FILED NOV 19 2025 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT

UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT

In re: BAP No. SC-25-1005-SCB RODRIGO AGUIRRE, Debtor. Bk. No. 23-03639-CL7

MARIO MONTES MORA, Adv. No. 24-90014-CL Appellant, v. MEMORANDUM* RODRIGO AGUIRRE, Appellee.

Appeal from the United States Bankruptcy Court for the Southern District of California Christopher B. Latham, Chief Bankruptcy Judge, Presiding

Before: SPRAKER, CORBIT, and BRAND, Bankruptcy Judges.

INTRODUCTION

Appellant Mario Montes Mora sued Chapter 71 debtor Rodrigo

* 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. 1 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code, 11 U.S.C. §§ 101–1532, all “Rule” references are to the Federal Rules of Bankruptcy Procedure, and all “Civil Rule” references are to the Federal Rules of Civil Procedure. Aguirre under § 523(a)(2)(A) to except from discharge a debt arising from a

stipulated judgment. He also objected to Aguirre’s discharge under

§ 727(a)(2)(A) and (a)(4)(A). After several amendments to these claims, the

bankruptcy court dismissed Mora’s third amended complaint in its entirety

without leave to amend.

Mora had more than ample opportunity to state legally sufficient

claims but failed to do so. On appeal, Mora fails to demonstrate any error.

Accordingly, we AFFIRM.

FACTS2

Mora’s appeal focuses exclusively on his third amended complaint

(“TAC”). He raises no issues arising from the prior versions of his

complaint. Therefore, our factual recitation relies on the allegations set

forth in the TAC and the documents attached to or incorporated into the

TAC by reference.

A. The initial transaction between Mora and Aguirre.

The TAC pleads that Mora provided Aguirre with $108,358.09 worth

of seafood from Mexico. Initially, Mora refers to this transaction as a “sale,”

but he later refers to it as part of a joint venture agreement between him,

Aguirre, and Aguirre’s corporation Ocean’s Best Seafood (“Ocean’s Best”).

The joint venture was to be known as Baja Pacific Fish, LLC (“Baja”) and

2 We exercise our discretion, when appropriate, 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 was to resell the seafood in the United States. According to Mora, he and

Aguirre were supposed to share the sale proceeds. 3 Mora alleges that

Aguirre made misrepresentations and omissions “in or about 2018” to

fraudulently induce him to provide the seafood. Mora states that Aguirre

never intended to share the sale proceeds as promised but rather always

intended to use Baja “as his own company and wrongfully

misappropriated profits which should have been paid by Aguirre to Mora

pursuant to the joint venture.” The TAC does not detail what Aguirre told

him—or when. Mora does state that he justifiably relied on Aguirre’s

alleged false promise(s). But again, the TAC does not specify what if any

actions he took to his detriment after Aguirre allegedly made the false

promise(s). Indeed, it is impossible to tell from the TAC how or when Mora

delivered the seafood in relationship to Aguirre’s alleged fraudulent

conduct.

B. Mora sues Aguirre and others in state court.

Mora sued Ocean’s Best, Aguirre, and Aguirre’s two brothers in state

court in 2019. The TAC discusses this lawsuit only in vague terms. The

TAC states several times that this lawsuit “included a claim for fraud.”

3 The stipulated judgment and transcript from the state court settlement proceedings attached to the TAC show that the action and stipulated judgment were in the name of Mora and his company, Comasu Distbuidora S. De R.L. De C.V (“Comasu”). Both were named as plaintiffs. The TAC largely ignores the distinction between Mora and his company. For purposes of this appeal, any such distinction appears irrelevant. 3 Mora, however, fails to reference the other causes of action that were stated

in the state court lawsuit.4

Instead, the TAC focuses on Mora’s settlement of that lawsuit. Mora

did not attach a copy of the state court complaint as an exhibit to the TAC,

but he did attach a copy of the transcript from a state court hearing

conducted on September 12, 2022. During that hearing, the terms of the

settlement were stated for the record, and no written settlement agreement

was drafted. As set forth in the transcript, Ocean’s Best (through Aguirre)

promised to pay Mora $45,000 in monthly installments of $1,000. The

settlement transcript repeatedly refers to Aguirre as the “guarantor” of the

settlement payments. The settlement further provided that if Ocean’s Best

failed to make the required payments, Mora was entitled to entry of a

stipulated judgment against Ocean’s Best and Aguirre for $82,417.99, less

credit for any settlement payments made. Under the settlement, Mora

immediately dismissed Aguirre’s brothers from the lawsuit, with prejudice.

