliet Y Oh

Movant(s):


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1:00 PMTatung Company of America, Inc.2:19-21521 Chapter 11

#12.00 Cont'd Status Conference re: Chapter 11 Case fr. 10/2/19, 10/15/19, 10/29/19, 11/5/19, 12/10/19,12/17/19, 01/07/20, 1/14/20, 02/18/20, 4/21/20,6/2/20, 6/16/20, 7/7/20, 8/18/20, 9/1/20

1Docket

Tentative Ruling for 9/29/20:Appearances are not required on 9/29/20.

(1) Current issues(a) Application to employ Law Offices of David Agler as special tax

counsel (dkt. 363, the "Application"), statement of disinterestedness (dkt. 365), no opposition is on file

The tentative ruling is to grant the application, subject to Judge Bason's standard employment terms, pursuant to 11 U.S.C. 327(a). This Court notes that the Application seeks employment under 11 U.S.C. 327(e), but subsection "(e)" applies by its terms only to an attorney that previously "has represented the debtor." Mr. Agler's declaration states that his firm has no prior connection with Debtor (dkt. 363, p.18 & 365, p.2, para. 6). Nevertheless, there is authority that special counsel can be retained under subsection "(a)." See In re Fondiller, 15 B.R. 890, 892-93 (9th Cir. BAP 1981).

Notwithstanding the foregoing, if there are grounds to authorize employment under section 327(e), the tentative ruling is to direct Applicant to submit a supplemental declaration establishing such grounds no later than 2 days after the hearing date and reference that supplemental declaration in the proposed order.

Proposed order: Debtor is directed to lodge a proposed order via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling, thereby incorporating it as this Court's final ruling, subject to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).

Tentative Ruling:

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1:00 PMTatung Company of America, Inc.CONT... Chapter 11

(2) Deadlines/dates. This case was filed on 9/30/19. (a) Bar date: 1/17/20 (Order dkt. 97, timely served, dkt.101). (b) Procedures order: dkt.18 (timely served, dkt. 25) (c) Plan/Disclosure Statement*: TBD (Debtor must use the forms

required by Judge Bason, absent an order excusing the use of such forms) (DO NOT SERVE yet, except on the U.S. Trustee -this Court will set a deadline and procedures at a later time).

(d) Continued status conference: 10/6/20 at 1:00 p.m., concurrent with other matters. No written status report required.

*Warning: special procedures apply (see order setting initial status conference).



Party Information

Debtor(s):


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1:00 PMTea Station Investment Inc.2:20-14175 Chapter 11

#20.00 Cont'd hrg re: Motion for relief from stay [UD]fr. 7/7/20, 8/18/20

SUN RICH DEVELOPMENT I, LLCvsDEBTOR

10Docket

Tentative Ruling for 9/29/20:Please see the tentative ruling for the status conference (Calendar No. 21, 9/29/20 at 1:00 p.m.).



At the 7/7/20 hearing, Debtor requested that the hearing on this motion be continued for a possible sale of Debtor's assets. There is no tentative ruling, but the parties should be prepared to address (a) whether the alleged arrears have been brought current and/or (b) whether they will agree to the terms of an adequate protection order (see the debtor's response, dkt. 13). In addition, Debtor should be prepared to address the status of any proposed sale.

If appearances are not required at the start of this tentative ruling but you

Tentative Ruling:

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1:00 PMTea Station Investment Inc.CONT... Chapter 11

wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear telephonically without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.



There is no tentative ruling, but the parties should be prepared to address (a) whether the alleged arrears have been brought current and/or (b) whether they will agree to the terms of an adequate protection order (see the debtor's response, dkt. 13). In addition, Debtor should be prepared to address the issues raised in Movant's reply (dkt. 14).


Party Information

Debtor(s):


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Movant(s):

Sun Rich Development I, LLC Represented ByDavid Brian Lally

Trustee(s):


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#21.00 Cont'd Status Conference re: Chapter 11 Case fr. 7/28/20, 9/1/20, 9/15/20

15Docket

Tentative Ruling for 9/29/20: Appearances required by counsel for the jointly administered debtors, principal(s) of the debtors, and the Subchapter V Trustee.

(1) Current issues(a) Combined status conferencesEight cases are jointly administered: In re Tea Station Investment, Inc.

(Case No. 2:20-bk-14175-NB) ("Investment"); In re Tea Station, Inc. (Case No. 2:20-bk-18039-NB) ("Station"); In re Tea Creations, Inc. (Case No. 2:20-bk-18041-NB) ("Creations"); In re Tea City, Inc. (Case No. 2:20-bk-18042-NB) ("City"); In re Tea Hut, Inc. (Case No. 2:20-bk-18043-NB) ("Hut"); In re Tea Station Operation, Inc. (Case No. 2:20-bk-18044-NB) ("Operation"); In re Tea Island, Inc. (Case No. 2:20-bk-18046) ("Island"); In re Tea Professor, Inc. (Case No. 2:20-bk-18047-NB) ("Professor"). For purposes of this tentative ruling, the newly filed debtors (i.e., all debtors except Investment) are collectively referred to as the "Affiliated Debtors." This status conference addresses all eight cases.

(b) Motions of Baodi Zhou for relief from automatic stay or dismissal of the Investment case (dkt.49, 50, 59); Debtor's opposition (dkt.62), reply (dkt.68)

Deny at this time, in view of Debtors' status reports (dkt.78, 79), but continue the motions to be concurrent with the continued Status Conference date (see below), so as to re-assess at that time what progress has or has not been made in this case.

(c) Motion of Sun Rich Development I, LLC ("SunRich") for relief from the automatic stay re unlawful detainer (dkt.10); Debtor's opposition (dkt.13); reply (dkt.14)

Continue to be concurrent with the continued Status Conference date (see below), provided that if Investment has not paid $7,563.58 for

Tentative Ruling:

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September by the time of this hearing, or has not paid another $7,563.58 for October by the time of the continued hearing, then SunRich may file a declaration of non-payment and lodge a proposed order terminating the automatic stay.

(d) Amended application to employ Leslie Cohen Law PC (dkt. 72), no opposition is on file

There is no tentative ruling. Applicant should be prepared to address her apparent conflict of interest in representing both Investment and Operation in view of (i) Operation's pre-petition gift to Investment to fund Applicant's retainer (dkt. 41, p.2, para. 2) and (ii) commitment to pay Investment's post-petition fees (Id., p.2, para. 3). Why was this fee arrangement not disclosed in the amended application or the statement of disinterestedness for Operation? How will Investment's fees be paid going forward in view of Operation's bankruptcy filing?

(e) Bar date for the Affiliated Debtors and joint plan deadlinePursuant to First Amended General Order 20-01 (available at

www.cacb.uscourts.gov under "Rules and Procedures"): For chapter 11 cases filed under Subchapter V, all claims – except by governmental units – must be filed within 70 days after the date of the order for relief. Governmental units’ claims for chapter 11 cases filed under Subchapter V must be filed within 180 days after the date of the order for relief." [Id., p.2:4-7 (emphasis added)]

Similarly, 11 U.S.C. 1189(b) provides:The debtor shall file a plan not later then 90 days after the order

for relief under this chapter, except that the court may extend the period if the need for the extension is attributable to circumstances for which the debtor should not justly be held accountable. [Id.(emphasis added).]

If this Court adopts those time frames, the general claims bar date for the Affiliated Debtors would be 70 days from 9/1/20, which is 11/10/20, and the deadline to file the plan would be 90 days from 9/1/20, which is 11/30/20. The tentative ruling is to issue an order memorializing those dates and continue Investment's deadline to file a plan to 11/30/20. The parties are directed to address whether this Court should adopt any different dates.

(2) Deadlines/dates. This case was filed on 5/4/20 and converted from

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chapter 7 to chapter 11 on 7/1/20 (dkt.17). The petition was amended to elect Subchapter V on 7/14/20 (dkt.27). On 9/4/20 this Court ordered joint administration with the Affiliated Debtors (dkt.64).

(a) Bar date: (i) Investment 9/9/20 (dkt. 40; timely served, dkt. 43); Affiliated Debtors 11/10/20 (see above) (DO NOT SERVE notice yet - court will prepare orders for each of the Affiliated Debtors after the status conference).

(b) Procedures order: dkt.18 (timely served, dkt.20) (also timely served in each jointly administered case).

(c) Plan/Disclosure Statement*: file by 11/30/20 (see above) using the forms required by Judge Bason, or other forms if expressly authorized (DO NOT SERVE yet, except on the U.S. Trustee -this Court will set a deadline and procedures at a later time).

(d) Continued status conference: 10/27/20 at 1:00 p.m. (no written status report required). The tentative ruling is that, although the continued status conferences will apply to all Affiliated Debtors, only the lead case will appear on this Court's calendar.




(1) Current issues(a) Motions of Baodi Zhou for relief from automatic stay or dismissal

(dkt.49, 50, 59); Debtor's opposition (dkt.62), no reply is on fileThe tentative ruling is to deny Ms. Zhou's request for dismissal and

deny any immediate relief from the automatic stay for the reasons stated in Debtor's opposition papers. But the tentative ruling is to continue the motions

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to be concurrent with the continued Status Conference date (see below), so as re-assess at that time what progress has or has not been made in this case, and whether Debtor and its affiliates are making appropriate use of their bankruptcy "breathing spell."

(2) Deadlines/dates. This case was filed on 5/4/20 and converted from chapter 7 on 7/1/20 (dkt.17). The petition was amended to elect Subchapter V on 7/14/20 (dkt.27). On 9/4/20 this Court ordered joint administration with several affiliated debtors (dkt.64).

