                                                                          FILED
                                                                          OCT 22 2018
                           NOT FOR PUBLICATION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. AZ-17-1308-BaFS

LE KWAK LE and VINH TRONG LE,                       Bk. No. 2:11-bk-05893-MCW

                    Debtors.                        Adv. No. 2:11-ap-00727-MCW

LE KWAK LE; VINH TRONG LE,

                    Appellants,

v.                                                  MEMORANDUM*

THOMAS Q. HUYNH,

                    Appellee.

                     Argued and Submitted on June 21, 2018
                             at Phoenix, Arizona

                               Filed – October 22, 2018

               Appeal from the United States Bankruptcy Court
                         for the District of Arizona



         *
        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.
       Honorable Madeleine C. Wanslee, Bankruptcy Judge, Presiding



Appearances:        Christopher James Piekarski of Piekarski & Brelsford, P.C.
                    argued for appellants Le Kwak Le and Vinh Trong Le;
                    Neal H. Bookspan of Jaburg & Wilk, P.C. argued for
                    appellee Thomas Q. Huynh.



Before: BASON,** FARIS, and SPRAKER, Bankruptcy Judges.



                                 INTRODUCTION

      Le Kwak Le (“Ms. Le”) and Vinh Trong Le (“Mr. Le”) (“Debtors”)

appeal from the bankruptcy court’s $864,000 judgment in favor of appellee

Thomas Q. Huynh (“Mr. Huynh”) under § 523(a)(6).1 In an earlier appeal

(BAP No. AZ-15-1364-JuFL), we vacated a prior judgment in the same

dollar amount (the “Prior Judgment”) and remanded for the bankruptcy

court to address the threshold issue under § 523(a)(6) of what torts, if any,

were committed under Arizona law. On remand, the parties all requested

that the bankruptcy court not reopen trial, and instead decide the issues on



      **
        Hon. Neil W. Bason, United States Bankruptcy Judge for the Central District of
California, sitting by designation.
      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.

                                           2
the basis of the evidence adduced at the prior trial and the parties’ briefs.

Debtors argue that the bankruptcy court erred in (a) determining that

Ms. Le’s conduct was tortious under Arizona law, (b) determining that her

conduct was “willful” and “malicious” within the meaning of § 523(a)(6),

(c) calculating Mr. Huynh’s damages, and (d) entering judgment not just

against Ms. Le but also against her husband and co-Debtor, Mr. Le. We

AFFIRM.

                        FACTUAL BACKGROUND

      Mr. Huynh and Ms. Le were co-owners of a business, Power Car

Wash and Foodmart, LLC (the “LLC”), which operated a Chevron-branded

gas station, car wash, and market. The LLC leased the real property on

which it operated the business from Mr. Huynh.

      Ms. Le shut down the business without notice to Mr. Huynh,

resulting in Chevron de-branding the gas station. Mr. Huynh attempted to

reopen the business with Chevron, find another franchisor, or continue the

business as an unbranded gas station, but those efforts were unsuccessful

and the business failed.

      Ms. Le blamed other factors for the LLC’s failure, including

competing gas stations, and nearby construction that impeded access to the

premises. Ms. Le also reasoned that she was justified in removing the

market’s inventory because she had purchased that inventory in her

individual capacity when she became co-owner of the business and she


                                       3
was worried that she would lose that investment when Mr. Huynh, acting

as landlord, gave notice that he would terminate the LLC’s lease for

nonpayment of rent.

     The bankruptcy court was not persuaded by Ms. Le’s explanations.

The court found that she not only removed inventory but also removed the

gas, equipment, computer, and books and records of the LLC; and when

Mr. Huynh found out what happened, Ms. Le locked him out of the

premises.

     The court also found that Ms. Le’s actions caused the gas station to go

“dark,” and prevented Mr. Huynh from reopening it soon enough to

persuade Chevron not to terminate the LLC’s franchise. That, in turn,

effectively prevented Mr. Huynh from obtaining a new franchise to lease

the gas station. Although he attempted to operate the gas station without a

franchise, he was unsuccessful and the business ultimately failed.

      The bankruptcy court found that Ms. Le’s conduct caused

Mr. Huynh to suffer $864,000 in damages. The bankruptcy court also

found that Ms. Le’s conduct was willful and malicious within the meaning

of § 523(a)(6), and entered the Prior Judgment against both Debtors.

