In re: SoCAL SLEEP CENTERS, LLC

FILED
AUG 08 2016
1 NOT FOR PUBLICATION
SUSAN M. SPRAUL, CLERK
U.S. BKCY. APP. PANEL
2 OF THE NINTH CIRCUIT

3 UNITED STATES BANKRUPTCY APPELLATE PANEL
4 OF THE NINTH CIRCUIT
5 In re: ) BAP No. CC-15-1216-FDKu
)
6 SoCAL SLEEP CENTERS, LLC, ) Bk. No. 2:14-bk-28581-NB
)
7 Debtor. )
_____________________________ )
8 )
MAUREEN JAROSCAK, )
9 )
Appellant, )
10 )
v. ) MEMORANDUM*
11 )
ARCADIA HUB HOLDINGS 3, LLC; )
12 UNITED STATES TRUSTEE, )
)
13 Appellees.** )
______________________________)
14
Argued and Submitted on July 28, 2016
15 at Pasadena, California
16 Filed – August 8, 2016
17 Appeal from the United States Bankruptcy Court
for the Central District of California
18
Honorable Neil W. Bason, Bankruptcy Judge, Presiding
19
20 Appearances: Robert Rice argued for Appellant Maureen Jaroscak;
Sumi Sakata argued for Appellee United States
21 Trustee.
22
Before: FARIS, DUNN, and KURTZ, Bankruptcy Judges.
23
24
*
This disposition is not appropriate for publication.
25 Although it may be cited for whatever persuasive value it may
26 have, see Fed. R. App. P. 32.1, it has no precedential value, see
9th Cir. BAP Rule 8024-1.
27
**
Arcadia Hub Holdings 3, LLC did not file an answering
28 brief or otherwise participate in this appeal.
 1 INTRODUCTION
2 Appellant Maureen Jaroscak appeals the bankruptcy court’s
3 imposition of sanctions against her for her conduct while she
4 represented debtor SoCal Sleep Centers, LLC in its chapter 111
5 case. Ms. Jaroscak argues that she did not make any false
6 statements or mislead the court. She contends that the court
7 erred by sanctioning her, rather than her client, and refusing to
8 amend its order (pursuant to the parties’ stipulation) to
9 sanction her client, rather than her.
10 Ms. Jaroscak’s arguments on appeal are all meritless, and
11 some are frivolous. Accordingly, we AFFIRM.
12 FACTUAL BACKGROUND
13 A. The unlawful detainer action
14 Arcadia Hub Holdings 3, LLC (“Arcadia Hub”) owned commercial
15 real property in Beverly Hills, California. Arcadia Hub’s
16 tenant, Beverly Hills Surgery Center, allegedly subleased some or
17 all of the premises to SoCal Sleep Centers2 without Arcadia Hub’s
18 knowledge.
19 In or around July 2014, Arcadia Hub began eviction
20 proceedings in California Superior Court against Beverly Hills
21 Surgery Center and filed an unlawful detainer action.
22 Ms. Jaroscak, who is an attorney licensed to practice in
23
24 1
Unless specified otherwise, all chapter and section
references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, all
25 “Rule” references are to the Federal Rules of Bankruptcy
26 Procedure, Rules 1001-9037, and all “Civil Rule” references are
to the Federal Rules of Civil Procedure, Rules 1-86.
27
2
SoCal Sleep Centers is allegedly a sleep clinic that
28 diagnosed sleep abnormalities.

2
 1 California, represented SoCal Sleep Centers.3 She signed a
2 “Prejudgment Claim of Right of Possession” on behalf of SoCal
3 Sleep Centers, in which she claimed that SoCal Sleep Centers
4 occupied the premises when the unlawful detainer complaint was
5 filed and had continued to occupy the premises ever since.
6 Inexplicably, Ms. Jaroscak also signed SoCal Sleep Centers’
7 answer to the complaint, which took the opposite position.
8 According to the answer, SoCal Sleep Centers “has tendered
9 possession and keys to the premises to plaintiff. Possession is
10 no longer an issue in the proceeding and no complaint for
11 unlawful detainer may be brought against the defendants.”4
12 The superior court later struck SoCal Sleep Centers’
13 prejudgment claim of right of possession as improperly executed.
14 It entered judgment for possession and unpaid rent in favor of
15 Arcadia Hub and against Beverly Hills Surgery Center.
16 B. SoCal Sleep Centers’ chapter 11 bankruptcy
17 On September 30, 2014, SoCal Sleep Centers filed a
18 chapter 11 bankruptcy petition. Ms. Jaroscak was listed as its
19 attorney of record.
20
21
22
3
23 Arcadia Hub alleged that Ms. Jaroscak also represented
Beverly Hills Surgery Center.
24
4
Ms. Jaroscak claims that this admission is a typo. She
25 asserts that it should have read, “Defendant has not tendered
26 possession . . . .” (Emphasis added.) This assertion is not
credible. The very next sentence of the answer says that
27 “[p]ossession is no longer an issue in this proceeding . . . .”
The “correction” would make the answer internally and patently
28 inconsistent.