Mora contends that Aguirre defrauded him a second time when

entering into the settlement. According to Mora, Aguirre never intended to

make the settlement payments as promised. Rather, Mora alleges that

Aguirre entered into the settlement solely to induce Mora to dismiss the

4 Mora filed in March 2024 a proof of claim in which he stated that the basis of his claim was “goods sold.” There is no mention at all of fraud in the proof of claim. The bankruptcy court, meanwhile, took judicial notice of the state court docket and stated: “The complaint includes causes of action for (1) breach of contract, (2) fraud, (3) negligent misrepresentation, (4) unjust enrichment, and (5) common counts.” 4 lawsuit against his bothers. Mora alleges that this was part of a fraudulent

transfer scheme; once Aguirre fraudulently procured the release of his

brothers from the state court lawsuit, he transferred “tools and equipment,

a walk-in cooler, ice machine, and a freezer” to them. Mora contends that

the settlement and asset transfer were both part of an overarching plan to

enable Aguirre and his brothers to continue their seafood business

operations free from the debt owed to Mora and Comasu.5

Almost a year after the settlement, on August 17, 2023, the state court

entered judgment on the parties’ stipulation. Judgment was entered against

Ocean’s Best and Aguirre in the amount of $73,417.99. Neither the

settlement hearing transcript nor the subsequently entered stipulated

judgment stated that Mora was entitled to judgment on any particular

cause of action. Rather, based on the settlement, the parties agreed that in

the event of a payment default Ocean’s Best and Aguirre would be liable

for $82,417.99 less any payments made prior to entry of the judgment. The

fact that judgment was entered for $73,417.99 indicates that Ocean’s Best or

Aguirre made $9,000 in settlement payments prior to entry of the

judgment.

//

5 Mora apparently asserts that another aspect of Aguirre’s plan to evade collection of Mora’s judgment was to shift his seafood business operations from Ocean’s Best to his sole proprietorship known as Oceans Best Community Fish Market. It is unclear how this would evade liability as both Ocean’s Best and Aquirre were liable under the settlement and stipulated judgment. 5 C. Aguirre files chapter 7 bankruptcy.

Aguirre filed his chapter 7 petition and his initial schedules and

statement of financial affairs (“SOFA”) in November 2023. The only

reference to Ocean’s Best in the schedules and SOFA is found in response

to question 19 of Schedule A/B. Aguirre identified Ocean’s Best as his

wholly-owned corporation, which he stated had no value. Mora contends

that Aguirre prepared false schedules that downplayed or negated the role

of Ocean’s Best (one of the judgment debtors) and instead falsely claimed

that he operated his seafood business prepetition through a proprietorship.

There are several references in his bankruptcy filings stating that Aguirre

conducted his seafood business prepetition as a sole proprietorship under

the trade name “Oceans Best Community Fish Market.” Aguirre stated in

his Schedule I that at the time of his bankruptcy filing, he was self-

employed and earned roughly $3,000 per month in net income from the

sole proprietorship. Oddly, despite his scheduled $3,000 in net monthly

income, Aguirre stated in his SOFA that he had no income from

employment or business operations in 2021, 2022, and 2023. Aguirre later

amended his SOFA to reflect gross prepetition income from his sole

proprietor seafood business of $60,000 in 2023, $88,000 in 2022, and $88,000

in 2021.

Aguirre disclosed in his SOFA that he had been both a sole proprietor

and an officer, director, or managing executive of a corporation within the

four years prior to the bankruptcy filing. When asked in question 27 of his

6 SOFA to identify the business names of these entities, he listed the

proprietorship, another company known as Oceanside Associates, and

Baja. Though Aguirre listed Ocean’s Best in his schedules, he failed to list it

in his answer to question 27.

Mora also alleged that Aguirre’s schedules and other bankruptcy

papers contained numerous other misstatements and omissions. Several of

these related to his theory that Aguirre wrongfully shifted his seafood

business operations from Ocean’s Best to the proprietorship. Mora alleged

that there was no fictitious business name statement for the proprietorship,

so Aguirre could not possibly have operated a sole proprietorship. And the

TAC further alleged that Aguirre “filed an Income and Expense

Declaration in [a] Domestic Support Action which demonstrates his false

oath, fraudulent transfer, and fraud in this Bankruptcy.”

Finally, Mora identified several other miscellaneous matters

involving alleged misrepresentations and omissions:

• Aguirre fraudulently omitted from his schedules his interest in Pacific Stone Crab LLC (“Stone Crab”).

• Aguirre failed to list the state court domestic support judgment entered against him. Mora claims that this omission was part of Aguirre’s efforts to fraudulently conceal the inconsistencies between his financial reporting in the domestic support proceedings and in the bankruptcy case. But Aguirre did list a domestic support obligation elsewhere in his schedules.

• Aguirre wrongly listed Mora as an unsecured creditor instead of a

7 secured creditor based on his recorded abstract of judgment in 2023.

• Aguirre’s petition misstated where he lived.

• The petition attempted to hide an interest in real estate located on Melrose Avenue in Chula Vista, California, in part, by falsely not listing it as his residence.

• Aguirre amended his schedules to falsely omit certain tangible business assets—the same ones he allegedly fraudulently transferred to his brothers (tools and equipment, walk-in cooler, ice machine, and a freezer).

D. The motion to dismiss the TAC.

As he had done with prior versions of the complaint, Aguirre moved

to dismiss the TAC. He asserted that it did not meet the pleading standards

set forth in Civil Rules 8(a) and 9(b)—and in Ashcroft v. Iqbal,

(2009), and Bell Atlantic Corp. v. Twombly,

(2007). Mora

opposed the motion to dismiss, but the bankruptcy court agreed with

Aguirre.

