FILED NOV 9 2021 SUSAN M. SPRAUL, CLERK NOT FOR PUBLICATION U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT

UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT

In re: BAP No. SC-19-1065-SFL TODD E. MACALUSO, Debtor. Bk. No. 16-04214-LT7

TODD E. MACALUSO, Adv. No. 16-90157-LT Appellant, v. MEMORANDUM* RJC FUNDING, LLC, Appellee.

Appeal from the United States Bankruptcy Court for the Southern District of California Laura S. Taylor, Bankruptcy Judge, Presiding

Before: SPRAKER, FARIS, and LAFFERTY, Bankruptcy Judges.

INTRODUCTION

In a federal diversity action, creditor RJC Funding, LLC, obtained a

partial default judgment against debtor Todd E. Macaluso on several

causes of action, including its fraud claim. The district court awarded RJC

* This disposition is not appropriate for publication. Although it may be cited for whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential value, see 9th Cir. BAP Rule 8024-1. damages of $2,385,000.70. Afterwards, Macaluso commenced his chapter 7 1

bankruptcy, and RJC initiated an adversary proceeding to except the

judgment debt from discharge. The bankruptcy court ultimately granted

RJC summary judgment on its claim under § 523(a)(2)(A) based on the

issue preclusive effect of the district court’s default judgment. The

bankruptcy court also granted summary judgment in a smaller amount

under § 523(a)(13) based on a judgment for criminal restitution resulting

from Macaluso’s guilty plea for wire fraud. RJC then dismissed its other

nondischargeability claims.

Because none of Macaluso’s arguments on appeal justify reversal, we

AFFIRM.

FACTS 2

RJC and its affiliates (collectively, “RJC”) provided litigation funding

to law firms and their litigation clients including Macaluso and his wholly-

owned law firm Macaluso & Associates, APC. For several years, the

litigation funding transactions between RJC and Macaluso were performed

in accordance with the parties’ agreements. Under the agreements,

Macaluso “sold” to RJC his interest in the anticipated proceeds from the

1 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code,

, all “Rule” references are to the Federal Rules of Bankruptcy Procedure, and all “Civil Rule” references are to the Federal Rules of Civil Procedure. 2 We exercise our discretion to take judicial notice of documents electronically

filed in the underlying bankruptcy case and adversary proceeding. See Atwood v. Chase Manhattan Mortg. Co. (In re Atwood),

, 233 n.9 (9th Cir. BAP 2003). 2 underlying litigation, and he was required to pay specified amounts in

accordance with a payment schedule in the parties’ agreements, subject to a

condition precedent that the underlying litigation yielded the anticipated

proceeds.

For every agreement between RJC and Macaluso, there was a

companion agreement between RJC and Macaluso’s litigation client. Under

the companion agreement, the client would sell RJC a portion of the

anticipated proceeds from the underlying litigation and also would agree

to non-recourse “pay-off amounts” from the litigation proceeds in

accordance with a payment schedule included in the companion

agreement.

In 2012 and 2013, the parties entered into a series of litigation funding

transactions that later resulted in years of litigation (collectively, the

“Failed Transactions”). RJC claims that Macaluso defaulted on the Failed

Transactions. In contrast, Macaluso claims that the Failed Transactions did

not yield any litigation proceeds for RJC because his litigation clients did

not prevail. Under such circumstances, Macaluso contended that he was

not obliged to pay anything.

In August 2014, the parties entered into a Promissory Note

Settlement Agreement (“Settlement”). Though neither party admitted fault

or breach, Macaluso agreed to pay over time a fraction of what RJC claimed

it was owed, plus 15% interest. Macaluso also offered to assign additional

anticipated litigation proceeds from various litigation matters. There were

3 several different default provisions in the Settlement. Ultimately, however,

if Macaluso defaulted and failed to cure, the claimed “full purchase price”

of $1,906,762, plus 15% interest, would be due. Macaluso defaulted and

never paid the amount agreed to under the Settlement.

