Case No. 06-22225-D-7, Adv. Pro. No. 07-2006-D, Docket Control No. TC-1.United States Bankruptcy Court, E.D. California.
September 24, 2007
This memorandum decision is not approved for publication and may not be cited except when relevant under the doctrine of law of the case or the rules of claim preclusion or issue preclusion.
MEMORANDUM DECISION
ROBERT BARDWIL, Bankruptcy Judge
Thomas Carter, Co-Trustee of the Aida Madeleine Lebbos No. 2 Trust, a defendant in this action (“Defendant”), seeks to disqualify the undersigned as the bankruptcy judge in this adversary proceeding. For the reasons set forth below, the court will deny the Defendant’s request.
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I. INTRODUCTION
On June 26, 2006, Betsey Warren Lebbos (“Debtor”) filed a voluntary chapter 7 petition, thereby commencing the case in which this adversary proceeding is pending. On January 3, 2007, Linda Schuette, the chapter 7 trustee in the case (“Plaintiff”) filed a complaint seeking to set aside alleged fraudulent transfers, to recover property and/or monetary damages, for turnover of property, and for declaratory relief, thereby commencing this adversary proceeding. The defendants in the adversary proceeding are the Debtor, individually and as a trustee of the Aida Madeleine Lebbos No. 2 Trust (“the Trust”), the Defendant, as a trustee of the Trust, and Jason Gold, as a trustee of the Trust.[1]
On August 17, 2007, the Defendant filed a document entitled “Affidavit for Disqualification of Honorable Robert Bardwil” (“Affidavit”). The caption of the Affidavit contained a hearing date of August 29, 2007, but the Defendant did not file a notice of hearing or an application for an order shortening time, as required by Local Bankruptcy Rule 9014-1.
Also on August 17, 2007, co-defendant Jason Gold filed his own request, in the form of a “Request for Disqualification of Honorable Robert Bardwil,” and on August 24, 2007, the Debtor filed a document in the parent bankruptcy case entitled “Judicial
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Disqualification Affidavit For Honorable Robert Bardwil Due to His Interest in the Outcome, Partisanship, Bias, Prejudice, And Prejudgment Against The Disabled.” Finally, on September 6, 2007, the Debtor filed a document bearing the same title in this adversary proceeding.
On August 29, 2007, the court issued orders on the first three matters, the Debtor’s affidavit in the parent case and Mr. Gold’s request and Mr. Carter’s affidavit in this adversary proceeding, construing the matters as motions, setting them for hearing on September 12, 2007, and setting a deadline of September 5, 2007, for the filing of responses. The Plaintiff, through her counsel, Michael Dacquisto, filed opposition in all three matters on August 30, 2007.
On September 12, 2007, the court heard oral argument. The following parties appeared and presented argument: Jason Gold on his own behalf, John Read (by telephone), making a special appearance for the Debtor, and Michael Dacquisto (by telephone), for the Plaintiff. Defendant Carter did not appear.
No objection was made to any evidence offered. The motion having been briefed and argued by those parties wishing to be heard, the court took the motion under submission.
II. ANALYSISA. Legal Standards for Disqualification
This court has jurisdiction over the motion pursuant to 28 U.S.C. sections 1334 and 157(b)(1). The motion is a core proceeding under 28 U.S.C. section (b)(2)(A) (0); In re Betts, 143 B.R. 1016, 1018 (Bankr. N.D. Ill. 1992).
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“A bankruptcy judge shall be governed by 28 U.S.C. § 455, and disqualified from presiding over the proceeding or contested matter in which the disqualifying circumstance arises, or, if appropriate, shall be disqualified from presiding over the case.” Fed.R.Bankr.P. 5004(a).
Section 455 of Title 28 provides in part as follows:
(a) Any justice, judge, or magistrate of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned.
(b) He shall also disqualify himself in the following circumstances:
(1) Where he has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding.
* * *
(4) He knows that he . . . has a financial interest in the subject matter in controversy or in a party to the proceeding, or any other interest that could be substantially affected by the outcome of the proceeding.
The disqualification statute was comprehensively revised in 1974, to provide for disqualification not only where a judge holds a personal bias or prejudice, but also to spell out a list (not fully reproduced above) of various interests and relationships that require the judge to disqualify himself from hearing a proceeding; such interests and relationships were only generally stated in the prior statutory language. Liteky v.United States, 510 U.S. 540, 546-48 (1994). Section 455(a) was added to include objective, “catch-all” grounds for disqualification, in addition to the earlier “interest or relationship” grounds and “bias or prejudice” grounds, which are
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now specifically stated and set forth in the various subsections making up § 455(b). Liteky, 510 U.S. at 548. Under § 455(a), “[the standard for recusal is clearly objective: `whether a reasonable person with knowledge of all of the facts would conclude that the judge’s impartiality might reasonably be questioned’.” In re Georgetown Park Apts., Ltd., 143 B.R. 557, 559 (B.A.P. 9th Cir. 1992), quoting United States v. Nelson, 718 F.2d 315, 321 (9th Cir. 1983) (other citations omitted).
