                                                        FILED
                                                         JUN 08 2016
 1                         ORDERED PUBLISHED
 2                                                   SUSAN M. SPRAUL, CLERK
                                                       U.S. BKCY. APP. PANEL
                                                       OF THE NINTH CIRCUIT
 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                          )    BAP No.     NV-15-1238-DFB
                                     )
 6   WESTERN FUNDING INCORPORATED;   )    Bk. No.     2:13-bk-17588-LED
     WESTERN FUNDING INC. OF NEVADA; )
 7   GLOBAL TRACK GPS, LLC,          )
                                     )
 8                  Debtors.         )
     ________________________________)
 9                                   )
     GREIF & CO.,                    )
10                                   )
                    Appellant,       )
11   v.                              )    O P I N I O N
                                     )
12   BRIAN D. SHAPIRO, Trustee of    )
     WFI Liquidating Trust; GUERIN   )
13   SENTER; AMERICAN EXPRESS TRAVEL )
     RELATED SERVICES COMPANY, INC.; )
14   AMERICAN EXPRESS CENTURION BANK,)
                                     )
15                  Appellees.       )
     ________________________________)
16
17                   Argued and Submitted on May 19, 2016,
                              at Las Vegas, Nevada
18
                              Filed - June 8, 2016
19
               Appeal from the United States Bankruptcy Court
20                       for the District of Nevada
21        Honorable Laurel E. Davis, Bankruptcy Judge, Presiding
22
     Appearances:     Louis Edward Humphrey, III, of Humphrey Lopez PLLC
23                    argued for appellant Greif & Co.; Robert E.
                      Atkinson, of Atkinson Law Associates, Ltd., argued
24                    for appellee Brian D. Shapiro, Trustee of WFI
                      Liquidating Trust.
25
26   Before:   DUNN, FARIS and BARASH,1 Bankruptcy Judges.
27
28
          1
            Hon. Martin R. Barash, United States Bankruptcy Judge for
     the Central District of California, sitting by designation.
 1   DUNN, Bankruptcy Judge:
 2
 3          The WFI Liquidating Trust, with Brian D. Shapiro as its
 4   trustee (“Liquidating Trustee”), was established upon
 5   confirmation of the chapter 112 plan of the jointly administered
 6   debtors Western Funding Incorporated (“WFI”), Western Funding
 7   Inc. of Nevada and Global Track GPS, LLC (collectively
 8   “Debtors”).       The confirmed plan empowered the Liquidating Trustee
 9   to litigate and settle claims belonging to the chapter 11
10   bankruptcy estates, provided that bankruptcy court approval be
11   sought and obtained to settle any claims over $50,000.       The
12   Liquidating Trustee commenced litigation against American Express
13   Travel Related Services Company, Inc. and American Express
14   Centurion Bank (collectively “Amex”) to avoid and recover over
15   $2 million in allegedly fraudulent prepetition transfers made by
16   WFI.       Subsequently, the Liquidating Trustee requested the
17   bankruptcy court’s approval of his agreement to settle the claims
18   against Amex for $331,476.53.
19          Greif & Co. (“Greif”), a beneficiary of the WFI Liquidating
20   Trust, objected to the proposed settlement.       Greif argued that
21   the settlement amount was unacceptably small, and the Liquidating
22   Trustee had undervalued the claims in his own complaint.
23   Ultimately, the bankruptcy court approved the settlement.        Greif
24
25
            2
            Unless otherwise indicated, all chapter and section
26   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.
27   All “Rule” references are to the Federal Rules of Bankruptcy
     Procedure. All “Civil Rule” references are to the Federal Rules
28   of Civil Procedure.

                                          2
 1   appeals; we AFFIRM.
 2                          I.   FACTUAL BACKGROUND
 3   A.   Events leading up to and including confirmation
 4        WFI was a servicer of subprime auto loans.    In 2010, Harbor
 5   Structured Finance LLC, a Delaware entity controlled by Frederick
 6   and Katherine Cooper, acquired WFI.    The Coopers were appointed
 7   to management positions in WFI.    They established Amex credit
 8   card accounts for themselves and other employees.    Although WFI
 9   was not the holder of any of the Amex cards, the Coopers
10   routinely caused WFI to pay the balances on the cards.    In WFI’s
11   accounting records, the Coopers designated many, but not all, of
12   the charges on their Amex cards as business expenses.
13        In 2013, WFI filed a chapter 11 petition, and the case was
14   administratively consolidated with the chapter 11 cases of the
15   two other Debtors.    On March 31, 2014, the bankruptcy court
16   approved a joint plan of liquidation (the “Plan”) for the
17   Debtors.   The Plan provided for the dissolution of the Debtors
18   and the vesting of all property of the Debtors’ bankruptcy
19   estates in the WFI Liquidating Trust (“Trust”) to be administered
20   by the Liquidating Trustee.    This vesting specifically included
21   any claims or causes of action held by any of the Debtors’
22   estates.   Creditors of the Debtors’ estates became beneficiaries
23   of the Trust.   The Plan gave the Liquidating Trustee the
24   “exclusive right, authority, and discretion to determine and to
25   initiate, file, prosecute, enforce, abandon, settle, compromise,
26   release, withdraw, or litigate” any claim “and to decline to do
27   any of the foregoing without the consent or approval of any third
28   party or further notice to or action, order, or approval” of the