In April 2015, the United States filed a criminal information against

Macaluso for one count of wire fraud under

. In the

information, the United States alleged that Macaluso:

knowingly devised and intended to devise, with the intent to defraud, a material scheme and artifice to defraud and to obtain money and property by means of materially false and fraudulent pretenses, representations and promises, and by intentional concealment and omission of material facts.

The information further alleged that in furtherance of his fraud scheme,

Macaluso caused to be transmitted a “funding agreement” in interstate

commerce.

Macaluso pled guilty to the one count of wire fraud. At the

sentencing hearing, the U.S. attorney described the nature of the fraud. He

stated that RJC was the victim and that it “invested in Mr. Macaluso’s

ongoing cases with the belief that those funds would be used for litigation

expenses, which they were not.” As for the amount of money RJC lost, the

U.S. attorney stated that at least $150,000 of the amount that RJC funded

“had not been repaid.”

The U.S. attorney further explained that RJC was presented with the

companion agreements supposedly obtained by Macaluso from his

4 litigation clients acknowledging their desire to obtain litigation funding

and to use a portion of the anticipated litigation proceeds as a payment

source for the specified payoff amounts. According to the U.S. attorney, the

signatures of the litigation clients and the attendant notary stamps on the

companion agreements were forged. Macaluso conceded that the

signatures and the notary stamps on the subsidiary agreements were not

done properly. But Macaluso denied that any litigation funds were

misused.

In November 2015, the district court entered its criminal judgment,

sentenced Macaluso to five months imprisonment, and imposed a $100,000

fine. The court also ordered Macaluso to pay RJC $150,000 in restitution.

That same month, RJC sued Macaluso and others in federal court for

fraud, breach of contract, and other causes of action. RJC alleged that

Macaluso and his co-defendants engaged in an intentional scheme to

defraud RJC by entering into litigation funding transactions under false

pretenses. According to RJC, Macaluso requested litigation funding for two

cases, Marsch v. DLA Piper US, LLC and Giordano v. Amex Assurance Co. RJC

asserted that Macaluso led RJC to believe that the plaintiffs in each of these

cases desired to sell their anticipated litigation proceeds for litigation

funding purposes and that they agreed to enter into the companion

agreements necessary to consummate litigation funding transactions. As

RJC explained, Macaluso presented RJC with fully executed companion

agreements that purported to include the notarized signatures of the

5 plaintiffs in the underlying cases. RJC maintained that, in reality, Macaluso

caused the client signatures and notary stamps to be forged and that he

never intended to use the funding for litigation expenses; rather, he always

intended to and did use the funding for his own personal use or for his co-

defendants’ benefit.

With respect to both the Marsch and Giordano transactions, RJC

contended that it reasonably relied on the information and documentation

Macaluso provided. RJC asserted that it suffered damages of not less than

$2,240,445.34, on which interest, costs, and attorney’s fees were continuing

to accrue.

Macaluso was duly served with the complaint in the district court

civil action. He never filed an answer, though he did file a request to

extend the time to respond to the original request for entry of default.

Indeed, he later admitted that he affirmatively chose not to defend the

district court civil action on the advice of counsel and based on his own

legal research. Ultimately, the district court entered partial default

judgment against Macaluso for $2,385,000.70. 3 The default judgment was

specifically granted on both RJC’s breach of contract and fraud causes of

action — as well as on certain other causes of action.

Macaluso commenced his chapter 7 case in July 2016. RJC filed its

nondischargeability complaint a few months later. Among other claims for

Although the default judgment only disposed of some of RJC’s claims, RJC 3

dismissed its remaining claims in July 2017, as reflected in the district court’s docket. 6 relief, RJC asserted a claim under § 523(a)(2)(A) that Macaluso fraudulently

induced it to enter into the Failed Transactions and the Settlement, which

resulted in RJC suffering damages of at least $2,380,000. For purposes of

this claim for relief, RJC relied on allegations that largely mirrored the

content of its first amended complaint filed in the district court civil action.

It attached and incorporated the district court’s default judgment into its

nondischargeability complaint.

