Opposition Brief — Cusano v. Klein (No. 05-1492)

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FILED

1) JUL 2.4 2006

No.05-1492 3 UPREME COURT, U.S.

In the

Supreme Court of the Anited States

VINCENT CuSANO, p/k/a Vinnie Vincent and

d/b/a Streetbeat Music and d/b/a Vinnie Vincent Music,

Petitioner,

GENE KLEIN, Paut STANLEY nee STANLEY EISEN,

Tue Kiss Company, GENE SIMMONS WoRLDWIDE, INC.,

SIMSTAN Music Ltp., KISStory Ltp.,

and POLYGRAM ReEcorps, INC.,

Respondents.

On Petition for a Writ of Certiorari to the United

States Court of Appeals for the Ninth Circuit

BRIEF IN OPPOSITION

Lesuit A. COHEN Brian G. WoLF

LineR YANKELEVITZ SUNSHINE Counsel of Record

& REGENSTREIF, LLP Henry L.. Secr Il

1100 GLENDON AVENUE KRISTINA BRITTENHAM

14™ FLoor Lave.y & SinGer, P.C.

Los ANGELES, CA 90024 2049 Century Park East

(310) 500-3560 Surre 2400

Los ANGetes, CA 90067

Counsel for Respondents (310) 556-3501

Counsel for Respondents

Dated: July 24, 2006

Becker Gallagher Legal Publishing, Inc. 800 890. 5001

QUESTIONS PRESENTED

Whether the November 15, 2005 decision by the Ninth

Circuit Court of Appeals affirming the district court’s

entry of judgment on the merits in favor of Respondents

as a result of Petitioner’s failure to present any competent

evidence in support of his claims presents a compelling

reason to justify review by this Court.

. Whether an unsettled factual dispute regarding whether a

1983 agreement between Petitioner and one or more

Respondents was “executory,” and thereby rejected in

Petitioner's 1989 bankruptcy, presents an issue of

importance to successful bankruptcy administration.

CORPORATE DISCLOSURE STATEMENT

PURSUANT TO RULE 29.6

Respondents The KISS Company, Gene Simmons

Worldwide, Inc., Simstan Music Ltd., and KISStory Ltd.

have no parent corporations, nor does a publicly held

company own ten percent (10%) or more of the stock of any

of said Respondents.

Respondent Polygram Records, Inc. (renamed UMG

Recordings, Inc., as of November 30, 1999) is a wholly-

owned subsidiary of Vivendi Universal S.A., a publicly held

company.

“ee

TABLE OF CONTENTS

Chansians Premeneel: ook. hee bs eh ie ee Be I

Corporate Disclosure Pursuant to Rule 29.6 ........ ii

pro Lt REE EEC PURE CCE er roe ee ill

po erat ore oe Sure aur ee vii

Summary of Reasons to Deny the Petition ......... l

Rg OPED We eee Pe ree 5

I. The Proceedings Below Concluded In Favor of

PIE ose 6.3 i Ske tse ee ea 5

A. Petitioner Did Not Challenge Findings That He

Signed the 1983 Agreement .............. 5

B. The Circuit Court’s Prior Opinions ......... 6

1. On Remand, the District Court Dismissed

Petitioner’s Claims Regarding the Creatures

CONE 5 554 8 ci eae ee ee 7

2. On Remand, the District Court Dismissed

Petitioner’s Claim for Open Book Account .. 8

3. On Remand, the District Court Dismissed

Petitioner’s Claims Regarding the Lick It Up

RUIN 0b 8'55 5s Geos Bice ee eee 8

Il. Petitioner’s 1989 Bankruptcy Action........... 9

lif. | Whether The 1983 Purchase Option Was

Timely Exercised Presents A Disputed Issue

SEN eo ee ERR EER ED Ce eee es

Reasons for Denying the Petition ...............

I. Petitioner Raises No Disputed Issue of Law

Regarding Application of the Bankruptcy Code

A. Respondents’ Ownership Interest In the Lick It

Up Compositions Never Became a Part of

Petitioner’s Bankruptcy Estate ..........

Because Petitioner Had Conveyed His

Property Interest In the Lick It Up

Compositions to KISS Co. In 1984, No

Property Interest In Those Compositions

Became Part of Petitioner’s Bankruptcy

UNE OE PROF os Ss ei i a ees

Petitioner Failed to Avoid the Conveyance

of His Property Interests In the Lick It Up

Compositions During His Bankruptcy Case

and He Is Now Time-Barred From Doing

DR cosas sian a be eh oie the ae aa

Because the Lick It Up Compositions

Never Became Property of the Bankruptcy

Estate, the Bankruptcy Court Lacked

Jerisdiction Over the Compositions .. .

B. Confirmation of Petitioner’s Chapter 11 Plan

Did Not Extinguish Respondents’ Property

Interests in the Lick It Up Compositions

. 16

Il.

Ill.

IV.

C. Petitioner’s Principal Argument Is Based on a

Fundamental Misunderstanding of What

Constitutes a “Claim” Against a Bankruptcy

RNG i oe eS ei i a ae ee

a es a et oe ees RU cae Bos ee 1a

A. Whether the Purchase-Option Provision Was

Timely Exercised Raises a Disputed Issue of

PUR sade i es a I ne OE he

B. Whether the 1983 Agreement Was Executory

Raises a Disputed Issue of Fact .........

C. Misstatements of Factand Law .........

The Circuit Court’s Decision Was Correct ....

A. The Ninth Circuit’s Decision In Cusano |

Merely Reinstated Petitioner’s Right to Assert

Cortes Rovers CIRUS oe oe a en

B. The Ninth Circuit in Cusano II Rejected

Petitioner’s Interpretation of the Court’s Prior

SR Foe oo Pe OER Nw ES

No Basis Exists for the Court to Exercise Its

UOEVIEY FES oo ss PA eee es

A. Petitioner Has Raised No Issue of Bankruptcy

Law Requiring Resolution ............

B. There Is No Basis For the Court to Issue

DN NN ig a es kee Re

I nn eg a ate ley

Appendix

Appendix A - Ninth Circuit Order,

ST EE SS eee Care ¥ ee ee wa b's

Appendix B - Statement of Executory Contracts,

SE UREN Oe ik GSR COE Wat ee heRe es

Appendix C - Bankruptcy Court Order Denying

Motion to Reopen, Dated 4/23/99 ............