3
 1 1. SoCal Sleep Centers’ schedules
2 SoCal Sleep Centers’ bankruptcy filings were woefully
3 deficient. Among other things, Ms. Jaroscak did not file a
4 retention application5 or disclosure of compensation, and she did
5 not file any “first day motions” which are almost always
6 necessary in a chapter 11 case.
7 SoCal Sleep Centers sought an extension to file its
8 schedules and statement of financial affairs in a motion filed on
9 October 14, 2014, the day those documents were due. SoCal Sleep
10 Centers’ manager, Mr. Oxman, submitted a declaration that SoCal
11 Sleep Centers had been unable to submit its schedules, because,
12 as a result of the landlord’s unlawful detainer action and
13 intimidation, “[a]ccess to debtor’s business records to
14 adequately complete the schedules has been severely impaired
15 . . . .”
16 The bankruptcy court granted SoCal Sleep Centers an
17 extension to file its schedules. SoCal Sleep Centers never filed
18 the required schedules and statements.
19 2. Ms. Jaroscak’s conflicting statements
20 Arcadia Hub filed a motion for relief from the automatic
21 stay (“Motion for Relief”). It argued (among other things) that
22
5
23 This was a serious omission. A person filing a retention
application must disclose “all of the person’s connections with
24 the debtor,” Rule 2015(a), so the court can evaluate whether the
person is a “disinterested person,” § 101(14), and “does not hold
25 or represent an interest adverse to the estate,” § 327(a). It
26 was later revealed that Ms. Jaroscak’s husband, Brian Oxman, is a
manager of SoCal Sleep Centers. (Mr. Oxman was also
27 Ms. Jaroscak’s law partner until he was disbarred for
misconduct.) Ms. Jaroscak should have disclosed these facts at
28 the very inception of the chapter 11 case.

4
 1 SoCal Sleep Centers had filed its bankruptcy petition in bad
2 faith. Additionally, Arcadia Hub stated that it believed that
3 SoCal Sleep Centers’ suite “is effectively empty and that no
4 personal property is located therein. . . . [N]o business has
5 been conducted . . . for over one year since Tenants’
6 ‘l-800-GET-THIN’ marketing program was shut down by governmental
7 investigators.”
8 SoCal Sleep Centers opposed the Motion for Relief.
9 Ms. Jaroscak submitted a declaration in support of the opposition
10 in which she stated (among other things) that SoCal Sleep Centers
11 was able to cure the rent arrearage and had tendered payment to
12 Arcadia Hub. She said that SoCal Sleep Centers had not abandoned
13 the property and attested that “SoCal Sleep Centers has sleep
14 study equipment, computers, files, and reception area equipment
15 and supplies on the premises and I have seen such equipment and
16 fixtures. . . . SoCal Sleep Centers still maintains a presence
17 at the medical suite.” She further stated that “SoCal Sleep
18 Centers operates out of that location.”
19 On October 28, 2014, the same day that SoCal Sleep Centers
20 filed its opposition to the Motion for Relief, the court held a
21 status conference. Counsel for Arcadia Hub and the Office of the
22 United States Trustee (“U.S. Trustee”) informed the court that
23 SoCal Sleep Centers had not filed many of the required documents,
24 communicated with the U.S. Trustee, or appeared for its initial
25 interview and § 341 meeting. They argued that the bankruptcy
26 petition was filed in bad faith. Arcadia Hub represented that
27 “[t]he premises have, in fact, been vacant for approximately a
28 year. There is no business being conducted in the premises, and

5
 1 has not been for approximately a year.” Ms. Jaroscak responded
2 that “we are still there. There are still files there. There is
3 furniture there. There are computers there.” She stated that
4 “[t]he debtor is not insolvent.”
5 The court expressed concern that SoCal Sleep Centers had not
6 filed first day motions that would have addressed issues such as
7 cash collateral, utilities, and payroll. The court required
8 SoCal Sleep Centers to file an “extensive” status report, warning
9 that it “may well have to dismiss the case . . . if there aren’t
10 some really good answers.”
11 The very next day, SoCal Sleep Centers filed a motion to
12 dismiss its chapter 11 case (“Motion to Dismiss”). It gave two
13 reasons for requesting dismissal: (1) it was unable to comply
14 with the court’s filing requirements, since it “does not have
15 access to its books, records, software, or files, to facilitate
16 compliance with Chapter 11 filing requirements due to a
17 government seizure of books and records on June 3, 2014[;]” and
18 (2) it “does not have sufficient information to formulate a
19 workable Chapter 11 plan within the next several months. The
20 absence of its records and papers makes it impossible to complete
21 this task.” (Previously, SoCal Sleep Centers had blamed Arcadia
22 Hub, not the federal government, for blocking access to its
23 records.)
24 In support of the Motion to Dismiss, Ms. Jaroscak attested:
25 3. On June 3, 2014, the United States Attorneys’
Office, including a task force of several government
26 agencies, conducted a raid of several locations
occupied by Beverly Hills Surgery Center, LLC,
27 including [SoCal Sleep Centers’ suite]. I was
personally present at the time of the raid.
28

6
 1 4. As a result of the raid, business files,
computers, software, patient records, and all records
2 belonging to . . . SoCal Sleep Centers, LLC, were
seized by the government and to date, have not been
3 returned. The raid effectively put all of the
occupants . . . out of business. . . .
4
5. While requests to the federal government for
5 return of some of the materials have been made by the
other defendants, nothing of any substance has been
6 returned by the government. The other occupants at
9001 Wilshire, including SoCal Sleep Centers, LLC, have
7 been unable to continue in their business operations.
Without access to books, records, and billing
8 information, no billing can be sent and no revenue has
been received since June 4, 2014. The money which
9 SoCal Sleep Centers has offered to pay the landlord
[has] come from the other occupants, and SoCal Sleep
10 Centers has no assets or funds available.6
11 6. . . . . SoCal Sleep Centers, LLC does not have
access to their records to effectively comply with the
12 US Trustee requirements, to make the motions required
of it to be in compliance with Chapter 1l statutes and
13 local rules, and to formulate a workable Chapter 11
Reorganization Plan.
14
15 (Emphases added.)
16 C. Hearings on the Motion for Relief and Motion to Dismiss
17 The court held hearings on the Motion for Relief and Motion
18 to Dismiss. Inexplicably, SoCal Sleep Centers did not appear at
19 the hearing on the Motion for Relief, so the court granted the
20 motion, terminating the automatic stay retroactively as of the
21 petition date.
22 Ms. Jaroscak did appear at the hearing on the Motion to
23 Dismiss and continued status conference. The court dismissed the
24
25 6
Ms. Jaroscak claims that this admission is another
26 unfortunate typo; she claims that she meant to say that SoCal
Sleep Centers had “no other assets or funds available.”
27 (Emphasis added.) This is not plausible. Adding the word
“other” would make the sentence absurd, because there is nothing
28 in the paragraph to which “other” might refer.