                                       3
 1   bankruptcy court.   The Plan also permitted the Liquidating
 2   Trustee to “sell and/or assign” claims to a third party to be
 3   pursued for the assignee’s “own benefit.”   The only stated
 4   limitation on the Liquidating Trustee’s settlement authority was
 5   that bankruptcy court approval would be required to settle any
 6   claim seeking to recover more than $50,000.   Neither the
 7   procedure for requesting such approval nor the criteria for
 8   granting it were specified.   The Trust was to be administered
 9   according to a WFI Liquidating Trust Agreement (“Trust
10   Agreement”), which authorized the Liquidating Trustee, among
11   other things, to settle actions in his “good faith judgment.”
12   B.   The adversary proceeding and the settlement
13        Several months later, the Liquidating Trustee filed an
14   adversary proceeding complaint against Amex, seeking to recover
15   allegedly fraudulent transfers.   The transfers at issue were the
16   payments made by WFI to Amex on the Coopers’ credit card
17   accounts.   In the complaint, the Liquidating Trustee alleged that
18   the “overwhelming majority” of the credit card charges were for
19   personal expenses of the Coopers and other employees.    Because
20   the charges were for personal rather than business expenses, the
21   Liquidating Trustee alleged that WFI did not receive reasonably
22   equivalent value in exchange for paying them.   In the two years
23   preceding WFI’s bankruptcy filing, the charges totaled over
24   $2 million.   The complaint asserted the following theories of
25   avoidance and recovery:3
26
          3
27          The complaint also included a claim for recovery of
     preferential transfers, in the event Amex was determined to be a
28                                                      (continued...)

                                       4
 1        1.   The transfers were avoidable under § 548(a)(1)(B)(ii)
 2   because the transfers were made at a time when WFI either was
 3   insolvent or was about to engage in transactions leaving it with
 4   unreasonably small capital (“Insolvency” theory).
 5        2.   Some of the transfers were avoidable under
 6   § 548(a)(1)(B)(ii)(IV) because they were “made under an
 7   employment contract for the benefit of an insider, outside the
 8   ordinary course of business” (“Employment Contract” theory).
 9        Amex contacted the Liquidating Trustee to initiate
10   settlement negotiations on December 8, 2014, approximately two
11   weeks after the complaint was filed.    Five months later, the
12   parties reached a settlement, and the Liquidating Trustee filed a
13   motion with the bankruptcy court seeking approval of the
14   settlement (“Settlement Motion”).    Amex agreed to pay $331,476.53
15   to the Trust in exchange for dismissal of the adversary
16   proceeding and a mutual release of claims, and Amex would be
17   entitled to an allowed general unsecured claim under the Plan in
18   the amount of the settlement payment.
19        The Liquidating Trustee took the position that, because he
20   derived his authority not from the Bankruptcy Code but from the
21   terms of the confirmed Plan and the Trust Agreement, he was not a
22   “trustee” as that term is used in the Code and Rules.    Thus, he
23   argued that standards governing settlement motions by bankruptcy
24   trustees were not applicable.   The Liquidating Trustee argued he
25   was entitled to “greater deference in approval of settlements”
26
27        3
           (...continued)
28   prepetition creditor of WFI.

                                      5
 1   based on the Plan and Trust Agreement, but he contended that the
 2   Settlement Motion should be approved regardless of whether the
 3   bankruptcy court accepted that argument.
 4        In the Settlement Motion and an accompanying declaration,
 5   the Liquidating Trustee went on to analyze the settlement under
 6   the factors enumerated in Martin v. Kane (In re A & C
 7   Properties), 784 F.2d 1377, 1381 (9th Cir. 1986) (the “A & C
 8   Factors”).   The Liquidating Trustee recognized the claims
 9   asserted in the complaint were susceptible to factual dispute.
10   In particular, though the Liquidating Trustee believed certain of
11   the charges in question were “easily identified” as personal, he
12   acknowledged that others were subject to dispute as to whether
13   they were legitimate business expenses that may have provided
14   value to WFI.    Likewise, the Liquidating Trustee believed that
15   WFI was undeniably insolvent at the petition date and that the
16   evidence “strongly supported” a finding of insolvency at least
17   nine months earlier.    Yet he recognized the difficulty in proving
18   that, as he suspected, the insolvency period had begun much
19   earlier still.    He concluded:
20        In my business judgment, compromise results in a fair
          and reasonable recovery for the estate, factoring in
21        the overall recovery, my estimate for success in the
          resolved matter, and the significant costs and delay
22        necessarily associated with litigating in an effort to
          obtain greater recovery.
23
          . . . Furthermore, the compromise represents an
24        immediate recovery for the Liquidating Trust that will
          allow for payment of a large portion of the outstanding
25        administrative expenses, which in turn maximizes the
          probability that future recoveries will allow for
26        meaningful distribution to general unsecured creditors,
          and makes additional funds available for payment of
27        cost[s] and expenses in pursuit of other causes of
          action.
28

