Miles v. Makishima et al

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UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
In re
ROYCE LEE MAKISHIMA and
TERRA ANN MAKISHIMA,
Debtors.
GRACE MILES,
Plaintiff,
vs.
ROYCE LEE MAKISHIMA; A.G. EDWARDS &
SONS, INC.; TERRA ANN MAKISHIMA,
Defendants.
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Case No. 07-27982 A7
Chapter 7
(Pending in the United
States Bankruptcy Court for
the Eastern District of
California)
Adv. Proc. No. 08-3037 TC
MEMORANDUM RE:(1) DEFENDANTS’ MOTION TO REMAND; (2) PLAINTIFF’S
MOTIONS TO STAY, FOR CONTINUANCE, AND TO DISQUALIFY
For the reasons stated below, the court grants Defendants’
motion to remand and declines to rule on Plaintiff’s other pending
motions.
FACTS
On November 17, 2004, Plaintiff filed San Mateo Superior Court
case Grace Miles v. Royce Makishima and A.G. Edwards & Sons, Inc.,
Case No. Civ. 443220 (the Action). 	The operative complaint in the
Signed and Filed: July 16, 2008
________________________________________
THOMAS E. CARLSON
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
July 17, 2008
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 08-03037 Doc# 49 Filed: 07/16/08 Entered: 07/17/08 17:15:20 Page 1 of 5

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Action asserts 20 state-law claims. 	A trial in the Action was held
from June 12, 2007 through July 5, 2007.
On September 28, 2007, Defendant Makishima and his wife filed
chapter 7 in the Bankruptcy Court for the Eastern District of
California (Case No. 07-27982). 	On October 12, 2007, the state
court issued a 30-page tentative decision. 	All claims in the
Action were decided in favor of Defendants. 	On March 21, 2008,
Debtors and Trustee filed a stipulation to modify the automatic
stay to retroactively validate the tentative decision and to permit
the state court to enter final judgment in the Action.
On April 28, 2008, Plaintiff removed the Action to this court.
The notice of removal provides that Plaintiff tentatively does not
consent to bankruptcy court jurisdiction, or to the bankruptcy
court’s entry of final orders or judgments. 	On May 28, 2008,
Defendants filed a Motion to Remand, arguing inter alia that the
claims are exclusively state-law claims, that the state court
presided over the Action for three years and conducted a four-week
trial, and that the state court has already issued an extensive
decision tentatively resolving all claims.
On May 29, 2008, Plaintiff filed and served a Request for Stay
of Proceedings, and a Request to Disqualify Morgan Lewis as counsel
for Defendants.
On July 3, 2008, Plaintiff filed an Ex Parte Motion for Stay
Pending Appeals. 	On July 9, 2008, the court entered any order
denying the Ex Parte Motion for Stay, due to Plaintiff’s failure to
serve the Motion and failure to comply with Bankruptcy Local Rule
9006-1.
On July 8, 2008, Plaintiff filed a Motion to Withdraw the
Reference, alleging that the adversary proceeding involves personal
Case: 08-03037 Doc# 49 Filed: 07/16/08 Entered: 07/17/08 17:15:20 Page 2 of 5

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injury claims, and that Plaintiff has demanded a jury trial.
Plaintiff also filed opposition to the Motion to Remand, arguing
that the proceeding should be transferred to federal District
Court, or retained by the bankruptcy court. 	Plaintiff contends
that the state court unjustly denied her request for a jury trial,
that the state-court judge signed the tentative decision for
improper reasons, that the state court denied Plaintiff due process
and generally treated her unfairly, and that the tentative decision
was issued in violation of the automatic stay. 	Plaintiff also
argues that remand is inappropriate, because she may prevail on her
appeal of the bankruptcy court’s order granting relief from stay,
and on her appeal of the state-court order denying Plaintiff’s
motion to disqualify the trial judge.
On July 10, 2008, Plaintiff filed a second Ex Parte Motion for
Stay Pending Appeals of the stay-relief order and order denying
Plaintiff’s motion to disqualify the state-court judge. 	The Motion
also seeks to continue the hearing on the Motion to Remand, based
on Plaintiff’s alleged disabilities and inability to retain
counsel.
On July 11, 2008, Plaintiff filed a Motion for Continuance and
Request for Order Shortening Time, and a second Motion to
Disqualify Morgan Lewis, which is set for hearing on August 29,
2008. 	On July 15, 2008, Defendants filed opposition to the Motion
for Continuance, and the Motion to Disqualify.
DISCUSSION
“The court to which [a] claim or cause of action is removed
may remand such claim or cause of action on any equitable ground.
An order entered under this subsection remanding a claim or cause
Case: 08-03037 Doc# 49 Filed: 07/16/08 Entered: 07/17/08 17:15:20 Page 3 of 5

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of action . . . is not reviewable by appeal or otherwise. . . .”
28 U.S.C. § 1452(b).
I determine that the adversary proceeding should be remanded
to state court. 	The removed Action involves purely state law
claims over which this court has no independent jurisdiction (28
U.S.C. § 1334(b)), and trial in the Action has already concluded.
All that remains is for the state court to enter final judgment,
which it may do promptly upon remand. 	Considerations of both
proper respect for the state court and judicial economy require
that this proceeding be remanded to the state court for entry of
final judgment in accord with that court’s decision following
trial.
This court is very mindful that Plaintiff strongly believes
that she did not receive fair treatment from the state court. 	It
is not appropriate, however, for this court to engage in appellate
review of the state-court decision, or to try the case afresh and
thereby ignore the fact that the state court already conducted a
long trial. 	After the state court enters judgment, Plaintiff can
pursue her grievance in the proper manner, by appealing the
judgment to the California Court of Appeal.
Plaintiff’s motion for stay pending appeal of the stay-relief
order is not properly directed to this court, because this court
did not issue that order and is not an appellate court. 	Fed. R.
Bankr. P. 8005. 	I decline to rule on Plaintiff’s motion for stay
pending appeal of the state-court and motions to disqualify Morgan
Lewis, 	because I am remanding this adversary proceeding to state-
court.
**END OF MEMORANDUM**
Case: 08-03037 Doc# 49 Filed: 07/16/08 Entered: 07/17/08 17:15:20 Page 4 of 5

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Court Service List
Grace Miles
21 Willow Road, Suite 22
Menlo Park, CA 94025
Lindsey K. Schroeder, Esq.
Morgan, Lewis and Bockius
3000 El Camino Real, Suite 700
Palo Alto, CA 94306
Case: 08-03037 Doc# 49 Filed: 07/16/08 Entered: 07/17/08 17:15:20 Page 5 of 5