     Debtors appealed the Prior Judgment. We vacated it and remanded

because the bankruptcy court had not addressed the threshold issue of

whether Ms. Le’s conduct was tortious under Arizona law. On remand, the

bankruptcy court determined that the evidence at trial was sufficient to


                                     4
establish that Ms. Le had committed at least one tort under Arizona law -

indeed, four separate torts. It reinstated the judgment against both Debtors

(the “Amended Judgment”). Debtors timely appealed from that judgment.

                                 JURISDICTION

      The bankruptcy court had jurisdiction pursuant to 28 U.S.C. §§ 1334

and 157(b)(2)(I). We have jurisdiction under 28 U.S.C. § 158.

                                      ISSUES

      1. Whether procedural errors by the parties require summary

affirmance, reversal, or dismissal.

      2. Whether the bankruptcy court erred when it determined that:

(a) Ms. Le committed at least one tort under Arizona law, (b) Ms. Le’s

conduct was “willful” and “malicious,” (c) damages were $864,000, and

(d) the judgment should include Mr. Le.2

                           STANDARDS OF REVIEW

      The trial court’s compliance with an appellate court’s mandate on

remand is reviewed de novo. United States v. Kellington, 217 F.3d 1084, 1092

(9th Cir. 2000). We review the bankruptcy court’s factual findings,

including findings about a debtor’s intent, for clear error. See Beauchamp v.

Hoose (In re Beauchamp), 236 B.R. 727, 729 (9th Cir. BAP 1999). A

bankruptcy court’s factual findings are not clearly erroneous unless they


      2
       Mr. Huynh asserts that the only issue is whether Ms. Le’s conduct was tortious.
Nothing in our mandate on the prior appeal imposed any such limitation of issues.

                                          5
are illogical, implausible, or without support in the record. Retz v. Samson

(In re Retz), 606 F.3d 1189, 1196 (9th Cir. 2010). On appeal, we give “due

regard . . . to the opportunity of the bankruptcy court to judge the

credibility of the witnesses.” Thiara v. Spycher Bros. (In re Thiara), 285 B.R.

420, 427 (9th Cir. BAP 2002). “This deference is also given to inferences

drawn by the trial court.” Id.

      “The bankruptcy court’s conclusions of law,” including those

pertaining to nondischargeability and interpretation of state law, are

reviewed de novo. Id. In general, we also review de novo the bankruptcy

court’s application of the legal standard in determining whether a debt

resulting from debtors’ wrongful conduct is dischargeable as a willful and

malicious injury. Id.; cf. U.S. Bank N.A. v. Vill. at Lakeridge, LLC, 138 S. Ct.

960, 967 (2018) (standard of review applicable to mixed questions of fact

and law).

                                 DISCUSSION

      Before we address the merits of the parties’ arguments on appeal,

they raise a number of procedural arguments, which they claim should

dispose of this appeal. We will address each procedural argument in turn.

1.    Procedural Issues

      A.    Debtors’ Failure to Comply With Rule 8009 Limits Our Review,
            But Does Not Prevent It

      Rule 8009 requires an appellant to file: (I) “a statement of the issues to


                                         6
be presented,” (ii) “a designation of the items to be included in the record

on appeal,” and (iii) relevant transcripts. Rule 8009(a)(1)(A) and (b)(1)(A).

Mr. Huynh argues that this appeal should be dismissed because Debtors

failed to file any of those things, even though we reminded Debtors of

these requirements twice. But in the circumstances of this appeal, we will

not summarily affirm or dismiss on this ground.

            i.    Statement of Issues

      We have held that arguments not raised in the statement of issues are

waived. See Marshack v. Orange Commercial Credit (In re Nat’l Lumber &

Supply Inc.), 184 B.R. 74, 79 (9th Cir. BAP 1995); Woods v. Pine Mountain, Ltd.

(In re Pine Mountain, Ltd.), 80 B.R. 171, 173 (9th Cir. BAP 1989). But the

Ninth Circuit has cautioned that “Rule 8006 [the predecessor to Rule 8009]

exists to ensure the adequacy of the record, and does not affect the ability

of any party to appeal findings or conclusions of the bankruptcy court.”

Office of the U.S. Tr. v. Hayes (In re Bishop, Baldwin, Rewald, Dillingham, &

Wong, Inc.), 104 F.3d 1147, 1148 (9th Cir. 1997) (citations omitted). Further,

we have been willing to entertain arguments not specified in the statement

of issues when a complete understanding of the case can be discerned from

the briefs and the record, and prejudice has not been shown. Gertsch v.