(a) Bar date: 9/9/20 (dkt. 40; timely served, dkt. 43).(b) Procedures order: dkt.18 (timely served, dkt.20) (c) Plan/Disclosure Statement*: TBD. (d) Continued status conference: 9/29/20 at 1:00 p.m. to be

concurrent with other matters (no written status report required). *Warning: special procedures apply (see order setting initial status conference).



Party Information

Debtor(s):


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#21.10 Cont'd hrg re: Motion to Dismiss Chapter 11 Bankruptcy Case; or in the Alternative, Motion for Relief from the Automatic Stay fr. 9/15/20

49Docket

Tentative Ruling for 9/29/20:Please see the tentative ruling for the Status Conference (Calendar No. 21, 9/29/20 at 1:00 p.m.).


Tentative Ruling:

Party Information

Debtor(s):


Movant(s):

Baodi Zhou Represented ByDavid Grimes

Trustee(s):


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#21.20 Cont'd hrg re: Motion for relief from stay [NA]fr. 9/15/20

BAODI ZHOUvsDEBTOR

50Docket



Tentative Ruling:

Party Information

Debtor(s):


Movant(s):

Baodi Zhou Represented ByDavid Grimes

Trustee(s):


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1:00 PMSergio Tellez and Roseanna Tellez2:20-15665 Chapter 11

#22.00 Hrg re: U.S. Trustee Motion to dismiss or convert case

39Docket


Tentative Ruling:

Party Information

Debtor(s):

Sergio Tellez Represented ByTodd B Becker

Joint Debtor(s):

Roseanna Tellez Represented ByTodd B Becker

Movant(s):

United States Trustee (LA) Represented ByDare Law

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#23.00 Cont'd hrg re: Motion for relief from stay [RP]fr. 8/18/20, 9/1/20

VADIM KOGANvsDEBTOR

23Docket


Tentative Ruling for 9/1/20:Please see the tentative ruling for the status conference (Calendar No. 25, 9/1/20 at 1:00 p.m.)

Tentative Ruling for 8/18/20:Grant in part and deny in part as set forth below. Appearances are not required.


Proposed order: Movant is directed to lodge a proposed order via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling, thereby incorporating it as this Court's final ruling, subject to any changes

Tentative Ruling:

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1:00 PMSergio Tellez and Roseanna TellezCONT... Chapter 11

ordered at the hearing. See LBR 9021-1(b)(1)(B).



Relief notwithstanding future bankruptcy casesDeny, without prejudice to any other types of relief granted herein (or

previously granted), for the following reasons. The motion requests requests "in rem" relief (i.e., relief applicable

notwithstanding future bankruptcy cases (under 11 U.S.C. 362(d)(4) and/or In re Vazquez, 580 B.R. 526 (Bankr. C.D. Cal. 2017), and/or In re Choong (case no. 2:14-bk-28378-NB, docket no. 31)). The tentative ruling is to deny that request because there is no evidence of multiple bankruptcy cases, unauthorized transfers of interests in property, or other acts that would amount to a scheme to delay, hinder, or defraud the Movant within the meaning of the authorities cited above.

Movant's assertion that Debtors are involved in the cannabis business - while apparently accurate in general - has not been tied to this specific property. Even if it were, Movant has not established how any activity at the property that might be illegal under federal law (with no evidence of any enforcement action by federal prosecutors) has any bearing on whether to grant in rem relief.

Effective date of reliefGrant the request to waive the 14-day stay provided by FRBP 4001(a)

(3).




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required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear telephonically without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.

Party Information

Debtor(s):


Joint Debtor(s):


Movant(s):

Vadim Kogan Represented ByRichard J ReynoldsJoseph P Buchman

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#24.00 Cont'd order to show cause why this case should notbe converted to chapter 7 or dismissed, or otherremedies imposed fr. 9/1/20

43Docket


Tentative Ruling for 9/1/20:Please see the tentative ruling for the status conference (Calendar No. 25, 9/1/20 at 1:00 p.m.)

Tentative Ruling:

Party Information

Debtor(s):


Joint Debtor(s):


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#25.00 Cont'd Status Conference re: Chapter 11 Case fr. 7/28/20, 8/18/20, 9/1/20

1Docket

Tentative Ruling for 9/29/20:Dismiss this case with a 180-day bar against being a debtor in any future bankruptcy case, for willful failure to appear in proper prosecution (11 U.S.C. 109(g)(1), 1112), and grant "in rem" relief from the automatic stay for 180 days, in favor of Vadim Kogan, for the reasons set forth below. Appearances required.

Analysis:Dismissal with a 180-day bar is appropriate for the reasons stated (a)

in the UST's motion to dismiss (dkt.39), (b) in tentative ruling for 9/1/20 (reproduced below), (c) in this Court's order to show cause ("OSC," dkt.43), (d) in the response by the United States Trustee (dkt.62) to that OSC, and (e) at all prior hearings in this case, as well as (f) based on this Court's review of the Court's records and the filed documents (through dkt.80 - the latest filed document as of the preparation of this tentative ruling).

The tentative ruling is that dismissal will moot all other matters that are on for hearing today, except the request by Vadim Kogan, as part of a motion for relief from the automatic stay with respect to 4531 Glenalbyn Drive, Los Angeles, CA 90065, for "in rem" relief for a period of 180 days. See dkt.23, p.5. Such requests typically survive dismissal. See In re Aheong, 276 B.R. 233 (9th Cir. BAP 2002). The tentative ruling is to grant such relief as follows, pursuant to the legal analysis in In re Vazquez, 580 B.R. 526 (Bankr. C.D. Cal. 2017) ("in rem" relief not limited to 11 U.S.C. 362(d)(4)):

If this order is duly recorded in compliance with applicable State laws governing notices of interests or liens in the property at issue, then no automatic stay shall apply to such property in any bankruptcy case purporting to affect such property and filed within 180 days after the date of entry of this order, unless otherwise ordered by the court presiding over that bankruptcy case.

Tentative Ruling:

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For the avoidance of doubt, any acts by the movant to obtain exclusive possession of such property shall not be stayed, including any eviction actions, through and including any lockout or other enforcement by the Sheriff or other authorized legal authority.

Proposed orders: The UST is directed to lodge a proposed order for dismissal, and Vadim Kogan is directed to lodge a proposed order on the motion for relief from the automatic stay. Both orders must be lodged via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling, thereby incorporating it as this Court's final ruling, subject to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).


Tentative Ruling for 9/1/20:Appearances required by counsel for Debtors.


(1) Current issues(a) Vadim Kogan's Motion For Relief From The Automatic Stay (dkt.

23, 29), adequate protection order (the "APO," dkt. 42)

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1:00 PMSergio Tellez and Roseanna TellezCONT... Chapter 11There is no tentative ruling, but, in connection with Mr. Kogan's request

for additional relief, including "in rem" relief, the parties are directed to address the following issues. First, Debtors have presented an unauthenticated copy of purported insurance declarations. See dkt.51. But this Court ordered them to file a declaration authenticating his insurance coverage. APO (dkt.42) p.6, para.11.

Second, the parties are directed to address whether Debtors have provided adequate proof of alleged payments to the senior lienholder, and are otherwise in compliance with the APO. Third, the parties are directed to address whether the following issues establish cause for "in rem" relief.

(b) Monthly Operating Reports ("MORs")Debtors' June and July 2020 MORs (dkt.49, 50) make a mockery of

the required disclosures. First, Debtors have completely ignored this Court's repeated directions - in the "Procedures" order issued at the inception of this case (dkt.6) and repeated in the adopted tentative ruling for 7/28/20 (dkt.43, Ex.A, pp.4-5) - that "For all reporting purposes – including Monthly Operating Reports (“MORs”), disclosure statements, etc. – Debtor[s] must disclose allincome, expenses, assets, and liabilities of (a) affiliated businesses ...." (Emphasis added.)

Second, even if Debtors' MORs were limited to their personal income and expenditures (which they are not) the MORs are not credible on their face. For example, they include almost no reported food expenditures.

Third, the MORs include vague entries such as "[c]ash" ($620 on 6/24/20, per dkt.49 at PDF p.6) or "[a]djustment" ($500 on 6/29/20, per id.). Such vague entries are tantamount to hidden transactions.

Fourth, the MORs are mostly blank in places where they should not be, such as disclosures of taxes owed and paid (e.g., dkt.49 at PDF p.15) and insurance coverage for vehicles (e.g., dkt.49 at PDF p.17). The MORs offer no explanation.

(c) Amended Bankruptcy Schedule I (dkt.48); and lack of amended SOFA

At one place in this Court's Order to Show Cause ("OSC," dkt.43, Ex.A, p.3, para."(1)(c)") this Court listed one example of Debtors' inadequate financial disclosure: their Bankruptcy Schedule I listed income but no income taxes. That one example was only that: a single example. The same OSC

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refers to the "same problems" previously noted (id.), which include, as another example, that Debtors' SOFA lists $0 in income from any source for the past several years, which appears on its face not to be credible. Seedkt.43, Ex.A, p.4, para."(1)(b)."

Despite owning a complex series of multi-million dollar businesses (seedkt.46, last page), Debtors' amended Bankruptcy Schedule I (dkt.48, at PDF pp.9-10) lists only $7,666/mo. of salary for Mr. Sergio Tellez, much reduced from his prior reported income. There is still no line item specifically disclosing any income taxes on that salary - instead there is a lump sum $2,300 described as "30% of gross [income] put aside for taxes, medicare, SSA." Id.