The Code of Conduct for United States Judges (the “Code of Conduct”) mirrors the provisions of 28 U.S.C. § 455. The Code of Conduct requires that “every judicial officer must satisfy himself that he is actually unbiased towards the parties in each case and that his impartiality is not reasonably subject to question.” In re Bernard, 31 F.3d 842, 843 (9th Cir. 1994). Under this standard, the judge must not only be subjectively confident that he is unbiased; it is also objectively necessary that “an informed, rational, objective observer would not doubt his impartiality.” Id. at 844, citing United States v. Winston, 613 F.2d 221, 222 (9th Cir. 1980). However, “to say that § 455(a) requires concern for appearances is not to say that it requires concern for mirages.” United States v. El-Gabrowny, 844 F. Supp. 955, 961 (S.D.N.Y. 1994). As such, recusal must be based on factors in the record and in the law. Id. at 962.
Cases applying recusal statutes apply a presumption of impartiality. E.g. In re Larson, 43 F.3d 410, 414 (8th Cir. 1994) (judge presumed impartial; parties seeking recusal bear “substantial burden” of proving otherwise); First Interstate Bankv. Murphy, Weir Butler, 210 F.3d 983, 987 (9th Cir. 2000)
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(“Judicial impartiality is presumed”); In re Spirtos, 298 B.R. 425, 431 (Bankr. C.D. Cal. 2003) (“A judge is presumed to be qualified to hear a matter and the burden is upon the moving party to prove otherwise”).
In addition, “[j]udges have an obligation to litigants and their colleagues not to remove themselves needlessly . . . because a change of umpire in mid-contest may require a great deal of work to be redone . . . and facilitate judge-shopping.”In re Betts, 143 B.R. 1016, 1020 (Bankr. N.D. Ill. 1992), quotingIn re National Union Fire Ins. Co., 839 F.2d 1226, 1229 (7th Cir. 1988) (omitting citation); see also In re Computer Dynamics,Inc., 253 B.R. 693, 698 (E.D. Va. 2000) (judge equally obligated not to remove himself when there is no necessity and to do so when there is), aff’d 10 F. App’x 141 (4th Cir. 2001).
B. The Defendant’s Arguments 1. Contentions re Factual Allegations of the Complaint
The Defendant begins with three paragraphs outlining his contentions regarding the factual allegations in the Plaintiff’s complaint. It is not necessary or appropriate that the court consider these contentions in ruling on the Affidavit, and the court therefore will not address or consider them.
2. Allegations Previously Considered
In paragraphs 4 through 9 of the Affidavit, the Defendant recites a variety of conclusions based on his “understandings” of previous rulings in this case. There is no evidence the Defendant has personal knowledge of any of these rulings, or of the evidence on which the rulings were based. The Defendant does not identify the source of his understandings. The particular
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arguments raised in these paragraphs have been previously considered by the court and addressed in the court’s Memorandum Decision filed April 13, 2007 (DN 250 in the parent case)[2] and its Memorandum Decision issued herewith in connection with the Debtor’s second request for disqualification of the undersigned, Docket Control No. BWL-9. The court’s responses will not be repeated here except to say that the court finds the Defendant’s conclusions to be unfounded.
3. Alleged Intention to “Take Trust Property”
The Defendant refers to a transcript in which the undersigned is alleged to have said that he “is barring [the defendants] from defending [the Debtor’s] daughter’s trust property,”[3] and that he “is going to take my property from me without letting me defend.”[4] The Defendant has failed to provide a copy of any transcript, and the court is aware of no instance in which any such remarks were made.
The contention is without support. In fact, the court set aside the default of the three co-trustees, Ms. Lebbos, Mr. Carter, and Mr. Gold, and has allowed them repeated extensions of the deadline to file an answer or other responsive pleading. The Defendant, through counsel, filed a motion to set aside his default on February 20, 2007. Yet it was almost six months later, on August 17, 2007, that the Defendant filed his first responsive pleading, a motion to dismiss.
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(At a hearing on August 1, 2007, the court had granted the most recent extension of time, to August 17. DN 187.) The facts do not support the conclusion that the court has been anything less than completely fair to the Defendant.
4. Remarks of Unidentified Persons
A second paragraph 9 recites the purported remarks of “people [the Defendant] has talked to.” The court assumes these alleged conversations are included to support a finding that “an informed, rational, objective observer” would doubt the court’s impartiality. See In re Bernard, supra, 31 F.3d at 844. The court concludes that an informed, rational, objective observer would find no reason to doubt the court’s impartiality toward the Defendant in this action. The alleged comments of unidentified individuals, derived from their hearsay discussions with the Defendant, in turn based on the Defendant’s “understandings,” add nothing helpful to the analysis.
III. CONCLUSION
For the reasons stated above, the court finds that the Defendant has not met his burden under 28 U.S.C. § 455(a) of overcoming the presumption of impartiality and demonstrating that the impartiality of the undersigned might reasonably be questioned. Neither has the Defendant demonstrated grounds for disqualification under 28 U.S.C. § 455(b).
The court will issue an order consistent with this memorandum.