The bankruptcy court entered a judgment of dismissal with prejudice

in favor of Aguirre, and Mora timely appealed.

JURISDICTION

The bankruptcy court had jurisdiction under

and

157. We have jurisdiction under

.

ISSUES

1. Did the bankruptcy court err when it granted Aguirre’s motion to

dismiss Mora’s TAC?

8 2. Did the bankruptcy err when it dismissed the TAC with prejudice—

without leave to amend.

STANDARDS OF REVIEW

We review de novo the bankruptcy court’s decision to dismiss a

complaint under Civil Rule 12(b)(6). See Movsesian v. Victoria Versicherung

AG,

(9th Cir. 2012) (en banc). When we review a matter

de novo, we give no deference to the bankruptcy court’s prior rulings.

Nordeen v. Bank of Am., N.A. (In re Nordeen ),

(9th Cir. BAP

2013).

Generally speaking, we review the bankruptcy court’s decision to

dismiss without leave to amend for an abuse of discretion. See, e .g., Curry

v. Yelp Inc.,

(9th Cir. 2017); Zadrozny v. Bank of N.Y.

Mellon,

(9th Cir. 2013). On the one hand, federal

appellate courts “review strictly” the trial court’s exercise of this discretion.

Albrecht v. Lund,

(9th Cir.), amended,

(9th

Cir. 1988). On the other hand, the strictness of this review diminishes as the

plaintiff is given additional opportunities to amend the complaint. As the

Ninth Circuit has stated, a court’s “discretion to deny leave to amend is

particularly broad where plaintiff has previously amended the complaint.“

Zadrozny,

(internal quotation marks omitted) (quoting

United States ex rel. Cafasso v. Gen. Dynamics C4 Sys., Inc.,

(9th Cir. 2011)). The Ninth Circuit also has stated that “[d]ismissal without

leave to amend is improper unless it is clear, upon de novo review, that the

9 complaint could not be saved by any amendment.“ Intri–Plex Techs., Inc. v.

Crest Grp., Inc.,

(9th Cir. 2007).

We may affirm on any ground supported by the record. Uzun v. City

of Santa Monica,

(9th Cir. 2022).

DISCUSSION

Mora challenges the bankruptcy court’s determination that he did not

sufficiently plead claims for relief under § 523(a)(2)(A), § 727(a)(2)(A), and

§ 727(a)(4)(A). We will address each claim in turn. But first we will set forth

the general standards governing the sufficiency of pleadings.

A. General standards governing the sufficiency of pleadings.

Civil Rule 12(b)(6) motions test the legal sufficiency of the plaintiff’s

complaint. They challenge whether the complaint presents any cognizable

legal theories and whether it contains sufficient factual allegations to

support those legal theories. See Johnson v. Riverside Healthcare Sys., LP,

, 1121–22 (9th Cir. 2008). Thus, “for a complaint to survive a

motion to dismiss, the non-conclusory ‘factual content,’ and reasonable

inferences from that content, must be plausibly suggestive of a claim

entitling the plaintiff to relief.” Moss v. U.S. Secret Serv.,

(9th Cir. 2009) (citing Ashcroft v. Iqbal,

(2009)). A claim

is facially plausible only if it contains enough factual allegations that, if

taken as true, would allow the court to reasonably infer that the defendant

is liable to the plaintiff. Iqbal,

. “Threadbare recitals of the

elements of a cause of action, supported by mere conclusory statements, do

10 not suffice.”

Mere legal conclusions are not accepted as true and do not

by themselves establish a plausible claim for relief.

Ultimately, a plaintiff must plead “more than a sheer possibility that

a defendant has acted unlawfully.”

(emphasis added). Dismissal is

appropriate if a complaint contains factual allegations “that are merely

consistent with a defendant’s liability.”

(quoting Bell Atl. Corp. v.

Twombly,

(2007)) (internal quotation marks omitted).

The Civil Rules governing pleading—made applicable in adversary

proceedings by Rules 7008 and 7009—further refine the federal pleading

standards. Civil Rule 8(a)(2) states that all claims for relief must contain “a

short and plain statement of the claim showing that the pleader is entitled

to relief.” But when pleading fraud, the plaintiff “must state with

particularity the circumstances constituting fraud.” Civil Rule 9(b); see also

Ebeid ex rel. United States v. Lungwitz,

(9th Cir. 2010). The

plaintiff must include in his or her fraud allegations “the who, what, when,

where, and how of the misconduct charged.”

(quoting Vess v. Ciba–Geigy

Corp. USA,

, 1106 (9th Cir. 2003)). Importantly, this requires

plaintiffs like Mora to plead fraud claims with specificity as to what they

were told, when, by whom, and what parts they relied on. See Kearns v.

Ford Motor Co.,

(9th Cir. 2009); see also Neubronner v.