Vil

TABLE OF AUTHORITIES

Cases

Begier v. IRS,

496 U.S. 53, 110 S. Ct. 2258 (1990) .......... 13

Boldt v. Crake (In re Riverside-Linden Inv. Co.),

945 F.2d 320 (9th Cir. 1991) ............ 11-12

Bracewell v. Kelly (In re Bracewell), No. 05-11951,

2006 WL 1814367 (11th Cir. June 30, 2006) ..... 14

Brown v. Dellinger (In re Brown),

Fe ee POO Ra BOD 6 ook be wise eee ha 14

Brown v. Pitzer (In re Brown),

Ae es Sas ee BP vc tetas 19

Caliaway v. Benton,

320 U.S; 132, 3. Ct. 5 CSR) 2. ee cce ns 28

City of Memphis v. Greene,

451 U.S. 100, 101 S. Ct. 1584 (1981) ......... 29

City of New York v. Saper,

336 U.S. 328,

og ee Se ae aye 3, 4, 10, 12, 23

Coleman v. Community Trust Bank (In re Coleman),

426 F.3d 719 (4th Cir. 2008) ......... we eeee i5

Cooper Indus., Inc. v. Aviall Serv., Inc.,

543 U.S. 157, 1258. Ct. 377 (206. ww ee 9,11

Vili

CPT Holdings, Inc. v. Indus. & Allied Employees

Union Pension Plan, Local 73,

162 F368 465 (6G Che. 19D) oo ok eK SS 19

Cusano v. Klein,

264 F.3d 936 (9th Cir. 2001) ............ passim

Cusano v. Klein,

196 F. Supp. 2d 1007 (C.D. Cal. 2002) ........ 7

Cusano v. Klein,

280 F. Supp. 2d. 1035 (C.D. Cal. 2003)

Bs i ar ee 2 do Gi Os Me he BO

FCC v. NextWave Personal Commc’ns, Inc.,

537 WS. 203; 423 3. Ch. BF Gee ke i es 18-19

Fed. Trade Comm’n v. Standard Oil Co..,

259: U5; FO; 70 O.G4. 508 OS 6 RE EGRESS 20

Florida v. Rodriguez,

BS B42, Fas ao lv De a ieee ks cee 29

Gendreau v. Gendreau (In re Gendreau),

52 Fe ek Ce Re es eh ck we ee 13, 19

Graziadei v. Graziadei (In re Graziadei),

52 FS OR OO CN I. ik Oo OE ewe 16

Griffel v. Murphy (In re Wegner),

BSP FA Ss Oe ob oe eh Ge eee 22

Lowenschuss v. Selnick (In re Lowenschuss),

170 F.3d 923 (9th Cir. 1999) ......... 13, 17, 19

Maggio v. Zeitz,

Bae Wiss OO; OO ot, GOL CIDSG) 6 ee cee eve 28

In re Merchants and Mfrs., Inc.,

166 B.R. 234 (Bankr. D. Del. 1994) .......... 19

Montana v. Kennedy,

366 U.S. 308, 81 S. Ct. 1336 (1961) .......... 29

Moody v. Amoco Oil Co.,

Toe Fae tae Cite Cr. 1968) 0c ce cc cece 14

Office of Personnel Mgmt. v. Richmond,

46 U.S. 414, 110:S. Ct. 2465. (1990) .......... 30

New York City Transit Auth. v. Beazer,

Oe es oe, eee. GR. ISSO CISTS) oe ewes 29

NLRB v. Bildisco and Bildisco,

465 U.S. 513, 104S. Ct. 1188 (1983) ......... 21

NLRB v. Manley Truck Line, Inc..,

ee ee FE AA EEE 9 0 aise 80 018 9 Bie es 22

NLRB vy. Pittsburgh S.S. Co.,

Ba te. aoe, 7h oe. CR. 459 CI9S)) . oe es 20

Resare v. Resare,

on Gs Mi fi oe BS, |. | SS ie are mea 19

Schweiker v. Hansen,

450 U.S. 785, 101 S. Ct. 1468 (1981) ......... 30

Singleton v. Wulff,

428 U.S. 106, 96 S. Ct. 2868 (1976) .......... 9

Tennessee Student Assistance Corp. v. Hood,

541 U.S. 440, 124 S. Ct. 1905 (2004) ......... 16

United States v. Hale,

472 U.S. 173, HS CY ZIBB CGT? | kein he NS 29

United States v. Ruzicka,

329 U.S. 287, 67 S. Ct. 207 (1946) ........ 28-29

United States v. Whiting Pools, Inc.,

462 U.S. 198, 103 S. Ct. 2309 (1983) ......... 14

Wilkerson v. McCarthy,

Se as cs ea el SS CD ea ass ee 28

Wolf v. Weinstein,

372 U.S. 633, 83 S. Ct. 969 (1963) ........... 15

Statutes

PEE © POCO oo os Oe ORO ON we ee 18

SE Re CE 6 oh eS bee ee Bee 21, 22

OS UF oe NE So. So ancy eee eee ee 13

BE eek. a LIED. 4c 6 doo etn be wea en ene 15

iS a). aL ose aie Sa oreo 15

SE TESS Bree. ok oo tee ee ee 16, 23

Se Re eee C2 Se iy gon aw eee aes 2

SF EEE SO Pea Cee So aces xt a oe eos 17

Se an CE os Hae ho hod be ee 16

Rules

Os Ss ee POE aia ea eee Cabana eee 15

ee Sy OE ee KS RRR ieee 20

ey Re Pre war eee Pre eee ee 17

DAs tes SD iv 066 8 Fb a ehh se bot EWS ee ]

A Rae 5h 6 ee eb Tce A RO 22

Other Authority

Bankruptcy Amendments and Federal Judgeship Act of 1984,

Pub. L. No. 98-353, Title Il, § 541(a),

Peet TG, 19S, SO ONO Fi 6s ee eek eawiv ds 22

SUMMARY OF REASONS TO DENY THE PETITION

The Ninth Circuit Court of Appeals found that “Cusano’s

entire appeal is frivolous; ‘the result is obvious [and] the

arguments of error are wholly without merit.’ Further,

Cusano has repeatedly misrepresented the facts of the case to

this court.” (Ninth Circuit Memorandum decision dated

November 15, 2005 at 2-3 4 5; Petr.’s App. A2-A3 (citations

omitted) (alteration in original).)

By this Petition, Cusano presents to this honorable Court

many of the same frivolous arguments and misstatements of

fact that the Ninth Circuit rejected.

The Petition should be denied because it presents no

“compelling reasons” to justify review by this Court. See

Sup. Ct. R. 10. Specifically, Petitioner fails to demonstrate

that the Ninth Circuit’s Memorandum decision dated

November 15, 2005 (Petr.’s App. A) affirming the judgment

of the United States District Court for the Central District of

California in favor of Respondents and against Petitioner is in

conflict with a decision of this Court or another court of

appeals, or that the Ninth Circuit’s decision otherwise decided

an important federal question that has not been settled by this

Court, or that the decision answered an important federal

question in a way that conflicts with relevant decisions of this

Court. See Sup. Ct. R. 10(a)-(c).

At most, the Petition raises one or more disputed issues of

fact and relates solely to the rights of and between the parties.

Petitioner argues that a purchase-option clause found in a

December 8, 1983 employment agreement between Petitioner

and KISS Co. (the “1983 Agreement”) was not timely

exercised. (Petr.’s Br. 6.) Petitioner did not seek or obtain

a determination of that factual issue in the lower courts, and

the district court found, without objection from Petitioner,

that the 1983 Agreement was valid and its terms were

enforceable. The 1983 Agreement “gave KISS Co. one

hundred percent ownership rights of Cusano’s compositions

on the ‘Lick it Up’ album.” Cusano v. Klein, 280 F. Supp.

2d. 1035, 1038 (C.D. Cal. 2003).

Petitioner also argues that the 1983 Agreement was an

“executory contract” and, consequently, was rejected upon

approval of Petitioner’s 1990 bankruptcy plan. (Petr.’s Br.