                                       6
 1        . . . Accordingly, I assert that the compromise is in
          the best interest of the bankruptcy estate’s creditors.
 2
 3   C.   The dispute over the Settlement Motion
 4        Two creditors, Greif and Guerin Senter, expressed views on
 5   the settlement.   Mr. Senter supported and joined in the
 6   Settlement Motion, but Greif vigorously opposed it.    Greif
 7   complained that the proposed settlement would pay subordinated
 8   administrative claims, including Mr. Senter’s claim, but other
 9   creditors would likely receive nothing.   Greif wanted the
10   Liquidating Trustee “to present the relevant facts and legal
11   analysis surrounding the claims asserted [in the complaint] (and
12   an explanation of why some theories were left out)” to allow the
13   bankruptcy court to evaluate the Settlement Motion.    Greif
14   presented its own analysis of the Insolvency and the Employment
15   Contract claims, along with an additional theory of recovery
16   under § 548(a)(1)(A), which the Liquidating Trustee did not
17   assert (“Fraudulent Intent” theory).
18        Concerning the Insolvency theory, Greif believed WFI likely
19   became insolvent in August 2010 and was rendered “even more
20   leveraged” after a March 2012 transaction.    Greif argued that
21   these facts supported greater recovery.   As to the Employment
22   Contract theory, Greif noted that insolvency is not an element
23   and questioned the lack of discussion of this theory in the
24   Settlement Motion.   Regarding both theories, Greif demanded
25   additional details concerning the methodology by which the
26   parties arrived at the settlement amount, as well as information
27   concerning the expected difficulty and expense of prevailing in
28   litigation.   Finally, Greif asked the bankruptcy court to require

                                      7
 1   the Liquidating Trustee to justify his decision not to pursue a
 2   Fraudulent Intent claim.
 3        The Liquidating Trustee filed a reply to Greif’s objection
 4   in which he provided some of the additional information Greif
 5   requested.    He explained that the settlement amount was based on
 6   calculations using two “estimates in compromise” between himself
 7   and Amex.    First, the parties had divided the universe of
 8   questioned credit card charges into two categories, which the
 9   Liquidating Trustee called “Type 1” and “Type 2” charges.       Type 1
10   charges were those that the Coopers had not designated as
11   business expenses.    Type 2 charges were those that were
12   designated as business expenses, though the Liquidating Trustee
13   disputed the accuracy of that designation.       For purposes of
14   calculating the settlement amount, the parties agreed to treat
15   all Type 1 charges and exactly half of the Type 2 charges as
16   having provided no value to WFI.       Second, the parties agreed,
17   again as an “estimate in compromise,” that WFI “would probably be
18   found to be ‘insolvent’ . . . from January 2013 onward.”       The
19   Liquidating Trustee emphasized that the parties had disagreed
20   during negotiations as to the correct insolvency date and had
21   chosen January 2013 “in the interest of settling the matter.”
22   The settlement amount was calculated by adding together all of
23   the Type 1 charges and half of the Type 2 charges incurred
24   beginning in January 2013.
25        The Liquidating Trustee disagreed as well with Greif’s
26   argument that he had undervalued other theories of recovery.
27   Discussing each of Greif’s suggested theories, the Liquidating
28   Trustee concluded that they did not significantly alter the

                                        8
 1   reasonableness of the settlement.    Regarding the Employment
 2   Contract theory, the Liquidating Trustee explained that the only
 3   transfers arguably avoidable under this theory were relatively
 4   small and had little effect on the value of the claims as a
 5   whole.
 6        Concerning the likelihood of success in the litigation, the
 7   Liquidating Trustee noted that the Coopers had a strong incentive
 8   to testify in favor of Amex, because their own interests would be
 9   served by asserting a legitimate business purpose for the
10   disputed charges.   The Liquidating Trustee estimated the costs of
11   litigation at $125,000, including the cost of hiring insolvency
12   experts, but he noted that this was a “very rough” estimate, as
13   “costs for the case could spiral out of control . . . without any
14   guarantee of recovery[.]”   Already having paid the unsubordinated
15   administrative claims, the Liquidating Trustee pointed out that
16   the settlement would allow the subordinated administrative claims
17   to be paid in full, with some funds remaining.    This, he
18   reasoned, was in the best interests of the unsecured creditor
19   body as a whole, notwithstanding Greif’s objection.
20        Finally, in response to Greif’s argument that he should have
21   asserted a Fraudulent Intent claim, the Liquidating Trustee
22   explained that he believed such a claim was unsupportable.      “If
23   there was any nefarious motive to [WFI]’s payment of the Coopers’
24   expenses, it is far more likely to have been the Coopers’ greed
25   than [WFI]’s desire to dodge creditors.”    With no evidence that
26   WFI made any transfers with the intent to hinder, delay or
27   defraud creditors, the Liquidating Trustee argued he could not
28   have prevailed on the Fraudulent Intent theory.