In addition, Ms. Roseanna Tellez is listed as having $0 income despite being described as an "Administrative Assistant" at Spliffin Group Inc. for the last 6 months; Debtors purport to have $0 income from any property or business (dkt.48 at PDF p.10, line 8a); and they claim $0 income from any interest or dividends (id., line 8b). In addition, Debtors have not filed any amended SOFA.

(d) Order to show cause ("OSC," dkt. 43)The tentative ruling is that, although Debtors nominally have filed most

of the documents required by the OSC (see dkt. 46-50), their financial disclosures are a complete sham, for the reasons set forth above. The tentative ruling is that Debtors have willfully failed to appear in proper prosecution of this case, within the meaning of 11 U.S.C. 109(g)(1), and have misrepresented facts, unfairly manipulated the Bankruptcy Code, filed their bankruptcy petition for improper and inequitable purposes of delaying and harassing creditors; and have engaged in egregious behavior as described above.

The tentative ruling is to dismiss this case with a permanent bar against being debtors in any future bankruptcy case, unless this Court for cause shown were to lift that bar after notice to all parties in interest in this case and a hearing. In addition, the tentative ruling is to include a concurrent bar under 11 U.S.C. 109(g)(1) (for the first 180-days of the permanent bar). See 11 U.S.C. §§ 105(a), 349(a), 1112(b); In re Glover, 537 Fed.Appx. 741 (9th Cir. 2013) (affirming dismissal with a five-year bar to refiling under 11 U.S.C. 105(a)); In re Leavitt, 171 F.3d 1219 (9th Cir. 1999) (affirming dismissal with prejudice based on finding of bad faith, considering whether debtor misrepresented facts, unfairly manipulated Code, or otherwise filed his

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petition or plan in inequitable manner; debtor’s history of filings and dismissals; whether the debtor intended to defeat state court litigation; and whether egregious behavior is present).

(e) Alternative grounds for dismissal with barThe record before this Court is that much of Debtors' business involves

cannabis, which is illegal under federal law. Although that fact does not necessarily create a bar that would prevent Debtors from reorganizing their finances at all in bankruptcy, at the very least Debtors would have had to pay special attention to careful disclosures of their finances and operations, and show what steps they are taking toward coming into compliance with nonbankruptcy laws, or divesting themselves of non-compliant businesses, or taking other steps to make appropriate use of the bankruptcy system. See, e.g., 28 U.S.C. 959(b); In re Burton, 610 B.R. 633 (9th Cir. BAP 2020); In re Olson, 2018 WL 989263 (9th Cir. BAP 2/5/2018). But Debtors have done none of these things, and as set forth above they have flouted the required financial disclosures.

In sum, Debtors' involvement in businesses that are illegal under federal law, and their lack of care in dealing with the associated legal and financial issues, are additional reasons to impose the above bars against being debtors in any future bankruptcy case.

(f) Starting date for barThe tentative ruling is that the bars described above should commence

from the time when this tentative ruling is first posted (8/31/20 just prior to 9:15am).

(g) NoticeThis Court notes that Debtors' counsel did not comply with this Court's

direction to serve the OSC on all parties in interest. See OSC (dkt.43), p.4, para.4. Nevertheless, the tentative ruling is that all parties in interest have received adequate notice pursuant to this Court's Procedures order, which was served on all parties in interest. See dkt.6, 16.

(2) Deadlines/dates. This case was filed on 6/23/20. (a) Bar date: 10/29/20 (dkt. 30; timely served dkt.47). (b) Procedures order: dkt.6 (timely served, dkt.16) (c) Plan/Disclosure Statement*: N/A

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1:00 PMSergio Tellez and Roseanna TellezCONT... Chapter 11(d) Continued status conference: N/A*Warning: special procedures apply (see order setting initial status conference).


[PRIOR TENTATIVE RULINGS OMITTED (see dkt.43, Ex.A, for tentative rulings through 8/18/20)]

Party Information

Debtor(s):


Joint Debtor(s):


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1:00 PMSergio Tellez2:20-15665 Chapter 11

Tellez et al v. FCI LENDER SERVICES, INC. et alAdv#: 2:20-01172

#26.00 Cont'd hrg re: Motion of Dismiss Plaintiffs' Complaint in Adversary Proceeding for Failure to State A Claim Upon Which Relief May Be Grantedfr. 9/15/20

8Docket


Tentative Ruling:

Party Information

Debtor(s):


Defendant(s):

FCI LENDER SERVICES, INC. Represented ByRichard J ReynoldsJoseph P Buchman

CALIFORNIA TD SPECIALISTS Represented ByRichard J ReynoldsJoseph P Buchman

Joint Debtor(s):


Movant(s):

FCI LENDER SERVICES, INC. Represented ByRichard J Reynolds

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1:00 PMSergio TellezCONT... Chapter 11

Joseph P Buchman

CALIFORNIA TD SPECIALISTS Represented ByRichard J ReynoldsJoseph P Buchman

Plaintiff(s):

Sergio Tellez Represented ByAnthony P Cara

Roseanna Tellez Represented ByAnthony P Cara

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1:00 PMOlinda Esperanza Lytle2:20-12166 Chapter 11

#27.00 Combined hrg re: Approval of Disclosure Statementand Confirmation of Chapter 11 Plan

96Docket


Tentative Ruling:

Party Information

Debtor(s):

Olinda Esperanza Lytle Represented ByOnyinye N Anyama

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1:00 PMOlinda Esperanza Lytle2:20-12166 Chapter 11

#28.00 Cont'd Status Conference re: Chapter 11 Case fr. 03/31/20, 4/21/20, 6/2/20, 6/16/20, 6/30/20,7/28/20

1Docket

Tentative Ruling for 9/29/20:Appearances required by counsel for the debtor.

(1) Current issues(a) Debtor's Disclosure Statement (dkt. 83) and Plan (dkt. 82), PHH

Mortgage Corporation’s limited objection (dkt. 91), Debtor's amended Disclosure Statement (dkt. 96) and amended Plan (dkt. 95, "AmPl"), proof of service of solicitation package (dkt. 103), ballot summary (dkt. 104), no opposition is on file

As a preliminary matter, even though there is no opposition on file, this Bankruptcy Court has an independent obligation to review the Plan and Disclosure Statement for compliance with 11 U.S.C. 1129. Based on that review, the tentative ruling is to approve the Disclosure Statement on a final basis and confirm the Plan.

The starting point is Debtor's ballot summary (dkt. 104). Debtor has one consenting impaired class (Class 2A), and two classes that did not vote (Classes 2B and 4A), and Debtor requests "cramdown" (confirmation with fewer than all classes accepting, per 11 U.S.C. 1129(b)). One of the cramdown requirements is the "absolute priority rule" of section 1129(b)(2)(B)(ii), which essentially provides that Debtor cannot receive or retain any property - e.g., Debtor's rental property - "on account of" her prepetition interest in that property. The corollary is that Debtor can receive or retain property on account of "new value," and, as stated in the posted "Procedures of Judge Bason" (available at www.cacb.uscourts.gov) (the "Procedures"):

new value must be (among other things) "reasonably equivalent to the value or interest received" (In re Bonner Mall P'ship, 2 F.3d 899, 908 (9th Cir. 1993) (citations omitted)) but by definition $0 is "reasonably equivalent" to whatever residual value exists in fully

Tentative Ruling:

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1:00 PMOlinda Esperanza LytleCONT... Chapter 11

encumbered property (which is what debtors often retain). The tentative ruling is that, because Debtor's rental property appears to

be fully encumbered under the Plan, the "reasonably equivalent" element of the new value test is satisfied in this case. The Procedures go on to state:

[In addition,] new value must be "necessary" and "substantial" (id.), which requires whatever cash is "necessary" to the success of the proposed reorganization, as opposed to a "token" cash infusion. In re Snyder, 967 F.2d 1126, 1131-32 (7th Cir. 1992) (cited in Bonner Mall, 2 F.3d at 908). When a debtor is devoting all or almost all disposable income to the plan then it may be "necessary" for feasibility (§ 1129(a)(11)) to have a cash infusion to cover the type of unanticipated emergency expenses that typically arise, and Judge Bason has accepted this as "substantial" new value even if it does not increase the dividend to unsecured creditors. ... See also In re Ambanc La Mesa L.P., 115 F.3d 650, 656-657 (9th Cir. 1997) (not deciding among various ways to measure if contribution is "substantial," but holding that $32,000 contribution, less than 0.5% of unsecured debt, was de minimus as a matter of law).

The tentative ruling is that, for analogous reasons, Debtor's Plan satisifes the new value requirement. First, part of the funding for Debtor's Plan is "new" in that it is not subject to the absolute priority rule: although future earnings do not count as "new value," that is different from Debtor's cash in the bank accumulated from postpetition earnings, which are not counted for purposes of the absolute priority rule. See 11 U.S.C. 1129(b)(2)(B)(ii) (exception providing that individual debtor "may retain property included in the estate under section 1115 ...."). Despite Debtor's right to "retain" such property under section 1129(b)(2)(B)(ii), she proposes to use such cash to make $9,325.00 in payments on the Effective Date. See Disclosure Statement (dkt.96), Ex.C (lines 1 & 11a).

Second, the tentative ruling is that this cash infusion is "necessary" because otherwise there are insufficient funds to make the payments required on the Effective Date under the Bankruptcy Code. See 11 U.S.C. 1129(a)(9)(A) &(a)(12).