7
 1 case on its own motion with a 180-day bar on refiling and denied
2 the Motion to Dismiss as moot. The court stated that it had
3 “some real concerns about how the case commenced and how things
4 progressed.” The court contemplated issuing an order to show
5 cause why SoCal Sleep Centers or Ms. Jaroscak should not be
6 sanctioned: “it’s a real concern to me that giving some leeway to
7 the debtor for additional time to file schedules, giving some
8 leeway to the debtor to be able to establish why relief from the
9 automatic stay shouldn’t be granted, continuing the hearing on
10 that, and then it all turns out, ‘Oh, never mind. None of that
11 was really true.’”
12 Ms. Jaroscak defended her previous statements by saying
13 that, at the time SoCal Sleep Centers filed its petition, it
14 believed that it “would be able to put [itself] together and move
15 forward.” She stated that, after meeting with her client
16 following the status conference, “it became apparent to me that
17 my client was not going to be able to do that. They did not have
18 the records. More importantly, when I enlightened them about the
19 fact that if they were going to stay in the space that they were
20 in, that they were going to have to continue to pay the current
21 rent, which is approximately $25,000 a month, there is absolutely
22 no way at this point that they could do that.”7 As for the
23
7
24 This statement is troubling for at least two reasons.
First, contrary to the implication of Ms. Jaroscak’s statements,
25 SoCal Sleep Centers knew that it had to pay rent; in response to
26 Arcadia Hub’s Motion for Relief, it had assured the court that it
could and would cure the delinquent rent. Second, any competent
27 attorney for a chapter 11 debtor in possession would have
“enlightened” the debtor about the need to pay post-petition rent
28 (continued...)

8
 1 status of the business, Ms. Jaroscak stated that “[a]s far as the
2 business going there, there is furniture there. There is some
3 artwork there. There have been some other things there. I was
4 there yesterday. They are not, at this point, effectively doing
5 a business there.”
6 D. The OSC
7 In response to the U.S. Trustee’s request for sanctions and
8 initiation of disciplinary proceedings against Ms. Jaroscak
9 (“Request for Sanctions”), the court issued its order to show
10 cause (the “OSC”) why Ms. Jaroscak should not be sanctioned or
11 referred to the state’s disciplinary board.
12 In response to the OSC, Ms. Jaroscak argued that she did not
13 mislead the court and her statements “were essentially true,
14 despite apparent inconsistencies.”
15 First, regarding SoCal Sleep Centers’ access to its
16 documents (and ability to file schedules), Ms. Jaroscak argued
17 that she did not conceal or lie about the government’s seizure of
18 SoCal Sleep Centers’ records and that “there is no absolute need
19 for Jaroscak to tell the court all of the reasons for why Debtor
20 was having trouble getting access to documents,” and that she was
21 entitled to “exercis[e] her discretion” in presenting her
22 client’s case to the court. (Emphasis added.) “Jaroscak’s
23 decision to withhold this information was then merely an attorney
24 deciding how much to tell the Court and when.” Also, she claimed
25 (for the first time) that SoCal Sleep Centers was “in the process
26
7
27 (...continued)
even before filing the petition because § 365(b)(3) requires the
28 debtor in possession to do exactly that.

9
 1 of trying to reconstruct its records.”
2 Second, regarding the status of SoCal Sleep Centers’
3 operations, Ms. Jaroscak argued that she had correctly informed
4 the court that SoCal Sleep Centers “was attempting to maintain an
5 active business even in the face of the loss of most of its most
6 critical documents and records . . . .” She stated that,
7 “although Debtor and other occupants moved certain equipment out
8 of the Suite 106 during October, Debtor continued to try to
9 maintain an active presence at Suite 106.”
10 Prior to the hearing on the OSC, the court issued a
11 tentative ruling wherein it indicated that it was inclined to
12 sanction Ms. Jaroscak in the amount of Arcadia Hub’s attorneys’
13 fees pursuant to its inherent power. It said that Ms. Jaroscak’s
14 October 23, 2014 declaration in support of SoCal Sleep Centers’
15 opposition to the Motion for Relief was “willfully misleading,
16 submitted in bad faith, presented for the improper purposes of
17 causing unnecessary delay and needless increase in the cost to
18 Landlord of litigation, lacking sufficient evidentiary support,
19 and not warranted by the evidence or on any stated and reasonable
20 information and belief.” It also indicated that it was inclined
21 to hold an evidentiary hearing regarding additional sanctions,
22 such as referral to the state’s disciplinary board (i.e., public-
23 interest sanctions).8
24
25 8
The issue of other sanctions was resolved when
26 Ms. Jaroscak agreed not to represent any party before the
bankruptcy court in the Central District of California for a
27 three-year period. Although Ms. Jaroscak agreed to that
sanction, she has appealed from that order also (BAP No.
28 (continued...)