                                      9
 1        One day before the initially scheduled hearing on the
 2   Settlement Motion, Greif filed a supplemental objection,
 3   including 597 pages of attachments.   Greif focused primarily on
 4   its disagreement with the Liquidating Trustee’s positions on the
 5   Fraudulent Intent and Employment Contract theories.   Greif argued
 6   the facts supported a finding of multiple “badges of fraud” in
 7   support of a Fraudulent Intent claim.   Regarding the Employment
 8   Contract theory, Greif cited scholarly commentary arguing that
 9   any payments to an insider having an employment contract were
10   avoidable, whether or not the payments were made pursuant to that
11   contract.   Regardless of whether the court accepted this view,
12   Greif argued that expense reimbursement provisions in the
13   Coopers’ contracts sufficed to bring all Type 1 and Type 2
14   charges within the scope of the Employment Contract theory.
15   Otherwise, the supplemental objection further elaborated Greif’s
16   arguments that the Liquidating Trustee’s insolvency analysis was
17   flawed.
18        The Liquidating Trustee submitted a reply with 161 pages of
19   exhibits.   He now provided his own analysis of the “badges of
20   fraud,” repeating his position that the Coopers’ apparent intent
21   to misuse WFI’s funds did not equate to the requisite intent by
22   WFI to hinder, delay or defraud creditors.   Considering a list of
23   badges of fraud identified both by the Ninth Circuit and in the
24   Uniform Fraudulent Transfer Act,4 the Liquidating Trustee
25
26        4
            The Trustee acknowledged that the Uniform Fraudulent
27   Transfer Act was not directly applicable, because his claims
     sounded under § 548, which does not depend on state law, as
28                                                      (continued...)

                                     10
 1   explained his conclusion that the facts did not support an
 2   avoidance claim based on Fraudulent Intent.    He maintained that
 3   Greif overestimated the value of the Employment Contract theory,
 4   both because Greif’s preferred interpretation of the statute was
 5   unlikely to be adopted by any court, and because he foresaw
 6   significant factual obstacles to recovery on that theory.
 7   Likewise, the Liquidating Trustee stood by his insolvency
 8   analysis as previously articulated.
 9        On the same day the Liquidating Trustee filed his reply to
10   the supplemental objection, Greif filed a motion asking the court
11   to compel the Liquidating Trustee to assert a Fraudulent Intent
12   claim or, in the alternative, to grant Greif derivative standing
13   to pursue such a claim “on behalf of the estate.”    This motion
14   repeated and elaborated at substantial length on Greif’s previous
15   analysis of this subject.    Because the hearing on the Settlement
16   Motion was now only a week away, Greif filed a separate request
17   that its new motion be consolidated with and considered
18   simultaneously with the Settlement Motion.    The Liquidating
19   Trustee opposed this request, and the bankruptcy court denied it
20   prior to the Settlement Motion hearing.
21   D.   The hearing on the Settlement Motion
22        After hearing oral argument from Greif and the Liquidating
23   Trustee, the bankruptcy court announced its findings and
24   conclusions on the record.   The bankruptcy court agreed with the
25   Liquidating Trustee that the A & C Factors were not applicable to
26
27        4
           (...continued)
28   opposed to § 544, which does.

                                      11
 1   “this post-confirmation determination.”   Applying Nevada law, the
 2   bankruptcy court concluded that the “good faith judgment”
 3   language in the Trust Agreement imposed a business judgment
 4   standard on the Liquidating Trustee.   The court found that the
 5   proposed settlement was “the product of the liquidating trustee’s
 6   good faith and informed decision reached after an extensive
 7   analysis of all legal and factual issues.”    The court noted that
 8   the Liquidating Trustee’s analysis of the issues supported a
 9   determination that victory against Amex was “less clear cut than
10   Greif appears to argue.”
11        As requested by the Liquidating Trustee, the bankruptcy
12   court went on to make findings concerning the A & C Factors,
13   which the court enumerated as follows: “A, the probability of
14   success in the litigation; B, the difficulties [i]f any to be
15   encountered in the [matter] of collection; C, the complexity of
16   the litigation and the expense, inconvenience and delay
17   necessarily attending it; D, the paramount interest of the
18   creditors and proper deference to their reasonable views in the
19   premises.”   Hr’g Tr. (July 6, 2015) at 31:13-19.   The bankruptcy
20   court found that, although collection was not a concern, the
21   Liquidating Trustee had established that the A & C Factors
22   overall weighed in favor of the settlement.   The court was
23   persuaded by the Liquidating Trustee’s argument that “the
24   complexity of these issues will require substantial expense and
25   delay without a corresponding increase of the probability that
26   [he] will prevail to the extent Greif argues.”
27        Having denied the request for expedited consideration of
28   Greif’s derivative standing motion, the bankruptcy court