7.) However, Petitioner did not claim that the 1983

Agreement was “executory” in 1989 (when Petitioner filed

for bankruptcy); nor is the 1983 Agreement listed in

Petitioner’s bankruptcy schedules as an “executory contract;”

nor is the 1983 Agreement referenced in Petitioner’s 1990

bankruptcy plan as a rejected “executory contract.”

Petitioner then applies the aforesaid disputed facts to a

noncontroversial aspect of bankruptcy law—that non-contested

assets of the estate revert to a debtor under 11 U.S.C.

§ 1141(c) upon confirmation of a debtor’s bankruptcy plan.

For the reasons stated below, Petitioner’s application of this

principle of bankruptcy law to the disputed facts of this case

presents no compelling reason for this Court to grant review,

nor does it otherwise present an issue of importance in the

administration of bankruptcy law.

First, Petitioner did not raise or argue application of

bankruptcy law in opposition to Respondents’ motion for

summary adjudication on which Petitioner’s appeal in Cusano

iI was based.' The district court ruled on the merits of that

motion without any argument or reference by the parties to

bankruptcy law: “Defendants are entitled to summary

judgment on all six claims because Cusano has failed to show

' ‘The Ninth Circuit’s decision in Cusano v. Klein, 264 F.3d 936 (9th

Cir. 2001) is referred to as “Cusano 1/1,” while the Ninth Circuit's

unreported decision dated November 15, 2005 (Petr.’s App. A) following

remand is referred to as “Cusano //.”

genuine issues for trial.” Cusano v. Klein, 280 F. Supp. 2d

at 1039.

Second, Petitioner fails to establish any erroneous

application of bankruptcy law by the Ninth Circuit.

Petitioner’s effort to create a conflict between the Ninth

Circuit’s opinions in Cusano I and Cusano II lacks any

support in the record. Cusano I was based, in part, on an

uncontroversial application of bankruptcy law. In his

subsequent appeal in Cusano II, Petitioner misapplied the

facts to that law—arguing that the fully-performed 1983

Agreement was “executory” and rejected over fifteen years

earlier upon confirmation of his bankruptcy plan. The Ninth

Circuit in Cusano II flatly rejected Petitioner’s argument,

finding that Cusano “misreads our opinion” in Cusano 1.

(Petr.’s App. A2 at ¢ 2.) This hardly presents a matter of

“importance in the administration of the Bankruptcy Act.”

See City of New York v. Saper, 336 U.S. 328, 329, 69 S. Ct.

554, 555 (1949) (footnotes omitted).

Third, Petitioner never sought or received an order from

the bankruptcy court or the district court that the 1983

Agreement was rejected upon confirmation of Petitioner’s

bankruptcy plan in 1990. Petitioner’s bankruptcy plan lists 19

rejected “executory” contracts. (ASE 76 at 1498.) The 1983

Agreement is not listed as one of those rejected contracts.

Fourth, when Petitioner filed a motion to reopen his

bankruptcy case in 1998 (after commencement of the action in

the district court), he did not-seek an order from the

For the convenience of the Court, Respondents will adopt

Petitioner's abbreviations of the record excerpts in the court of appeals:

Appellant's original excerpts of record are abbreviated ~AE;” Appellant's

supplemental excerpts of record are abbreviated “ASE;" and Appellees’

supplement excerpts of record are abbreviated “Appelices’ SE.”

bankruptcy court that the 1983 Agreement had been rejected

upon confirmation of his bankruptcy plan in 1990.

Finally, Petitioner fails to demonstrate that the decision

appealed from is in conflict with a decision of this Court or any

other circuit court, nor does the Petition present any unsettled

issues of law.

In short, nothing in the Petition presents a basis for this

Court to grant review. Petitioner’s claims in the district court

lacked any legal or factual support. The district court rightfully

dismissed the claims on the merits and the court of appeals

affirmed. Petitioner’s only grievance is that he lost. Petitioner

has sorely abused the judicial process for the past nine years

without going to trial on a single issue raised by his complaint.

That is because the district court either rejected Petitioner’s

claims as a matter of law (and the Ninth Circuit affirmed those

decisions) or because Petitioner failed to offer any evidence to

support his claims despite having repeated opportunities and

numerous years to do so. Upon review of the record, the court

of appeals in Cusano II found Petitioner’s second appeal to be

so frivolous that it awarded attorneys’ fees to Respondents

(Petr.’s App. A3) and issued an order barring Petitioner from

filing any additional papers with the court of appeals in this

matter (Respondents’ Appendix “Resp. App.” A). Petitioner’s

abuse of the judicial process continues with his Petition to this

Court: Petitioner now argues for the first time that this case

presenis an issue of extreme “ ‘importance in the administration

of the Bankruptcy’ laws,” yet Petitioner failed to raise this issue

before the district court or the bankruptcy court upon his

motion to reopen his bankruptcy case. (Petr.’s Br. 14 (quoting

Saper, 336 U.S. at 329).)

The Court should deny the Petition because the case does

not qualify for or otherwise meet the standard of review by this

Court.

STATEMENT OF THE CASE

I. The Proceedings Below Concluded In Favor of

Respondents.

Petitioner filed his complaint in the District Court for the

Central District of California on July 7, 1997.’ Petitioner

claimed that one or more of the Respondents failed to pay

Petitioner royalties due from certain songs that Petitioner co-

authored with members of the musical group KISS during

Petitioner’s brief association with the band in 1982 through

1984.4

A. Petitioner Did Not Challenge Findings That He

Signed the 1983 Agreement.

Petitioner and the KISS Partnership (the predecessor in

interest to Respondent The KISS Company) executed a written

employment agreement dated September 23, 1982 (Appellees’

SE 79 at 1565- 85), which was subsequently amended by the

1983 Agreement (Appellees’ SE 79 at 1560-64). Paragraph

5(b) of the 1983 Agreement includes the purchase-option

provision regarding Petitioner’s interest in the Lick It Up

Compositions.

* Petitioner alleged claims for open book account, breach of fiduciary

duty, fraud, constructive fraud, negligent misrepresentation, conversion,

imposition of a constructive trust, breach of contract, open book account,

right of publicity and defamation. (AE 1.) Petitioner never filed an

amended complaint. (Docket passim; AE 69.)

Only the musical compositions on the KISS album Lick it Up

released in 1983 were at issue in the court of appeals in Cusano Il. Those

compositions are entitled: “A Million to One,” “All Hell’s Breakin’

Loose,” “And On The Eighth Day,” “Exciter,” “Gimme More,” Lick It

Up,” “Young and Wasted” and “Not for the Innocent” (the “Lick It Up

Compositions”). (Complaint, {4 47, 48; AE 1 at 15.)

The district court found on several occasions that Petitioner

had signed the 1983 Agreement.° Petitioner did not object to

or appeal those findings.

B. The Circuit Court’s Prior Opinions.

This Petition arises from Petitioner’s second appeal in the

underlying civil action. In 1999, the district court dismissed

Petitioner’s claims. With respect to the claims regarding the

Lick It Up Compositions, the district court ruled that, as a

result of Petitioner’s failure to adequately schedule his rights in

those songs in his 1989 bankruptcy, he lacked standing to seek

royalties owed both before and after the fliiing of the

bankruptcy petition. (AE 2 at 82- 83.)