Johnson & Johnson, Fin. Corp. (In re Gertsch), 237 B.R. 160, 166 (9th Cir. BAP

1999); see also Turner v. Marshack (In re Turner), 186 B.R. 108, 112, 117 (9th

Cir. BAP 1995).


                                        7
      Mr. Huynh asserts that Debtors’ failure to file a statement of issues

has prejudiced him because he was left “hamstrung to try to guess what,

exactly, this Second Appeal would be premised upon.” We find this

argument unpersuasive for at least two reasons.

      First, Debtors did not file a statement of issues at all - as opposed to

filing a statement but omitting an issue - so Mr. Huynh has been on notice

of this defect from the early stages of this appeal. Second, we granted

Mr. Huynh’s request for additional time to respond to the issues included

in Debtors’ opening brief. Mr. Huynh has not explained how he is still

prejudiced, despite that additional time.

            ii.    Designation of Record

      Similarly, we find no prejudice to Mr. Huynh from Debtors’ failure to

file a designation of record. Again, Mr. Huynh was on notice of this defect

for several months. We gave him additional time to address any

deficiencies in Debtors’ filings but he never sought to file a supplemental

designation and he has not established any prejudice.

            iii.   Transcript of Trial

      Mr. Huynh cites authority that this panel can summarily dispose of

or dismiss this appeal due to Debtors’ failure to provide the trial transcript.

See N/S Corp. v. Liberty Mut. Ins. Co., 127 F.3d 1145, 1146 (9th Cir. 1997).

      It is true that it is appellants’ burden, in the first instance, to provide

the complete record. Kritt v. Kritt (In re Kritt), 190 B.R. 382, 387 (9th Cir.


                                         8
BAP 1995). When appellants have omitted something from the excerpts of

record (the “Excerpts”), we are entitled to presume that they do not regard

the missing items as helpful to their appeal. Gionis v. Wayne (In re Gionis),

170 B.R. 675, 680-81 (9th Cir. BAP 1994), aff’d, 92 F.3d 1192 (9th Cir. 1996)

(table); McCarthy v. Prince (In re McCarthy), 230 B.R. 414, 416-17 (9th Cir.

BAP 1999). Furthermore, in order to review a factual finding for clear

error, the Excerpts usually should include the entire transcript and all other

relevant evidence considered by the bankruptcy court. See Friedman v.

Sheila Plotsky Brokers, Inc. (In re Friedman), 126 B.R. 63, 68 (9th Cir. BAP

1991); Burkhart v. Fed. Deposit Ins. Corp. (In re Burkhart), 84 B.R. 658, 661 (9th

Cir. BAP 1988). But public policy favors disposing of cases on their merits

instead of procedural grounds. See Foman v. Davis, 371 U.S. 178, 181 (1962).

In the particular circumstances of this appeal, our review is limited but not

impossible without the trial transcript.

      In addition, we have exercised our discretion to review the copy of

the trial transcript that is available on the bankruptcy court’s docket. See

O'Rourke v. Seaboard Sur. Co. (In re E.R. Fegert, Inc.), 887 F.2d 955, 957-58

(9th Cir. 1989); Atwood v. Chase Manhattan Mortg. Co. (In re Atwood), 293 B.R.

227, 233 n.9 (9th Cir. BAP 2003). Based on that review, formal inclusion of

the transcript in the Excerpts would not change our disposition of this

appeal.

      For all of the foregoing reasons, we will not dismiss or summarily


                                         9
dispose of this entire appeal due to the lack of a statement of issues,

designation of the record, or trial transcript.

      B.     References to Documents That Were Not Introduced at Trial
             Must be Stricken

      Debtors included in the Excerpts various documents that were filed

in connection with their motion for summary judgment, but there is no

indication that those documents were accepted into evidence at trial.

Mr. Huynh argues that such material must be stricken from the Excerpts.

We agree. See Nunez v. Parker (In re Shaver Lakewoods Dev. Inc.), BAP No.

EC-15-1311-JuKuMa; 2016 WL 7188660, at *4 (9th Cir. BAP Nov. 29, 2016)

(citing Heath v. Helmick, 173 F.2d 156 (9th Cir. 1949)); see also Lowry v.

