GREGORY CRAWFORD AN INDIVIDUAL v. LOUIS ROBINSON AN INDIVIDUAL ALLIANCE TRUST COMPANY LLC NEVADA LIMITED LIABILITY COMPANY AND DENIS DAMIENS JR AN INDIVIDUAL (2025)

ORDER GRANTING MOTION TO SEAL AND DISMISSING APPEAL

On April 3, 2025, appellant filed an unopposed motion to file certain exhibits of the amended docketing statement under seal. That motion is granted. SRCR 7. The clerk shall file exhibits 3-8 to the amended docketing statement received on April 3, 2025, under seal. The clerk shall file the amended docketing statement and the remaining exhibits on this court's public docket.

Appellant filed a notice of bankruptcy filing and automatic stay on February 13, 2025, informing this court that he has filed a voluntary petition for relief under Chapter 7 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Nevada. On February 28, 2025, the parties filed a stipulation for temporary stay and requested 60 days to provide this court with a status report regarding the bankruptcy proceeding. This court issued an order on April 11, 2025. allowing 60 days to provide the requested update. Appellant filed a statement regarding bankruptcy stay on April 29, 2025, and respondents filed a joint response the same day. Appellant argues that the automatic stay does not apply but fails to cite authority supporting that position. Respondents do not appear to agree with appellant's conclusion but instead discuss their belief that the bankruptcy trustee would make decisions regarding pursuit of this appeal.

The filing of a bankruptcy petition operates to stay, automatically, the “continuation” of any “Judicial ․ action ․ against the debtor.” 11 U.S.C. § 362(a)(1). An appeal, for purposes of the automatic stay, is considered a continuation of the action in the trial court. Consequently, an appeal is automatically stayed if the debtor was the defendant in the underlying trial court action regardless of the debtor's position as appellant or appellee. See Ingersoll-Rand Fin. Corp. v. Miller Mining Co., Inc., 817 F.2d 1424 (9th Cir. 1987). It appears that appellant was a defendant below. Therefore, this appeal is stayed pursuant to the automatic stay provisions of federal bankruptcy law.

Given the applicability of the automatic stay, this appeal may linger indefinitely on this court's docket pending final resolution of the bankruptcy proceedings. Accordingly, we conclude that judicial efficiency will be best served if this appeal is dismissed without prejudice. Because a dismissal without prejudice will not require this court to reach the merits of this appeal and is not inconsistent with the primary purposes of the bankruptcy stay—to provide protection for debtors and creditors—we further conclude that such dismissal will not violate the bankruptcy stay.¹ See Indep. Union of Flight Attendants v. Pan Am. World Airways, Inc., 966 F.2d 457, 459 (9th Cir. 1992) (holding that the automatic stay does not preclude dismissal of an appeal so long as dismissal is “consistent with the purpose of [11 U.S.C. § 362(a)”]; Dean v. Trans World Airlines, Inc., 72 F.3d 754, 755 (9th Cir. 1995) (holding that a post-bankruptcy petition dismissal will violate the automatic stay “where a decision to dismiss requires the court to first consider other issues presented by or related to the underlying case”).

Accordingly, this appeal is dismissed. This dismissal is without prejudice to appellant's right to move for reinstatement of this appeal within 60 days of either the lifting of the bankruptcy stay or final resolution of the bankruptcy proceedings, if appellant deems such a motion appropriate at that time.

It is so ORDERED.²

Parraguirre, J.

Bell, J.

Stiglich, J.

FOOTNOTES

1.   The automatic stay provides a debtor “with protection against hungry creditors” and gives it a “breathing spell from its creditors” by stopping all collection efforts. Dean v. Trans World Airlines, Inc., 72 F.3d 754, 755 (9th Cir. 1995) (internal quotation marks omitted). Further, it “assures creditors that the debtor's other creditors are not racing to various courthouses to pursue independent remedies to drain the debtor's assets.” Id. at 755-56.

2.   Given this dismissal, this court takes no action in regard to the joint motion to dismiss filed on November 8, 2024.