Third, the tentative ruling is that the $9,325 is "substantial" for two alternative reasons. For one thing, Debtor's payment is approximately 4.4% of unsecured claims ($9,325 / $212,238.88 (from dkt.95, Ex.A, Class 4A) = 4.39%). Although that percentage is not huge, it is meaningful, and not de

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minimus as a matter of law. Cf. Ambanc La Mesa L.P., 115 F.3d 650, 656-657. Alternatively, the tentative ruling is that comparing the dollar amount of new value to general unsecured claims is not the only way to measure what is "substantial," and $9,325 is very substantial in comparison to (a) Debtor's modest earnings despite working two jobs, (b) Debtor's very modest budget, including living in a rental apartment for only $1,000 per month (while reserving $300 per month for "miscellaneous" contingencies), and (c) Debtor's modest retention of property (she is not proposing to retain a mansion, for example). To illustrate the last point, consider a hypothetical situation in which a debtor proposes to retain property worth $10,000 and contributes $10,000 in new value. It is hard to conceive how that could be a violation of the absolute priority rule, even if $10,000 were some tiny fraction of creditors' claims.

For all of these reasons the tentative ruling is that Debtor's proposed Plan satisfied the absolute priority rule. In addition, based on this Court's review of Debtor's proposed budget and monthly operating reports, the tentative ruling is that her Plan meets the "feasibility" requirements of 11 U.S.C. 1129(a)(11). Finally, the tentative ruling is that Debtor's Plan meets meets the "fair and equitable" requirements (11 U.S.C. 1129(b)), the "good faith" requirement (11 U.S.C. 1129(a)(3)), and all the other requirements for confirmation.

Proposed orders: Debtor is directed to lodge two proposed orders via LOU within 7 days after the hearing date: (i) an order approving the Disclosure Statement on a final basis, and (ii) an order confirming the Plan and setting a post-confirmation status conference on the date set forth below, and attach a copy of this tentative ruling, thereby incorporating it as this Court's final ruling, subject to any changes ordered at the hearing. In addition, the confirmation order should include the langauge required by the local rules regarding post-confirmation status reports and the effect of any future conversion. See LBR 3020-1(b), 9021-1(b)(1)(B).

(2) Deadlines/dates. This case was filed on 2/26/20. (a) Bar date: 6/3/20 (dkt. 30; timely served, dkt. 35)(b) Procedures order: dkt. 5 (not timely served, but eventually served

which gives notice of matters therein, dkt. 34)

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1:00 PMOlinda Esperanza LytleCONT... Chapter 11(c) Plan/Disclosure Statement*: see above(d) Post-Confirmation status conference: 1/12/21 at 1:00 p.m. *Warning: special procedures apply (see order setting initial status conference).


Tentative Ruling for 7/28/20: Appearances required.


(1) Current issues(a) Debtor's disclosure statement (dkt. 83) and plan (dkt. 82), PHH

Mortgage Corporation’s limited objection (dkt. 91)The tentative ruling is that if Debtor can satisfactorily address the

issues set forth below, this Court will set a deadline of 8/7/20 for Debtor to file a further amended Plan and amended D/S to correct these issues and lodge a proposed order, substantially in the form of the order posted on Judge Bason's portion of the Court's website (www.cacb.uscourts.gov), authorizing the service of a voting package and setting a combined hearing on final approval of the D/S and confirmation of the Plan for the same time as

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the continued status conference (see below). The tentative ruling is also to sustain PHH Mortgage's limited objection and required Debtor to attach the parties' plan treatment stipulation to the plan and incorporate its provisions by reference.

(i) Debtor’s projected income is inconsistent with Debtor’s actual monthly income

Debtor's projected personal income from employment is $4,314.46 (dkt. 83, Ex. 1), but Debtor's June Monthly Operating Report ("MOR") only reflects $2,824.16 in net monthly income from Vons (dkt. 92, p.1, line 4). Debtor's Amended Schedule I lists income from a second job at "City of Pomona" which provided Debtor with an additional $1,750.99 in monthly income (dkt. 28, p.5, line 8h). Debtor should be prepared to address whether she is still receiving income from the City of Pomona and what impact any loss in income from that source has on Debtor's plan projections and/or the feasibility of the Plan.

(ii) Overly inflated projected expenses Debtor's projected monthly expenses includes a line item for $500 for

"Cable/Internet" (dkt. 83, Ex.1), which appears to be excessive and is significantly higher than the $200 figure this Court authorized in Debtor's Budget Motion (dkt. 57, p. 7). Debtor should be prepared to address why this expense is projected to be so much higher and whether it is appropriate for her to spend that much on cable and internet each month when that money could be used to increase distributions to creditors.

(b) Outstanding UST feesDebtor’s June MOR reflects that UST fees for Q2 are outstanding in

the amount of $325 (dkt. 92, p.11). Debtor is cautioned that failure to pay these fees by the payment deadline may result in adverse consequences.

(2) Deadlines/dates. This case was filed on 2/26/20. (a) Bar date: 6/3/20 (dkt. 30; timely served, dkt. 35)(b) Procedures order: dkt. 5 (not timely served, but eventually served

which gives notice of matters therein, dkt. 34)(c) Plan/Disclosure Statement*: see above(d) Continued status conference: 9/29/20 at 1:00 p.m. No written

status report is required. *Warning: special procedures apply (see order setting initial status conference).

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Party Information

Debtor(s):

Olinda Esperanza Lytle Represented ByOnyinye N Anyama

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1:00 PMThe New School of Cooking, Inc.2:20-10484 Chapter 7

#29.00 Cont'd Status Conference re: Chapter 11 Casefr. 1/23/20, 2/4/20, 03/31/20, 4/21/20, 6/2/20,6/16/20, 7/28/20

1Docket *** VACATED *** REASON: Order converting case to chapter 7 entered 8/6/20 (dkt. 158)

Tentative Ruling:

Party Information

Debtor(s):

The New School of Cooking, Inc. Represented ByCrystle Jane LindseyDaniel J WeintraubJames R Selth

Trustee(s):

Wesley H Avery (TR) Pro Se

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1:00 PMJeremy Caleb Gardiner2:19-24099 Chapter 11

#30.00 Cont'd Status Conference re: Chapter 11 Casefr. 12/17/19, 1/28/20, 3/3/20, 5/12/20, 7/14/20,9/1/20

6Docket *** VACATED *** REASON: Continued to 10/6/20 at 1:00 p.m. pursuant to the stipulation (dkt. 67) and order thereon (dkt. 69)

Tentative Ruling:

Party Information

Debtor(s):

Jeremy Caleb Gardiner Represented ByMatthew D. ResnikRoksana D. Moradi-Brovia

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1:00 PMKoi Design LLC2:19-10762 Chapter 11

#31.00 Cont'd Status Conference re: Post Confirmation fr. 01/30/19, 02/13/19, 03/05/19, 3/26/19, 4/9/19,4/22/19, 5/14/19, 6/11/19, 7/30/19, 9/24/19, 10/15/19,11/12/19, 12/17/19, 2/4/20, 3/3/20, 03/31/20

1Docket *** VACATED *** REASON: Final decree and order closing case [dkt. 273]

Tentative Ruling:

Party Information

Debtor(s):

Koi Design LLC Represented BySusan K SeflinJessica L Bagdanov

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1:00 PMLiat Talasazan2:19-23664 Chapter 11

#32.00 Cont'd hrg re: Motion for Turnover of Property of the Estate Pursuant to 11 U.S.C. § 542fr. 9/15/20

280Docket

Tentative Ruling for 9/29/20:Please see the tentative ruling for the status conference (Calendar no. 34, 9/29/20 at 1:00 p.m.).


Tentative Ruling:

Party Information

Debtor(s):

Liat Talasazan Represented ByGiovanni OrantesLuis A Solorzano

Trustee(s):

Caroline Renee Djang (TR) Pro Se

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#33.00 Cont'd hrg re: Confirmation of Small Business Ch. 11 Planand deadlines under rule 3017.2 of the interim rulesof bankruptcy procedure as adopted by generalorder 20-01fr. 7/28/20, 8/18/20, 9/1/20, 9/15/20

247Docket

Tentative Ruling for 9/29/20:Please see the tentative ruling for the status conference (Calendar no. 34, 9/29/20 at 1:00 p.m.).


Tentative Ruling:

Party Information

Debtor(s):


Trustee(s):


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#34.00 Cont'd Status Conference re: Chapter 11 Casefr. 1/28/20, 2/18/20, 3/3/20, 3/10/20, 03/31/20,4/7/20, 5/12/20, 5/19/20, 6/2/20, 6/16/20, 7/28/20,8/18/20, 9/1/20, 9/15/20

49Docket


(1) Current issues(a) Debtor's small business chapter 11 plan, as amended ("Plan," dkt.

246, 258, 259, 260, 270, 271); Debtor's requests to set hearing on confirmation etc., as amended ("Plan Hearing Request," dkt. 247, 272), Order denying plan hearing request without prejudice (dkt. 304)

As of the preparation of this tentative ruling, the docket does not appear to reflect that Debtor has resolved the issues set forth in this Court's 9/21/20 order (dkt. 304, p.3:1-12). Accordingly, the tentative ruling is to continue Debtor's Plan Hearing Request to be concurrent with the continued Status Conference set forth below.

(b) SubChapter V Trustee's motion for turnover of Laurel Property (dkt. 280), Debtor's opposition (dkt. 285), Michael Tremblay's response (dkt. 291), Interim Turnover Order (dkt. 300)

There is no tentative ruling. This Court's order (dkt.300, p.2:16-19) set a deadline of 9/25/20 at noon for the parties to file any declarations regarding whether Debtor and her parents have complied with the Interim Turnover Order. As of the preparation of this tenative ruling, that deadline has not yet expired, so this Court will review any declarations prior to the hearing and review the issues with the parties at the hearing.