Barnhart, 329 F.3d 1019, 1025 (9th Cir. 2003).3

      C.     Mr. Huynh’s Failure to Seek Formal Amendment of the
             Complaint, to Include Claims for Tortious Conduct Under
             Arizona Law, is Not Fatal to the Amended Judgment

      On remand, the bankruptcy court directed the parties to file briefs to

identify “what state law torts, if any,” the evidence already in the record

would support and “whether the Court should reopen evidence in order

for either party to present additional testimony or other evidence.”

Mr. Huynh’s brief argued, with specific references to evidence at trial, that



      3
        Similarly, Mr. Huynh requests that this panel take judicial notice of the state
court action that he filed against Debtors, but he has not provided us with a copy of any
documents from that action or explained why it is relevant. His request is denied.

                                           10
the existing record supported five Arizona torts. Alternatively, Mr. Huynh

requested an opportunity to present additional evidence regarding those

torts if the court determined the record was insufficient.

      Debtors’ brief on remand argued that at trial they did not know what

torts were being asserted. They pointed out that Mr. Huynh’s complaint

did not assert any specific claims under Arizona tort law or allege the

elements of each tort, as required by Civil Rule 8 (made applicable by Rule

7008). Debtors also argued that the existing record at trial was inadequate

to support any of the tort claims asserted by Mr. Huynh.

      The bankruptcy court ruled that the existing trial record was

sufficient to establish four of the tort claims asserted by Mr. Huynh. It

effectively treated Mr. Huynh’s remand brief as an informal motion to

amend the complaint to conform to the evidence at trial, and granted that

motion. See Civil Rule 15(b)(2) (made applicable by Rule 7015) (“A party

may move – at any time, even after judgment – to amend the pleadings to

conform them to the evidence and to raise an unpleaded issue.”). In its oral

ruling, the bankruptcy court stated:

      The Court instructed [Mr. Huynh] to file an opening brief and
      the [Debtors] to file a responsive brief addressing the potential
      torts identified by [Mr. Huynh]. Unfortunately, [Debtors’] brief
      seemed to focus on the adversary complaint instead of dealing
      with the evidence presented at trial and the specific torts
      identified by [Mr. Huynh].
                                      ***


                                       11
      The Court finds and concludes, based on the briefs filed and the
      citations to the record made therein, that [Mr. Huynh] has
      established four state law tort causes of action that are
      necessary to a finding of nondischargeabilty under § 523(a)(6)
      for willful and malicious conduct.
                                        ***
      The Court finds the pleadings conform to the facts that came
      out at trial and in this case. [Tr. 9/29/17, pp. 3:17-23, 4:4-8, 15:7-8
      (emphasis added).]

      On this appeal, Debtors argue that, under principles of “notice

pleading,” they were deprived of a sufficient opportunity to defend

themselves. Debtors’ argument is flawed.

      First, Civil Rule 15 specifically contemplates that an unpleaded issue

may be raised if it “conform[s] to the evidence” at trial. Civil Rule 15(b)(2).

Second, although Debtors argued on remand that the evidence at trial was

inadequate, the bankruptcy court disagreed, and Debtors did not argue in

the alternative that they should be able to present more evidence in their

defense. To the contrary, Debtors opposed reopening the trial, arguing that

this “would be grossly unfair to [Debtors] who have incurred a small

fortune in attorney’s fees, court costs, expert witness fees and wage

garnishments.”

      For these reasons, we hold that Debtors elected to proceed on the

existing trial record, and have waived and forfeited their argument that the

lack of a formal motion to amend the complaint is fatal to the Amended


                                        12
Judgment. See generally Hamer v. Neighborhood Hous. Servs., 138 S. Ct. 13, 17

n.1 (2017) (distinguishing forfeiture and waiver); Wellness Int’l Network, Ltd.

v. Sharif, 135 S. Ct. 1932 (2015) (discussing implicit waiver).

      Alternatively, we have used our discretion to review the trial

transcript and the limited documents that are available to us. Those things

would not alter our conclusions, for the reasons discussed below.

      D.    Conclusion as to Procedural Issues

      For all of the foregoing reasons, we conclude that none of the

procedural issues raised by the parties warrants a summary affirmance,

reversal, or dismissal of this appeal. We turn now to the merits.

2.    The Record Supports the Bankruptcy Court’s Entry of the Amended
      Judgment Under § 523(a)(6)

      Section 523(a)(6) excepts from discharge any debt “for willful and

malicious injury by the debtor to another entity or to the property of

another entity.” The willfulness and malice requirements are analyzed

separately and both elements must be met. Ormsby v. First Am. Title Co. of

Nev. (In re Ormsby), 591 F.3d 1199, 1206 (9th Cir. 2010); Carrillo v. Su (In re

Su), 290 F.3d 1140, 1146-47 (9th Cir. 2002).