10
 1 Following a hearing on the OSC, the court issued an order
2 adopting its tentative ruling and awarded Arcadia Hub $18,987.82
3 (“Original Order”).
4 E. Ms. Jaroscak’s attempt to amend the Original Order
5 Ms. Jaroscak did not appeal the Original Order. However,
6 there was a flurry of activity on March 6, 2015, the deadline to
7 file a notice of appeal from the Original Order. Ms. Jaroscak,
8 through counsel, told Arcadia Hub’s counsel that she “would like
9 to amend the order to make the debtor instead of her liable for
10 the sanctions.” Arcadia Hub initially stated in an e-mail that
11 it “does not care who pays the sanctions” but was “not going to
12 agree to amend the Order.” Ms. Jaroscak’s counsel replied, “She
13 does not have the money. I can get the money from the client if
14 the order is amended.” Later that day, a cashier’s check drawn
15 by Mr. Oxman was delivered to counsel for Arcadia Hub in the
16 amount of the sanctions award. Arcadia Hub’s counsel then signed
17 a stipulation to amend the Original Order by changing the last
18 sentence from
19 IT IS HEREBY ORDERED that Maureen Jaroscak shall pay to
Arcadia Hub Holdings 3, LLC within fourteen days from
20 the entry of this Order, sanctions in the sum of
$19,407.82 - $420 = $18,987.82.
21
22 to
23 IT IS HEREBY ORDERED that Debtor shall pay to Arcadia
Hub Holdings 3, LLC within fourteen days from the entry
24 of this Order . . . .
25 Arcadia Hub’s counsel signed the stipulation to amend the
26
27
8
(...continued)
28 CC-16-1036).

11
 1 Original Order (“Stipulation”) on the afternoon of March 6, 2015,
2 and Ms. Jaroscak’s counsel says that he signed it the same day.
3 The U.S. Trustee did not sign, and was not asked to sign, the
4 Stipulation.9
5 Months later, on May 29, 2015, Ms. Jaroscak filed a motion
6 to approve the Stipulation (“Motion to Approve Stipulation”).10
7 The U.S. Trustee opposed to Motion to Approve Stipulation.
8 Among other things, it pointed out that the motion was untimely
9 because Ms. Jaroscak filed it over three months after the court
10 entered the Original Order.
11 In response, Ms. Jaroscak argued that the Stipulation was
12 executed in March 2015 and would have been timely if filed
13 immediately. She blamed the failure to file the Motion to
14 Approve Stipulation on the inadvertence of her attorney. She
15 also stated that her counsel “discussed the proposed Stipulation
16 with [counsel for the U.S. Trustee] and she indicated to him that
17 the U.S. Trustee did not care about it. . . . [T]he OUST was
18 aware of the terms of amendment and expressed no objection at the
19 time.”
20 At the hearing on the Motion to Approve Stipulation, the
21 court indicated that it would “approve the stipulation
22
23
9
As discussed below, Ms. Dare Law, counsel for the
24 U.S. Trustee, was included in certain e-mail correspondence but
was removed from later communications wherein Ms. Jaroscak and
25 Arcadia Hub agreed to the Stipulation.
26 10
The court entered an order granting the Motion to Approve
27 Stipulation shortly after it was filed, but later vacated the
order because it was entered prematurely due to an internal
28 clerical error.

12
 1 notwithstanding the United States Trustee’s argument, but with
2 everybody understanding that what I’ve already decided is what
3 I’ve already decided.” Ms. Jaroscak’s counsel confirmed that:
4 I want to make sure it’s clear that we’re not sitting
here saying that anything that you issued on that
5 February 6th tentative ruling has changed. We’re not
-- the only thing that’s changed is the one slight
6 thing, which is that the sanctions will be paid by
Arcadia Hub and, in fact, to Arcadia Hub by the debtor
7 and in fact (indiscernible). Other than that,
everything remains the same.
8
9 He later reiterated that “the Court awarded the sanctions that
10 they were awarded. It’s only amended that the debtor is to pay
11 -- can pay the sanctions and everything that’s in that order is
12 unchanged other than that one small part. And I think it’s -- I
13 think it’s very important here.”
14 The court ruled that “if Arcadia chooses to accept a payment
15 from another source then it can choose to do so . . . . It also
16 still holds that the tentative ruling and the findings that were
17 part of [the Original Order] are still very much extant.” The
18 court approved an amendment whereby the “new version would be
19 that Arcadia is entitled to payment of its attorney’s fees and
20 based on the findings of fact and conclusions of law that I did
21 before and that the source of the payment doesn’t matter.”
22 Ms. Jaroscak’s counsel prepared the order amending the
23 Original Order (“Amended Order”), which stated:
24 The final paragraph of the Order for Payment of
Sanctions by Maureen Jaroscak to Arcadia Hub Holdings 3, LLC
25 [Docket No. 69] (the “Order”) is hereby amended so that it
shall read as follows:
26
IT IS HEREBY ORDERED that Maureen Jaroscak or her
27 designee shall pay to Arcadia Hub Holdings 3, LLC
within fourteen days from the entry of this Order,
28 sanctions in the sum of $19,407.82 - $420 = $18,987.82.

13
 1 Notwithstanding the above amendment, all other parts of
the Order remain fully in force and effect.
2
3 F. Appeal to the BAP
4 On July 6, 2015, Ms. Jaroscak filed a notice of appeal from
5 both the Original Order and the Amended Order.
6 On April 17, 2016, Ms. Jaroscak filed a motion to enforce
7 settlement (“Motion to Enforce”) with this Panel. She stated
8 that, on March 28, 2016, she, Arcadia Hub, and SoCal Sleep
9 Centers entered into a “settlement” that allegedly resolved the
10 appeal, since they reaffirmed the terms of the Stipulation. The
11 motions panel denied the Motion to Enforce without prejudice
12 pending resolution of the merits of the appeal.
13 JURISDICTION
14 The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
15 §§ 1334 and 157(b)(1). Subject to our discussion of the
16 timeliness of this appeal, we have jurisdiction under 28 U.S.C.
17 § 158.
18 ISSUES
19 (1) Whether Ms. Jaroscak timely appealed the Original Order.
20 (2) If so, whether the court abused its discretion in
21 sanctioning Ms. Jaroscak.
22 (3) Whether the court abused its discretion in refusing to
23 amend the Original Order pursuant to the Stipulation.
24 STANDARDS OF REVIEW
25 We review the bankruptcy court’s conclusions of law de novo
26 and its findings of fact for clear error. Hansen v. Moore
27 (In re Hansen), 368 B.R. 868, 874 (9th Cir. BAP 2007). “De novo
28 review requires that we consider a matter anew, as if no decision