RJC also stated a claim for relief under § 523(a)(13) seeking to except

from discharge the $150,000 restitution award provided for in the district

court’s criminal judgment.

Macaluso appeared through counsel and filed an answer to the

nondischargeability complaint. Notably, Macaluso admitted the truth of

paragraph 41 of the nondischargeability complaint, which provided: “[a]s a

direct and proximate result of the foregoing [fraudulent conduct], Plaintiff

has suffered damages in an amount not presently ascertained but believed

to be in excess of $2,380,000 which should be exempted from discharge in

the Debtor Macaluso’s bankruptcy.”

RJC filed its summary judgment motion based largely on the issue

preclusive effect of the district court default judgment. But it also relied on

the preclusive effect of the federal criminal judgment, especially for its

§ 523(a)(13) claim for relief. It further relied on Macaluso’s admission of

paragraph 41 of the nondischargeability complaint.

7 Macaluso complained that RJC gave his counsel insufficient notice of

the summary judgment hearing. Nonetheless, Macaluso opposed the

summary judgment motion. He principally argued that the Settlement

subsumed and superseded the Failed Transactions, and the Settlement was

insufficient by itself to support the district court’s fraud finding.

At the hearing on the summary judgment motion, the bankruptcy

court rejected Macaluso’s arguments and granted partial summary

judgment in favor RJC on its claims for relief under § 523(a)(2)(A) and (13).

The court made it clear it was denying summary judgment with respect to

the remainder of RJC’s nondischargeability claims and required RJC to

advise the court whether it wanted to continue to prosecute those other

claims or to dismiss them without prejudice.

Macaluso filed a notice of appeal on March 18, 2019 and an amended

notice of appeal on March 25, 2019. On May 16, 2019, he filed a motion for

reconsideration. Meanwhile, the bankruptcy court entered on April 16,

2019 an order granting partial summary judgment in favor of RJC. That

order contemplated not only the voluntary dismissal of RJC’s lingering

nondischargeability claims but also the submission and entry of a “final

separate judgment” to fully and finally dispose of the adversary

proceeding. The bankruptcy court entered that judgment on June 19, 2019.

On July 1, 2019, the bankruptcy court entered an order denying

Macaluso’s reconsideration motion. Among other things, the court noted

that Macaluso had admitted in his declaration in support of his

8 reconsideration motion that he affirmatively chose not to defend the

district court civil action based on the advice of his counsel and his own

legal research. The court further observed that most of the points Macaluso

sought to advance in his reconsideration motion amounted to defenses and

arguments that he might have asserted in the district court civil action but

were not properly before the bankruptcy court as part of the

nondischargeability action.

Macaluso did not file a new notice of appeal or an amended notice of

appeal from the denial of his reconsideration motion, as contemplated in

Rule 8002(b)(3).

JURISDICTION

The bankruptcy court had jurisdiction under

and

157(b)(2)(I). We have jurisdiction under

.

ISSUES

1. Did the bankruptcy court err when it granted summary judgment in

favor of RJC on its claim under § 523(a)(2)(A)?

2. Did the bankruptcy court err when it granted summary judgment in

favor of RJC on its claim under § 523(a)(13)?

STANDARDS OF REVIEW

We review de novo the bankruptcy court’s grant of summary

judgment. Plyam v. Precision Dev., LLC (In re Plyam),

(9th

Cir. BAP 2015). We also review de novo the bankruptcy court's

determination that issue preclusion is available. Lopez v. Emergency Serv.

9 Restoration, Inc. (In re Lopez),

(9th Cir. BAP 2007). When we

review a matter de novo, “we consider [the] matter anew, as if no decision

had been rendered previously.” Kashikar v. Turnstile Cap. Mgmt., LLC (In re

Kashikar),

(9th Cir. BAP 2017).

If we determine that issue preclusion is available, we then review the

bankruptcy court’s decision to apply it for an abuse of discretion. In re

Lopez,

. A bankruptcy court abuses its discretion if it applies

the wrong legal standard, or its findings of fact are illogical, implausible or

without support in the record. TrafficSchool.com, Inc. v. Edriver Inc.,

(9th Cir. 2011).