The court of appeals in Cusano | agreed with half of the

district court’s 1999 ruling. The Ninth Circuit held in Cusano

/ that Petitioner lost his right to claim any royalties that may

have accrued prior to his 1989 bankruptcy filing but that

Petitioner failed to adequately schedule. Cusano, 264 F.3d at

947-48. “His failure to do so vests the claim in the bankruptcy

estate, where it remains.” /d. at 948. The court in Cusano |

held that only claims accruing post-petition may be pursued

because Petitioner “retains standing to sue for any royalty

payments coming due post-petition.” /d. (emphasis added).

> “(Plaintiff admitted executing the December 8, 1983 Agreement

[and] it is, therefore, apparent that the 1983 contract was entered into by

the parties.” (Order, filed June 16, 1998, at 2:18-19, 5:3-4; Appellees’

- SE 79 at 1769-72); (Order, filed Sept. 15, 1998, at 2:14-19; Appellees’

SE 79 at 1775). “Unless otherwise noted, the following facts are

undisputed . . . . [iJnm December 1983, Defendant KISS Company (“KISS

Co.”), the KISS partnership's successor in interest, entered into an

agreement with Cusano (‘Employment Agreement’) . . . . The

Employment Agreement gave KISS Co. one hundred percent ownership

rights of Cusano’s compositions on the ‘Lick It Up’ album.” Cusano, 280

F. Supp. 2d at 1038 (emphasis added).

Accordingly, the court of appeals in Cusano I reinstated

and remanded for further proceedings Petitioner’s claims for

post-bankruptcy royalties generated by the Lick It Up

Compositions. /d.° The court of appeals in Cusano J did not

make any findings that the 1983 Agreement was rescinded or

that any copyright interest in the Lick It Up Compositions

reverted to Petitioner.

After remand, Respondents filed motions for summary

adjudication demonstrating the lack of merit to Petitioner’s

remaining claims. Each of those motions was granted by the

district court.

1. On Remand, the District Court Dismissed

Petitioner’s Claims Regarding the Creatures

Compositions.

On February 14, 2002, Respondents filed a motion for

summary adjudication with respect to a separate group of

musical compositions referred to as the Creatures

Compositions (the “Creatures Motion”). (Appellees’ SE 79

at 1511-43.) In opposing that motion, Petitioner did not

allege that the 1983 Agreement was abrogated or that any

his discharge from bankruptcy. (Appellees’ SE 84 at

2291-2307.)

In a published decision, the district court dismissed

Petitioner’s claims regarding the Creatures Compositions.

Cusano v. Klein, 196 F. Supp. 2d 1007, 1016 (C.D. Cal.

2002).

® Specifically, the Court reinstated Petitioner’s post-petition claims for

open book account (claim 1), breach of fiduciary duty (claim 2), fraud

(claim 3), constructive fraud (claim 4), negligent misrepresentation (claim

5), conversion, (claim 9) and imposition of constructive trust (claim 10).

2. On Remand, the District Court Dismissed

Petitioner’s Claim for Open Book Account.

On February 25, 2002, Respondents filed a motion for

summary adjudication on Petitioner’s claim for open book

account (the “Open Book Motion”). (Appellees’ SE 82 at

1835-68.) In opposing that motion, Petitioner did not allege

that the 1983 Agreement was abrogated or that any copyright

interest was reconveyed to Petitioner upon his discharge from

bankruptcy. (Appellees’ SE 88 at 2580-96.)

The district court granted the motion, dismissing the claim

for open book account. (Civil Minutes, dated April 9, 2002,

at 2-4; Appellees’ SE 97 at 2727-32.)

3. On Remand, the District Court Dismissed

Petitioner’s Claims Regarding the Lick It Up

Compositions.

On June 2, 2003, Respondents filed a motion for summary

adjudication with respect to the remaining claims regarding

the Lick It Up Compositions (the “Lick It Up Motion”).

(Appellees’ SE 119 at 3047-79). The Lick it Up Motion

alleged that the 1983 Agreement conveyed 100% of all right,

title, and interest, including the copyrights, in the Lick it Up

Compositions to the KISS Co. (Appellees’ SE 119 at 3062.)

Petitioner’s opposition to the Lick It Up Motion made no

reference to bankruptcy law, nor was there any argument that

the 1983 Agreement was abrogated or that any copyright

interest was reconveyed to Petitioner upon Petitioner’s

discharge from bankruptcy. (Appellees’ SE 126 at 3231-38.)

In a published decision, the district court granted the Lick

It Up Motion and ended the trial-level litigation in this case.

Cusano v. Klein, 280 F. Supp. 2d at 1037 n.1. The district

court granted the Lick It Up Motion on the merits:

“Defendants are entitled to summary judgment on all six

claims because Cusano has failed to show genuine issues for

trial. Each of his claims is premised on Defendants’ allegedly

false royalty statements, but he has utterly failed to produce

any evidence whatsoever of inaccuracies in_ the

accounting... .” /d. at 1040.

Petitioner did not argue the application of bankruptcy law

in Opposition to the Lick It Up Motion, nor did the district

court consider or make any reference to the application of

bankruptcy law in rendering its decision. Wherefore,

Petitioner’s subsequent effort to interject his new bankruptcy

law argument before the court of appeals in Cusano I] lacked

merit. “It is the general rule, of course, that a federal

appellate court does not consider an issue not passed upon

below.” Singleton v. Wulff, 428 U.S. 106, 120, 96 S. Ct.

2868, 2877 (1976).

Accordingly, Petitioner’s bankruptcy argument—which

forms the principal basis for his seeking review by this

Court—was not preserved on appeal and does not present a

compelling reason for review by this Court. See Cooper

Indus., Inc. v. Aviall Serv., Inc. , 543 U.S. 157, 168-69, 125

S. Ct. 577, 585 (2004) (Supreme Court ordinarily does not

decide in the first instance issues not decided below).

II. Petitioner’s 1989 Bankruptcy Action.

On or about March 7, 1989, Petitioner filed a Chapter 11

bankruptcy petition in the United States Bankruptcy Court for

the Central District of California. Attached to Petitioner’s

bankruptcy schedules and statements of affairs dated March

21, 1989 is a “Statement of Executory Contracts.” (Resp.

App. B, 4b) The 1983 Agreement was not listed by Petitioner

as an “executory contract.”

On or about April 27, 1990, Petitioner filed a Chapter 11

plan, which was subsequently confirmed by the bankruptcy

court on or about September 18, 1990. (ASE 76.) Likewise,

the bankruptcy plan does not list the 1983 Agreement as an

“executory contract.”

Eight years later, in December 1998, Petitioner filed a

motion to reopen his bankruptcy case. That motion was made

by Petitioner as a result of an order entered by the district

court dated December 3, 1997, whereby the court found that,

absent approval of the bankruptcy court, Petitioner lacked

standing to pursue his claims in the district court. (AE 2 at

59.)

In seeking to reopen his bankruptcy case, Petitioner did

not argue or request an order from the bankruptcy court that

the 1983 Agreement was rejected. On or about April 27,

i999, the bankruptcy court entered its order denying

Petitioner’s motion to reopen his bankruptcy case. (Resp.

App. C.)