                                     12
 1   nevertheless reviewed that motion and took into consideration
 2   Greif’s discussion of “causes of action that were and were not
 3   brought by the liquidating trustee.”         Still, the bankruptcy court
 4   expressly declined to decide the derivative standing motion,
 5   opining that it would not be “procedurally proper” to do so under
 6   the circumstances.   The court granted the Settlement Motion, but
 7   the order approving the settlement included a provision delaying
 8   its effectiveness for two weeks to give Greif a further
 9   opportunity to offer to purchase the claims against Amex.        After
10   the two-week period expired, the Liquidating Trustee reported
11   that Greif had made no offer, and the order became effective.
12   This timely appeal followed.
13                              II.    JURISDICTION
14        The bankruptcy court had jurisdiction under 28 U.S.C.
15   §§ 1334 and 157(b)(2)(O).        We have jurisdiction under 28 U.S.C.
16   § 158.
17                                    III.    ISSUE
18        Whether the bankruptcy court abused its discretion in
19   granting the Settlement Motion.
20                        IV.    STANDARDS OF REVIEW
21        We review a bankruptcy court’s decision to approve a motion
22   to settle and compromise for abuse of discretion.        Goodwin v.
23   Mickey Thompson Entm’t Grp., Inc. (In re Mickey Thompson Entm’t
24   Grp., Inc.), 292 B.R. 415, 420 (9th Cir. BAP 2003).        A bankruptcy
25   court abuses its discretion only if it fails to apply the correct
26   legal standard or applies it in a way that is illogical,
27   implausible or unsupported by the record.        United States v.
28   Inouye, ___ F.3d ___, ___, 2016 WL 2641109 at *3 (9th Cir.

                                             13
 1   May 31, 2016); United States v. Hinkson, 585 F.3d 1247, 1262 (9th
 2   Cir. 2009) (en banc).   We may affirm the decision of the
 3   bankruptcy court on any basis supported by the record.     See Hooks
 4   v. Kitsap Tenant Support Servs., Inc., 816 F.3d 550, 554 (9th
 5   Cir. 2016); Shanks v. Dressel, 540 F.3d 1082, 1086 (9th Cir.
 6   2008).
 7        In general, a chapter 11 plan is interpreted as a contract,
 8   and we review its interpretation de novo.     Dolven v. Bartleson
 9   (In re Bartleson), 253 B.R. 75, 78-79 (9th Cir. BAP 2000).
10
11                               V.   DISCUSSION
12   A.   The proper standard
13        The threshold question in this appeal is what standard(s)
14   the bankruptcy court was required to apply in deciding the
15   Settlement Motion.   Applying Nevada law to interpret the Plan and
16   Trust Agreement, the court concluded that a business judgment
17   standard was appropriate.    Greif argues that the proper standard
18   is the “fair and equitable” standard that ordinarily governs
19   settlement motions by bankruptcy trustees.
20        We agree with the bankruptcy court that the standards
21   governing motions by bankruptcy trustees appointed under the
22   Bankruptcy Code are not necessarily applicable to the trustee of
23   a liquidating trust established under the terms of a confirmed
24   chapter 11 plan.   Notwithstanding his title, the Liquidating
25   Trustee is not a “trustee” under § 323(a).     Rather, he is a
26   “representative” under § 1123(b)(3)(B), empowered by the terms of
27   the Plan to prosecute and settle claims previously belonging to
28   the Debtors’ estates.   Granted, a § 1123(b)(3)(B) representative

                                        14
 1   is “the functional equivalent of a trustee” in some regards.
 2   Beck v. Fort James Corp. (In re Crown Vantage, Inc.), 421 F.3d
 3   963, 973 (9th Cir. 2005) (liquidating trustee is equivalent of
 4   trustee for purposes of Barton doctrine).   It does not follow,
 5   however, that his powers and duties are identical to those of a
 6   trustee under the Bankruptcy Code.
 7        Greif asks us to hold that postconfirmation settlements
 8   negotiated by liquidating trustees are subject to the same
 9   standards as settlements negotiated by bankruptcy trustees or
10   debtors in possession.    We decline to impose such an across-the-
11   board requirement.   “[T]he hallmark of chapter 11 is a
12   flexibility in which the content of plans is primarily up to the
13   genius of the drafter.”   The Alary Corp. v. Sims (In re
14   Associated Vintage Grp., Inc.), 283 B.R. 549, 560 (9th Cir. BAP
15   2002).   The confirmed Plan exhibited that flexibility by
16   permitting the Liquidating Trustee to settle claims under $50,000
17   without bankruptcy court oversight, while requiring approval for
18   settlement of larger claims.   The provision allowing settlement
19   of smaller claims without approval is not implicated here, and
20   Greif does not attack it directly.    Instead, we understand Greif
21   to argue that, where a plan requires bankruptcy court approval of
22   a settlement, that approval must be sought under the “fair and
23   equitable” standard.   We see no reason to read this standard into
24   the Plan where the drafters have omitted it.   Greif’s concern
25   about the ability of a “target insider” to exploit the
26   availability of less searching review of settlements by
27   “liquidat[ing] inside of a Chapter 11 rather than a Chapter 7” is
28   unpersuasive.   Apart from the fact that no insider is a party to