      Whether a debtor acted willfully is a subjective inquiry: the “willful

injury” requirement is met only when the debtor has a “subjective motive

to inflict injury” or when the debtor believes that injury is “substantially

certain to result” from his or her own conduct. In re Ormsby, 591 F.3d at


                                       13
1206. Further, when determining the debtor’s intent under § 523(a)(6),

there is a presumption that the debtor knows the natural consequences of

his or her actions. Id.

      “A malicious injury involves (1) a wrongful act, (2) done

intentionally, (3) which necessarily causes injury, and (4) is done without

just cause or excuse.” Id. at 1207. “Malice may be inferred based on the

nature of the wrongful act.” Id.

      “It is well settled that a simple breach of contract is not the type of

injury addressed by § 523(a)(6).” Snoke v. Riso (In re Riso), 978 F.2d 1151,

1154 (9th Cir. 1992). But when an intentional breach of contract is

accompanied by tortious conduct that results in willful and malicious

injury, the resulting debt is excepted from discharge under § 523(a)(6).

Lockerby v. Sierra, 535 F.3d 1038, 1040-42 (9th Cir. 2008) (citing Petralia v.

Jercich (In re Jercich), 238 F.3d 1202, 1205 (9th Cir. 2001)).

      Under Jercich, courts are instructed first to consider whether the

debtor’s conduct was “tortious,” and then to ask whether the debtor’s

conduct was both “willful” and “malicious.” In re Jercich, 238 F.3d at 1206-

09. Whether a breach of contract is tortious is determined under state law.

Lockerby, 535 F.3d at 1041 (“[C]onduct is not tortious under § 523(a)(6)

simply because injury is intended or ‘substantially likely to occur,’ but

rather is tortious if it constitutes a tort under state law.”).




                                         14
      A.    Debtors Have Not Established Error in the Bankruptcy
            Court’s Determination That Ms. Le Intentionally Interfered
            With Mr. Huynh’s Business Relations Under Arizona Law

      On remand, the bankruptcy court made detailed findings of fact and

conclusions of law on the record, as permitted by Rule 7052 (incorporating

Civil Rule 52(a)(1)). Debtors do not dispute the bankruptcy court’s

summary of the elements of a claim for intentional interference with

business relations:

      [1] [T]here must be the existence of a valid contractual
      relationship or business expectancy. [2] There must be
      knowledge of the relationship or expectancy on the part of the
      interferer. [3] There must be intentional interference inducing
      or causing a breach or termination of the relationship or
      expectancy. [4] There must be resultant damage to the party
      whose relationship or expectancy has been disrupted and
      [Debtor(s)] must have acted improperly. [Tr. 9/29/17, p. 12:14-
      13:2 (citing Safeway Ins. Co. v. Guerrero, 106 P.3d 1020, 1025
      (Ariz. 2005); Antwerp Diamond Exchange of Am., Inc. v. Better
      Business Bureau of Maricopa Cty., 130 Ariz. 523, 530 (1981)).]

      To be the foundation of a claim for tortious interference, a business

expectancy must be more than a mere “hope.” Dube v. Likins, 216 Ariz. 406,

413 (Ct. App. 2007) (citation omitted). There must be “a colorable economic

relationship between the plaintiff and a third party with the potential to

develop into a full contractual relationship.” Id. at 414 (citations and

internal quotation marks omitted).


                                      15
      The bankruptcy court determined that Mr. Huynh established each of

these elements at trial.

            i.    Existence of a valid contractual relationship or business
                  expectancy

      As conceded in Debtors’ opening brief on this appeal, they knew that

the primary contractual relationship or business expectancy at issue

involved Chevron. There was evidence that Mr. Huynh had a contractual

and business relationship with Chevron that predated Debtors’

involvement with the business, both through the LLC and directly as the

owner of the real estate on which it operated and as a guarantor.

      Mr. Huynh testified that he purchased the gas station property in

2004 when it was already operating under the Chevron brand. He and his

wife guaranteed the LLC’s debt to Chevron, and if the business had not

been precipitously shut down and debranded he expected that his business

relationship with Chevron could have continued, either through a new

LLC or in some other manner. Tr. 1/21/15, pp. 28:4-6, 29:8-31:9, 82:17-20,

121:22-122:19, & 127:17-128:8. The bankruptcy court found that Mr. Huynh

“had a valid contractual relationship and business expectancy through

both the LLC and also through the LLC’s rental of the real property from

[Mr. Huynh].” Tr. 9/29/17, p. 13:9-12.

