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In re Roessler-Lobert

United States Bankruptcy Appellate Panel of the Ninth Circuit

May 15, 2017

In re: CAREY A. ROESSLER-LOBERT, Debtor
v.
CAREY A. ROESSLER-LOBERT; JERRY NAMBA, Appellees. [*] MARY LEE, in her capacity as Personal Representative of the Estate of Juliana March, Appellant, Bk. No. 9:15-bk-11174-PC Adv. Pro. 9:15-ap-01065-PC

          Argued and Submitted on February 23, 2017 at Pasadena, California

         Appeal from the United States Bankruptcy Court for the Central District of California Honorable Peter H. Carroll, Bankruptcy Judge, Presiding

          Seymour I. Amster argued on behalf of Appellant Mary Lee.

          Before: FARIS, CLEMENT, [**] and TAYLOR, Bankruptcy Judges.

          OPINION

          FARIS, Bankruptcy Judge

         INTRODUCTION

         Appellant Mary Lee, in her capacity as personal representative of the Estate of Juliana March, appeals from the bankruptcy court's order dismissing her adversary complaint against chapter 7[1] debtor Carey A. Roessler-Lobert. Although the bankruptcy court was understandably frustrated with Ms. Lee's attorney's misrepresentations and noncompliance with the applicable court order and rules, it abused its discretion in dismissing the complaint at the initial status and scheduling conference. Accordingly, we REVERSE the dismissal order and REMAND this case to the bankruptcy court.

         FACTUAL BACKGROUND

         On June 2, 2015, Ms. Roessler-Lobert, proceeding pro se, filed a chapter 7 petition in the United States Bankruptcy Court for the Central District of California. On September 3, Ms. Lee, though her attorney, Seymour I. Amster, timely filed an adversary complaint to determine dischargeability.[2]

         That same day, the bankruptcy court promptly issued the summons required by Rule 7004 via CM/ECF. The summons set a status and scheduling conference for November 5, 2015 and required Ms. Roessler-Lobert to respond to the adversary complaint by October 5, 2015.

         The court simultaneously issued a scheduling conference order regarding the Civil Rule 26(f) meeting, initial disclosures, and Civil Rule 16(b) status conference. The scheduling conference order directed the plaintiff to serve a copy of the scheduling conference order with the summons. It also directed the parties to meet and confer at least twenty-one days prior to the November 5 status conference; discuss the nature of their claims and defenses, arrange for initial disclosures, discuss discovery issues, and propose a discovery plan; make initial disclosures; consider alternative dispute resolution; and file a joint status report no later than seven days before the status conference. According to the notice of electronic filing, the bankruptcy court e-mailed CM/ECF notification of the scheduling conference order to Mr. Amster's e-mail address on record with the court and mailed a hard copy to his address in Granada Hills, California, which was listed on the complaint.

         Mr. Amster failed to timely serve Ms. Roessler-Lobert with the summons and scheduling conference order. At some point, he logged into his CM/ECF account and retrieved the summons and scheduling conference order. He attempted service on Ms. Roessler-Lobert on October 17, and she received the documents on October 20 - fifteen days after her deadline to respond to the complaint and only sixteen days before the status conference. Mr. Amster did not file a proof of service of the summons with the court.

          On November 1, four days before the status conference, Mr. Amster called Ms. Roessler-Lobert and asked her to agree that they had met and conferred ahead of the status conference. According to Ms. Roessler-Lobert, the call lasted about eight minutes and "he said that he was just going to go ahead and file a unilateral statement. . . . [B]asically it was just about as far as whether or not to meet and confer and just say that I have." At approximately 8:15 pm the night before the conference, Mr. Amster filed a unilateral status report on behalf of Ms. Lee.

         Mr. Amster did not appear at the November 5 status conference; instead, attorney Laura Dewey made a special appearance in his place. Ms. Dewey represented to the court that Mr. Amster was involved in a death penalty trial. She stated that Ms. Roessler-Lobert had not answered the complaint and requested that the court continue the status conference.

         Ms. Roessler-Lobert explained to the court that she had only received the summons on October 20 and that Mr. Amster had called her four days prior and asked her to agree that they had met and conferred. The court noted that, in addition to the tardy service of the summons and the late meet-and-confer, Ms. Lee had not filed a status report[3] or a proof of service of the summons. In response, Ms. Dewey said that Mr. Amster has "been stuck in this very long-standing death penalty case and has simply fallen behind in his administrative work in his practice."

         The court dismissed the case for want of prosecution, failure to file a status report that Local Bankruptcy Rule ("LBR") 7016-1 requires, and violation of the scheduling conference order. It entered an order ("Dismissal Order") dismissing the adversary proceeding the same day.