(2) Deadlines/dates. This case was filed on 11/20/19, converted from chapter 13 to chapter 11 on 1/2/20, and designated by Debtor as a Subchapter V case on 3/2/20 (dkt.128).

Tentative Ruling:

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1:00 PMLiat TalasazanCONT... Chapter 11(a) Bar date: 6/29/20, dkt. 179 (timely served, dkt. 184) (b) Procedures order: dkt. 50 (timely served, dkt. 58) (c) Plan/Disclosure Statement*: see above (& dkt.270)(d) Continued status conference: 10/27/20 at 1:00 p.m. No written

status report required.*Warning: special procedures apply (see order setting initial status conference).


[PRIOR TENTATIVE RULINGS OMITTED (see Memorialization of Tentative Rulings, dkt.208 (filed 5/19/20) and dkt.303 (filed 9/21/20)]

Party Information

Debtor(s):


Trustee(s):


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1:00 PMAngel Rodriguez Lara and Angelica Soto Calva2:19-14078 Chapter 11

#35.00 Cont'd hrg re: Second motion for order determing value of collateral [11 U.S.C. section 506(a), FRBP 3012] fr. 7/14/20, 8/4/20, 9/15/20

172Docket

Tentative Ruling for 9/29/20: Please see the tentative ruling for the status conference (Calendar No. 37, 9/29/20 at 1:00 p.m.).



Tentative Ruling:

Party Information

Debtor(s):

Angel Rodriguez Lara Represented ByJoanne P SanchezAnthony Obehi Egbase

Joint Debtor(s):

Angelica Soto Calva Represented ByJoanne P SanchezAnthony Obehi Egbase

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#36.00 Combined hrg re: Approval of Disclosure Statementand Confirmation of Chapter 11 Plan fr. 6/30/20, 8/4/20, 9/15/20

159Docket





Tentative Ruling:

Party Information

Debtor(s):


Joint Debtor(s):


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#37.00 Cont'd Status Conference re: Chapter 11 Casefr. 7/30/19, 8/20/19, 9/17/19, 10/1/19, 10/29/19,11/5/19, 12/10/19, 1/28/20, 2/18/20, 3/10/20, 4/21/20, 6/30/20, 7/28/20, 8/4/20, 9/15/20

42Docket

Note for 9/29/20: This Court anticipates issuing a written Memorandum Decision prior to the hearing.

Tentative Ruling:

Party Information

Debtor(s):


Joint Debtor(s):


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1:00 PMJohn Martin Kennedy2:20-15954 Chapter 11

#38.00 Cont'd hrg re: Motion of Debtor and Debtor-In-Possessionfor an Order: (1) Authorizing the Assumption of MediationTerm Sheet; and (2) Enforcing Compliance with MediationSettlementfr. 9/15/20

67Docket

Note for 9/29/20: This Court anticipates issuing a written Memorandum Decision prior to the hearing.

Tentative Ruling:

Party Information

Debtor(s):

John Martin Kennedy Represented BySandford L. Frey

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#39.00 Cont'd hrg re: Insider Compensationfr. 9/15/20

60Docket



Tentative Ruling:

Party Information

Debtor(s):


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#40.00 Cont'd hrg re: Motion for relief from stay [NA]fr. 7/28/20, 8/18/20, 9/15/20

YUNUEN CAMPOSvsDEBTOR

22Docket



Tentative Ruling:

Party Information

Debtor(s):


Movant(s):

Yunuen Campos Represented ByLauren A Dean

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#41.00 Cont'd hrg re: Motion in Individual Ch 11 Case for Order Approvinga Budget for the Use of Debtor's Cash and Post-Petiton Income fr. 8/18/20, 9/15/20

51Docket




Tentative Ruling:

Party Information

Debtor(s):


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#42.00 Cont'd Status Conference re: Chapter 11 Casefr. 7/14/20, 7/28/20, 8/18/20, 9/15/20

1Docket


(1) Current issues(a) Budget motion (dkt. 51), Yunuen Campos' opposition (dkt. 57),

Debtor's supplemental declarations (dkt. 71), Campos' response (dkt. 92), interim order (dkt. 101), Debtor's reply (dkt. 103)

The tentative ruling is to grant the Budget motion on a further interim basis (except as modified in section 1(b) below) and set a further continued hearing concurrent with the status conference (see below).

(b) Insider compensation, Debtor's supplemental declaration (dkt. 71), Ms. Campos' response (dkt. 92), Debtor's reply (dkt. 103)

The tentative ruling is to authorize Debtor to continue to pay Ms. Howerton monthly compensation of $6,000, on an interim basis, and set a further continued hearing concurrent with the status conference (see below) pending additional evidence from Debtor’s accountant.

(c) Motion to assume and enforce settlement agreement (dkt. 67, the "Assumption Motion"), supporting declarations & request for judicial notice (dkt. 68, 69, 70) Ms. Campos' opposition (dkt. 89, 91) & evidentiary objections (dkt. 90), Debtor's response to evidentiary objections (dkt. 104) & reply (dkt. 105), Ms. Campos’ evidentiary objections (dkt. 106)

This Court anticipates issuing its memorandum decision in advance of the hearing adopting this Court's tentative ruling for 9/15/20 (posted below) and expanding this Court's analysis in response to the arguments set forth on the record at that hearing.

(d) Yunuen Campos' motion for relief from the automatic stay (the "R/S

Tentative Ruling:

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1:00 PMJohn Martin KennedyCONT... Chapter 11

Motion," dkt. 22), Debtor's opposition (dkt. 34), notice of continued hearing (dkt. 35) & proof of service (dkt. 36), Ms. Campos' reply (dkt. 55) and evidentiary objections (dkt. 56), Ms. Campos' supplemental briefing (dkt. 66, 82), Debtor's supplemental briefing (dkt. 71, 72), scheduling order (dkt. 88), Ms. Campos' second supplemental reply (dkt. 102), Debtor's second supplemental opposition (dkt. 114)

(i) Pre-petition accounts receivableIn view of this Court's forthcoming memorandum decision on the

Assumption Motion, the tentative ruling is to authorize Ms. Campos to deposit any pre-petition accounts receivable checks currently in her possession, to be credited against any amounts Debtor must pay to cure and assume the mediation term sheet, upon the entry of a final non-appealable order approving the Assumption Motion. See dkt. 114, p.2:19-25.

(ii) Post-petition accounts receivableThe tentative ruling is that Ms. Campos has the burden to establish

that she has a valid perfected interest in post-petition accounts receivable and she has not satisfied that burden. This Court does not find Ms. Campos' reliance on In re Advanced Biomedical, Inc., 547 B.R. 337 (2016), aff'd 2016 WL 7188651 (9th Cir. BAP, Dec. 2, 2016) to be particularly helpful because that case only addresses pre-petition accounts receivable and the trial court did not need to address whether its analysis would be the same for any post-petition accounts receivable (such as, for example, whether, 11 U.S.C. 552 cuts off a pre-petition assignment order) because the value of the property securing the judgment creditor's lien exceeded the amount of the debt.

The tentative ruling is further that the underlying policies and principles of the Bankruptcy Court do not support Ms. Campos' reading of section 708.510 (Cal. Code Civ. Proc.) and the combination of the Supremacy Clause of the Constitution (Article VI, Clause 2), and 11 U.S.C. 362, 541, 552 et cetera appear to support the conclusion that an individual chapter 11 Debtor's post-petition earnings belong to the estate, notwithstanding the existence of any pre-petition assignment order(s). Therefore, the tentative ruling is that Ms. Campos is not entitled to any post-petition accounts receivable.

Proposed orders: Debtor is directed to lodge proposed orders on each of the following motions via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling to the proposed order on the R/S Motion, thereby incorporating it as this Court's final ruling, subject

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1:00 PMJohn Martin KennedyCONT... Chapter 11to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).

(2) Deadlines/dates. This case was filed on 6/30/20.(a) Bar date: 10/2/20 (dkt. 39) (timely served, dkt. 52)(b) Procedures order: dkt.4 (timely served, dkt.18). (c) Plan/Disclosure Statement*: file by 12/18/20 either using the forms

generally required by Judge Bason or, if authorized, using Debtor's own form(s) of Plan/Disclosure Statement (DO NOT SERVE yet, except on the U.S. Trustee - this Court will set a deadline and procedures at a later time).

(d) Continued status conference: 10/27/20 at 1:00 p.m. Brief written status report due 10/13/20.




Proposed orders: Debtor is directed to lodge proposed orders on each of the following motions via LOU within 7 days after the hearing date, and attach a copy of this tentative ruling to the proposed order on the Assumption Motion, thereby incorporating it as this Court's final ruling, subject to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).

(1) Current issues(a) Budget motion (dkt. 51), Yunuen Campos' opposition (dkt. 57),

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Debtor's supplemental declarations (dkt. 71), Campos' response (dkt. 92), interim order (dkt. 101), Debtor's reply (dkt. 103)

The tentative ruling is to grant the Budget motion on a further interim basis (except as modified in section 1(b) below) and set a further continued hearing concurrent with the status conference (see below).

(b) Insider compensation, Debtor's supplemental declaration (dkt. 71), Ms. Campos' response (dkt. 92), Debtor's reply (dkt. 103)

The tentative ruling is to authorize Debtor to pay Ms. Howerton monthly compensation of $6,000, retroactive to July 2020, on an interim basis, and set a further continued hearing concurrent with the status conference (see below) pending additional evidence from Debtor’s accountant.