14
 1 had been made previously.” Francis v. Wallace (In re Francis),
2 505 B.R. 914, 917 (9th Cir. BAP 2014) (citation omitted). A
3 bankruptcy court clearly errs if its findings were illogical,
4 implausible, or “without support in inferences that may be drawn
5 from the facts in the record.” United States v. Hinkson,
6 585 F.3d 1247, 1262–63 & n.21 (9th Cir. 2009) (en banc).
7 We review for abuse of discretion the bankruptcy court’s
8 decision to alter or amend its own order. See Int’l Rehab.
9 Sciences Inc. v. Sebelius, 688 F.3d 994, 1000 (9th Cir. 2012)
10 (denial of Civil Rule 59(e) motion); Lal v. California, 610 F.3d
11 518, 523 (9th Cir. 2010) (denial of Civil Rule 60(b) motion). A
12 bankruptcy court abuses its discretion if it applies an incorrect
13 legal standard or misapplies the correct legal standard, or if
14 its fact findings are illogical, implausible, or not supported by
15 evidence in the record. TrafficSchool.com, Inc. v. Edriver Inc.,
16 653 F.3d 820, 832 (9th Cir. 2011).
17 DISCUSSION
18 A. Ms. Jaroscak did not timely appeal the Original Order.
19 The U.S. Trustee argues that Ms. Jaroscak’s appeal from the
20 Original Order is untimely. Ms. Jaroscak argues that her notice
21 of appeal from the Amended Order was timely and should relate
22 back to the Original Order. We agree with the U.S. Trustee.
23 1. The Original Order was a final and appealable order.
24 The U.S. Trustee argues that the Original Order was a final
25 order from which Ms. Jaroscak could have appealed. Although
26 Ms. Jaroscak does not challenge this assertion, we must consider
27 it independently because it bears upon our jurisdiction over this
28 appeal. See Symantec Corp. v. Glob. Impact, Inc., 559 F.3d 922,

15
 1 923 (9th Cir. 2009).
2 In Eden Place, LLC v. Perl (In re Perl), 811 F.3d 1120 (9th
3 Cir. 2016), the Ninth Circuit held that a bankruptcy court order
4 determining that a creditor had violated the automatic stay was a
5 final and appealable order, even though the bankruptcy court
6 deferred ruling on the amount of sanctions for the violation.
7 The court of appeals noted that it takes a flexible and pragmatic
8 approach to “finality” in bankruptcy cases. Id. at 1127. The
9 court reasoned that:
10 There is no question that the discrete issue addressed
by the bankruptcy court – violation of the automatic
11 stay – has been definitively and finally resolved.
Resolution of that issue is as final as it will ever be
12 in this case.
13 Id.
14 Perl establishes that the Original Order was final for
15 purposes of appeal. If anything, the Original Order was more
16 final than the order that the Ninth Circuit considered in Perl,
17 because the Original Order determined not only Ms. Jaroscak’s
18 liability for sanctions, but also the amount of those sanctions.
19 Similarly, our decision in Stasz v. Gonzalez (In re Stasz),
20 387 B.R. 271 (9th Cir. BAP 2008), considered, as a matter of
21 first impression, whether an order granting civil contempt
22 sanctions under Rule 9020 was final for the purposes of an
23 immediate appeal. The Panel stated the general rule that “[a]
24 final order ‘ends the litigation on the merits and leaves nothing
25 for the court to do but execute the judgment.’” Id. at 274
26 (quoting Catlin v. United States, 324 U.S. 229, 233 (1945)).
27 The Panel noted that, “[w]hile civil contempt orders
28 entered ‘during the course of a pending civil action’ are not

16
 1 appealable until final judgment, the Ninth Circuit has allowed
2 immediate appeals of sanctions orders that dispose of the only
3 issue before the court.” Id. at 275. The Panel thus determined
4 that the sanctions order was properly appealable, because “[i]f
5 the award of sanctions were not appealable now, it is unclear
6 when the order would become final and appealable. Unlike an
7 adversary proceeding or a civil action outside bankruptcy, the
8 culmination of the bankruptcy case does not result in a final
9 judgment.” Id. at 276.
10 Similarly, the Original Order in the present case was
11 immediately appealable. It ended the litigation regarding
12 private sanctions against Ms. Jaroscak and left the court with
13 nothing to do but execute the order. Although the bankruptcy
14 court here did not rely on Rule 9020, the result is the same, as
15 there was no further litigation that would preclude finality of
16 the Original Order.
17 Under Rule 8002(a)(1), “a notice of appeal must be filed
18 with the bankruptcy court within 14 days after entry of the
19 judgment, order, or decree being appealed.” It is undisputed
20 that Ms. Jaroscak did not appeal the Original Order within
21 fourteen days of its entry. She did not file a notice of appeal
22 until July 6, 2015, within the time permitted after entry of the
23 bankruptcy court’s Amended Order on June 19, 2015.11 Thus,
24 absent an exception to Rule 8002, the notice of appeal was
25 untimely as to the Original Order.
26
11
27 The appeal was timely filed seventeen days after the
entry of the Amended Order due to the observation of the
28 Independence Day holiday on July 3 and the intervening weekend.

