Hitt Ex Rel. All American Bottled Water Corp. v. Ng (In Re All American Bottled Water Corp.) ( 2010 )

FILED
NOT FOR PUBLICATION NOV 18 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
In the Matter of: ALL AMERICAN No. 09-36050
BOTTLED WATER CORPORATION,
D.C. No. 3:09-cv-05171-BHS
Debtor,
MEMORANDUM*
MICHAEL D. HITT, in his capacity as the
trustee for the bankruptcy estate of All
American Bottled Water Corporation,
Appellant,
v.
BARNEY NG; RE LOANS LLC; BAR K
INC; PENSCO TRUST CO,
Appellees.
Appeal from the United States District Court
for the Western District of Washington
Benjamin H. Settle, District Judge, Presiding
Argued and Submitted November 1, 2010
Seattle, Washington
Before: B. FLETCHER, FERNANDEZ and BYBEE, Circuit Judges.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
The trustee appeals from the district court’s order affirming the bankruptcy
court’s dismissal of a motion to avoid certain transfers made by the debtor to
defendants Bar K and Ng, on the grounds that the transfers allegedly ran afoul of
state fraudulent transfer laws and federal bankruptcy law. See Wash. Rev. Code §§
19.40.041, 19.40.051; 11 U.S.C. § 544(b). We affirm.
We review de novo a district court’s decision on appeal from a bankruptcy
court. Green v. Savage (In re Greene), 583 F.3d 614, 618 (9th Cir. 2009). We
review the bankruptcy court’s conclusions of law de novo and its factual findings
for clear error. Id. We may affirm the bankruptcy court’s decision on any ground
fairly supported by the record. Wirum v. Warren (In re Warren), 568 F.3d 1113,
1116 (9th Cir. 2009).
The bankruptcy court noted that the challenged transfer — the payment of
points to Bar K and Ng — was part of an overall plan to provide the debtor with
short-term funding needed to complete a purchase and begin the development of a
water bottling plant. It found that all steps of the plan, including the payments to
the defendants, involved transactions that were “integral to consummating [the]
business plan.” The points payments in particular constituted standard fees for
loan servicing. We agree with this assessment. Accordingly, we hold that the
transfers to Bar K and Ng were part of a single loan transaction.
Furthermore, regardless of whether the transfers to Bar K and Ng are viewed
separately or as part of a single transaction, the debtor received reasonably
equivalent value for the transfers. The district court and bankruptcy court both
found that the debtor would not have received $25 million in short-term funds if it
had not paid these points to the defendants. Furthermore, neither party suggests
that an exchange for $32 million in debt for $25 million in immediate assets does
not constitute a transfer for reasonably equivalent value, and neither party suggests
that the transaction was conducted at less than arms-length or was otherwise unfair.
AFFIRMED.