Barnes v. Henry

CourtDistrict Court, D. Hawaii
DecidedJanuary 13, 2020
Docket1:19-cv-00211
StatusUnknown

This text of Barnes v. Henry (Barnes v. Henry) is published on Counsel Stack Legal Research, covering District Court, D. Hawaii primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Barnes v. Henry, (D. Haw. 2020).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF HAWAI‘I

CHAD BARRY BARNES, Case No. 19-cv-00211-DKW-RT

Appellant, Bankr. No. 14-01475 v.

KRISTIN KIMO HENRY,

Appellee.

CHAD BARRY BARNES, Case No. 19-cv-00214-DKW-RT

Appellant, Bankr. No. 14-01520 v.

SEA HAWAII RAFTING, LLC,

ORDER AFFIRMING IN PART AND REVERSING IN PART ORDERS OF THE BANKRUPTCY COURT

In these consolidated appeals, Appellant Chad Barry Barnes challenges two orders of the U.S. Bankruptcy Court for the District of Hawai‘i, which, together, addressed a motion for reconsideration Barnes filed with respect to various orders entered in two separate bankruptcy proceedings.1 In addressing Barnes’ motion, the Bankruptcy Court reconsidered and vacated certain orders, declined to vacate

orders for which an appeal was already pending, and observed that other orders had already been declared void. Otherwise, the Bankruptcy Court denied Barnes the relief he sought. On appeal, Barnes’ briefing is, once again, largely

unhelpful.2 Nevertheless, in one of the other consolidated appeals involving the parties here, this Court found that Barnes’ claim for maintenance and cure was, in part, a secured in rem claim against Appellee Kristin Kimo Henry to the extent Barnes was able to pierce the corporate veil of Appellee Sea Hawaii Rafting, LLC.

Because that issue arises again in these consolidated appeals, as set forth below, this Court REVERSES IN PART the order of the Bankruptcy Court entered in Henry’s bankruptcy proceeding that is subject to these appeals. In all other

respects, the two orders of the Bankruptcy Court are AFFIRMED for the reasons discussed below. I. Procedural Background3

1Pursuant to Local Rule 7.1(c), the Court elects to decide these consolidated appeals without a hearing. 2At the same time as filing these consolidated appeals, Barnes also filed five other bankruptcy appeals that were assigned to the undersigned. Briefing in all of the appeals has suffered from the same unhelpful argument styles and arguments, some of which are identified further below. 3The Court notes that there is a lengthy procedural background to the underlying bankruptcy and admiralty cases between the parties. While the Court does not recite that history in full herein, the Court is cognizant of the same and, to the extent relevant, it is mentioned herein. 2 To better understand the motion for reconsideration and orders addressing the same at issue in these consolidated appeals, it is helpful to recount some of the

procedural background on which many of the requests in the motion are based. The underlying litigation between the parties here began, seven years ago, with Barnes’ filing of an admiralty complaint against, inter alia, Appellees Henry and

Sea Hawaii Rafting, LLC (“SHR”). Nearly two years later, Henry and SHR filed voluntary petitions for bankruptcy protection. Those three proceedings–one admiralty and two bankruptcy–have produced a vast amount of litigation and a large number of appeals. For example, in the bankruptcy proceeding of SHR, at

the time the motion for reconsideration was filed, at least six appeals had been docketed with the district court from orders of the Bankruptcy Court. In the admiralty case, meanwhile, three appeals had been docketed with the Ninth Circuit

Court of Appeals by a similar time. Those appeals have, in turn, on occasion, produced results that reverse, at least in some fashion, actions taken by the Bankruptcy Court and/or the admiralty court in their respective proceedings. It is in this context that the motion for reconsideration exists, as therein, many of the

requests for reconsideration are premised upon Barnes’ interpretation of orders entered in the foregoing appeals or his interpretation of orders entered following the remand of an appeal.

3 In ruling on the motion for reconsideration, the Bankruptcy Court split its decision into two separate orders: one entered in the SHR bankruptcy proceeding

and one entered in Henry’s. In total, the motion for reconsideration sought reconsideration of 13 orders: 5 in the SHR bankruptcy proceeding and 8 in Henry’s. In Henry’s bankruptcy proceeding, the Bankruptcy Court vacated one

order, indicated that it would vacate another, and otherwise denied the motion for reconsideration. Case No. 19-cv-211-DKW-RT, Dkt. No. 1-2 (“Henry Order”). In SHR’s bankruptcy proceeding, the Bankruptcy Court vacated one order, declined to take further action with respect to two orders (because the orders had

already been vacated), and otherwise denied the motion for reconsideration. Case No. 19-cv-214-DKW-RT, Dkt. No. 1-2 (“SHR Order”). On April 24, 2019, Barnes filed notices of appeal of the foregoing orders,

one in the SHR bankruptcy proceeding and one in Henry’s (collectively, “the Bankruptcy Appeals”).4 Because the orders being appealed in the Bankruptcy Appeals involved common questions of law and fact, and because consolidation would produce savings in time and effort, while causing no inconvenience, delay,

or expense, the Court consolidated the Bankruptcy Appeals. See Dkt. No. 5. In the Court’s order of consolidation, Barnes was instructed to clearly identify the

4Herein, going forward, unless otherwise noted, the Court cites to docket entries in Case No. 19- cv-211-DKW-RT. 4 issue or issues being appealed, clearly explain how the Bankruptcy Court purportedly erred with respect to the issue, and provide legal support for the

Bankruptcy Court’s purported error. On August 16, 2019, Barnes filed his opening brief. Dkt. No. 10. Thereafter, Appellee SHR filed a response brief. Dkt. No. 11. Appellee Henry

has not filed any brief in these Bankruptcy Appeals. Finally, while Barnes had until November 4, 2019 to file a reply brief, Dkt. No. 9, no such brief was (or has been) filed. II. Legal Standard

This Court reviews a bankruptcy court’s factual findings for clear error and its conclusions of law and determinations on mixed questions of law and fact de novo. In re Salazar, 430 F.3d 992, 994 (9th Cir. 2005); In re Hamada, 291 F.3d

645, 649 (9th Cir. 2002). III. Discussion In order to make as straightforward as possible this Court’s review of the rulings at issue in these Bankruptcy Appeals, the Court will address each of the

orders for which reconsideration was sought in Henry’s bankruptcy proceeding, followed by the orders in the SHR bankruptcy proceeding. Initially, however, the Court first discusses an issue that, although not involving a specific order for

5 which Barnes sought reconsideration, was addressed by both the Bankruptcy Court and Barnes in his opening brief.

A. Recusal of the Bankruptcy Court In both orders at issue in these Bankruptcy Appeals, the Bankruptcy Court observed that Barnes had asserted the Bankruptcy Court was biased against Barnes

or his counsel. Henry Order at 2; SHR Order at 2. The Bankruptcy Court stated that, “[a]t multiple points in these cases, I have carefully considered whether I should recuse myself, and I have determined (and I still conclude) that a reasonable person would not conclude that I could not decide these cases fairly.” Henry

Order at 2 (footnote omitted); SHR Order at 2 (footnote omitted). In his opening brief, Barnes asserts that the Bankruptcy Court applied the wrong standard in considering recusal, arguing that an “appearance of impropriety”

is sufficient to justify recusal. Dkt. No. 10 at 26.

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