         Ms. Lee filed a timely motion to set aside or reconsider the Dismissal Order ("Motion for Reconsideration"). Mr. Amster, on behalf of Ms. Lee, argued that he did not receive a copy of the summons or scheduling conference order because the court mistakenly sent the hard copy to an old address. (This was a false statement.) He logged into CM/ECF at an unspecified date and found the summons, then served the summons, complaint, and scheduling conference order on Ms. Roessler-Lobert on October 17.

         He said that he called Ms. Roessler-Lobert on November 1 to obtain her support in creating a joint status report. He said that she did not understand what she was supposed to do, so he told her that he would file a unilateral status report.

         Mr. Amster explained that he was unable to personally attend the November 5 status conference because he was involved in the so-called "Grim Sleeper" death penalty case and "was devoting a significant amount of his time to that matter which caused the delays in this matter."

         Mr. Amster again did not show up for the hearing on the Motion for Reconsideration. Rather, attorney William C. Beall appeared on behalf of Ms. Lee. Mr. Beall argued that the court should reconsider the Dismissal Order based on Mr. Amster's neglect. He represented that "the hard copy summons [went] to the wrong address, so [Mr. Amster] didn't see it, and then he eventually did go into ECF and got it." He repeatedly reminded the court that Mr. Amster was "involved in a multiple murder death penalty case down south. He got himself in too deep in this case. He wasn't able to give it the attention that it deserved, and so now, however, he is."[4]

         The court was unsympathetic. It said that the court routinely issues the summons and scheduling conference order in every adversary proceeding. The scheduling conference order requires the plaintiff to contact the defendant and arrange a Civil Rule 26(f) meeting no later than twenty-one days prior to the status conference. It also stated that the local bankruptcy rules require the plaintiff to file a status report fourteen days[5] prior to the status conference and to appear at the status conference.

         The court rejected Mr. Amster's excuse for not timely serving the summons. It said that the court had e-mailed notice of the issuance of the summons to Mr. Amster's e-mail address of record on September 3, and nothing "indicates that he even bothered to check his e-mail for the summons that he asked for from the Court." The court also rejected Mr. Amster's attempt to blame the court for mailing the documents to an incorrect address: "He claims in his defense in his motion for reconsideration - that the Court sent the summons by regular mail to an incorrect address. That's not what happened. The Court didn't send a summons to an incorrect address. The Court sent the summons to him electronically with an ECF notice, just like the Court's supposed to, the day the summons was issued." The court noted that Mr. Amster had neglected to pay attention to this case and inquire after the summons for over a month.

         The court also discussed Mr. Amster's failure to comply with Civil Rule 26(f). It said that he only contacted Ms. Roessler-Lobert a few days before the status conference; he did not file a status report until the night before the status conference; and he tried to convince Ms. Roessler-Lobert to agree that the short telephone call satisfied the meet-and-confer requirement. The court stated that "[t]hat's not what the order envisioned."

         Ultimately, the court denied the Motion for Reconsideration. It clarified that the basis for dismissal was not merely the failure to serve the summons timely, but also the failure to comply with LBR 7016-1, Civil Rule 26, and the scheduling conference order. The court stated that, contrary to Mr. Amster's representations, the summons and scheduling conference order were sent to Mr. Amster's e-mail address of record, [6] and the scheduling conference order was also mailed to the Granada Hills address on record. The court concluded:

Counsel failed to check his e-mail for notice that the summons had been issued; failed to timely serve the summons, order, and complaint on the defendant; failed to file a proof of service of the summons with the Court; failed to initiate the Rule 26(f) conference, as ordered by the Court; and failed to timely file a status report. These omissions involve a complete lack of diligence in following the rules of this Court, which are unambiguous.

         The court issued its order ("Reconsideration Order") denying the Motion for Reconsideration. Ms. Lee timely appealed from the Dismissal Order and the Reconsideration Order.

         JURISDICTION

         The bankruptcy court had jurisdiction pursuant to 28 U.S.C. §§ 1334 and 157(b)(1). We have jurisdiction under 28 U.S.C. § 158.

         ISSUE

         Whether the bankruptcy court erred in dismissing Ms. Lee's adversary complaint.

         STANDARD OF REVIEW

         We review for abuse of discretion the bankruptcy court's dismissal of a complaint for failure to comply with the rules or court order. See Schmidt v. Herrmann, 614 F.2d 1221, 1224 (9th Cir. 1980). Similarly, the bankruptcy court's dismissal of an adversary proceeding based upon a plaintiff's failure to prosecute is reviewed for an abuse of discretion. See Al-Torki v. Kaempen, 78 F.3d 1381, 1384 (9th Cir. 1996); Moneymaker v. CoBen (In re Eisen), 31 F.3d 1447, 1451 (9th Cir. 1994).

         We also review for abuse of discretion the bankruptcy court's denial of a motion for reconsideration. See First Ave. W. Bldg., LLC v. James (In re Onecast ...


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