936 F2d 578 Merchant Distributors Inc Plotkin v. Merchant Distributors Inc E

936 F.2d 578

Unpublished Disposition

NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.

In re MERCHANT DISTRIBUTORS, INC., Debtor.
Gary A. PLOTKIN, Trustee, Appellant,
v.
MERCHANT DISTRIBUTORS, INC., Jack Turner, Maya Koehler, aka
Linda Maya Koehler, aka Mrs. Jack Turner, Andrew
E. Smyth, Appellees.

No. 90-55568.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 6, 1991.
Decided June 11, 1991.

Before GOODWIN, PREGERSON and ALARCON, Circuit Judges.

1

MEMORANDUM*

2

Gary A. Plotkin, the trustee in a Chapter 7 bankruptcy proceeding, appeals the Bankruptcy Appellate Court's ("BAP") decision affirming the bankruptcy court's denial of his motion to clarify and correct findings of fact and conclusions of law under Fed.R.Civ.P. 60.

3

The trustee raises two issues on appeal. First, he contends that the bankruptcy court lacked jurisdiction to consider the state court action. Second, he contends that the bankruptcy court erred by denying his Rule 60 motion which would allow a California state court creditor's suit to proceed. We reject both arguments and affirm.

4

In 1986, Merchant Distributors, Inc. ("Merchant") filed a Chapter 7 petition. The trustee began an adversary proceeding in bankruptcy court to enforce the claims of a creditor, DeSoto Associates, Ltd. ("DeSoto"), against Jack Turner and his wife Maya Koehler, both of whom were principals of Merchant. After a June 1988 hearing, Judge Eisen held that the statute of limitations had run on DeSoto's claims. The trustee appealed Judge Eisen's order to federal district court, where it was affirmed. In an effort to permit one of DeSoto's claims--its creditor's suit filed pursuant to Cal.Civ. Code Proc. Secs. 708.210 et seq. (West's 1990)--to proceed further in state court, the trustee returned to bankruptcy court and filed a Rule 60 motion to modify Judge Eisen's order and declare that the creditor's suit claim was outside the scope of his holding. Judge Fenning denied the motion, and this appeal follows.

5

The trustee's claim that the bankruptcy court lacked jurisdiction is unpersuasive. In the first paragraph of his complaint, where he acknowledges the bankruptcy court's jurisdiction, the trustee states "[t]his is a core proceeding." E.R. at 1. Under 28 U.S.C. Sec. 157(b)(1), "[b]ankruptcy judges may hear and determine all cases under title 11 and all core proceedings arising under title 11, or arising in a case under title 11...." Thus, because DeSoto's state law cause of action arises in the context of a title 11 proceeding, the bankruptcy court had jurisdiction.

6

"An appellate court may set aside a trial court's denial of a Rule 60(b) motion only if the denial constitutes an abuse of discretion." In re Burley, 738 F.2d 981, 988 (9th Cir.1984). In employing this standard, "a reviewing court cannot reverse unless it has a definite and firm conviction that the court below committed a clear error of judgment in the conclusion it reached upon a weighing of the relevant factors." Mission Indians v. American Management & Amusement, 840 F.2d 1394, 1408 (9th Cir.1987).

7

The trustee's claim that the bankruptcy court erred by denying his Rule 60 motion for clarification and nunc pro tunc correction of findings of fact and conclusions of law is similarly unpersuasive. The alleged mistake occurs in Finding 5, which states that all three of DeSoto's claims, including its creditor's suit, were adopted by the trustee. The trustee seeks to modify this finding to clarify that he adopted only DeSoto's fraudulent conveyance claims.

8

As the BAP found, however, Finding 5 unambiguously states that the trustee adopted all of DeSoto's claims. E.R. at A5. Furthermore, the fourth and fifth paragraphs of the trustee's complaint suggest that he elected to pursue all of DeSoto's claims, including the creditor's suit, in bankruptcy court. E.R. at 2; A5-A6. The June 1988 order is consistent with both the fifth finding and the complaint, and it states: "It is further adjudged ... that all claims of DeSoto Associates, Ltd. ... have been determined by this action...." E.R. at 295. The trustee's complaint explicitly presents the claim regarding the creditor's suit, and he cannot now seek to have this claim insulated from an adverse ruling. Thus, the bankruptcy court had ample grounds to reject the trustee's Rule 60 motion and its decision was not an abuse of discretion. See Burley, 738 F.2d at 988.

9

AFFIRMED.

*

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3