Milken,

(9th Cir. 1993) (“The complaint must specify such

facts as the times, dates, places, benefits received, and other details of the

alleged fraudulent activity.”); see also McMaster v. United States,

(9th Cir. 2013) (“Particularity generally necessitates a great deal of

specificity.”).

Moreover, in some instances, the falsity of the alleged

misrepresentations when made will not be obvious from the type and

nature of the misrepresentation alleged. See Decker v. GlenFed, Inc. (In re

GlenFed, Inc. Sec. Litig.),

, 1548-49 (9th Cir. 1994) (en banc),

superseded by statute on other grounds as stated in SEC v. Todd,

(9th Cir. 2011). In such a context, the plaintiff also should plead facts

plausibly showing why he or she believes the alleged misrepresentations

were false when made. See

Thus, in the context of alleged false promises

in entering into a contract, the fraud plaintiff ordinarily should plead facts

plausibly showing why he or she believes that the defendant’s promise was

false when made.

Mora’s TAC, as well as his appeal brief, repeat the same scattershot

litany of factual allegations for each of his claims for relief—rendering them

almost incomprehensible. The appeal brief offers little assistance as it

contains virtually no legal analysis in support of Mora’s bald contention

that each of his claims for relief was sufficiently pled. The only concrete

and specific legal analysis Mora included in his appeal brief cites to this

Panel’s decision in Italiane v. Jeffrey Catanzarite Family Ltd. Partnership (In re

Italiane),

, 672 (9th Cir. BAP 2021), aff'd,

(9th

Cir. Dec. 5, 2022), as it relates to issue preclusion. However, as we explain

in detail below, Mora misunderstands and misapplies In re Italiane to his

12 case.

We decline to pick through Mora’s scattershot allegations in an effort

to match them with any legal theories that Mora has never articulated but

which might support reversal. See Indep. Towers of Wash. v. Wash.,

, 929-30 (9th Cir. 2003); see also Leigh v. Salazar,

(9th Cir.

2012). With this in mind, we turn our attention to examining the claims

Mora asserted in his TAC.

B. Section 523(a)(2)(A).

Section 523(a)(2)(A) excepts from discharge any debt arising from

false pretenses, a false representation, or actual fraud, other than a

statement respecting the debtor’s or an insider’s financial condition. A

claim under § 523(a)(2)(A) typically is pled by stating the elements of a

common law cause of action for fraudulent misrepresentation. The

required elements are:

(1) the debtor made representations; (2) that at the time he knew they were false; (3) that he made them with the intention and purpose of deceiving the creditor; (4) that the creditor relied on such representations; and (5) that the creditor sustained the alleged loss and damage as the proximate result of the misrepresentations having been made.

Ghomeshi v. Sabban (In re Sabban),

(9th Cir. 2010)

(cleaned up). A “false promise” is one type of misrepresentation that can

lead to a nondischargeable debt under § 523(a)(2)(A), but only if the debtor

harbored an intention not to perform at the time the promise was made; a 13 subsequently-developed intent to not perform is insufficient for

nondischargeability. Wagner v. Malich (In re Malich),

, at *5

(9th Cir. BAP Mar. 15, 2011) (citing Eashai v. Citibank, South Dakota, N.A., (In

re Eashai),

(9th Cir. BAP 1994), aff'd,

(9th Cir.

1996)). Civil Rule 9(b) applies to claims under § 523(a)(2)(A). See Nahman v.

Jacks (In re Jacks),

(9th Cir. BAP 2001).

Mora maintains that Aguirre committed fraud, originally, by

inducing him to deliver his seafood and, later, by entering into the

settlement. 6 The bankruptcy court granted Mora leave to amend his

complaint multiple times to particularly identify which specific

representation(s) induced Mora to enter into both transactions and when

Aguirre made these representations. The court also required Mora to

provide details as to Aguirre’s knowledge and fraudulent intent. The court

concluded that Mora failed to sufficiently plead any viable theory in

support of his § 523(a)(2)(A) claim.

1. Fraudulent inducement to deliver seafood.

According to Mora, Aguirre fraudulently induced him to provide

6 Mora includes allegations sounding in fraudulent transfer within his claim under § 523(a)(2)(A). But he fails to make any reference in his appellate brief to fraudulent transfers in his scant discussion of his § 523(a)(2)(A) claim. Consequently, Mora has forfeited any argument that he asserted a claim for a prepetition fraudulent transfer that gave rise to nondischargeable damages under § 523(a)(2)(A). Generally speaking, claims for fraudulent transfer belong exclusively to the bankruptcy estate upon the filing of a bankruptcy. See Valente v. Nowland (In re Valente),

, at *7 (9th Cir. BAP June 16, 2022). 14 seafood based on the alleged false promise to share the proceeds from

resale of the seafood in furtherance of a joint venture agreement between

Mora and Aguirre. But after four attempts, the TAC remains bereft of any

specific information regarding Aguirre’s representations, including the

content and timing of the parties’ alleged agreement, stating only that they

were to split profits. Both before the bankruptcy court and on appeal Mora

argues that the stipulated judgment entered by the state court established

Aguirre’s fraud because that complaint included a claim for fraud among

other claims. In support of this argument, Mora cites this court’s decision

in In re Italiane.

