                                                                           FILED
                            NOT FOR PUBLICATION                             MAR 23 2018
                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                        U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT

In re: ANTHONY THOMAS; et al.,                  No.    17-60042

             Debtors,                           BAP No. 16-1058
______________________________

ANTHONY THOMAS and WENDI                        MEMORANDUM*
THOMAS,

                Appellants,

 v.

KENMARK VENTURES, LLC,

                Appellee.

                           Appeal from the Ninth Circuit
                            Bankruptcy Appellate Panel
            Kurtz, Jury, and Lafferty III, Bankruptcy Judges, Presiding

                            Submitted February 13, 2018**
                              San Francisco, California

Before: BEA and N.R. SMITH, Circuit Judges, and STATON,*** District Judge.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **     The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).

      ***    The Honorable Josephine L. Staton, United States District Judge for
the Central District of California, sitting by designation.
       Anthony Thomas appeals the decision of the Bankruptcy Appellate Panel

(“BAP”) affirming the bankruptcy court’s judgment of nondischargeability under

11 U.S.C. § 523(a)(2)(A). The bankruptcy court and the BAP each concluded that

Thomas’s debt to Kenmark was nondischargeable because it was incurred by fraud.

We have jurisdiction pursuant to 28 U.S.C. § 158(d), and we affirm.

                                             I

       As an initial matter, we deny Thomas’s Motion to Supplement the Record

with evidence that purports to challenge the legitimacy of the state court judgment

debt underlying this appeal. At the time of the bankruptcy trial, Thomas was aware

of all facts related to his personal liability for the judgment, but he failed to raise

these arguments. Because “exceptional circumstances are lacking, we refuse to

consider them now.” Scovis v. Henrichsen (In re Scovis), 249 F.3d 975, 984 (9th

Cir. 2011).

                                            II

       Turning to the substance of Thomas’s appeal, Thomas argues that (1) he had

no duty to disclose to Kenmark certain information regarding the Thomas Emerald;

(2) Kenmark’s reliance on Thomas’s representations was not justifiable; and (3)

there is not sufficient evidence that Thomas had the requisite intent to deceive

Kenmark.

       We independently review the bankruptcy court’s rulings on appeal from the



                                                                                   17-60042
BAP. Citibank (South Dakota), N.A. v. Eashai (In re Eashai), 87 F.3d 1082, 1086

(9th Cir. 1996). Whether a creditor has proven an essential element of a claim is a

“factual determination reviewed for clear error.” Anastas v. American Savings

Bank (In re Anastas), 94 F.3d 1280, 1283 (9th Cir. 1996). We hold that the

bankruptcy court did not clearly err in concluding that Kenmark proved the

elements of fraud to support the nondischargeability judgment.

      Kenmark’s claim of fraud was based on Thomas’s failure to disclose that the

Thomas Emerald, the collateral pledged for Kenmark’s loan to Electronic Plastics

(“EP”), had been previously valued at amounts far lower than the amount of the

loan. Therefore, Kenmark was required to prove that (1) the omitted information

was “material,” and (2) the debtor had a duty to disclose the omitted information.

See Apte v. Japra (In re Apte), 96 F.3d 1319, 1323 (9th Cir. 1996). The lower

valuations of the Thomas Emerald were “material” because a reasonable lender

would have considered them important in agreeing to the loan . See id. Further,

Thomas had a duty to disclose those lower valuations because he selectively

disclosed to Kenmark that the Thomas Emerald had, at one point, been valued at an

amount substantially greater than the amount of the loan. See Restatement

(Second) of Torts § 551(2)(b) (1976) (“[A] party to a business transaction is under

a duty to exercise reasonable care to disclose . . . matters known to him that he

knows to be necessary to prevent his partial or ambiguous statement of the facts



                                                                               17-60042
from being misleading.”); In re Apte, 96 F.3d at 1324 (applying the Restatement

(Second) of Torts to determine the existence of a duty to disclose).

      The element of justifiable reliance may be presumed where, as here, the

fraud claim is based on the debtor’s concealment of material facts. In re Apte, 96

F.3d at 1323. Therefore, because Thomas’s omissions relating to the value of the

Thomas Emerald were material, Kenmark’s justifiable reliance may be presumed.

      Thomas’s intent to deceive can be inferred from the fact that Thomas knew

that lower valuations of the Thomas Emerald existed and selectively disclosed to

Kenmark only the higher valuation. Cowen v. Kennedy (In re Kennedy), 108 F.3d

1015, 1018 (9th Cir. 1997), as amended (Mar. 21, 1997) (“Intent to deceive can be

inferred from surrounding circumstances.”).



                                         III

      Separately, Thomas argues that the bankruptcy court erred in failing to

clarify whether the nondischargeability judgment applies to Thomas’s wife,

Wendi. We construe a judgment so as to give effect to the stated intention of the

issuing court. United States v. 60.22 Acres of Land, 638 F.2d 1176, 1178 (9th Cir.

1980). Wendi Thomas was not a subject of the bankruptcy court’s judgment. No

evidence was presented at trial that implicated Wendi Thomas in the fraud, and the

bankruptcy court made no findings of fact as to her. Therefore, we do not find any



                                                                             17-60042
error in the bankruptcy court’s judgment.

      AFFIRMED.




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