(c) Motion to assume and enforce settlement agreement (dkt. 67, the "Assumption Motion"), supporting declarations & request for judicial notice (dkt. 68, 69, 70) Ms. Campos' opposition (dkt. 89, 91) & evidentiary objections (dkt. 90), Debtor's response to evidentiary objections (dkt. 104) & reply (dkt. 105), Ms. Campos’ evidentiary objections (dkt. 106)

The tentative ruling is conditionally to grant the Assumption Motion in part, without any evidentiary hearing, for the following reasons. (i) This Bankruptcy Court has "arising under" jurisdiction. (ii) The mediation term sheet lacked agreement on an essential term to make it noncontingent - the dollar amount and other terms to be offered by Ms. Campos to settle with a third party - and Debtor has not established that this contingency can be eliminated by any judicial determination of a dollar amount and other terms that Ms. Campos allegedly "should" have offered to comport with the duty of good faith and fair dealing. (iii) Nevertheless, as of the date of the bankruptcy petition the conditional agreement embodied in the mediation term sheet still existed; and if Ms. Campos is not required to pay anything more than her highest offer to settle the Fuller matters then, to that extent, Debtor's theory of good faith and fair dealing can apply, such that she could not deny that the condition is satisfied. Accordingly, if Debtor is willing to absorb the cost of settling the Fuller matters above what Ms. Campos previously agreed to pay, then the mediation term sheet is enforceable - otherwise not.

(i) JurisdictionThe parties dispute whether this Bankruptcy Court has jurisdiction.

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See 28 U.S.C. 1334. In addition, this Court has an independent duty to consider its own jurisdiction. In re AWTR Liquidation Inc., 547 B.R. 831, 833 (2016).

Ms. Campos argues that this Court lacks jurisdiction under Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994). Ms. Campos cites a decision in which a Bankruptcy Court held that, under Kokkonen, it lacked post-dismissal jurisdiction over a settlement allegedly agreed to during the bankruptcy case. In re Hanks, 182 B.R. 930 (Bankr. ND Ga. 1995).

One of Debtor's arguments is that Kokkonen includes an exception when the federal court's dismissal order retains jurisdiction. It is true that this Bankruptcy Court's dismissal order included language retaining jurisdiction. On the one hand, the tentative ruling is that this language would not be broad enough to adjudicate a run-of-the-mill contract dispute (if that were all that is at issue).

The dismissal order provides that this Court "retains jurisdiction on all issues involving sanctions [and other irrelevant grounds] ... and to any additional extent provided by law." Dismissal Order (Ex.2 to Reply, dkt.105, at PDF pp.15-17) (emphasis added). The problem for Debtor is that, under Kokkonen, the "additional extent provided by law" does not include ordinary post-dismissal disputes over alleged settlements.

On the other hand, the tentative ruling is that Debtor's alternative argument is correct: the mediation term sheet, just like any other purported contract sought to be assumed, is subject to this Bankruptcy Court's jurisdiction. See dkt.105, p.7:5-12. Any ability to assume the contract arises under the Bankruptcy Code (11 U.S.C. 365), and an essential element of assumption is the determination whether an assumable contract exists. In other words, this is not just a run-of-the-mill contract dispute: it is part and parcel of issues that arise under section 365.

Any contrary ruling would not make sense. Motions to assume executory contracts and unexpired leases could not be litigated at all if Bankruptcy Courts lacked jurisdiction to address the inevitable subsidiary issues: everything from whether a contract was formed to whether it was terminated prepetition, who breached it, what damages have been incurred, whether those damages amount to penalties that need not be cured, etc., etc. See generally AWTR, 547 B.R. 831, 833-37 (discussing "arising under" jurisdiction and authority, and Bankruptcy Courts' ability to determine issues necessarily addressed in determining issues arising under the Bankruptcy

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Code).For these reasons, the tentative ruling is that this Bankruptcy Court has

subject matter jurisdiction.

(ii) The mediation term sheet lacked agreement on an essential term to make it noncontingent - the dollar amount to be paid by Ms. Campos to settle with a third party

Debtor argues that the mediation term sheet contains all of the essential terms of the parties’ agreement, is signed by both parties, and was intended to be a binding (albeit conditional) agreement. Dkt. 67, pp.14:12-17:9. The tentative ruling is that Debtor has established prima facieevidence of all of those things, but that as long as the contingency exists the agreement cannot be enforced.

Paragraph 10 of the mediation term sheet (id., Ex.1, at PDF p.37) states in relevant part that "[t]he settlement is contingent upon Campos’ negotiating a settlement with Bertram Fuller ...." (Emphasis added.) Ms. Campos argues that this is a condition precedent that has not been satisfied, which renders the mediation term sheet unenforceable. Dkt. 89, p.14:9-18. Debtor counters that, regardless whether paragraph 10 is a condition precedent or (as Debtor argues) a condition subsequent, Ms. Campos failed to use good faith to fulfill the contingency. Dkt. 105, pp.2:6-6:16.

The parties devote considerable time and effort to addressing whether or not Ms. Campos attempted to settle in good faith. The tentative ruling is that this is not a justiciable question.

Debtor has not cited any legal authority that this Bankruptcy Court can and should determine whether a party to a settlement agreement, which is itself conditioned on settling with a third party, acted in good faith in deciding how many dollars to offer that third party and any other settlement terms. Nor is this Bankruptcy Court aware of such authority.

To the contrary, paragraph 10 appears to be an agreement to agree, which is generally unenforceable. The fact that the issue reserved for future agreement was the terms of a settlement with a third party only makes matters worse.

Under Debtor's theory, he and Ms. Campos had an agreement that was contingent on Ms. Campos' negotiation of a future agreement with a third party in an unspecified dollar amount, to be paid over an unspecified period of time, with unspecified other terms and conditions. Without having set forth in

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the mediation term sheet the range of terms that Ms. Campos could agree to, Debtor now asks this Bankruptcy Court to determine what range he and Ms. Campos alleged would have agreed to, had they finished negotiating every term of the mediation term sheet, under the implied covenant of good faith and fair dealing.

The tentative ruling is that this is the very definition of an agreement to agree. Such amorphous agreements are unenforceable - at least, until the contingency is removed. See, e.g., City of L.A. v. Superior Court of L.A. Cnty., 51 Cal.2d 423, 433 (1959) ("The general rule is that if an ‘essential element’ of a promise is reserved for future agreement of both parties, the promise gives rise to no legal obligation until such future agreement is made") (citation omitted).

Alternatively, even if paragraph 10 of the mediation term sheet were not an agreement to agree, the same principles should apply. Just as agreements to agree are too amorphous to be enforceable, there is no yardstick by which this Bankruptcy Court can determine whether Ms. Campos did or did not act in good faith by not offering a higher dollar amount, or sooner payment, or other terms.

In sum, Debtor has not established that the mediation term sheet is enforceable, as long as the contingency in paragraph 10 continues to exist. But that last clause is important because Debtor apparently has settled part of the Fuller matters, and has an option to settle the rest (dkt. 67, p.22:19-26).

(iii) If the contingency is removed then the mediation term sheet becomes enforceable

As of the date of the bankruptcy petition the conditional agreement embodied in the mediation term sheet still existed. Therefore, unlike a situation in which a contract has terminated prepetition, there is something to be assumed.

True, as Ms. Campos points out, neither Debtor nor she performed the other terms of the mediation term sheet, such as Debtors obligation to make monthly payments. But that is the whole point of section 365: debtors in bankruptcy can cure defaults (even many defaults that could not be cured outside of bankruptcy).

As noted above, "[t]he general rule is that if an ‘essential element’ of a promise is reserved for future agreement of both parties, the promise gives rise to no legal obligation until such future agreement is made." City of L.A.,

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51 Cal.2d 423, 433 (1959) (emphasis added). Therefore, for example, if Ms. Campos were to have reached a settlement of the Fuller matters then, at that moment, the mediation term sheet would have become enforceable.

But the equivalent of that outcome can still happen. Consider what would happen if Debt has simply settled the Fuller matters (rather than purchasing the judgments/claims). In that event, the contingency would have become moot, thereby eliminating Ms. Campos' objection to the enforceability of the mediation term sheet.

The tentative ruling is that Debtor need not go that far. There is evidence that Ms. Campos offered $60,000 to settle the Fuller matters (seedkt. 89, p.8) That changes the amorphous state of affairs that existed when the parties signed the mediation term sheet. The tentative ruling is that any refusal by Ms. Campos now to apply that same $60,000 that she offered before to settle the Fuller matters would be a violation of the covenant of good faith and fair dealing. In that situation, the tentative ruling is that Ms. Campos has not overcome Debtor's arguments that the mediation term sheet will be a curable, assumable, enforceable contract.

In other words, the tentative ruling is that if Debtor is willing to absorb the cost of settling the Fuller matters above the $60,000 that Ms. Campos previously agreed to pay, then Ms. Campos has not adequately rebutted Debtor's arguments in favor of granting the Assumption Motion. But, if Debtor is unwilling to absorb that cost, then the parties are left with an agreement to agree, which is unenforceable.

(iv) Conclusion as to the Assumption MotionThere is no precedent of which this Bankruptcy Court is aware for

holding a trial to assess Ms. Campos' "good faith" in exploring settlement of the Fuller matters. Moreover, as a practical matter, doing so would be highly impractical.

Presumably this Court not only would have to take evidence regarding the underlying merits of Ms. Campos' disputes with Bertram Fuller, but also would have to take evidence on the "meta-issue" of whether, based on Ms. Campos' subjective beliefs as to those merits, she did or did not make or receive settlement offers in "good faith." More precisely, this Court would have to determine whether an offer of $X over Y months with Z contingencies was too little, but $Z' over X' months with Y' contingencies would be enough to constitute "good faith." The process just described would include layers of

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expensive litigation and uncertainty. The tentative ruling is that such litigation over Ms. Campos' good faith

is not legally warranted, not practical, and not necessary. Rather, applying California precedent cited above regarding agreements to agree, Debtor can either hold Ms. Campos to her highest and best offer and thereby remove the contingency in paragraph 10, or Debtor can elect not to do so. In the latter event, the parties will be left with an unenforceable agreement (and they can continue litigating as before, or Debtor can explore other options).