DISCUSSION

A. Summary judgment and issue preclusion legal standards.

A bankruptcy court may grant summary judgment when the record

demonstrates “that there is no genuine issue as to any material fact and

that the moving party is entitled to a judgment as a matter of law.” Celotex

Corp. v. Catrett,

(1986); see also In re Plyam,

(citing Civil Rule 56(a), which is made applicable in adversary proceedings

by Rule 7056).

When a federal district court, sitting in diversity, disposes of a cause

of action under state law, the issue preclusive effect of the district court’s

judgment also is determined by state law. See Taco Bell Corp. v. TBWA

Chiat/Day Inc.,

(9th Cir. 2009) (citing Semtek Int'l Inc.

v. Lockheed Martin Corp.,

(2001)). RJC’s causes of action set

10 forth in its district court complaint were founded on California law. Under

California issue preclusion law, the proponent must establish the following

threshold elements:

(1) the issue sought to be precluded from relitigation is identical to that decided in a former proceeding; (2) the issue was actually litigated in the former proceeding; (3) the issue was necessarily decided in the former proceeding; (4) the decision in the former proceeding is final and on the merits; and (5) the party against whom preclusion is sought was the same as, or in privity with, the party to the former proceeding.

In re Plyam,

(citing Lucido v. Super. Ct.,

(1990)).

Before applying issue preclusion, the bankruptcy court additionally

needs to assess “whether imposition of issue preclusion in the particular

setting would be fair and consistent with sound public policy.” Khaligh v.

Hadaegh (In re Khaligh),

(9th Cir. BAP 2006), aff'd,

(9th Cir. 2007) (citing Lucido,

).

The party asserting issue preclusion has the burden of proof to

establish each of the threshold requirements. See Harmon v. Kobrin (In re

Harmon),

(9th Cir. 2001). To satisfy this burden, the

moving party “must introduce a record sufficient to reveal the controlling

facts and pinpoint the exact issues litigated in the prior action.” Kelly v.

Okoye (In re Kelly),

(9th Cir. BAP 1995), aff'd,

(9th Cir. 1996). Any reasonable doubt regarding what the prior court

decided is resolved against the moving party.

11 California generally applies issue preclusion to default judgments. As

the California Supreme Court has explained: “The fact that the judgment

was secured by default does not warrant the application of a special rule. A

default judgment is an estoppel as to all issues necessarily litigated therein

and determined thereby exactly like any other judgment.” Williams v.

Williams (In re Williams' Estate),

(1950) (cleaned up),

quoted with approval in In re Harmon,

.

Harmon interpreted Williams’ rules for applying issue preclusion to

default judgments through the lens of modern (post-Lucido) California

issue preclusion law. In re Harmon,

-47 & nn. 5, 6. Based on

its interpretation of Williams, Harmon explained that when a litigant

invokes the issue preclusive effect of a prior default judgment, he or she

must establish — in addition to Lucido’s threshold elements — that the

defendant in the prior action duly received service of the summons and the

complaint or had actual knowledge of the existence of the prior action.

at 1247 (citing In re Williams’ Estate,

).

According to Harmon, the plaintiff must also show that the court in

the prior action made express findings on the issues to be precluded or that

such findings, even if not expressly made, were essential to the prior

court’s default judgment — in the sense that the default judgment could

not have been properly rendered without implicitly making such findings.

Id. at 1247-48. As Harmon further explained, if the issues were essential to

the default judgment, they were both actually litigated and necessarily

12 decided for issue preclusion purposes. Id. at 1248-49 (citing Baldwin v.

Kilpatrick (In re Baldwin),

(9th Cir. 2001)).

B. Macaluso’s arguments on appeal.

Macaluso exclusively attacks the portion of the bankruptcy court’s

judgment based on § 523(a)(2)(A). That section generally excepts from

discharge debts for money, property, or services procured by fraud. Oney v.