We agree with the bankruptcy court that Italiane is distinguishable

and does not aid Mora. In Italiane, the bankruptcy court granted relief from

stay to permit prosecution of a pending state court action that included

claims for securities fraud under California law, fraudulent

misrepresentation, fraudulent nondisclosure, and conspiracy to commit

fraud. 632 B.R. at 666. The bankruptcy court noted that the state court

claims largely overlapped the facts and issues raised in the

nondischargeability adversary proceeding. Moreover, the court anticipated

that resolution of the state court action would lead to application of issue

preclusion resolving the § 523(a) claims. Id. Unlike the present case, the

parties in Italiane ultimately stipulated to a judgment in the state court case

for fraudulent concealment recognizing that the debt would be

nondischargeable in bankruptcy. Id. at 667-68. We affirmed the bankruptcy

15 court in Italiane, agreeing that the stipulated judgment for fraud was

entitled to issue preclusive effect.

Despite several opportunities, Mora has failed to allege anything to

establish that his stipulated judgment arises specifically from a fraud claim

to give it preclusive effect on the issue of fraud in his adversary

proceeding. California law controls here and requires the party seeking to

apply issue preclusion to prove:

(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.

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

(9th Cir. BAP

2015) (citing Lucido v. Super. Ct.,

(1990)).

Under Iqbal and Twombly, Mora’s conclusory statement that issue

preclusion applies to his stipulated judgment is clearly insufficient. The

TAC merely alleges that Mora’s state court action included a claim for

fraud. This is insufficient as there are no allegations that judgment was

entered on the fraud claim. Mora attached to the TAC copies of the

judgment and the transcript from the settlement hearing, but neither

document refers to any specific cause of action. Other than involving the

same parties, Mora failed to sufficiently allege any of the other issue

preclusion elements. 16 Mora does not otherwise challenge the court’s dismissal of his

fraudulent inducement claim related to the seafood. Nonetheless, we note

the absence from the TAC of sufficient specificity as to this claim. Thus, we

agree with the bankruptcy court that this claim was neither plausible nor

sufficiently particular. Indeed, while it is possible that Aguirre fraudulently

induced Mora to deliver the seafood, in the parlance of Iqbal and Twombly,

the claim as amended “stops short of the line between possibility and

plausibility of entitlement to relief.”

2. Fraudulent inducement to enter stipulated judgment.

Mora’s § 523(a)(2)(A) claim included allegations that Aguirre

fraudulently induced him to enter into the stipulated judgment without

any intent to pay but only to insulate his brothers from liability. Mora

argues that Aguirre entered into the stipulated judgment only to continue

the fish business with his brothers, obtain dismissal of Mora’s claims

against them, and fraudulently transfer assets beyond his reach.

As noted above, Mora’s claim for fraudulent inducement required

him to allege that Aguirre had the requisite fraudulent intent at the time

the parties entered into the settlement. Yet, it is apparent from the TAC and

the attached stipulated judgment that Aguirre partially performed his

settlement obligations. As reflected in the TAC, the stipulated judgment,

and the settlement transcript, Aguirre made $9,000 total in settlement

payments. The TAC fails to address this even though partial payment is

clear given the reduced amount of the stipulated judgment. Partial

17 performance of a contract typically is compelling evidence militating

against a finding of fraudulent intent in nondischargeability actions based

on promissory fraud. See Snapir v. Breliant (In re Snapir),

,

at *5 (9th Cir. BAP Nov. 3, 2017) (citing In re Malich,

, at

*7).

Under these circumstances, Iqbal, Twombly, and GlenFed all stand for

the proposition that it was incumbent on Mora to give some plausible

explanation why Aguirre’s representation (or false promise) was false

when made. Without such an explanation, the allegation that Aguirre

never intended to perform is not plausible and the claim is merely one for

breach of contract not fraud. To hold otherwise would permit frustrated

creditors with breach of contract claims to impermissibly convert such

claims into fraud claims for purposes of nondischargeability under

§ 523(a)(2)(A).

C. Section 727(a)(2)(A).

Section 727(a)(2)(A) denies the debtor a discharge when he or she—

with the intent to hinder, delay, or defraud his creditors or the estate—“has

transferred, removed, destroyed, mutilated, or concealed” his property

“within one year before the date of the filing of the petition.” As the Ninth

Circuit has explained, “A party seeking denial of discharge under

§ 727(a)(2)(A) must prove two things: (1) a disposition of property, such as

transfer or concealment, and (2) a subjective intent on the debtor’s part to

hinder, delay or defraud a creditor through the act of disposing of the

18 property.” Retz v. Samson (In re Retz),

(9th Cir. 2010)

(cleaned up). A claim under § 727(a)(2)(A) is subject to Civil Rule 9(b) only

to the extent the claim is based on the debtor’s fraud. See Kubik v. FDIC (In

re Kubick),

(9th Cir. BAP 1994).