In sum, when Petitioner was before the bankruptcy court

in 1990 and again in 1998, he failed to make the very

argument that he now claims presents such an important issue

with respect to the “‘administration of the Bankruptcy’

laws” —that the issue should be considered for the first time

by this Court. (Petr.’s Br. 14 (quoting Saper, 336 U.S. at

329) (footnote omitted).)

III. Whether The 1983 Purchase Option Was Timely

Exercised Presents A Disputed Issue Of Fact.

The 1983 Agreement grants all right, title, and interest in

the Lick It Up Compositions to the KISS Partnership,

predecessor-in-interest to Respondent The KISS Company.’

’ Paragraph 5(a) of the 1983 Agreement states:

The Partnership shall exclusively own and control one hundred

percent (100%) of all right, title and interest, including the

copyrights, all rights under such copyrights and all rights to the

so-called “publisher’s share” of income derived from the

Petitioner fas. to present any evidence in the district court

to support his claim that the copyright interests in the Lick it

Up Compositions reverted to him in or around 1984 because

KISS failed to timely exercise the purchase-option provision

of Paragraph 5(b) of the 1983 Agreement.

Moreover, when Respondents brought their motions for

summary adjudication after remand, Petitioner did not present

the district court with evidence to support this argument.

Indeed, the district court affirmed that KISS owns 100% of

the Lick It Up Compositions:

Defendants are entitled to summary judgment since

Cusano cannot establish that he has ownership rights

in the royalties allegedly due him. KISS Co.

“exclusively own[s] and control[s] one hundred

percent (100%) of all right, title and interest [in the

Compositions], including the copyrights, all rights

under such copyrights, and all rights to the so-called

‘publisher’s share’ of income derived from the

worldwide exploitation of such copyrights. ”

Cusano, 280 F. Supp.2d at 1043 (alternations in original)

(quoting the 1983 Agreement).

Petitioner did not appeal! that finding by the district court.

Thus, Petitioner failed to preserve this argument on appeal in

Cusano I], and it should not be considered by the Court. See

Cooper, 543 U.S. at 168-69 (Supreme Court ordinarily does

not decide in the first instance issues not decided below);

Boldt v. Crake (In re Riverside-Linden Inv. Co.), 945 F.2d

worldwide exploitation of such copyrights, in and to your musical

compositions (or, where applicable, your share of co-written

musical compositions) which are included in the album heretofore

recorded by KISS entitled “Lick It Up” (the “Current LP”).

(Appellees’ SE 79 at 1561.)

320, 24 (9th Cir. 1991) (issue waived on appeal when

appellant did not argue it in opening brief).

REASONS FOR DENYING THE PETITION

I. Petitioner Raises No Disputed Issue of Law Regarding

Application of the Bankruptcy Code.

The principal basis on which Petitioner seeks review by

this Court amounts to little more than application of an

uncontroversial aspect of bankruptcy law. Petitioner argues

that a confirmed reorganization plan constitutes a final

judgment that is res judicata as to any claims that were or

could have been raised in the bankruptcy proceeding. (Petr.’s

Br. 15.) Respondents do not dispute that basic proposition.

However, the application of that proposition of bankruptcy

law to the facts of this case does not present a compelling —

reason for this Court to grant review, nor does it present any

issue of “importance in the administration of the Bankrupicy

Act.” See Saper, 336 U.S. at 329 (footnotes omitted).

The record is undisputed that, as a matter of contract,

Petitioner did not have any copyright interests in the Lick It

Up Compositions at the time he filed for bankruptcy in 1989.

The 1983 Agreement expressly states that KISS Co. owns the

entire copyright to the Lick It Up Compositions. Paragraph

5(a) of the 1983 Agreement states: “The Partnership [KISS

Co.] shall exclusively own and control one hundred percent

(100%) of all right, title and interest, including the copyrights

{in the Lick It Up Compositions].” (1983 Agreement;

Appellees’ SE 79 at 1561 (emphasis added).)*

* The district court made a judicial finding that Petitioner admitted

signing the 1983 Agreement and that the KISS and Petitioner entered into

the 1983 Agreement. (Order, filed June 16, 1998, 2:18-19, 5:3-4;

Appellees’ SE 79 at 1769, 1772.)

A. Respondents’ Ownership Interest In the Lick It Up

Compositions Never Became a Part of Petitioner’s

Bankruptcy Estate.

1. Because Petitioner Had Conveyed His Property

Interest In the Lick It Up Compositions to KISS

Co. In 1984, No Property Interest In Those

Compositions Became Part of Petitioner’s

Bankruptcy Estate in 1989.

“The commencement of a case under section 301 . . . of

this title creates an estate.” 11 U.S.C. § 541(a) (1988).?

Property of the estate “includes all of the debtor’s legal or

equitable interests in property as of the commencement of the

case.” Begier v. IRS, 496 U.S. 53, 59, 110 S. Ct. 2258,

2260 (1990). Because Petitioner conveyed his interest in the

Lick It Up Compositions to KISS Co. in 1984, he did not hold

any legal or equitable interest in those compositions to

become property of his bankruptcy estate when he filed his

bankruptcy petition in 1989:

In his Petition, Petitioner incorrectly argues that by

placing “songrights in . . . Songs written while in the band

known as ‘KISS’” on Schedule B of his bankruptcy schedules

he obtained or revived a property interest in the Lick It Up

Compositions. (Petr.’s Br. 16-18.) “Bankruptcy recognizes

estate property rights, and filing bankruptcy cannot give a

debtor a greater interest in an asset than that which he owned

pre-bankruptcy.” Lowenschuss v. Selnick (in re

Lowenschuss), 170 F.3d 923, 930 (9th Cir. 1999) (quoting

Gendreau v. Gendreau (In re Gendreau), 122 F.3d 815, 819

(9th Cir. 1997)).

* All Title Il citations are to the 1988 official version of the United

States Code, the Bankruptcy Code in effect when Petitioner filed his

bankruptcy petition (March 7, 1989).

It is well-settled that a debtor cannot use his bankruptcy

filing to augment his property interests beyond what they were

on the day before he filed his bankruptcy petition. Bracewell

v. Kelly (In re Bracewell), No. 05-11951, 2006 WL 1814367,

at *1 (11th Cir. June 30, 2006) (“[A] debtor’s estate cannot |

be greater than the property rights the debtor had at the

commencement of the case”); Moody v. Amoco Oil Co. , 734

F.2d 1200, 1213 (7th Cir. 1984) (“[W]hatever rights a debtor

has in property at the commencement of the case continue in

bankruptcy—no more, no less”); Brown v. Dellinger (In re

Brown), 734 F.2d 119, 124 (2d Cir. 1984) (“It is true of

course that upon the filing of a petition in bankruptcy, the

bankruptcy estate can have not greater interest in property

included in it than the debtor had when the petition was

filed”).

Petitioner fails to cite any legal authority in support of his

conclusion that by scheduling “songrights” on his bankruptcy

schedule he revived or reconveyed his interest in the Lick It

Up Compositions back to himself or his bankruptcy estate.

By contrast, it is black letter bankruptcy law that Petitioner

could not increase his property interests merely by filing for

bankruptcy.

2. Petitioner Failed to Avoid the Conveyance of

His Property Interests In the Lick It Up

Compositions During His Bankruptcy Case and

He Is Now Time-Barred From Doing So.