Weinberg (In re Weinberg),

(9th Cir. BAP 2009). The elements

for a fraud claim under § 523(a)(2)(A) mirror the elements for a fraud cause

of action under California law, which require: “(1) a misrepresentation

(false representation, concealment, or nondisclosure); (2) knowledge of

falsity; (3) intent to defraud (i.e., to induce reliance); (4) justifiable reliance;

and (5) resulting damage.” Zuckerman v. Crigler (In re Zuckerman),

, 714 (9th Cir. BAP 2020), appeal docketed, Case No. 20-60031 (9th Cir. July

13, 2020).

We will address in turn each of Macaluso’s arguments challenging

the portion of the bankruptcy court’s judgment based on § 523(a)(2)(A).

1. Macaluso’s argument that no actionable fraud occurred is an impermissible collateral attack on the default judgment.

Macaluso initially contends that the bankruptcy court erred in

granting summary judgment on RJC’s § 523(a)(2)(A) claim because no

actionable fraud occurred. He reasons that RJC could not have suffered

compensable fraud damages inasmuch as his clients lost the underlying

litigation. Given that the underlying litigation was lost, Macaluso

13 maintains that he owed nothing to RJC on account of the Failed

Transactions. As he further maintains, he only agreed in the Settlement to

make further payments on account of the Failed Transactions because he

hoped to obtain additional litigation funding from RJC in the future.

In addition, Macaluso posits that because the district court already

had awarded RJC $150,000 in restitution in its criminal judgment, any

amount of damages awarded in the district court civil action would have

been duplicative and a windfall because the restitution award made RJC

whole.

It is too late for Macaluso to argue that he did not commit any

actionable fraud. As the bankruptcy court correctly observed, Macaluso

could have asserted this and similar arguments if he had elected to defend

the district court civil action. But he chose not to do so, and the district

court entered judgment against Macaluso for fraud.

Put differently, Macaluso’s argument that he did not commit

actionable fraud amounts to an impermissible collateral attack on the

district court’s default judgment. Therefore, we will not further consider it.

“Our prior decisions make clear that appellants cannot successfully

challenge an order on appeal by attacking a prior final order that they did

not timely appeal.” Jue v. Liu (In re Liu),

, 881 (9th Cir. BAP

2020); see also Heritage Pac. Fin., LLC v. Machuca (In re Machuca),

(9th Cir. BAP 2012) (“[T]he bankruptcy court’s order granting

14 summary judgment was final. HPF cannot collaterally attack that judgment

through the § 523(d) proceeding.”).

2. The bankruptcy court did not err in applying issue preclusion to the default judgment.

Macaluso next argues that the bankruptcy court should not have

applied issue preclusion to the district court default judgment. Macaluso

reasons that he did not have a full and fair opportunity to defend against

the district court civil action because he was incarcerated at the time and

was not able to work effectively with his counsel or review necessary

documents to mount a meaningful defense within the time permitted. He

further asserts that the district court should not have denied his request for

additional time to respond to the request for entry of default.

Macaluso’s assertions regarding his opportunity to defend the district

court action are at odds with his admission that he affirmatively chose not

to defend the action. Furthermore, though courts consider the opportunity

to litigate when deciding the issue preclusive effect of a default judgment,

that requirement generally is satisfied if the defendant received service of

the summons and the complaint or had actual knowledge of the existence

of the prior action. In re Harmon,

(citing In re Williams’

Estate,

). Here, there is no legitimate dispute that Macaluso

was duly served with the summons and complaint in the district court civil

action and that he was aware of the action. Indeed, his counsel made an

15 appearance in the action when he requested an extension of time to

respond to RJC’s initial request for entry of default.

Under California law, the opportunity to litigate can be considered

more fully as part of the public policy inquiry the court must undertake if it

determines that the threshold elements for application of issue preclusion

have been met. See

at 1247 & n.6. Here, the bankruptcy court applied the

correct law. It expressly considered Macaluso’s points about his

opportunity to litigate in the process of considering whether public policy

supported the application of issue preclusion to the district court default

judgment. The bankruptcy court found that in spite of his incarceration,

Macaluso had ample opportunity both before and after entry of the default

judgment to challenge the district court’s entry of a default judgment.

