B.B. v. Grossman (In re Grossman)

• Citation: 538 B.R. 34
• Decision Date: 10 September 2015
• Docket Number: Adv. Pro. No. 14–02140,Case No. 14–21767–C–13
• Parties: In re: Clayton Grossman, Debtor. B.B., Plaintiff, v. Clayton Grossman, Defendant.
• Court: United States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — Eastern District of California

538 B.R. 34

In re: Clayton Grossman, Debtor.

B.B., Plaintiff
v.
Clayton Grossman, Defendant.

Case No. 14–21767–C–13
Adv. Pro. No. 14–02140

United States Bankruptcy Court, E.D. California.

Signed September 10, 2015
Filed September 11, 2015

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Timothy B. Broderick, Broderick Saleen, Palo Alto, California, for Plaintiff.

David M. Alden, Sacramento, California, for Defendant.

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Before: Christopher M. Klein, Chief Judge

OPINION

KLEIN, Bankruptcy Judge:

Revenge porn comes to bankruptcy. The plaintiff wants a $25,000 judgment debt excepted from the chapter 13 discharge. The judgment was entered in a lawsuit for invasion of privacy and intentional infliction of emotional distress because the debtor-defendant posted on the internet a supposedly-private video showing the parties disrobed and engaged in intimate relations. The question is whether the complaint states a claim for relief under 11 U.S.C. § 1328(a)(4) for “willful or malicious” conduct. The answer is yes.

Facts

For purposes of this motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the following facts drawn from the First Amended Complaint are assumed to be true.

The plaintiff¹ and defendant lived together in a monogamous relationship for nearly two years. During that time, based on his promise that it would be only for personal use and would remain private, the plaintiff allowed him to make a video showing her nude and engaging in sexual acts with him.

After their relationship had ended and the plaintiff had married someone else, the defendant uploaded the private video on a pornography website, labeling it with the plaintiff's maiden name and married name and the tags “amateur / ex-girlfriend.”

The plaintiff did not give permission for publication of the video. Nor did the defendant inform her of his actions.

By the time the plaintiff learned (from her husband, who was told by a friend) that the video was on the internet and had the video removed from the pornography website, it had been viewed more than 6,900 times.

The plaintiff sued defendant in a California Superior Court for invasion of privacy and intentional infliction of emotional distress, seeking compensatory and punitive damages.

The defendant countered by filing this chapter 13 bankruptcy case, which precipitated the plaintiff's initial version of this adversary proceeding. The Complaint asked this court to award the same compensatory and punitive damages for invasion of privacy and intentional infliction of emotional distress being sought in the still-pending state-court action, together with nondischargeability determinations under 11 U.S.C. §§ 523(a)(2), (a)(4), and (a)(6).

This court modified the automatic stay to enable the state court to proceed to judgment and stayed the adversary proceeding.

Upon return to state court, the defendant made an offer of judgment under California's version of Federal Rule of Civil Procedure 68 (Cal. Code Civ. P. § 998 ) for $25,000. The offer was accepted and judgment entered for that amount.

The First Amended Complaint filed here treats the damages as fixed by the $25,000 state-court judgment and alleges counts sounding only in nondischargeability under 11 U.S.C. §§ 523(a)(2) and (a)(4) and § 1328(a)(4).

The defendant has filed the instant motion to dismiss under Rule 12(b)(6) or for a more definite statement under Rule 12(e).

Jurisdiction

Jurisdiction over this adversary proceeding, which “arises under” title 11, is

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founded upon 28 U.S.C. § 1334(b). Actions to except debts from discharge are core proceedings that bankruptcy judges may hear and determine. 28 U.S.C. § 157(b)(2)(I).

Analysis

The question is whether the alleged facts, accepted as true, state a claim for exception from discharge in bankruptcy.

The key statute is Bankruptcy Code § 1328(a)(4), which was enacted in 2005. The relevant portion of that section excepts from discharge any debt for damages “awarded in a civil action against the debtor as a result of willful or malicious injury by the debtor that caused personal injury to an individual....” 11 U.S.C. § 1328(a)(4).²

The $25,000 state-court judgment debt satisfies the requirement of a debt for damages awarded in a civil action against the debtor. The remaining questions are whether the conduct was “willful or malicious” and whether invasion of privacy and intentional infliction of emotional distress qualify as causing “personal injury” to the plaintiff.