Property of the estate also includes property which may be

recovered by the trustee or debtor-in-possession utilizing the

Bankruptcy Code’s avoidance powers. United States v.

Whiting Pools, Inc., 462 U.S. 198, 205, 103 S. Ct. 2309,

2313-14 (1983) (describing avoidance provisions such as

section 543 (turnover of property by a custodian), section 547

(avoidance of preferences), and section 548 (avoidance of

fraudulent transfers)).

Therefore, when Petitioner filed his bankruptcy petition in

1989, his bankruptcy estate also included property interests

which could be returned to the estate pursuant to sections 543,

544, 547, or 548 of the Bankruptcy Code. These sections

give a bankruptcy trustee certain powers to recover property

belonging to the bankruptcy estate which is being held by

another party or which was impermissibly transferred by the

debtor to another party. As a debtor in possession, Petitioner

enjoyed the same avoidance powers as a bankruptcy trustee.

11 U.S.C. § 1107(a) (1988); Wolf v. Weinstein, 372 U.S.

633, 649-50, 83 S. Ct. 969, 979-80 (1963) (debtor in

possession has a fiduciary duty to the estate); Coleman v.

Community Trust Bank (In re Coleman), 426 F.3d 719, 729

(4th Cir. 2005).

If Petitioner actually believed in 1989 that his conveyance

of rights to the Lick It Up Compositions was avoidable in his

bankruptcy case, he should have filed an adversary

proceeding to avoid that conveyance’. He did not do so.

The statute of limitations for Petitioner to file avoidance

actions ran out at the time his bankruptcy case was closed

(April 15, 1994). 11 U.S.C. § 546(a) (1988) (“An action or

proceeding under section 544 . . . 547, 548 . . . of this title

may not be commenced after the earlier of (1) two years after

the appointment of a trustee . . . or (2) the time the case is

closed or dismissed”). Therefore, Petitioner’s current claim

that his conveyance of his interest in the Lick It Up

Compositions in 1984 is avoidable was time-barred long ago.

'© Federal Rule of Bankruptcy Procedure 7001(1) requires the filing

of a complaint to initiate an adversary proceeding “to recover money or

property...” Fr. R. Bnkr. P. 7001(1).

3. Because the Lick It Up Compositions Never

Became Property of the Bankruptcy Estate, the

Bankruptcy Court Lacked Jurisdiction Over the

Compositions.

“(T]he district court in which a case under title 11 is

commenced or pending shall have exclusive jurisdiction (1) of

all property, wherever located, of the debtor as of the

commencement of such case.” 28 U.S.C. § 1334(e) (1988);

Tennessee Student Assistance Corp. v. Hood, 541 U.S. 440,

447, 124S. Ct. 1905, 1910 (2004). If property falls outside

of the bankruptcy estate, the bankruptcy court has no

jurisdiction over that property. Graziadei v. Graziadei (In re

Graziadei), 32 F.3d 1408, 1410 n.2 (9th Cir. 1994).

Because the Lick It Up Compositions never became part

of Petitioner’s bankruptcy estate, the bankruptcy court lacked

jurisdiction over the compositions under Section 1334(e) and

Graziadei. See 28 U.S.C. § 1334(e); 32 F.3d at 1410 n.2.

B. Confirmation of Petitioner’s Chapter 11 Plan Did

Not Extinguish Respondents’ Property Interests in

the Lick It Up Compositions.

Petitioner incorrectly argues that confirmation of his

bankruptcy plan revested in him the Lick It Up Compositions.

(Petr.’s Br. 17-18, 22-23.) However, by the express

language of the Bankruptcy Code, only property of the estate

may revest in the debtor. 11 U.S.C. § 1141(b) (1988)

(“confirmation of a plan vests all of the property of the estate

in the debtor”). Because the Lick It Up Compositions never

became property of the Cusano bankruptcy estate, they could

not have vested in Petitioner upon confirmation of his plan.

Petitioner also incorrectly argues that confirmation of his

plan somehow terminated Respondents’ “claims” to the

compositions. (Petr.’s Br. 17-18.) However, as discussed

below, Respondents held a property interest in the

compositions and did not hold a claim against the estate.

While confirmation of Petitioner’s plan discharged Petitioner

from debts and claims under section 1141, confirmation did

not, and could not, extinguish Respondents’ property interests

in the Lick It Up Compositions. § 1141(d)(1) (1988) (“. . .

confirmation of a plan (A) discharges the debtor from any

debt that arose before the date of such confirmation... .”).

Because an ownership interest is not a “claim” or a “debt,”

it cannot be discharged or extinguished by confirmation of the

debtor’s chapter 11 plan. Lowenschuss, 170 F.3d at 930-31.

In addition, by the bankruptcy plan’s own words, a

“rejection” of a contract simply means that “the Debtor is

then released from all further liability and obligations.” (ASE

76 at 1498.) Thus, even if the 1983 Agreement had been

rejected in bankruptcy, that would only mean that Petitioner

was released from any obligations he had thereunder (which

were none, in any event).

C. Petitioner’s Principal Argument Is Based on a

Fundamental Misunderstanding of What

Constitutes a “Claim” Against a Bankruptcy

Estate.

Petitioner acknowledges that there is no circuit split with

respect to the bankruptcy issue presented: “the current

Petition does not involve a “split” as do many of this Court’s

cases.” (Petr.’s Br. 15.) However, in an effort to fabricate

an issue that “so far departed from the accepted course of

judicial proceedings” to merit review by this Court under

Supreme Court Rule 10(a), Petitioner argues that Respondents

were obligated to present a claim in Petitioner’s 1989

bankruptcy proceeding with respect to the 1983 Agreement

and, because they did not, the 1983 Agreement was rejected

upon confirmation of the bankruptcy plan in 1990. (Petr.’s

Br. 15-17.) This argument is factually and legally baseless.

As previously stated, Respondents have a property interest in

the Lick It Up Compositions, not a claim.

Petitioner’s argument is based on the faulty assumption

that because Respondents acquired all right, title and interest

to the Lick It Up Compositions in 1984, Respondents must

have had a “claim” against his bankruptcy estate in 1989.

The fundamental flaw in this argument is that Respondents

held a property interest in the Lick It Up Compositions; they

did not hold a “claim” within the meaning of the Bankruptcy

Code against the Cusano bankruptcy estate. See 11 U.S.C.

§ 101(4) (1988).

A property interest is not a “claim.” A property interest

belonging to a third party does not become property of the

bankruptcy estate and therefore cannot vest in the debtor upon

confirmation. Confirmation only discharges debts—it does not

extinguish property interests.

A “claim” is a bankruptcy term of art and is defined by

section 101 of the Bankruptcy Code as a:

(A) right to payment, whether or not such right is

reduced to judgment, liquidated, unliquidated, fixed,

contingent, matured, unmatured, disputed, undisputed,

legal, equitable, secured, or unsecured; or

(B) right to an equitable remedy for breach of

performance if such breach gives rise to a right to

payment, whether or not such right to an equitable

remedy is reduced to judgment, fixed, contingent,

matured, unmatured, disputed, undisputed, secured or

unsecured.

ld.

The “plain meaning of a ‘right to payment’ is nothing

more nor less than an enforceable obligation... .” FCC v.