17
 1 2. The Amended Order did not create new rights or
liabilities such that it extended the time to appeal
2 the Original Order.
3 Ms. Jaroscak argues that, because the Amended Order “revised
4 legal rights and obligations” under the Original Order, her
5 notice of appeal was timely as to the Original Order. We
6 disagree.
7 As a general rule, the time to file an appeal is extended if
8 “the lower court, in its second order, has disturbed or revised
9 legal rights and obligations which, by its prior judgment, had
10 been plainly and properly settled with finality.” Fed. Trade
11 Comm’n v. Minneapolis-Honeywell Regulator Co., 344 U.S. 206, 212
12 (1952). “Only when the lower court changes matters of substance,
13 or resolves a genuine ambiguity, in a judgment previously
14 rendered should the period within which an appeal must be taken
15 or a petition for certiorari filed begin to run anew.” Id. at
16 211-12. Stated another way, “the mere fact that a judgment
17 previously entered has been reentered or revised in an immaterial
18 way does not toll the time within which review must be sought.”
19 Id. at 211; see United States v. Doe, 374 F.3d 851, 853-54 (9th
20 Cir. 2004) (stating, in a criminal context, that “[w]here a
21 district court enters an amended judgment that revises legal
22 rights or obligations, the period for filing an appeal begins
23 anew”); Day v. AT&T Disability Income Plan, 608 F. App’x 454, 456
24 (9th Cir. 2015) (“The Supreme Court has recognized that a
25 district court’s decision to amend a judgment may re-start the
26 period during which a litigant may appeal, provided that the
27 amended judgment differs materially from the earlier judgment.”);
28 see also Am. Safety Indem. Co. v. Official Comm. of Unsecured

18
 1 Creditors (In re Am. Safety Indem. Co.), 502 F.3d 70, 72 (2d Cir.
2 2007) (“it is well-established that [w]here a judgment is
3 reentered, and the subsequent judgment does not alter the
4 substantive rights affected by the first judgment, the time for
5 appeal runs from the first judgment.” (citation and internal
6 quotation marks omitted)).
7 Ms. Jaroscak argues that the Amended Order revised the
8 Original Order. She further contends that the Amended Order was
9 a “material change” to the Original Order and that the
10 U.S. Trustee’s “inequitable conduct” was a material change.
11 Ms. Jaroscak fails to explain how the Amended Order changed
12 the “legal rights and obligations” laid out in the Original
13 Order. The Amended Order did not affect the court’s factual
14 findings against Ms. Jaroscak or affect Ms. Jaroscak’s liability
15 on the sanctions award; it only permitted Ms. Jaroscak’s designee
16 to pay the sanctions award on her behalf. The court specified
17 multiple times that the Original Order “still holds and that the
18 tentative ruling and the findings that were part of [the Original
19 Order] are still very much extant.”
20 Further, Ms. Jaroscak’s argument on appeal is the exact
21 opposite of the argument her counsel made to the bankruptcy
22 court. Ms. Jaroscak’s counsel explicitly and repeatedly
23 confirmed that the Amended Order did not alter Ms. Jaroscak’s
24 rights or obligations under the Original Order. He stated, “the
25 only thing that’s changed is the one slight thing . . . . Other
26 than that, everything remains the same.” He reiterated that the
27 Original Order is “only amended that the debtor is to pay -- can
28 pay the sanctions and everything that’s in that order is

19
 1 unchanged other than that one small part.” Ms. Jaroscak’s
2 counsel did not object to the court’s ruling or the language of
3 the Amended Order. In fact, her counsel drafted the Amended
4 Order, which specified that, “[n]otwithstanding the above
5 amendment, all other parts of the [Original] Order remain fully
6 in force and effect.”
7 The Amended Order did not alter any of Ms. Jaroscak’s legal
8 rights and obligations. Nothing in the Amended Order absolved
9 her of liability or changed the court’s finding of sanctionable
10 conduct. By her counsel’s own admission, the Amended Order
11 altered only “one slight thing.” Accordingly, the Amended Order
12 did not extend the time to appeal the Original Order.12
13 3. Even if the U.S. Trustee “lulled” Ms. Jaroscak into
complacency, the time to appeal the Original Order was
14 not extended.
15 Ms. Jaroscak also argues that she did not timely appeal the
16 Original Order because the U.S. Trustee did not object to the
17 Stipulation and “lulled” her into not timely appealing. This
18 contention is frivolous.
19 Even assuming that the U.S. Trustee engaged in any kind of
20
21 12
The U.S. Trustee argues that the United States Supreme
Court’s decision in Bowles v. Russell, 551 U.S. 205 (2007), also
22
precludes review of the Original Order. Bowles stands for the
23 proposition that a time limit for taking an appeal is
jurisdictional, so the failure to appeal timely divests a court
24 of jurisdiction. The U.S. Trustee questions whether courts
should continue to apply the rule of Minneapolis-Honeywell
25 Regulator Co. following Bowles.
26
Because we hold that the relation-back doctrine does not
27 apply to the facts of this case, we need not decide whether the
Ninth Circuit’s view of that doctrine remains valid following
28 Bowles.

20
 1 improper conduct (and it did not), or that equitable estoppel
2 might apply (and it does not), the time for taking an appeal from
3 the Original Order would not change. See Bowles, 551 U.S. at 214
4 (rejecting equitable considerations as a reason to extend the
5 time to appeal, stating that the court “has no authority to
6 create equitable exceptions to jurisdictional requirements”);
7 Melendres v. Maricopa Cty., 815 F.3d 645, 649 (9th Cir. 2016)
8 (“we are not at liberty to overlook a defect with the notice of
9 appeal no matter how compelling an appellant’s argument may be”);
10 Gonzalez v. Wells Fargo Bank, N.A., No. 13-CV-02210-JST, 2014 WL
11 93930, at *3 (N.D. Cal. Jan. 9, 2014) (the time for appeal can
12 only be enlarged pursuant to Rule 8002(c)).
13 Therefore, we conclude that we lack jurisdiction over
14 Ms. Jaroscak’s purported appeal from the Original Order.13 The
15 only order that we have power to review is the Amended Order.
16 B. The court did not abuse its discretion in entering the
Amended Order and refusing to absolve Ms. Jaroscak of
17 liability.
18 Ms. Jaroscak contends that the bankruptcy court erred when
19
20
13
Even if we had jurisdiction to consider the Original
21 Order, we would affirm. All of Ms. Jaroscak’s challenges to that
order turn on the bankruptcy court’s factual findings. All of
22
those findings have evidentiary support in the record, and none
23 of them is clearly erroneous.