I

The “willful or malicious” injury component of the § 1328 exception to discharge differs from § 523(a)(6), which excepts from discharge debts that are the result of “willful and malicious” injury. Compare 11 U.S.C. § 1328(a)(4), with id. § 523(a)(6) (emphases supplied).

Although the difference between “or” and “and” may affect the dynamic of the analysis, the meanings of the terms “willful” and “malicious” that were hammered out in decades of § 523(a)(6) litigation before enactment of § 1328(a)(4) have the same meanings in the later-enacted section. Nothing suggests that Congress intended that the terms “willful” and “malicious” should have different meanings within the same statute.

A

“Willful” conduct, in the context of personal injury, entails a deliberate or intentional injury and not merely an injury resulting from a deliberate or intentional act. Kawaauhau v. Geiger, 523 U.S. 57, 61–62, 118 S.Ct. 974, 140 L.Ed.2d 90 (1998) (§ 523(a)(6) ).

The debtor must either subjectively have intended to cause injury or have believed injury was substantially certain to result. Carillo v. Su (In re Su), 290 F.3d 1140, 1146–47 (9th Cir.2002) (§ 523(a)(6) ) (“Su ”).

The requisite state of mind may be established by circumstantial evidence that tends to show what the debtor must actually have known when acting in the manner that produced injury. Su, 290 F.3d at 1146 n. 6. Some acts are so inherently wrongful that the very nature of the act testifies to intent: i.e., res ipsa loquitur.

The facts alleged could support a determination by a trier of fact that the defendant's conduct was “willful” under the requisite standard.

Uploading the video onto the pornography website was self-evidently no accident. In addition, the defendant's acts of identifying the plaintiff by both her maiden and

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her married names are circumstances indicative of a subjective intent to embarrass and humiliate her, inviting harassment, shaming, stalking, or worse.

It follows that the First Amended Complaint states a claim that defendant's conduct was “willful” for purposes of § 1328(a)(4).

B

“Malicious” is an ambiguous concept that has both a factual sense and an artificial, legal sense. The former is controlling for purposes of §§ 523(a)(6) and 1328(a)(4) but eludes proof by direct evidence; the latter describes the circumstantial evidence that provides a proxy for inferring the requisite state of mind.

In the factual sense, “malicious” connotes ill will, animosity, and a desire to do harm for harm's sake. The practical problem of proof for the trier of fact is the rarity of direct evidence of this state of mind.

“Malicious” in the artificial, legal sense means a wrongful, intentional act that is done without just cause or excuse and that necessarily causes injury. Su, 290 F.3d at 1146–47 ; Petralia v. Jercich (In re Jercich), 238 F.3d 1202, 1209 (9th Cir.2001) ; Introductory Note, Restatement (Second) of Torts, Div. 7, Ch. 29 (“Restatement ”).³

Proof of a wrongful, intentional act done without just cause or excuse and that necessarily causes injury constitutes circumstantial evidence that warrants an inference of factual malice. In other words, the artificial, legal sense is a proxy by which one determines actual, factual malice in the absence of direct evidence of malice.

Here, there is direct evidence of factual malice. The defendant's animus towards the plaintiff and intent to injure the plaintiff is inherent in his act of labeling the uploaded sex tape with the tag “ex-girlfriend.” It reeks of revenge and of intention to embarrass and humiliate the plaintiff in a manner that necessarily causes damages by inviting harassment, shaming, stalking, or worse. See Jett v. Sicroff (In re Sicroff), 401 F.3d 1101, 1106 (9th Cir.2005) (defamatory statements that necessarily harmed the plaintiff in his occupation were self-evidently wrongful and intentional).

In other words, the facts alleged in the First Amended Complaint support a determination by a trier of fact that the defendant's conduct was “malicious” under the requisite standard of being wrongful, intentional, inexcusable, and necessarily damaging to reputation and psyche.

Nor was there any just cause that might privilege or excuse the publication.

It follows that the complaint states a claim that the defendant's conduct was “malicious” for purposes of § 1328(a)(4).

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