On this record, the bankruptcy court’s findings regarding Macaluso’s

opportunity to defend the district court civil action were logical, plausible,

and supported by the record. Consequently, we perceive no ground for

reversal based on Macaluso’s opportunity to defend against the district

court civil action.

Macaluso also challenges the bankruptcy court’s determination that

his fraudulent conduct was actually litigated in the district court civil

action. By implication, he also challenges the necessarily decided issue

preclusion element. See id. at 1248 (“As a conceptual matter, if an issue was

necessarily decided in a prior proceeding, it was actually litigated.”).

Relying exclusively on federal issue preclusion law, Macaluso asserts that a

16 default judgment generally should not be considered to satisfy the issue

preclusion elements of actually litigated and necessarily decided.

However, the bankruptcy court correctly applied California issue

preclusion law, which provides that a default judgment satisfies the

actually litigated and necessarily decided elements when it includes

express findings or when such findings are implicit in the prior judgment

because they were essential elements of the causes of action on which the

prior court specifically granted relief. See id. at 1248-49; In re Baldwin,

. Here, the default judgment established that all the elements for

RJC’s fraud claim were met. Because the fraud elements obviously were

essential to rendering judgment on the fraud claim, the fraud elements

were actually litigated and necessarily decided for issue preclusion

purposes.

Thus, we reject as meritless Macaluso’s arguments that the

bankruptcy court erred when it applied issue preclusion to the district

court’s default judgment.

3. The bankruptcy court did not err in its treatment of the federal criminal judgment.

The bankruptcy court granted summary judgment for RJC on its

§ 523(a)(13) claim based on the criminal judgment entered on Macaluso’s

guilty plea. Section 523(a)(13) excepts from discharge any debt “for any

payment of an order of restitution issued under title 18, United States

Code.” Nothing other than a criminal judgment for violation of title 18 that

17 provides for restitution is necessary to except a debt from discharge under

§ 523(a)(13). See Sanders v. Progressive Cas. Ins. Co. (In re Sanders), BAP No.

AZ-06-1382-PaBMo,

, at *1, *4 (9th Cir. Mar. 30, 2007).

Macaluso did not challenge the bankruptcy court’s decision that the

criminal restitution judgment was nondischargeable under § 523(a)(13) and

has waived any argument for reversing that portion of the bankruptcy

court’s judgment. See Christian Legal Soc'y v. Wu,

(9th

Cir. 2010).

Macaluso does contend that the bankruptcy court erred in giving the

criminal judgment issue preclusive effect as to RJC’s nondischargeability

claim under § 523(a)(2)(A). However, as explained above, the bankruptcy

court’s summary judgment on RJC’s § 523(a)(2)(A) claim was adequately

supported by the issue preclusive effect of the default judgment, so there is

no need for us to address the extent to which the criminal judgment also

supported summary judgment on RJC’s § 523(a)(2)(A) claim.

4. The bankruptcy court’s alleged violation of Macaluso’s due process rights was not reversible error.

Macaluso argues that the bankruptcy court erred when it failed to

continue the summary judgment hearing. He contends that he did not have

enough time to meaningfully respond to the summary judgment motion

and that the bankruptcy court violated his due process rights by denying

his counsel’s request for a continuance of the summary judgment

proceedings. He states that his counsel was given only 20 days advance

18 notice of RJC’s summary judgment motion rather than 28 days as required

by Local Rule 9013-6(a)(1).

This is a misstatement of the record. Whereas Macaluso says that the

summary judgment motion was served on his counsel on January 16, 2019,

the record reflects that the summary judgment motion and the moving

papers filed contemporaneously with the motion were served on January 3,

2019. This was more than 30 days before the February 6, 2019 summary

judgment hearing. The notice of the February 6, 2019 summary judgment

hearing was the only document that RJC served on January 16, 2019. But

Macaluso’s counsel was actually apprised of the February 6, 2019 hearing

date much earlier. At the time of the status conference held on November

2, 2018, which counsel for both sides attended, the court set February 6,

2019 for hearing any dispositive motions filed in the action. On the same

day as the November 2, 2018 status conference, the bankruptcy court

entered a minute order reflecting the February 6, 2019 hearing date as well

as other dates and deadlines set by the court.