24 We are particularly dismayed by Ms. Jaroscak’s argument
that, despite her ethical duty of candor to the tribunal, see
25 Cal. R. Prof’l Conduct 5-200(B) (an attorney “[s]hall not seek to
26 mislead the judge, judicial officer, or jury by an artifice or
false statement of fact or law”), she was free to use her
27 “discretion” to decide when to tell the bankruptcy court the
whole truth, rather than just part of the story. A half-truth is
28 a half-lie.

21
 1 it issued the Amended Order to make her “or her designee”
2 responsible for the monetary sanctions, rather than adopting the
3 Stipulation.
4 Ms. Jaroscak’s briefs are not models of clarity. As far as
5 we can tell, she thinks the court erred in two respects.14 We
6 reject both contentions.
7 1. The bankruptcy court was not obligated to approve the
Stipulation and modify the Original Order.
8
9 Ms. Jaroscak faults the court for “rewriting the settlement”
10 she reached with Arcadia Hub. The bankruptcy court did not err.
11 In the first place, it is a stretch to call the Stipulation
12 a “settlement.” By its terms, it provides that SoCal Sleep
13 Centers, rather than Ms. Jaroscak, would pay the sanctions; it
14 does not exonerate Ms. Jaroscak or even change the amount of the
15 sanctions. Arcadia Hub did not agree to compromise any of its
16 rights and claims. The e-mails make it clear that Arcadia Hub
17 entered into the Stipulation simply because it did not care who
18 paid the sanctions as long as someone did.
19 More importantly, Ms. Jaroscak’s argument rests on a false
20 assumption. She seems to think that the bankruptcy court had no
21 choice but to approve the Stipulation. There is no authority for
22 the proposition that a court must modify its orders simply
23 because the parties ask it to. In fact, the Ninth Circuit
24 authority is exactly to the contrary. See Nat’l Union Fire Ins.
25
26 14
Ms. Jaroscak argued before the bankruptcy court that the
27 Motion to Approve Stipulation satisfied Rule 9024. But she does
not argue on appeal that the court erred in its application of
28 Rule 9024, so this issue is waived.

22
 1 Co. v. Seafirst Corp., 891 F.2d 762 (9th Cir. 1989) (the court
2 need not vacate a judgment even when all non-defaulting parties
3 request that it do so); Ringsby Truck Lines, Inc. v. W.
4 Conference of Teamsters, 686 F.2d 720 (9th Cir. 1982) (a post-
5 judgment settlement does not require vacatur of the judgment).
6 Further, Ms. Jaroscak waived this argument because her
7 counsel did not oppose the entry of the Amended Order. Rather,
8 her counsel seemed satisfied with the court’s ruling. He did not
9 take issue with the court leaving Ms. Jaroscak liable for the
10 sanctions but allowing SoCal Sleep Centers to pay on her behalf.
11 2. The U.S. Trustee was entitled to appear and be heard on
the approval of the Stipulation and is entitled to
12 participate in this appeal.
13 Ms. Jaroscak claims that the U.S. Trustee should not have
14 objected to the Stipulation and should not be heard in this
15 appeal. This argument is meritless.
16 Ms. Jaroscak argues that the U.S. Trustee is advocating the
17 private pecuniary interests of Arcadia Hub and that this is
18 improper.15 This argument has no legal foundation. The
19 U.S. Trustee “may raise and may appear and be heard on any issue
20 in any case or proceeding under this title . . . .” § 307. The
21 U.S. Trustee does not need to demonstrate a pecuniary interest in
22 the outcome of the case. See Stanley v. McCormick, Barstow,
23
15
24 Ms. Jaroscak also argues extensively in her Motion to
Enforce that the U.S. Trustee cannot object to the Stipulation
25 and defend this appeal in the public interest. She points to the
26 events in the related appeal of the public-interest sanctions as
proof that the U.S. Trustee no longer has any interest in this
27 appeal. Insofar as these events occurred outside the scope of
this appeal, we reject these arguments. See Kirshner v. Uniden
28 Corp. of Am., 842 F.2d 1074, 1077 (9th Cir. 1988).

23
 1 Sheppard, Wayte & Carruth (In re Donovan Corp.), 215 F.3d 929,
2 930 (9th Cir. 2000). By the same token, the U.S. Trustee is free
3 to participate even if doing so might further the private
4 interests of one or more creditors. In fact, the U.S. Trustee’s
5 arguments in bankruptcy cases almost always affect the pecuniary
6 interests of private parties. There is nothing wrong with that;
7 it simply means the office is doing its job.
8 Ms. Jaroscak also argues that the U.S. Trustee is estopped
9 from objecting to the Stipulation and defending the Amended Order
10 on appeal. Ms. Jaroscak has not shown that any of the elements
11 of equitable estoppel apply here.
12 The Ninth Circuit has stated that equitable estoppel
13 requires that the proponent show: “(1) knowledge of the true
14 facts by the party to be estopped, (2) intent to induce reliance
15 or actions giving rise to a belief in that intent, (3) ignorance
16 of the true facts by the relying party, and (4) detrimental
17 reliance.” Estate of Amaro v. City of Oakland, 653 F.3d 808, 813
18 (9th Cir. 2011) (quoting Bolt v. United States, 944 F.2d 603, 609
19 (9th Cir. 1991)).
20 A party asserting equitable estoppel against the government
21 must meet a higher standard. Such a party must establish that:
22 “(1) the government engaged in affirmative misconduct going
23 beyond mere negligence; (2) the government’s wrongful acts will
24 cause a serious injustice; and (3) the public’s interest will not
25 suffer undue damage by imposition of estoppel.” Baccei v. United
26 States, 632 F.3d 1140, 1147 (9th Cir. 2011) (citation omitted).
27 Ms. Jaroscak has not established a single one of these
28 elements.