NextWave Personal Commc’ns, Inc. , 537 U.S. 293, 303, 123

S. Ct. 832, 834 (2003).

Unless a legal relationship gives rise to an asserted right

to payment from the debtor, the third party does not hold a

“claim” against the debtor within the meaning of section 101.

CPT Holdings, Inc. v. Indus. & Allied Employees Union

Pension Plan, Local 73, 162 F.3d 405, 408-09 (6th Cir.

1999) (pension plan did not hold a “claim” against employer’s

bankruptcy estate based on withdrawal liability as pension

plan had no enforceable right to payment); Jn re Merchants

and Mfrs., Inc., 166 B.R. 234, 237 (Bankr. D. Del. 1994)

(same).

Here, while the 1983 Agreement created a legal

relationship between Petitioner and KISS Co., that agreement

did not create any right to payment from Petitioner to KISS

Co. Rather than creating a debt of Petitioner in favor of the

KISS Co., the 1983 Agreement created an ownership interest

in the Lick It Up Compositions in favor of KISS Co. In other

words, the 1983 Agreement created a property interest, not a

“claim” within the meaning of section 101 of the Bankruptcy

Code. See Gendreau, 122 F.3d at 818-19 (ex-husband’s

bankruptcy case could not eliminate the ex-wife’s property

interests and filing a bankruptcy case cannot give a debtor

greater property rights than he would have outside of

bankruptcy); Lowenschuss, 170 F.3d at 930-31 (citing

Gendreau, 122 F.3d at 818-19).

Cases from other circuits reaching the same result that

property rights of third parties do not constitute a claim are

abundant. See, e.g., Brown v. Pitzer (In re Brown), 249 B.R.

303, 308-09 (S.D. Ind. 2000) (separate property interest in

the pension fund “is neither a debt owed by [Debtor] nor a

part of his bankruptcy case subject to discharge”); Resare v.

Resare, 154 B.R. 399, 403 (D. R.I. 1993) (ex-wife's interest

in her former husband’s pension is her sole and separate

property, and not a part of the bankruptcy estate).

Here, because Petitioner had fully performed all of his

obligations under the 1983 Agreement prior to the filing of his

1989 bankruptcy petition, KISS Co. did not have a claim—a

right to payment from Petitioner—when Petitioner filed his

1989 bankruptcy petition within the meaning of section 101 of

the Bankruptcy Code.

II. The Petition Is Based On Disputed Issues of Fact.

A. Whether the Purchase-Option Provision Was

Timely Exercised Raises a Disputed Issue of Fact.

The Petition is based on a disputed issue of fact.

Petitioner argues that Respondents did not timely exercise the

purchase-option provision of the 1983 Agreement while, on

the other hand, Respondents claim that the purchase-option

provision was timely exercised. That disputed fact does not

raise any issue affecting the administration of the bankruptcy

courts, nor does it constitute a compelling reason for this

Court to grant review. Rather, the dispute in this case relates

solely to the rights of and between the parties.

A factual dispute in the lower court does not constitute a

basis for the Supreme Court to grant a writ of certiorari. Sup.

Ct. R. 10 (writ of certiorari rarely granted when the asserted

error consists of erroneous factual findings); Fed. Trade

Comm'n v. Standard Oil Co., 355 U.S. 396, 400, 78 S.Ct.

369, 371 (1958) (explaining that the Court will “adhere to the

usual rule of noninterference” when there is a factual dispute);

NLRB v. Pittsburgh S.S. Co., 340 U.S. 498, 503, 71 S. Ct.

453, 456 (1951) (clarifying that the Supreme Court “is not the

place to review a conflict of evidence”).

B. Whether the 1983 Agreement Was Executory

Raises a Disputed Issue of Fact.

Petitioner’s 1990 bankruptcy plan did not reject the 1983

Agreement. (ASE 76 at 1498.) In fact, the relevant section

of the bankruptcy plan lists 19 contracts which were

rejected—and the 1983 Agreement is not one of them."'

The 1983 Agreement was not “executory” because, at the

time of Petitioner’s bankruptcy in 1989, Petitioner had no

further obligations under the 1983 Agreement. A bankruptcy

trustee may assume or reject any executory contract of the

debtor. 11 U.S.C. § 365(a) (1988). An “executory contract”

is one “on which performance is due to some extent on both

sides.” NLRB v. Bildisco and Bildisco, 465 U.S. 513, 522-23

n.6, 104 S. Ct. 1188, 1194 n.6 (1983) (legislative history to

'' Petitioner’s 1990 bankruptcy plan states in relevant part:

5.1 Executory Contracts.

(a) Allexecutory contracts or unexpired leases of the Debtor

which have not been specifically assumed by the Debtor as

authorized by order of the Bankruptcy Court either prior to the

date of confirmation of the Plan or after a hearing for which

notice is given within forty-five days after the Effective Date of

the Plan will, be deemed rejected. These include Debtor's

executory contracts, to the extent they are cxecutory contracts and

have not already been rejected, with Axic Worldwide, Lid.;

Excalibur, Nigel Thomas, International Talent Group, Wayne

Forte, Brockum Company; Carvin Guitars, Chrysalis Records;

Nadysystems, Inc., New Image, P.B. Serbin, Parks, Palmer,

Turner & Yemendjian, Pro- Mark Corp., Sound Castle Recording

Studio, Sound Design Studios, Inc., Bruce Mancinelli, George

Sewitt, Siegel & Feldstein, Washburn International. In the event

that an executory contract or unexpired lease is rejected, the

Debtor is then released from all further liability and obligations.

(ASE 76 at 1497-98.)

§ 365(a) supports this definition), superceded by statute on

other grounds, Bankruptcy Amendments and Federal

Judgeship Act of 1984, Pub. L. No. 98-353, Title II,

§ 541(a), July 10, 1984, 98 Stat. 390, as recognized in NLRB

v. Manley Truck Line, Inc., 779 F.2d 1327, 1332 n.7 (7th

Cir. 1985). More precisely, a contract is executory if “the

obligations of both parties are so unperformed that the failure

of either party to complete performance would constitute a

material breach and thus excuse the performance of the

other.” Griffel v. Murphy (In re Wegner), 839 F.2d 533, 536

(9th Cir. 1988).

Here, Petitioner had no further obligations under the 1983

Agreement at the time of his bankruptcy filing in 1989.

Petitioner was not obligated to perform on stage, write new

songs, or do anything. Because Petitioner had fully

performed under the 1983 Agreement, that agreement was not

an executory contract that confirmation of Petitioner’s

bankruptcy plan in 1990 could have been deemed to “reject”.

In any case, at most, this argument presents little more than

a disputed issue of fact.

C. Misstatements of Fact and Law.

Pursuant to Supreme Court Rule 15.2, the Petition

contains the following misstatements of fact and law that

might bear on the issues before this Court if certiorari were

granted. '?