The bankruptcy court effectively denied Macaluso’s continuance

request during the summary judgment hearing. In doing so, the court

observed that there was little or nothing additional that Macaluso could

meaningfully say that could potentially change its analysis and resolution

of the summary judgment motion given the issue preclusive effect of the

default judgment and nature of the criminal restitution. In short, Macaluso

has failed to establish how he was harmed by the denial of the continuance.

19 The contents of Macaluso’s subsequent motion for reconsideration

bear out the bankruptcy court’s observation. The motion for

reconsideration largely mirrors the arguments that Macaluso has advanced

on appeal. As we have explained in this decision, most of Macaluso’s

arguments are meritless and none justify reversal. When as here the record

demonstrates that appellant was not prejudiced in any discernable way by

an alleged denial of due process, the appellant’s due process argument will

not support reversal. See Rosson v. Fitzgerald (In re Rosson),

(9th Cir. 2008), partially overruled on other grounds by Nichols v.

Marana Stockyard & Livestock Mkt., Inc. (In re Nichols),

, 962 (9th

Cir. 2021).

5. Macaluso was not entitled to a sua sponte grant of summary judgment in his favor.

Next, Macaluso argues that the bankruptcy court should have sua

sponte granted summary judgment in his favor. Civil Rule 56(f), made

applicable in adversary proceedings by Rule 7056, sets forth procedures

that enable a court to exercise its discretion to grant summary judgment in

favor of a nonmoving party. But nothing in Macaluso’s appeal papers

demonstrates that the bankruptcy court was obliged to sua sponte exercise

such discretion. To the contrary, the general rule is that an appellant cannot

successfully argue on appeal that a court abused its discretion by failing to

grant discretionary relief when the appellant never asked the court for that

relief. See, e.g., Consorzio Del Prosciutto Di Parma v. Domain Name Clearing

20 Co., LLC,

(9th Cir. 2003); Rohauer v. Friedman,

(9th Cir. 1962).

In any event, Macaluso’s argument that he should have been granted

summary judgment is largely a recapitulation of the same points Macaluso

made in his initial argument that his conduct did not amount to actionable

fraud. Thus, for the same reasons we rejected Macaluso’s initial argument,

we also reject his final argument attacking the bankruptcy court’s summary

judgment ruling.

6. The denial of Macaluso’s reconsideration motion is beyond the scope of this appeal.

There is one final issue that we must address. To the extent Macaluso

sought to challenge on appeal the denial of his motion for reconsideration,

he should have filed a new notice of appeal or an amended notice of appeal

as contemplated in Rule 8002(b)(3). Because he failed to do so, the denial of

his reconsideration motion is beyond the scope of this appeal. Olomi v.

Tukhi (In re Tukhi),

(9th Cir. BAP 2017); see also Linton v.

Colpo Talpa, LLC (In re Linton), ___ B.R. ___, BAP No. NC-20-1175-KTB,

, at *7 (9th Cir. BAP Oct. 6, 2021) (“Linton's notice of appeal

challenged only the denial of the Civil Rule 21 motion to join parties. As

Linton did not appeal the § 303(i) judgment, no other ruling by the

bankruptcy court arising from the § 303(i) relevant proceeding is before

us.”), appeal docketed, Case No. 21-60053 (9th Cir. Oct. 19, 2021).

21 Even if we were to conclude that we somehow have jurisdiction to

review the denial of the reconsideration motion, we still would affirm.

Macaluso has forfeited any issue concerning the propriety of that denial by

not specifically and distinctly advancing any argument for reversal of the

denial. See Christian Legal Soc'y,

.

CONCLUSION

For the reasons set forth above, the bankruptcy court’s grant of

summary judgment in favor of RJC on its claims for relief under

§ 523(a)(2)(A) and (13) is AFFIRMED.

22