Mora’s § 727(a)(2)(A) claim is directed at Aguirre’s alleged transfer to

his brothers of the same tangible assets referenced throughout his

complaint—tools and equipment, the walk-in cooler, an ice machine, and a

freezer. Aguirre listed these items in his original and first amended

Schedule B—as his personal property. It was not until Aguirre filed his

second amended Schedule B that he omitted the walk in cooler, explaining

that it belonged to the building owner. As the bankruptcy court noted, only

the cooler has ever been omitted from Aguirre’s amended Schedule A/B;

the other tangible assets were all still scheduled as Aguirre’s property. The

court concluded that the TAC’s allegations were conclusory and not

sufficiently particular.

On appeal, Mora simply disagrees with the bankruptcy court. Once

again, his appellate brief merely repeats the same vague fraudulent transfer

allegations set forth in the TAC. Mora fails to provide any legal analysis

explaining why he believes his § 727(a)(2)(A) claim was legally sufficient.

He merely states: “Plaintiff has properly pled a claim that Aguirre should

not be granted a discharge pursuant to

(a)(2)(A).”

Aplt. Opn. Br. at 20. In fact, his legal argument fails to even identify the

specific assets at issue, merely stating that he “disposed of his property.”

19 Nor did Mora ever identify how or specifically when any tangible assets

were fraudulently transferred. This is particularly problematic as

§ 727(a)(2)(A) is restricted to transfers within a year of the petition filing.

Yet, Aguirre’s schedules indicate that he still has possession and control of

the tools and equipment, the walk-in cooler; the ice machine; and the

freezer. Indeed, Aguirre’s schedules originally indicated that he owned

each of these items. Aguirre amended his schedules to indicate that his

possession and control of the cooler arise not from outright ownership but

from his leasehold interest in 72 E J St., Chula Vista, California—the

building in which he represented he lived and operated his seafood

business at the time of his bankruptcy filing.

Mora merely disputes Aguirre’s recharacterization of his interest in

the cooler. But the TAC fails to specifically identify any qualifying transfer

of the personal property, including the walk-in cooler affixed to Aguirre’s

leased property. Moreover, both the TAC and Mora’s opening appeal brief

fail to plausibly or coherently explain how Aguirre’s amendment of his

schedules—which specifically stated that the cooler belongs to the building

owner—is indicative of any transfer, much less a fraudulent, prepetition

one for purposes of § 727(a)(2)(A). Civil Rule 9(b), Iqbal, and Twombly each

required Mora to plead more than the mere conclusory compliance with

the statutory requirements of § 727(a)(2)(A). Without any specificity

regarding the transfers, the TAC fails to state a plausible claim.

As we explained above, we will not sift through Mora’s shotgun

20 allegations in search of a viable legal theory in support of his § 727(a)(2)(A)

claim—especially when his counsel has failed to provide one. In short,

Mora has failed to establish any ground for reversal of the bankruptcy

court’s dismissal of his § 727(a)(2)(A) claim.

D. Section 727(a)(4)(A).

Section 727(a)(4)(A) denies the debtor a discharge when “the debtor

knowingly and fraudulently, in or in connection with the case[,] made a

false oath or account.” As recognized in Retz, “[a] false statement or an

omission in the debtor’s bankruptcy schedules or statement of financial

affairs can constitute a false oath.” In re Retz,

(quoting

Khalil v. Devs. Sur. & Indem. Co. (In re Khalil),

(9th Cir. BAP

2007), aff'd & adopted,

(9th Cir. 2009)). A party seeking

denial of discharge under § 727(a)(4)(A) must prove four things: “(1) the

debtor made a false oath in connection with the case; (2) the oath related to

a material fact; (3) the oath was made knowingly; and (4) the oath was

made fraudulently.” Id. at 1197 (quoting Roberts v. Erhard (In re Roberts),

(9th Cir. BAP 2005)). Claims under § 727(a)(4)(A) are subject to

Civil Rule 9(b). Kubick,

.

In dismissing Mora’s § 727(a)(4)(A) claim, the bankruptcy court

focused on the failure to sufficiently allege materiality and that Aguirre

made the false oaths knowingly and fraudulently. For purposes of

§ 727(a)(4)(A), materiality is interpreted very broadly, in part, because “the

viability of the system of voluntary bankruptcy depends upon full, candid,

21 and complete disclosure by debtors of their financial affairs.” In re Retz,

; see also Fogal Legware of Switz., Inc. v. Wills (In re Wills),

(9th Cir. BAP 1999) (“The fundamental purpose of § 727(a)(4)(A) is to

insure that the trustee and creditors have accurate information without

having to conduct costly investigations.”). Thus, under § 727(a)(4)(A), “[a]

fact is material if it bears a relationship to the debtor’s business transactions

or estate, or concerns the discovery of assets, business dealings, or the

existence and disposition of the debtor’s property.” In re Retz,

(cleaned up); see also In re Wills,

(“a discharge may be

denied if the omission adversely affects the trustee’s or creditors’ ability to

discover other assets or to fully investigate the debtor’s pre-bankruptcy

dealing and financial condition.” (citation omitted)). Yet, a plaintiff still

must present some plausible basis for concluding that the alleged false oath

is material to the case. This is because “a false statement or omission that

has no impact on a bankruptcy case is not material and does not provide

grounds for denial of a discharge under § 727(a)(4)(A).” Khalil,

.