(d) Yunuen Campos' motion for relief from the automatic stay (the "R/S Motion," dkt. 22), Debtor's opposition (dkt. 34), notice of continued hearing (dkt. 35) & proof of service (dkt. 36), Ms. Campos' reply (dkt. 55) and evidentiary objections (dkt. 56), Ms. Campos' supplemental briefing (dkt. 66, 82), Debtor's supplemental briefing (dkt. 71, 72), scheduling order (dkt. 88), Ms. Campos' second supplemental reply (dkt. 102)

The tentative ruling is to direct Debtor to continue making monthly transfers of $10,000 into Counsel’s client-trust account, subject to Debtor’s proposed procedures for a reduction in that amount in the event of unforeseen circumstances. The tentative ruling is to continue the matter with respect to Ms. Campos’ interest in pre- and post-petition accounts receivable, to be heard concurrent with the continued status conference (see below), with a deadline of 9/18/20 for Debtor’s response to Ms. Campos' second supplemental reply.

The foregoing tentative ruling presumes Ms. Campos' consent to a further extension of the time period in 11 U.S.C. 362(e). Alternatively, if Ms. Campos does not wish to consent, she is directed to say so at the hearing, and this Court will address whether her second supplemental reply constitutes implied consent and, if not, make a final ruling on the R/S Motion.



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1:00 PMJohn Martin KennedyCONT... Chapter 11(d) Continued status conference: 9/29/20 at 1:00 p.m. No status

report is required.*Warning: special procedures apply (see order setting initial status conference).


Tentative Ruling for 9/15/20:This Court anticipates posting a tentative ruling at a later time.



(1) Current issues(a) Budget motion (dkt. 51), Yunuen Campos' opposition (dkt. 57)There is no tentative ruling. The parties are directed to address the

issues raised in Ms. Campos' opposition (dkt. 57). Debtor is also directed to explain the proposed expenditure of $800/mo. for "Personal Care, South Bay Family-Emily."

As to all questioned expenditures, Debtor is directed to address why

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they are monthly transactions "in the ordinary course" of Debtor's business (11 U.S.C. 363(c)(1)), or otherwise authorized by the Bankruptcy Code. SeeDkt.51, Ex.A at p.6 (PDF p.7) (last line on page). See generally In re Villalobos, 2011 WL 4485793, 2011 Bankr.LEXIS 4329 (9th Cir. BAP August 19, 2011) (noting uncertain legal standards applicable to budget review); In re Seely, 492 B.R. 284, 290-291 (Bankr. C.D. Cal. 2013) (approval required for living expenses or other expenses out of ordinary course in individual chapter 11 case); In re Goldstein, 383 B.R. 496, 499 (Bankr. C.D. Cal. 2007) (same); and cf. In re Salazar, 465 B.R. 875 (9th Cir. BAP 2012) (citing cases re same in chapter 13). See also In re Concoff (case no. 2:13-bk-37328-NB, dkt. 246) (permissible expenses for disposable income requirement in 11 U.S.C. 1129(a)(15)).

(b) Patient care ombudsman motion (dkt. 28), proof of service (dkt. 37), no opposition is on file

The tentative ruling is to grant the motion.

(c) Debtor's motion for leave to file documents under seal (dkt. 41), Yunuen Campos' response (dkt. 44), Debtor's reply (dkt. 45), order setting hearing (dkt. 47)

Debtor moves for an order authorizing him to file under seal a motion authorizing the assumption of a mediation term sheet between Debtor and Yuneun Campos. Ms. Campos objects to the admissibility of the mediation term sheet on the grounds that it is protected by the evidence exclusion provision pursuant to California Evidence Code section 1119. The tentative ruling is to grant the motion as follows.

(i) Applicable law"Privileges are narrowly construed, because they impede the full and

fair discovery of truth." Yeager v. Yeager, 2008 U.S. Dist. LEXIS 74245, at *3 (E.D. Cal. Sep. 25, 2008) (citing Weil v. Investment/Indicators, Research & Management, Inc., 647 F.2d 18, 24 (9th Cir. 1981)). "The party asserting an evidentiary privilege has the burden to demonstrate that the privilege applies to the information in question." Id. (quoting Torney v. United States, 840 F.2d 1424, 1426 (9th Cir. 1988)).

"Under Federal Rule of Evidence 501, privileges provided by state law apply in civil actions only ‘with respect to an element of a claim or defense as to which State law supplies the rule of decision." Babasa v. LensCrafters,

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Inc., 498 F.3d 972, 974 (9th Cir. 2007) (citing Fed. R. Evid. 501; Breed v. U.S. Dist. Court for the N. Dist. Of Cal., 542 F.2d 1114, 1115 (9th Cir. 1976)). "State contract law governs how settlement agreements are construed and enforced, even if the underlying cause of action is federal." Karubian v. Kaiser Ventures, LLC, 2018 U.S. Dist. LEXIS 235252, at *12 (C.D. Cal. Oct. 17, 2018) (citing United Commercial Ins. Serv., Inc., v. Paymaster Corp., 962 F.2d 853, 856 (9th Cir. 1992)). Therefore, California privilege law applies.

Two relevant provisions apply. First, California Evidence Code § 1119 states, in relevant part:

Except as otherwise provided in this chapter: (a) No evidence of anything said or any admission made . . . in the course of, or pursuant to, a mediation . . . is admissible or subject to discovery, and disclosure of the evidence shall not be compelled, in any . . . noncriminal proceeding (b) No writing . . . prepared in the course of, or pursuant to, a mediation . . . is admissible or subject to discovery, and disclosure of the writing shall not be compelled in any . . . noncriminal proceeding . . . (c) All communications . . . by and between participants in the course of a mediation . . . shall remain confidential.

Second, California Evidence Code § 1123 states, in relevant part: A written settlement agreement prepared in the course of, or

pursuant to, a mediation, is not made inadmissible, or protected from disclosure . . . if the agreement is signed by the settling parties and any of the following conditions are satisfied: (a) The agreement provides that it is admissible or subject to disclosure, or words to that effect. (b) The agreement provides that it is enforceable or binding or words to that effect.

This Court notes that the foregoing provisions are also consistent with the Rules 6.1 and 6.5 set forth in Appendix III of the Local Bankruptcy Rules, governing mediations in this district.

As the party asserting the privilege, Ms. Campos bears the burden of demonstrating that the exception set forth in California Evidence Code § 1123 do not apply. The tentative ruling is that Ms. Campos has not carried that burden. In support of her opposition, Ms. Campos simply concludes that "the requirements of California Evidence Code are not met to render any of the exhibits admissible" and "[t]here is no doubt the Mediation Term Sheet is inadmissible and confidential." Dkt. 44, p.3: 5-6 & 20-21. This is not

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sufficient. Alternatively, the tentative ruling is that authorizing the Debtor to file

the Mediation Term Sheet under seal will enable this Court to determine whether an exception to California Evidence Code § 1123 applies while still protecting the contents of the document from public disclosure.

(d) Yunuen Campos' motion for relief from the automatic stay (dkt. 22), Debtor's opposition (dkt. 34), notice of continued hearing (dkt. 35) & proof of service (dkt. 36), Ms. Campos' reply (dkt. 55) and evidentiary objections (dkt. 56)

The tentative ruling is to grant in part, deny in part, for the reasons stated in the tentative ruling for that motion (Calendar No. 12, 8/18/20 at 1:00 p.m.).

Proposed orders: Debtor is directed to lodge proposed orders on each of the foregoing motions via LOU within 7 days after the hearing date and attach a copy of this tentative ruling, thereby adopting it as this Court's final ruling, subject to any changes ordered at the hearing. See LBR 9021-1(b)(1)(B).



(d) Continued status conference: 9/15/20 at 1:00 p.m. No written status report required.


If appearances are not required at the start of this tentative ruling but you wish to dispute the tentative ruling, or for further explanation of "appearances required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances

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are required, and you fail to appear telephonically without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing.


Party Information

Debtor(s):


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2:00 PMAshley Susan Aarons2:19-18316 Chapter 11

#1.00 Hrg re: Plan confirmation and related deadlines

313Docket


Tentative Ruling:

Party Information

Debtor(s):

Ashley Susan Aarons Represented ByJames C Bastian JrRika Kido

Trustee(s):


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#2.00 Cont'd hrg re: U.S. Trustee's Motion to Dismiss or Convert Casefr. 10/15/19, 10/29/19, 12/10/19, 1/14/20, 03/31/20, 4/7/20,4/21/20, 5/5/20, 6/16/20, 6/30/20, 8/4/20

65Docket



Tentative Ruling:

Party Information

Debtor(s):


Movant(s):

United States Trustee (LA) Represented ByDare LawAlvin MarRon Maroko

Trustee(s):


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#3.00 Cont'd Status Conference re: Chapter 11 Casefr. 8/20/19, 9/24/19, 10/4/19, 10/15/19, 10/29/19,11/12/19, 12/10/19, 1/14/20, 03/31/20, 4/7/20, 4/21/20, 5/5/20, 6/16/20, 6/30/20, 8/4/20

1Docket


(1) Current issues(a) Motion of the U.S. Trustee ("UST") to dismiss (dkt. 65, "MTD"),

debtor's opposition (dkt. 86), UST's reply (dkt. 168, 170), debtor's response (dkt. 179), debtor's status report (dkt. 180), stipulation and order re pre-petition bank account (dkt. 212, 221)

There is no tentative ruling. The outcome of this motion may depend on whether this Court confirms Debtor's amended plan.