                                      15
 1   the claims at issue here, creditors desiring greater control over
 2   settlements may lobby for it through the ordinary voting and
 3   confirmation process.
 4        Unfortunately, though the Plan makes no reference to the
 5   “fair and equitable” standard, neither does it expressly provide
 6   for any other standard by which to evaluate those settlements
 7   requiring approval.   To fill the gap, the bankruptcy court turned
 8   to paragraph 5.1 of the Trust Agreement, requiring the
 9   Liquidating Trustee to exercise “good faith judgment, in the best
10   interests of the Liquidating Trust Beneficiaries and to maximize
11   net recoveries and distributions[.]”   The bankruptcy court
12   analogized this to the “business judgment” standard under Nevada
13   law and concluded it was satisfied.    Rather than decide whether
14   this interpretation was correct, we simply conclude that the
15   applicable standard under the Plan was something less exacting
16   than the A & C Properties standard.5   Because the bankruptcy
17   court made findings and conclusions based upon consideration of
18   the A & C Factors, and because we may affirm on any basis
19   supported by the record, we review these findings and
20   conclusions.   If we conclude the court’s determination under this
21   standard was not an abuse of discretion, it follows necessarily
22   that the lesser standard of the Plan and Trust Agreement was
23   satisfied as well.
24
25
          5
            We note that the A & C Properties standard itself includes
26   a requirement of good faith on the part of the trustee. In re
27   A & C Props., 784 F.2d at 1381 (“It is clear that there must be
     more than a mere good faith negotiation . . . .” (emphasis
28   added)). The Liquidating Trustee’s good faith is not questioned.

                                     16
 1   B.   The A & C Factors
 2        “Basic” to the process of approving compromises by
 3   bankruptcy trustees “is the need to compare the terms of the
 4   compromise with the likely rewards of litigation.”   Protective
 5   Comm. for Indep. Stockholders of TMT Trailer Ferry, Inc. v.
 6   Anderson, 390 U.S. 414, 424-25 (1968), quoted in In re A & C
 7   Props., 784 F.2d at 1382.   Approval of a settlement requires “a
 8   sufficient factual foundation which establishes that it is fair
 9   and equitable,” but “where the record supports approval of the
10   compromise, the bankruptcy court should be affirmed.”    784 F.2d
11   at 1383.
12        In assessing whether a settlement is fair and equitable,
13   bankruptcy courts must consider the following factors:
14        (a) The probability of success in the litigation;
          (b) the difficulties, if any, to be encountered in the
15        matter of collection; (c) the complexity of the
          litigation involved, and the expense, inconvenience and
16        delay necessarily attending it; (d) the paramount
          interest of the creditors and a proper deference to
17        their reasonable views in the premises.
18   Id. at 1381.   Each factor need not be treated in a vacuum;
19   rather, the factors should be considered as a whole to determine
20   whether the settlement compares favorably with the expected
21   rewards of litigation.   See, e.g., In re Pac. Gas & Elec. Co.,
22   304 B.R. 395 (Bankr. N.D. Cal. 2004) (“factors as a whole”
23   favored settlement); In re WCI Cable, Inc., 282 B.R. 457, 472-73
24   (Bankr. D. Or. 2002) (approving settlement despite high
25   probability of success where litigation costs “extremely high”).
26        The bankruptcy court stated at the Settlement Motion hearing
27   that it had considered all the filings related to the Settlement
28   Motion, including Greif’s opposition and Mr. Senter’s support of