As noted previously, Mora alleges a number of errors and omissions

in Aguirre’s schedules and SOFA. We address each in turn.

1. Aguirre’s income.

In the TAC, Mora alleges that Aquirre submitted an Income and

Expense Declaration in a prior domestic support action that demonstrates

Aguirre made a false oath in his bankruptcy schedules about receiving

22 monthly business income from his proprietorship. The declaration, filed on

July 26, 2023, stated that Mora worked at “Community Fish Market Inc.”

beginning on June 1, 2023, that he worked about 40 hours a week, and was

paid $25 per hour. The declaration also stated that on average, over the

prior 12 months, Aguirre had earned $3,221.12 per month.

Mora appears to allege that the declaration was inconsistent with his

later declaration submitted to the bankruptcy court in support of his

motion to convert the case to chapter 13. In his bankruptcy declaration,

Aguirre stated that as of date he filed for bankruptcy, the County of San

Diego had closed his business and Aguirre had to work for months with

the county to reopen his business. The bankruptcy court held that Mora’s

conclusory statements failed to sufficiently identify what the alleged lies

were or that they were knowingly and fraudulently made.

On appeal, Mora simply repeats the very same nebulous allegations

without explaining specifically how Aguirre knowingly and fraudulently

presented a false oath in his bankruptcy filings. Mora has provided no

coherent or plausible explanation as to why these statements are even

inconsistent, much less how he has pled a false oath under § 727(a)(4)(A). It

is unclear why Mora believes these declarations are in conflict. Nor is it

clear why he believes they establish that the bankruptcy declaration or

Aguirre’s schedules contain a material falsehood that was knowingly and

fraudulently made. Once again, Mora’s conclusory and vague allegations

are insufficient to state a plausible claim under § 727(a)(4)(A).

23 2. Business interests.

Mora contends that Aguirre failed to list an interest in Stone Crab.

The bankruptcy court held that the failure to list an interest in Stone Crab

was not material because it is listed as inactive since 2019 on the California

Secretary of State’s website. Mora does not dispute or challenge the court’s

reasoning on appeal.

Mora also asserts that Aguirre falsely listed his interest in Oceans

Best Community Fish Market as a sole proprietorship. He argues that

Aguirre has continued to misrepresent that his income comes from this sole

proprietorship rather than from Ocean’s Best—a California corporation. In

support of this contention, he alleged that Aguirre never filed a fictitious

business name statement in San Diego county.7 However, in his appeal

brief, Mora merely references paragraphs 8 through 94 of his TAC and

baldly concludes that “Aguirre has knowingly and fraudulently, in or in

connection with this case, made a false oath” under § 727(a)(4)(A). Aplt.

Opn. Br. at 19. This is not a helpful or sufficient analysis to explain why

Mora’s § 727(a)(4)(A) claim is legally cognizable. Mora’s allegations are

7 The bankruptcy court found that this allegation was “irrelevant” because the official records of the California Secretary of State indicated the existence of an entity called Ocean’s Best Community Fish Market, Inc., an active corporation by the same name. We are a bit confused by the court’s reference and the conclusion it draws from the reference. Even so, Mora has not even suggested it was error because he failed to address it within his appellate brief. 24 classic conclusory allegations that the Supreme Court has repeatedly

refused to accept as sufficient to defeat a motion to dismiss. See Iqbal,

; Twombly,

.

Similarly, the TAC fails to adequately allege that the omission of

either the Stone Crab interest or the inclusion of the sole proprietorship

was material. Mora’s appellate brief did not challenge the bankruptcy

court’s taking judicial notice of the inactive status of Stone Crab. Nor did

Mora challenge the court’s conclusion that the failure to list an entity that

has been inactive for four years prior to the bankruptcy filing was

immaterial. Such an omission may be material in a different set of

circumstances, but the TAC failed to allege such a situation. 8

As to Aguirre’s listing of the Oceans Best Community Fish Market as

a sole proprietorship, he has listed his interest in Ocean’s Best Seafood as

well as Oceans Best Community Fish Market. Both businesses have been

disclosed, and Aguirre has stated that he has received his income from

Oceans Best Community Fish Market. Both the trustee and creditors have

been advised of those interests. Without further specific allegations

establishing the materiality of these interests, Mora has merely alleged a

possible claim of false oath but after several attempts has failed to allege a

plausible claim.

8At oral argument, Mora’s counsel posited that this omission was material because the parties had agreed to operate their joint venture through Stone Crab. But the TAC alleged otherwise. The TAC stated that the alleged joint venture was to be operated through Baja—a different entity. 25 3. The Melrose Avenue property.