      Debtors argue in their opening brief on this appeal that Mr. Huynh

was responsible, and they were not, for “securing the station and


                                     16
maintaining Chevron branding.” But that proves the point. Mr. Huynh is

the one who had an expectation of continuing his relationship with

Chevron. “It is not necessary that it be absolutely certain that contracts

would have been made were it not for the interference. Reasonable

assurance thereof in view of all the circumstances is sufficient.” Marmis v.

Solot Co., 117 Ariz. 499, 502 (Ct. App. 1977).

            ii.    Knowledge of the relationship or expectancy on the part
                   of the interferer

      Ms. Le knew of Mr. Huynh’s business expectations. She was “aware

that [Mr. Huynh] had purchased the underlying real estate and was renting

the real property to the LLC,” and “knew of [Mr. Huynh’s] relationship to

the LLC as both a fellow member and as the landlord.” Tr. 9/29/17, p. 13:7-

16. “Ms. Le understood the business relationship held by [Mr. Huynh]

with Chevron through the LLC.” Id., p. 14:10-11.

      Again, there is support for these findings. Mr. Huynh testified that

he gave Ms. Le explicit notice of the importance of the relationship with

Chevron. Tr. 1/21/15, pp. 54:24-55:6 & 63:2-4.

            iii.   Intentional interference inducing or causing a breach or
                   termination of the relationship or expectancy

      The bankruptcy court determined that Ms. Le’s taking of the

inventory, computer, and books and records, among other acts, amounted

to an intentional interference that caused a breach or termination of


                                       17
Mr. Huynh’s business relationship and expectancies. Tr. 9/29/17, p. 13:19-

14:3.

        The intentional interference is also demonstrated by Ms. Le’s
        admission that she knew that shutting down the business
        would hurt [Mr. Huynh] financially. She also admitted
        knowing that [Mr. Huynh] had a loan on the real property
        where the gas station was located and that there were other
        options other than to simply unilaterally close the business.
                                        ***
        Further, she knew that her actions would result in the store
        going dark and the potential de-branding of the gas station
        from the Chevron brand name. [Tr. 9/29/17, p. 14:4-14
        (emphasis added).]

        Debtors have not shown any clear error in these findings. The

evidence fully supports the finding of intent and causation.

             iv.   Improperness of Debtor(s)’ conduct, and damage to
                   Mr. Huynh resulting from interference

        The bankruptcy court found that “Ms. Le acted improperly” and that

her conduct “directly caused the gas station to shut down, causing financial

harm and other resultant damage to [Mr. Huynh].” Tr. 9/29/17, p. 14:14-17.

There is ample support for this finding. For example, Ms. Le admitted that

she knew her acts would harm Mr. Huynh financially. There was also

evidence at trial that Ms. Le at first promised to provide Mr. Huynh with

the keys to the premises and equipment but that, after he flew from the

San Francisco Bay Area to Phoenix to meet with her, she refused to turn


                                      18
over those keys, or provide him with access to the LLC’s computer or

books and records, and eventually when he gained access to the premises

he found that the fixtures and store had been “trash[ed].“ Tr. 1/21/15,

pp. 62:11-67:23, 173:18-20, 175:22-176:16, 179:11-13, 213:24-214:9.

      Debtors contend that the bankruptcy court erred because, they claim,

they were not aware of Mr. Huynh’s responsibilities in maintaining the

Chevron brand. Debtors also contend that the bankruptcy court erred

because economic hardship and Mr. Huynh’s threat to evict the LLC

supposedly were the true causes of the LLC shutting down and Chevron

debranding the business.

