Ilya Yukhimets, et al. v. PFO Side Car LLC, et al.
Opinion
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5 UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT TACOMA 7 In re: CASE NO. 26-5574-BHS 8 ILYA YUKHIMETS, U.S.B.C. NO. 25-43020 9 Debtor. 10 ORDER 11 ILYA YUKHIMETS, et al., 12 Appellants, 13 v. 14 PFO SIDE CAR LLC, et al. 15 Appellees.
16 THIS MATTER is before the Court on pro se appellant debtors Ilya and Anna 17 Yukhimets’1 emergency motion for a stay pending appeal and request for a temporary 18 restraining order. Dkt. 7. Yukhimets asks this Court to overturn Bankruptcy Judge Mary 19 Jo Heston’s Order, Dkt. 8, in the underlying adversary action. Judge Heston denied his 20 request for a stay pending appeal of her Order dismissing on summary judgment his 21
22 1 The Court refers to appellants in the masculine singular for clarity and ease of reference. 1 claims against some of his creditors, appellees PFO Side Car LLC, Christopher Ambrose, 2 and PacWest Funding, dba Precision Capital (“defendants”). 3 In 2022, Yukhimets guaranteed a loan from Precision to Yukhimets’ entity,
4 Prudent Capital, and secured the loan with his Vancouver home. Defendants contend the 5 loan went into default in 2024. Dkt. 10 at 2. Yukhimets filed a Chapter 13 bankruptcy on 6 December 4, 2025, apparently in the face of a pending foreclosure on the home. 7 Yukhimets filed this adversary proceeding in the bankruptcy court on December 29, 8 2025. See No. 25-04074 MJH, Dkt. 1.
9 Defendants purchased the home at a trustee’s sale on December 5, 2025. In May 10 2026, the bankruptcy court granted defendants’ summary judgment motion and dismissed 11 the adversary proceeding. Dkt. 8 at 2; Dkt. 7-2 at 3. Yukhimets moved for a stay pending 12 appeal. Id. The bankruptcy court concluded he had not met the heavy burden required for 13 a stay and denied the motion. Dkt. 8 at 3.
14 Yukhimets appeals the dismissal and moves for a temporary restraining order 15 (TRO) precluding “eviction” or unlawful detainer proceedings against him, which are 16 apparently scheduled for June 25. Dkt. 7. 17 He asserts that the bankruptcy court’s order is erroneous for six reasons: (1) the 18 trustee’s sale and deed is void ab initio due to fraud, because the bankruptcy filing was
19 one day earlier and the sale violated the § 362 automatic stay; (2) the bankruptcy court 20 converted defendants’ motion to dismiss into a summary judgment motion without 21 notice; (3) the bankruptcy court’s consistently adverse rulings suggest personal bias; (4) 22 Precision is under “active securities fraud investigation”; (5) defendant attorney Ambrose 1 has a conflict of interest, tainting all of his conduct in the foreclosure; and (6) fraud 2 vitiates everything. Dkt. 7 at 6–9. 3 The purpose of a TRO is “preserving the status quo and preventing irreparable
4 harm just so long as is necessary to hold a hearing [on the preliminary injunction 5 application], and no longer.” Granny Goose Foods, Inc. v. Brotherhood of Teamsters & 6 Auto Truck Drivers, 415 U.S. 423 (1974); see also Reno Air Racing Ass’n v. McCord, 7 452 F.3d 1126, 1130–31 (9th Cir. 2006). For a court to grant a preliminary injunction, the 8 plaintiff “must establish that he is likely to succeed on the merits, that he is likely to
9 suffer irreparable harm in the absence of preliminary relief, that the balance of equities 10 tips in his favor, and that an injunction is in the public interest.” Winter v. Nat. Res. Def. 11 Council, Inc., 555 U.S. 7, 20 (2008). The last two factors merge if the government is a 12 party. Drakes Bay Oyster Co. v. Jewell, 747 F.3d 1073, 1092 (9th Cir. 2014). When 13 considering whether to grant this “extraordinary remedy, . . . courts must balance the
14 competing claims of injury and consider the effect of granting or withholding the 15 requested relief, paying particular regard to the public consequences.” Winter, 555 U.S. at 16 24. 17 This framework generally applies to a stay under Bankruptcy Rule 8007. See Dkt. 18 10 at 4 (citing Lair v. Bullock, 697 F.3d 1200, 1203 (9th Cir. 2012) (quoting Nken v.
19 Holder, 556 U.S. 418, 434 (2009)). 20 Defendants oppose the motion. Dkt. 10. First, they contend and demonstrate that 21 the bankruptcy court already correctly determined that Precision’s actions were excepted 22 from the bankruptcy stay. Id. (citing 11 U.S.C. § 362 and the bankruptcy court’s order, 1 Dkt. 76, in the adversary proceeding). The sale did not violate the automatic stay, and 2 Yukhimets cannot demonstrate that he is likely to succeed on the merits of this claim. 3 Second, defendants contend and demonstrate that the bankruptcy court provided
4 Yukhimets notice and an opportunity to provide new evidence or argument, more than a 5 month before the hearing. Dkt. 10 at 5 (citing bankruptcy court order, Dkt. 112 at 5). 6 Yukhimets’ assertion that the bankruptcy court converted defendants’ motion without 7 notice, and that the Order is therefore reversible error, is not correct. Yukhimets is not 8 likely to succeed on the merits of this claim, and it is not a basis for reversing that order
9 or for granting injunctive relief. 10 Third, Yukhimets argues that Judge Heston’s consistent rulings against him 11 suggest bias. This is not a viable predicate for recusal, disqualification, or a 12 TRO. “[J]udicial rulings alone almost never constitute a valid basis for a bias or partiality 13 motion.” Liteky v. United States, 510 U.S. 540, 555 (1994). To the contrary, “[a]lmost
14 invariably, they are proper grounds for appeal, not recusal.” Id. Yukhimets has not 15 demonstrated that he is likely to succeed on the merits of his claim that the bankruptcy 16 court’s orders were error because they were the product of bias. 17 Fourth, Yukhimets asserts that PacWest Funding is “under investigation,” voiding 18 the original deed of trust on his home, securing the in-default loan. This is a wholly
19 conclusory accusation and Yukhimets has not articulated how any such ongoing 20 21 2 Defendants’ request that the court take judicial notice of the attached bankruptcy orders 22 and filings, Dkt. 11, is GRANTED. 1 investigation warrants reversal of the bankruptcy court’s order dismissing his adversary 2 action. He has not shown he is likely to succeed on the merits of any such claim. 3 Fifth, Yukhimets sued defendants’ attorney Ambrose, and then asserted he had a
4 conflict of interest. As defendants contend, the conflict rules are designed to protect 5 clients, not their adversaries. And Ambrose is not the attorney on this appeal. Yukhimets 6 is not likely to succeed on the merits of his claim that any conflict would warrant reversal 7 of the bankruptcy court’s order. 8 Finally, defendants correctly contend that Yukhimets has failed to plead “fraud”
9 with any particularity. He has not established that he is likely to succeed on the merits of 10 any claim that fraud led to the original deed of trust, the foreclosure, or the bankruptcy 11 court’s order. 12 It is true that Yukhimets is facing irreparable harm if he is evicted from his home. 13 But absent any likelihood of success on the merits of his claims that the bankruptcy court
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