The bankruptcy court also addressed Mora’s claim that Aguirre

fraudulently omitted his interest in 1687 Melrose Avenue, Unit L, Chula

Vista, California. Mora alleges in the TAC that Aguirre was served with

process at the Melrose Avenue property sometime during the domestic

support action and this is evidence of an ownership interest. According to

the court, none of the specific facts Mora alleged plausibly demonstrated

that Aguirre held such an interest. The court also relied in part on

information from the official county real property records showing that

others hold legal title to the property.

Again, Mora’s appellate brief fails to provide any legal analysis

explaining why his § 727(a)(4)(A) claim was viable based on his theory

arising from the Melrose Avenue property—other than his unsupported

belief that Aguirre owns an interest in that property. In his petition, Mora

stated that he lived at 72 E J St., Chula Vista, California, which also is the

address of his seafood business. His Schedule A/B listed his ownership

interest in 1939-41 Ensenada St., Lemon Grove, California, as well as a

security deposit for rent.

Mora’s claim of false oath for failing to list an ownership interest in

the Melrose Avenue property again states only a “possible” claim. He

alleged only conclusions and does not challenge on appeal the bankruptcy

court’s judicial notice of the real property records evidencing ownership of

26 that property by nondebtor third parties. As such, Mora has failed to

establish that the bankruptcy court erred in dismissing his § 727(a)(4)(A)

claim as to the omission of the Melrose Avenue property from Aguirre’s

bankruptcy schedules.

4. Miscellaneous omissions.

In the TAC, Mora also claimed that Aguirre made false oaths by (1)

failing to disclose his interest in the tangible assets allegedly fraudulently

transferred, though his amended Schedule A/B continued to claim

ownership of three of the four subject assets and explained why he no

longer claimed ownership of the walk-in cooler; (2) failing to list Mora’s

claim as secured, though Aguirre’s schedules did list the claim as

unsecured; and (3) failing to list a judgment for domestic support, though

he did list his support obligation in his schedule of monthly expenses.

Mora appears to have cut and pasted into his appeal brief the relevant

factual allegations from the TAC, but he has failed to specifically discuss

any of these three items within his § 727(a)(4)(A) argument.

The court held that Mora failed to sufficiently allege the materiality of

not listing the domestic support judgment. It also held that the subject

tangible assets were, in fact, scheduled as Aguirre’s property—except for

the walk-in cooler (which was specifically discussed in the amendment). It

further concluded that Mora’s allegation that Aguirre’s real property lease

would show that the walk-in cooler was owned by Aguirre was

impermissibly conclusory. The court did not specifically discuss Aguirre’s

27 failure to list Mora’s claim as secured—though the underlying debt was

disclosed.

On appeal, Mora has wholly failed to address how and why the

bankruptcy court erred in dismissing his § 727(a)(4)(A) claim as to these

items. We will not make arguments for reversible error where he has not

done so.

E. Leave to amend.

Mora complains that the bankruptcy court should have granted him

leave to amend his complaint for a fourth time. As we indicated above,

when the plaintiff is given additional opportunities to amend, the trial

court’s discretion to deny leave to amend becomes progressively broader.

Zadrozny,

; United States ex rel. Cafasso,

.

Importantly, Mora fails to explain why the prior versions of his complaint

lacked the particularity needed to support his claims related to the seafood

he provided to Aguirre. All of the missing specifics should have been

readily within Mora’s knowledge—because he claims to have been a party

to the contract in which the false promise was made.

With respect to the false promise claim arising from the settlement,

Mora has never explained why he plausibly believes that Aguirre never

intended to perform the settlement despite Aguirre’s partial performance.

And in four attempts to state a fraud claim, Mora has not even tried.

Absent such an explanation, this claim is hopelessly implausible. Without

the required explanation, Mora’s false promise claim is nothing more than

28 “a pretext for the discovery of unknown wrongs.” Kearns,

(quoting Anderson v. Clow (In re Stac Elecs. Sec. Litig.),

(9th

Cir. 1996)).

As for his fraudulent transfer claims, Mora has never coherently

explained why he believes that Aguirre transferred away the tools and

equipment, the walk-in cooler, an ice machine, and a freezer. As we

explained above, Aguirre’s original and amended schedules all indicate

that each of these items was still within his possession and control at the

time he filed bankruptcy. If Mora had facts to plausibly allege that a

transfer of these tangible assets actually occurred prepetition, it defies

belief that he would not have included them in one of his four prior

versions of his complaint. In its analysis of Mora’s first amended

complaint, the bankruptcy court warned Mora that his complaint needed to

be more specific regarding the transfer of these tangible assets. Yet despite

two additional amendments, Mora never has managed to plausibly explain

why he believes that the subject tangible assets—all referenced in Aguirre’s

schedules—had been transferred away by Aguirre.

Finally, as to Mora’s § 727(a)(4)(A) claim, after having four

opportunities to state this claim, there is no reason to believe on this record

that Mora can or will be any more successful in curing the deficiencies in

this claim if given a fifth opportunity.

Under these circumstances, the bankruptcy court did not commit

reversible error when it denied Mora leave to amend.

29 CONCLUSION

For the reasons set forth above, we AFFIRM.

30