      But the bankruptcy court’s findings quoted throughout this

memorandum support contrary conclusions. There is support for its

findings that precipitously shutting down the business without prior

notice, withholding keys, removing the business’s computer, “trash[ing]”

the interior, and other acts were improper, and were the true causes of the

gas station “going dark.” It was Ms. Le’s actions that prevented

Mr. Huynh from being able to reopen the station quickly. All of this

damaged Mr. Huynh by ending his valid expectancy, known to Debtors, of

a valuable business relationship with Chevron. Where there are two

possible interpretations of the evidence, we cannot hold that the

bankruptcy court committed clear error by adopting one of them. See

Hansen v. Moore (In re Hansen), 368 B.R. 868, 874-75 (9th Cir. BAP 2007)


                                      19
(citing Anderson v. Bessemer City, 470 U.S. 564, 573-75 (1985)).4

      B.     Debtors Have Not Established Error in the Bankruptcy
             Court’s Findings That the Injury to Mr. Huynh Was “Willful”
             and “Malicious” Under § 523(a)(6)

      Debtors contend that Ms. Le’s conduct fails to support a finding of

nondischargeability under § 523(a)(6). Because Debtors do not assert that

the bankruptcy court applied the wrong legal standard, we review the

bankruptcy court’s factual findings for clear error.

      First, as discussed above, Debtors have not established any error in

the bankruptcy court’s determination that Ms. Le’s conduct was “tortious”

under Arizona law as required by Jercich. Next, the bankruptcy court

found that Ms. Le acted willfully. The bankruptcy court found that,

according to Ms. Le’s own admission, “she knew shutting down the

business would hurt Mr. Huynh financially,” and she also “knew her

actions would result in the store going dark and the potential de-branding

of the gas station from the Chevron brand name.” Tr. 9/29/17, pp. 14:5-14.

      The bankruptcy court also found that Ms. Le acted with malice.

Debtors argue that the record does not support a finding of malice and

instead reflects that their actions were guided by fear of losing the

inventory. But, the bankruptcy court found that “[g]iven Ms. Le’s business



      4
        We do not address the other torts found by the bankruptcy court because any
one tort is sufficient under In re Jercich, 238 F.3d 1202.

                                         20
background and experience, including her experiences before her

agreements with [Mr. Huynh], Ms. Le’s testimony of not fully

understanding the ramifications of her actions was not credible.” Tr.

9/29/17, p. 15:3-6. We give due regard to the opportunity of the bankruptcy

court to judge the credibility of the witnesses. Wells Fargo Bank v. Beltran

(In re Beltran), 182 B.R. 820, 823 (9th Cir. BAP 1995).

      In addition, the bankruptcy found that Ms. Le had prevented

Mr. Huynh, who lived in another state, from monitoring the business by

blocking his access to video surveillance. The bankruptcy court’s written

order found that this:

      reveals her intent to shut [Mr. Huynh] out of the business, and
      also to undermine his ability to protect his interest.
                                       ***
      [Ms.] Le’s failure to respond to [Mr. Huynh’s] Demand Letter
      [to pay the rent] and instead liquidate assets demonstrates that
      Ms. Le acted out of anger towards [Mr. Huynh] and with the
      intent to exclude him from the process. Regardless of her
      testimony that she interpreted the Demand Letter as a notice of
      lockout . . . the Court cannot find Ms. Le’s actions justified. The
      totality of Ms. Le’s conduct shows that she was angry with
      [Mr. Huynh], that she intended to exclude him from
      participating in the business, including whether it should be
      sold or shutdown . . . . [Order Re: Nondischargeability Of Debt ,
      p. 7:17-27]

      Debtors have not established any error in the bankruptcy court’s

findings that Ms. Le’s conduct was “willful” and “malicious” within the


                                       21
meaning of § 523(a)(6).

      C.    Debtors Have Not Established Error in Calculating Damages

      Debtors argue that the bankruptcy court erred in determining

Mr. Huynh’s damages. Because this requires a review of the bankruptcy

court’s factual findings, we review the damages issue for clear error.

Again, Debtors’ arguments are not persuasive.

      First, the only evidence of damages in the Excerpts was introduced in

connection with Debtors’ motion for summary judgment (the “MSJ”),

which we have stricken. Without the evidence introduced at trial, we

cannot review the bankruptcy court’s interpretation of that evidence for

clear error. See Lowry, 329 F.3d at 1025; In re Shaver Lakewoods Dev. Inc.,

2016 WL 7188660, at *4.

      Second, even if we had not stricken this evidence, our examination of

the available record reveals that the MSJ evidence was materially different

from the trial evidence. Specifically, the trial transcript reveals that there

were changes after the MSJ to Mr. Huynh’s damages analysis prepared by

Mr. Scott E. Evans (the “Evans Report”).