24
 1 She has not shown that the U.S. Trustee made any false
2 statements with the intent to induce reliance. She argues that
3 Arcadia Hub and the U.S. Trustee “agreed there would be no
4 sanctions against Ms. Jaroscak . . . .” She claims that Ms. Law,
5 attorney for the U.S. Trustee, told her counsel that the
6 U.S. Trustee “did not care” and had no opposition to the
7 Stipulation. This recitation of the historical facts is at best
8 incomplete. Ms. Jaroscak’s counsel initiated negotiations to
9 modify the Original Order by sending an e-mail only to Arcadia
10 Hub’s counsel. When Arcadia Hub’s counsel responded, he added
11 the U.S. Trustee (Ms. Law) to the e-mail string. In that e-mail,
12 Arcadia Hub’s counsel stated that he did not care who paid the
13 sanction, but Arcadia Hub was “not going to agree to amend the
14 Order, even if the Court would consider it. The Order has
15 already been entered, with the detailed findings concerning
16 Ms. Jaroscak in the attached tentative ruling. As damaging as
17 that may be to her, that bell can’t be un-rung.” However, when
18 Ms. Jaroscak’s counsel responded, he removed Ms. Law from the
19 e-mail string. The U.S. Trustee was not involved in any further
20 discussions or even aware of the terms of the Stipulation until
21 after it was filed. Therefore, the record shows only that the
22 U.S. Trustee knew about, and did not object to, Arcadia Hub’s
23 position stated in the e-mail - that it did not matter who paid
24 the sanctions, but the findings of sanctionable conduct would
25 stand. The U.S. Trustee has consistently adhered to that
26 position.
27 Ms. Jaroscak fails to demonstrate that she detrimentally
28 relied on the U.S. Trustee’s statements. The U.S. Trustee did

25
 1 nothing to prevent or discourage her from filing a timely appeal
2 or taking any other steps to protect her interests.
3 Ms. Jaroscak also fails to address the heightened standard
4 for government entities. She does not present any evidence or
5 argument that the U.S. Trustee engaged in affirmative misconduct
6 going beyond mere negligence, that its actions caused a serious
7 injustice, or that preventing the U.S. Trustee from challenging
8 the Stipulation will not unduly damage the public’s interest.
9 In short, the U.S. Trustee was entitled to appear and be
10 heard on these issues in the bankruptcy court and before the
11 Panel.
12 C. The Motion to Enforce is meritless.
13 Finally, Ms. Jaroscak requests that we enforce a supposed
14 “settlement” between herself, Arcadia Hub, and SoCal Sleep
15 Centers that they reached in March 2016. In essence, she asks us
16 to do exactly what the bankruptcy court refused to do. This
17 request is frivolous.
18 In the first place, contrary to Ms. Jaroscak’s
19 representations, there is no “new settlement.” The so-called
20 “settlement” consists only of a letter from Arcadia Hub stating
21 that it is still “satisfied with” the Stipulation and a letter
22 from SoCal Sleep Centers stating that “the stipulation was
23 approved on behalf of SoCal Sleep Centers at the time it was
24 signed, and remains approved on behalf of SoCal Sleep Centers.”
25 The parties’ decision to reaffirm, rather than repudiate, the
26 Stipulation is not a “new” agreement.
27 Second, even if there was a “new agreement” (and there is
28 not), Ms. Jaroscak mischaracterizes it. As we have explained,

26
 1 the Stipulation does not exonerate her. Rather, as her own
2 attorney told the bankruptcy court, it simply provides that her
3 client will pay the sanctions for her.
4 Third, approval of the supposed “new settlement” would not
5 terminate this appeal because the U.S. Trustee, the only appellee
6 in this appeal, is not a party to it. See Hatami v. Kia Motors
7 Am., Inc., No. SACV 08–226 DOC, 2011 WL 1456192, at *1 (C.D. Cal.
8 Apr. 14, 2011) (“The Court cannot enforce a purported settlement
9 agreement unless all of the terms of that agreement have been
10 agreed to by both parties.”).
11 Finally, Ms. Jaroscak’s argument is a blatant attempt to
12 offer new evidence on appeal, exceed the size limits for
13 appellate briefs, and evade the standard of appellate review.
14 She wants us to approve the “settlement” ourselves, without any
15 regard for the bankruptcy court’s decision. That is not the
16 function of an appellate court.
17 At oral argument, the Panel asked Ms. Jaroscak exactly what
18 relief she sought. The parties to the Stipulation have done
19 exactly what they agreed to do; the bankruptcy court did not
20 amend its order exactly as the Stipulation provided, but
21 Ms. Jaroscak does not claim that the Stipulation is somehow
22 “enforceable” against the court. Her counsel responded that she
23 simply wants clarification that SoCal Sleep Centers may pay the
24 sanctions on her behalf. We acknowledge that, under the
25 bankruptcy court’s orders, it was permissible for SoCal Sleep
26 Centers to pay the sanctions on her behalf.
27 Accordingly, we DENY the Motion to Enforce.
28

27
 1 CONCLUSION
2 For the reasons set forth above, we AFFIRM.
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