Medical Acquisition Company, Inc. v. Tri-City Healthcare District

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS OCT 25 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT MEDICAL ACQUISITION CO., INC., No. 24-152 D.C. No. Plaintiff - Appellant, 3:23-cv-01454-CAB-KSC v. MEMORANDUM* TRI-CITY HEALTHCARE DISTRICT, Defendant - Appellee. Appeal from the United States District Court for the Southern District of California Cathy Ann Bencivengo, District Judge, Presiding Submitted October 23, 2024** Pasadena, California Before: TALLMAN, R. NELSON, and BRESS, Circuit Judges. Tri-City Healthcare District (Tri-City) filed a proof of claim in Medical Acquisition Company’s (MAC) Chapter 11 bankruptcy proceedings. Tri-City’s claim was based on a $4,042,754.84 judgment that it obtained against MAC in California state court. During post-judgment proceedings, the state trial court * This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). awarded Tri-City another $1,135,083.12 in pre-judgment interest. In MAC’s Chapter 11 bankruptcy, Tri-City filed a proof of claim for these amounts (minus certain offsets), plus post-judgment interest. MAC objected to one aspect of Tri-City’s claim, contending that Tri-City should not be allowed to obtain post-judgment interest on the $1,135,083.12 pre-judgment interest award. The bankruptcy court overruled MAC’s objection to Tri-City’s proof of claim, and the district court affirmed. We review a bankruptcy court’s legal conclusions de novo and its factual determinations for clear error. See In re First T.D. & Inv., Inc., 253 F.3d 520, 526 (9th Cir. 2001). We have jurisdiction under 28 U.S.C. § 158, and we affirm. California law provides that “interest accrues at the rate of 10 percent per annum on the principal amount of a money judgment remaining unsatisfied.” Cal. Civ. Proc. Code § 685.010(a)(1). Tri-City was entitled to pre-judgment interest in the amount of $1,135,083.12 on the $4,042,754.84 damages award. See Cal. Civ. Proc. Code § 1255.280(b)(2). MAC does not dispute that the pre-judgment interest award was valid or that pre-judgment interest can be part of the judgment. Instead, MAC’s argument is that the $1,135,083.12 in pre-judgment interest was never made part of the state court judgment, and thus that post-judgment interest on the pre- judgment interest award is not available under § 685.010(a)(1). The bankruptcy court correctly rejected this argument, as did the district court. 2 24-152  California Rule of Court 3.1802 provides that “[t]he clerk must include in the judgment any interest awarded by the court.” There is no reason Tri-City’s pre- judgment interest award should not be regarded as part of the state court’s judgment. See Felczer v. Apple Inc., 63 Cal. App. 5th 406, 415 (2021) (explaining that “any judgment that establishes one party owes the other payment is a money judgment for the purposes of section 685.020, even if the precise amount owed has yet to be determined”). Here, Tri-City’s judgment established its right to pre-judgment interest, which was eventually awarded. Cal. Civ. Proc. Code § 1255.280(b)(2). MAC identifies no authority conditioning Tri-City’s recovery of post-judgment interest on the state court undertaking any further formalities with respect to the award of pre-judgment interest. So, the bankruptcy court’s analysis was correct that Tri-City’s pre-judgment interest award was part of the state court judgment, and the district court was correct in affirming that judgment. AFFIRMED. 3 24-152