                                     17
 1   the settlement, along with the Liquidating Trustee’s and Greif’s
 2   oral arguments.    The court correctly identified the applicable
 3   factors and found that continuing to litigate would “require
 4   substantial expense and delay without a corresponding increase of
 5   the probability that the liquidating trustee will prevail to the
 6   extent Greif argues.”    This statement reveals that the bankruptcy
 7   court predicated its findings on (i) its assessment of the
 8   probability of success should the Liquidating Trustee try the
 9   case; (ii) the “substantial” anticipated expenses and delays
10   involved in litigation; and (iii) its evaluation of Greif’s views
11   on the subject.6
12        On appeal, Greif devotes much of its argument to the merits
13   of the claims the Liquidating Trustee proposed to settle,
14   including the hypothetical Fraudulent Intent claim.7   Greif
15   criticizes the Liquidating Trustee’s legal and factual analysis
16   of his claims and suggests the calculation of the settlement
17   amount was based on false premises.    Having presented its own
18   detailed analysis of the claims, Greif now argues that the
19   bankruptcy court erred by failing to “assess the actual merits of
20   the parties’ legal and factual positions.”
21        A trustee seeking approval of a settlement is not required
22   to prove it would have been impossible to obtain a superior
23
24        6
            The bankruptcy court noted there was no reason to expect
25   difficulty in collecting on a judgment against Amex.
26        7
            Though no Fraudulent Intent claim was asserted in the
27   complaint, it is undisputed that any potential Fraudulent Intent
     claim would be extinguished by the mutual release contained in
28   the settlement agreement.

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 1   result by trying the case.   If this were required, the settlement
 2   approval process would degenerate into a trial of the underlying
 3   claims, which would defeat the purpose of settling.   Burton v.
 4   Ulrich (In re Schmitt), 215 B.R. 417, 423 (9th Cir. BAP 1997)
 5   (court should “canvass the issues” rather than conduct “mini
 6   trial” of underlying claims).   It would also frustrate
 7   negotiations, because it would prevent the trustee from making
 8   any material concessions in the interest of compromise.   The
 9   settlement amount was the product of negotiation and compromise
10   and was not presented as a conclusive determination of the merits
11   of the claims being settled.
12        We make these observations to clarify the scope of our
13   review in this appeal.   We are not called upon to decide the
14   merits of the claims asserted in the adversary proceeding, nor
15   must we decide whether the Liquidating Trustee’s factual and
16   legal analysis of the claims was correct in every particular.     It
17   is the bankruptcy court’s findings and conclusions, not the
18   Liquidating Trustee’s analysis of his claims, that we review for
19   abuse of discretion.   With these principles in mind, we address
20   Greif’s arguments regarding areas in which the record purportedly
21   fails to support the bankruptcy court’s decision.
22        1.   The Employment Contract theory
23        The Liquidating Trustee admitted that this theory played
24   little role in the settlement calculations.   He explained that he
25   considered it a “backstop” to the more important Insolvency
26   claims.   Greif argues that, on the contrary, virtually every
27   transfer within the two-year reach-back period was avoidable on
28   this theory.   Greif presented a detailed explanation of how it

                                     19
 1   would have gone about arguing this claim.   Then, effectively
 2   deeming its own position to be irrefutable, Greif faulted the
 3   Liquidating Trustee for not adopting that position in his
 4   settlement negotiations.   Now, Greif argues that the bankruptcy
 5   court abused its discretion because it did not “earnestly assess”
 6   the contending views on the subject.
 7        As explained above, we are not called upon to decide whether
 8   the claim ultimately would or should have been decided in the way
 9   Greif asserts.   The fact that the Liquidating Trustee did not
10   negotiate the claim in the way Greif would have liked also is not
11   dispositive.   It is possible that, if the Liquidating Trustee had
12   adopted Greif’s position at trial, he would have prevailed.     It
13   is possible he could have obtained a greater settlement by
14   presenting this argument during negotiations.   But based on the
15   record, neither of these outcomes was so likely as to preclude a
16   finding that the settlement was fair and equitable.8
17        Because the claim does not depend on a showing of insolvency
18   or other financial distress, Greif also argues that the expense
19   of litigating it is substantially less onerous compared to the
20   Insolvency claims.   Unfortunately, there is no reason to suppose
21   Amex would have been willing to pay to settle the other claims
22   while leaving the Employment Contract claim unresolved.   Unless
23
24        8
            Among other things, the Employment Contract Theory was
25   vulnerable to the argument that the questioned transfers were
     made in the ordinary course of business, and that they provided
26   value to WFI because they offset WFI’s obligations to the
27   Coopers. Greif argues that these defenses could be overcome, but
     again, victory was not so assured as to deprive the court of a
28   basis on which to conclude the settlement was fair and equitable.