      Third, even if we were prepared to search for error in the Evans

Report, Debtors’ challenges to that report miss the mark. Debtors assert

that Mr. Evans failed to take into consideration the economic hardships the

LLC faced and Mr. Huynh’s threat of eviction, but our own review of that

report shows that he did consider those things. Debtors also argue that


                                       22
Mr. Evans did not discount lost profit damages by 50% to account for

Ms. Le’s ownership interest. But this argument incorrectly presumes that

Mr. Evans’ calculation of damages is based on the LLC’s future lost profits.

In reality, the Evans Report contains projections based on Mr. Huynh’s

future lost revenues as landlord (plus $38,929 in out-of-pocket costs).

Mr. Evans compared the actual rents received by Mr. Huynh against the

projected rents if the gas station could have been continued or reopened as

a Chevron station or the equivalent.

      Finally, the bankruptcy court found Mr. Evans’ testimony “credible,

largely unchallenged by Ms. Le, and uncontroverted.” Order re:

Nondischargeability of Debt, p. 8:13-14. As an appellate court, we are not

to retry issues of fact or supplant our judgment for that of the bankruptcy

court. Smith v. James Irvine Found., 402 F.2d 772, 774 (9th Cir. 1968). If two

views of the evidence are possible, the trial judge’s choice between them

cannot be clearly erroneous. In re Hansen, 368 B.R. at 874-75. We give

findings of fact based on credibility particular deference. Id.

      For all of these reasons, Debtors have not demonstrated any error in

the bankruptcy court’s calculation of damages.

      D.    Debtors Have Waived and Forfeited Any Arguments
            Distinguishing Mr. Le from Ms. Le

      Debtors argue that the bankruptcy court did not make any specific

findings about Mr. Le’s conduct. They also argue that Ms. Le’s subjective


                                       23
intent cannot be imputed to Mr. Le.

      It is true that the burden was on Mr. Huynh to prove

nondischargeability, and under our precedent Mr. Le himself would have

to have the requisite willful and malicious intent under § 523(a)(6) - intent

cannot be imputed from Ms. Le. See Jenkins v. Mitelhaus (In re Jenkins), BAP

Nos. CC-14-1185-PaTaD, CC-14-1258-PaTaD ; 2015 WL 735799 (9th Cir.

BAP Feb. 20, 2015) (“Behaviors and outcomes might be imputed, maybe

even misrepresentations, but subjective thoughts cannot be.”) (quoting Luc

v. Chien (In re Chien), BAP No. NC-07-1265-JuMkK; 2008 WL 8240422, at *7

(9th Cir. BAP Feb. 7, 2008)); cf. Sachan v. Huh (In re Huh), 506 B.R. 257 (9th

Cir. BAP 2014).

      But the key question is not who had the initial burden of proof. The

question is whether issues regarding Mr. Le’s intent that were not raised on

the prior appeal or on remand can be raised now, on this second appeal.

We hold that they cannot.

      In the prior appeal we expressly pointed out that although a spouse’s

subjective intent cannot be imputed to the debtor for § 523(a)(6) purposes,

nowhere did Debtors argue that point in the bankruptcy court, or object to

the Prior Judgment on that basis, or argue that issue on that appeal. We

noted that this issue had been waived for purposes of that appeal.

Nothing, however, prevented Debtors from raising this issue on remand.

Nevertheless, so far as we can tell from the Excerpts, Debtors did not do so.


                                       24
      Mr. Huynh correctly points out that arguments not raised before the

trial court are almost never heard on appeal. See El Paso v. Am. W. Airlines,

Inc. (In re Am. W. Airlines, Inc.), 217 F.3d 1161, 1165 (9th Cir. 2000) (“This

court will only consider new arguments under ‘exceptional

circumstances’”); Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir. 1999) (“As a

general rule, we will not consider arguments that are raised for the first

time on appeal”); Marx v. Loral Corp., 87 F.3d 1049 (9th Cir. 1996).

      Debtors have not established sufficient grounds to depart from this

policy. They consciously chose not to address this issue before the

bankruptcy court, both before and after the prior appeal, and therefore they

have waived this issue. Alternatively, by failing to address the issue on

remand, despite what we said about it on the prior appeal, Debtors have

forfeited it. See Smith, 194 F.3d at 1052 (declining to consider arguments

that are raised on appeal for the first time); see also Hamer, 138 S. Ct. at 17

n.1 (distinguishing forfeiture and waiver); Wellness Int’l Network, Ltd., 135 S.

Ct. 1932 (implicit waiver).

                                CONCLUSION

      For the foregoing reasons, we AFFIRM.




                                        25