(c) Debtor's Amended plan (dkt. 313) (see also Disclosure Statement, dkt. 311), order setting confirmation hearing (dkt. 317), proof of service of solicitation package (dkt. 324), Debtor's confirmation brief (dkt. 329), ballot summary (dkt. 330), objection of Post Acute Care Partners, Inc. ("Post") (dkt. 332), objection of Shiv Raj & Saroj Gupta ("Guptas") (dkt. 333), Debtor's Reply (dkt. 335)

The tentative ruling is that (x) Debtor has adequately addressed Post's objection; (y) Debtor has adequately addressed the non-materiality of her proposed minor modifications to the Plan (i.e., re-balloting is not required); and (z) Debtor has provided sufficient arguments and evidence to overrule most of the Guptas' objections. The Guptas' objections that Debtor has not yet sufficiently addressed are explained below.

(A) Best Interest Test (11 U.S.C. 1129(a)(7)): Debtor's calculations require an adjustment, but even with an adjustment the Guptas have not rebutted Debtor's showing that the Plan satisfies the best interest test

Tentative Ruling:

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2:00 PMAshley Susan AaronsCONT... Chapter 11The tentative ruling is that Debtor's alternative liquidation analysis

(dkt.335, pp.11-12) should be adjusted to account for the possibility that the secured claim asserted by Patch Of Land ("Patch" or "POL") might be reduced to some extent, based on objections to default interest and other claims by the bankruptcy estate. But the tentative ruling - based on this Court's familiarity with numerous disputes in other cases regarding default rates of interest and other charges - is that the possibility of such reduction, discounted to present value, is less than shortfall in funds that would be availabe in any hypothetical chapter 7 case. See Debtor's Reply (dkt.335), p.12. See generally, e.g., East-West Bank v. Altadena Lincoln Crossing, LLC, 598 B.R. 633 (C.D. Cal. 2019)

The tentative ruling is that a precise dollar estimate is not required because the shortfall is hundreds of thousands of dollars; the discount to Patch's claim would not be greater than that. In other words, even with the adjustment to Patch's claim as described above, there would be $-0- for general unsecured creditors in a hypothetical chapter 7 case.

Alternatively, assuming for the sake of discussion that any adjustments to Debtor's liquidation analysis would be enough to provide any projected recovery for nonpriority unsecured creditors, that in itself does not establish that liquidation would be in the best interests of creditors. Rather, the issue would require further evidence because any such projected chapter 7 recovery still would have to exceed the projected recovery under Debtor's proposed Plan, and the latter requires more evidence (as noted below).

(B) Adequate means for implementation (11 U.S.C. 1123(a)(5)) and feasibility (11 U.S.C. 1129(a)(11))

Debtor is directed to address whether she has evidence of sufficient loan commitments and/or gift commitments from family and friends to make her proposed commitments in the Plan adequate and feasible. See, e.g., Debtor's Reply (dkt.335), p.14:2-8. The parties are directed to address whether any evidentiary hearing will be necessary to address the sufficiency of such evidence, and the possible scheduling of any such evidentiary hearing and any related matters.

(2) Deadlines/dates. This case was filed on 7/17/19. (a) Bar date: 12/20/19, dkt. 116 (timely served, dkt. 120)(b) Procedures order: dkt.9 (timely served, dkt.18)

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2:00 PMAshley Susan AaronsCONT... Chapter 11(c) AmPlan/AmDisclosure Statement*: See above.(d) Continued status conference: If there are unresolved confirmation

issues, this Court anticipates setting either a continued hearing/status conference on 10/6/20 at 2:00 p.m. and/or an evidentiary hearing (at a date and time to be determined). Alternatively, if the Plan were to be confirmed at today's hearing, the tentative ruling would be to set a post-confirmation status conference for 1/12/21 at 2:00 p.m.




Party Information

Debtor(s):


Trustee(s):


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Los Angeles


2:00 PMR44 LENDING GROUP, LLC a Delaware Limited Liabilit2:18-15559 Chapter 11

#4.00 Cont'd Pre-Trial Conference re:Fifth Amended Chapter 11 Plan fr. 06/16/20, 8/18/20

134Docket

Tentative Ruling for 9/29/20:Please see the tentative ruling for the status conference (Calendar. No. 5, 9/29/20 at 2:00 p.m.).


Tentative Ruling:

Party Information

Debtor(s):

R44 LENDING GROUP, LLC a Represented ByJeffrey S Shinbrot

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Los Angeles


2:00 PMR44 LENDING GROUP, LLC a Delaware Limited Liabilit2:18-15559 Chapter 11

#5.00 Cont'd Status Conference re: Chapter 11 Casefr. 6/12/18, 6/26/18, 08/07/18, 10/9/18, 11/6/18,12/11/18, 03/12/19, 3/26/19, 5/14/19, 6/11/19,7/2/19, 7/30/19, 9/17/19, 11/12/19, 12/17/19, 3/10/20, 6/16/20, 8/18/20

5Docket

Tentative Ruling for 9/29/20:Appearances required by counsel for the debtor.

(1) Current issues(a) Pre-trial conferenceContinue to the same date and time as the continued status

conference as set forth below.

(b) Status of mediationDebtor is directed to appear to provide an update on the status of

mediation efforts.

(c) Missing MORsAs of the preparation of this tentative ruling, Debtor has not filed a

monthly operating report for August. Why not?

(2) Deadlines/dates. This case was filed on 5/15/18. (a) Bar date: 8/14/18 (dkt. 35), timely served (dkt. 38).(b) Plan/Disclosure Statement (dkt. 133, 134)*: See above(c) Continued status conference: 11/10/20 at 2:00 p.m., Brief written

status report due 10/27/20.*Warning: special procedures apply (see order setting initial status conference).


Tentative Ruling:

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Los Angeles


2:00 PMR44 LENDING GROUP, LLC a Delaware Limited LiabilitCONT... Chapter 11

required/are not required," please see Judge Bason's Procedures (posted at www.cacb.uscourts.gov) then search for "tentative rulings." If appearances are required, and you fail to appear without adequately resolving this matter by consent, then you may waive your right to be heard on matters that are appropriate for disposition at this hearing. Pursuant to Judge Bason's COVID-19 procedures, all appearances are telephonic via CourtCall at (888) 882-6878.


Party Information

Debtor(s):

R44 LENDING GROUP, LLC a Represented ByJeffrey S Shinbrot

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Los Angeles


2:00 PMJeffrey Mark Freeman2:11-34162 Chapter 13

#6.00 Cont'd Status Conference re: Briefing Schedule / Proceduresfr. 12/19/19, 03/10/20, 5/19/20, 06/30/20, 7/28/20, 8/18/20

270Docket *** VACATED *** REASON: MOD & Order entered 9/4/20 (dkt. 327, 328)

Tentative Ruling:

Party Information

Debtor(s):

Jeffrey Mark Freeman Represented ByJames D. HornbuckleMark T Young

Trustee(s):


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Los Angeles


2:00 PMSaeed Cohen2:13-26483 Chapter 11

#7.00 Cont'd Status Conference re: Post Confirmation fr. 5/23/17, 8/8/17, 9/12/17, 12/12/17, 1/9/18,4/10/18, 4/17/18, 07/17/18, 11/20/18, 12/11/18,03/12/19, 3/26/19; 08/06/19, 11/5/19, 12/10/19, 3/10/20, 6/30/20

0Docket

Tentative Ruling for 9/29/20:Continue this status conference to 1/26/21 at 2:00 p.m., with a brief status report due 1/12/21 based on Debtor's status report (dkt. 1537). Appearances are not required on 9/29/20.



Tentative Ruling:

Party Information

Debtor(s):

Saeed Cohen Represented ByRon BenderKrikor J MeshefejianKurt RamloBeth Ann R YoungTodd M Bailey

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Los Angeles


2:00 PMCandelario Lora2:19-23303 Chapter 11

#8.00 Cont'd hrg re: Objection to Claim No. 6-1 and Aztec Financial's Demand Worksheet Dated July 17, 2020fr. 9/1/20, 9/15/20

178Docket


Tentative Ruling for 9/1/20:Please see the tentative ruling for the status conference (calendar no. 12, 9/1/20 at 1:00 p.m.)

Tentative Ruling:

Party Information

Debtor(s):

Candelario Lora Represented ByOnyinye N Anyama

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Los Angeles



#9.00 Cont'd Combined hrg re: Final Approval ofDisclosure Statement and Confirmation of Plan fr. 6/30/20, 7/28/20, 9/1/20, 9/15/20

124Docket


Tentative Ruling for 6/30/20:Please see the tentative ruling for the status conference (calendar no. 20, 6/30/20 at 1:00 p.m.)

Tentative Ruling:

Party Information

Debtor(s):


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Los Angeles



#10.00 Cont'd Status Conference re: Chapter 11 Casefr. 12/17/19, 1/14/20, 02/18/20, 03/31/20, 4/21/20,5/5/20, 6/30/20, 7/28/20, 9/1/20, 9/15/20

1Docket

Tentative Ruling for 9/29/20: This Court anticipates issuing a written tentative ruling prior to the hearing.

Tentative Ruling for 9/15/20:This Court anticipates issuing a written tentative ruling prior to the hearing.

Tentative Ruling:

Party Information

Debtor(s):


of 1249/25/2020 11:23:57 AM

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