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 1   the Liquidating Trustee had been willing to forgo the other
 2   claims and hang his entire case on § 548(a)(1)(B)(ii)(IV) - a
 3   risky proposition given the Liquidating Trustee’s doubts about
 4   the claim’s value - this strategy would not necessarily have
 5   helped avoid costs.   In short, Greif has not shown that the
 6   bankruptcy court so overestimated the expense of litigation as to
 7   render its decision an abuse of discretion.
 8        2.   The Insolvency theory
 9        According to Greif, the “linchpin” of the settlement was the
10   “agreed upon insolvency date of January 1, 2013.”   Greif implies
11   this “agreed upon” date resulted in an inappropriately low
12   settlement amount, and the bankruptcy court abused its discretion
13   by allowing the Liquidating Trustee to accept it.
14        This argument mischaracterizes the nature of the settlement.
15   Parties to a settlement need not (and generally do not) “agree”
16   on the objectively correct resolution of the facts in dispute.
17   The Liquidating Trustee made clear that he argued during
18   negotiations that WFI had become insolvent before January 1,
19   2013, while Amex argued for a later date.   The parties simply
20   settled on that date in the interest of compromise.   The question
21   before the bankruptcy court was not whether the estimated date
22   was correct, but whether the settlement based on that estimate
23   was fair in light of the A & C Factors.   We are not persuaded
24   that the estimate was so obviously wrong as to undermine the
25   overall fairness of the settlement.
26        Otherwise, Greif argues that the bankruptcy court should
27   have required the Liquidating Trustee to hire an insolvency
28   expert to explore the issue more fully before settling.

                                       21
 1   Recognizing that this was one of the expenses the Liquidating
 2   Trustee hoped to avoid by settling, Greif argues that the
 3   Liquidating Trustee at least should have provided specific
 4   evidence of how much it would cost to hire an expert.      It is true
 5   that the bankruptcy court must have an adequate record on which
 6   to base its decision, and specific information about the
 7   projected costs of an insolvency investigation might have been
 8   useful.   Nevertheless, we conclude that the record before the
 9   bankruptcy court was adequate.   As the court recognized, the
10   heated disagreement between Greif and the Liquidating Trustee,
11   concerning the insolvency issue among others, demonstrated that
12   resolution of the claims would not be easy or inexpensive.
13   C.   Derivative standing
14        The bankruptcy court denied Greif’s request to expedite
15   consideration of its motion for derivative standing.      In the
16   order granting the Settlement Motion, however, the bankruptcy
17   court allowed Greif additional time to make an offer to purchase
18   the Trust’s claims against Amex.      During the hearing, the
19   Liquidating Trustee’s counsel indicated he would entertain an
20   all-cash offer from Greif, but not a credit bid as Greif
21   apparently had suggested in previous discussions.      Greif argues
22   that the bankruptcy court should have required the Liquidating
23   Trustee to entertain other offers, such as a credit bid, or
24   should have granted the derivative standing motion.
25        Though the bankruptcy court did not decide the derivative
26   standing motion, it expressed its doubt that such a motion was
27   cognizable: “[W]e’re looking at post-confirmation powers granted
28   to a liquidating trustee.   We’re way beyond a case pending under

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 1   Chapter 11. . . .   So I think we have a limited number of options
 2   available[.]”9   Hr’g Tr. (July 6, 2015) at 16:15-20.   The denial
 3   of Greif’s request for expedited consideration of the derivative
 4   standing motion is not on appeal, and we need not consider
 5   whether such a motion could have been granted.
 6        We have held, however, that a trustee must consider offers
 7   from creditors to purchase claims the trustee wishes to settle.
 8   This is because settlement of a claim that is property of the
 9   estate is equivalent to a sale of that claim to the defendant.
10   In re Mickey Thompson Entm’t Grp., Inc., 292 B.R. at 421.    Where
11   an interested party offers to purchase a claim in exchange for a
12   sum certain plus a percentage of net proceeds, the trustee must
13   take the percentage into account in determining whether the bid
14   is superior to an all-cash offer from the defendant.    Simantob v.
15   Claims Prosecutor, LLC (In re Lahijani), 325 B.R. 282, 288-90
16   (9th Cir. BAP 2005).   The trustee should not reject out of hand
17   all offers that include a non-cash component.    Id.
18        In contrast to Lahijani, however, there is no indication in
19   the record that Greif made any offer to purchase the claims,
20   either before or after the Liquidating Trustee expressed his
21   unwillingness to entertain non-cash offers.   Certainly, there is
22   nothing to suggest Greif made an offer consisting of a sum
23
24        9
            The “limited number of options” to which the bankruptcy
25   court referred included the Plan provision allowing the
     Liquidating Trustee to “sell and/or assign” claims to be pursued
26   by the purchaser or assignee “for its own benefit.” The
27   Liquidating Trustee argues this provision permits only outright
     sale, not derivative standing, but the bankruptcy court did not
28   decide the question, and neither do we.

                                     23
 1   certain plus a percentage of proceeds or that Greif had any
 2   intention of doing so if given the opportunity.   The Liquidating
 3   Trustee rejected Greif’s suggestion of making a credit bid for
 4   the claims.   Considering the difficulties inherent in determining
 5   the value of a credit bid by an unsecured creditor beneficiary of
 6   an insolvent liquidating trust, we conclude that the Liquidating
 7   Trustee was not obligated to entertain this novel suggestion.
 8                             VI.   CONCLUSION
 9        Based upon the foregoing, we conclude that the bankruptcy
10   court did not abuse its discretion in granting the Settlement
11   Motion.   We AFFIRM.
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