'? Misrepresenting the record is nothing new for Petitioner. Prior to

the initial appeal, the district court admonished Petitioner and his then-

counsel at length for a lack of veracity when presenting arguments to the

court. “[T]he record reflects that counsel for plaintiff ‘clearly and

unequivocally’ misrepresented to Magistrate Judge Jones ‘that there were

no additional responsive documents in plaintiff's possession responsive to

any of defendant’s document requests."” (Order Granting Defendants’

Motions for Summary Adjudication, Etc., entered April 14, -1999 at 9; AE

1. Petitioner misstates the law in arguing that, upon his

discharge from bankruptcy in 1990, a copyright interest in the

Lick It Up Compositions reverted to Petitioner. Only

“property of the estate” vests in the debtor upon confirmation

of the bankruptcy plan. 11 U.S.C. § 1141(b). Petitioner had

conveyed all of his right, title, and interest in the Lick It Up

Compositions five years earlier pursuant to the 1983

Agreement. Accordingly, Petitioner had no ownership

interest in the Lick It Up Compositions when he commenced

his bankruptcy action in 1989.

2. Petitioner misstates the fact that the purchase-option

provision of the 1983 Agreement was not timely exercised by

KISS in 1984. (Petr.’s Br. 14.) Petitioner presents no facts

to support this allegation.

3. Petitioner misstates that the district couri’s opinion

granting the motion for summary adjudication with respect to

the Lick It Up Compositions implicates a matter of

“‘importance in the administration of the Bankruptcy’ laws”

(Petr.’s Br. 14 (quoting Saper, 336 U.S. at 329).) The motion

for summary adjudication granted by the district court with

respect to the Lick It Up Compositions was not based on any

application of bankruptcy law. It was based on the merits and

Petitioner’s failure to present any evidence to support his

claims. Cusano v. Klein, 280 F. Supp. 2d at 1040.

4. Petitioner misstates that the decision of the court of

appeals in Cusano | “revived the 1983 Employment

Agreement.” (Petr.’s Br. 11.) This is a fundamental

misstatement of fact. Nothing in Cusano / or in the 1990

bankruptcy plan rejected the 1983 Agreement. Accordingly,

18 at 428 (citation omitted) (emphasis added).) “And, perhaps most

egregious of all his misconduct, plaintiff submitted a false affidavit to this

Court challenging the genuineness of his signatures on the Revenge

Agreements... .” (/d. (emphasis added))

the court in Cusano I did not “revive” the 1983 Agreement,

because it remained extant.

5. Petitioner misstates the fact that, as of the purchase-

option payment date of September 19, 1984, there was a

“dispute concerning Respondents’ rights under the

Employment Agreement.” (Petr.’s Br. 14.) Atno time from

that date until the filing of the complaint in the district court

in 1997 did Petitioner ever “dispute” the fact or validity of the

timeliness of the purchase-option payment.

6. Petitioner misstates that there were competing claims

to the Lick It Up Compositions at the time of Petitioner’s

1989 bankruptcy proceeding. (Petr.’s Br. 27.) In fact, in

1989 there were no competing claims with respect to the Lick

It Up Compositions. Petitioner never objected to KISS’s

ownership of the copyright in and to the Lick It Up

Compositions, nor did Petitioner ever seek to raise a

competing claim with respect to those compositions in the

bankruptcy court.

Ill. The Circuit Court’s Decision Was Correct.

Petitioner claims that, by virtue of the appellate court’s

decision in Cusano I, he now has a copyright interest in the

Lick It Up Compositions. (Petr.’s Br. 18.) This is incorrect.

The Court in Cusano | did not reconvey to Petitioner any

Court merely found that Petitioner had standing to pursue a

portion of Petitioner’s royalty claims regarding the Lick It Up

Compositions. “Cusano retains standing to sue for any

royalty payments coming due post-petition.” Cusano, 264 F.

3d at 948 (emphasis added). —

Further, even though Petitioner failed to raise his

reversion argument in the district court and, accordingly, it

was not preserved for appeal, the court of appeals in Cusano

/1 considered and flatly rejected this argument: “Cusano | did

not rule in favor of Cusano on the merits of any of his claims

to royalty rights or copyrights, and did not invalidate any of

the agreements between the parties.” (Petr.’s App. A2 at

4 2.)

The bad faith of Petitioner’s current argument is best

exemplified by his statements to the district court immediately

after the remand. The district court requested a status report

regarding, among other things, the “it act on this case of the

Ninth Circuit’s ruling” in Cusano J. (Order Setting Status

Conference Following Remand From The Ninth Circuit,

entered Dec. 13, 2001 at 1; Appellees’ SE 73 at 1484.)

Petitioner did not argue, explicitly or implicitly, in the joint

status report following remand that the court of appeals

decision in Cusano I reconveyed to him a copyright interest

in the Lick It Up Compositions. Petitioner responded:

“[C]Jonfirmation of Plaintiff's bankruptcy reorganization plan

caused all rights to post-petition royalties on Plaintiff's pre-

petition compositions and other damages accruing post-

petition to revert to Plaintiff.” (Joint Status Report, dated

Dec. 28, 2001, at 2; Appellees’ SE 74 at 1488.)

In other words, when the district court wanted to know

each party’s position regarding the effect of the Ninth

Circuit’s ruling in Cusano J, Petitioner stated clearly on the

record that only his claims for royalties had been remanded.

Petitioner’s new reversion argument is a post hoc fiction that

the court of appeals in Cusano II found to be “frivolous.”

(Petr.’s App. A2 at 4 5.)

A. The Ninth Circuit’s Decision In Cusano I Merely

Reinstated Petitioner’s Right to Assert Certain

Royalty Claims.

Contrary to Petitioner’s argument, nothing in the Ninth

Circuit’s decision in Cusano / altered the ownership of the

copyrights in the Lick It Up Compositions. The Ninth

Circuit’s opinion in Cusano / stated repeatedly that only

Petitioner’s royalty claims were being revived (in part):

@ “We conclude that Cusano’s scheduled

‘songrights’ asset reverted to him upon the

confirmation of his reorganization plan . . . and

vested in him all post-petition royalty rights to his

pre-petition compositions . . . . He thus reacquired

ownership of all claims to royalties derived from

these compositions post-petition . . . . Thus, we

reverse the district court in part, and reinstate

some of Cusano’s royalty claims.” Cusano, 264

F.3d at 945 (emphasis added).

@ “Weconclude, therefore, that [Cusano’s] listing of

the ‘songrights’ asset was a sufficient scheduling

of Cusano’s interest in his _pre-petition

compositions, which reverted to him upon

confirmation of his plan. The reversion vested in

Cusano the rights to post-petition royalties on his

pre-petition compositions . . ..” /d. at 947

(emphasis added).

Thus, in Cusano J] the Ninth Circuit stated repeatedly that

it was only reviving certain claims for royalties. Further, the

Court in Cusano / stated clearly that only “Cusano’s interest”

in the Lick It Up Compositions reverted to him through his

bankruptcy proceeding. In that, in 1989 when Petitioner filed

for bankruptcy, he had no remaining ownership interest in the

Lick It Up Compositions, he had no “interest” in those

compositions that could revert to him on confirmation of his

bankruptcy plan.

B. The Ninth Circuit in Cusano II Rejected

Petitioner’s Interpretation of the Court’s Prior

Decision.

The Ninth Circuit in Cusano II flatly rejected Petitioner’s

new argument that the court of appeals decision in Cusano |

reconveyed a copyright interest in the Lick It Up

Compositions to Petitioner. “Cusano misreads our opinion in

{Cusano I}, which held only that Cusano had standing to raise

some of his claims. Cusano I did not rule in favor of Cusano

on the merits of any of his claims to royalty rights or

copyrights, and did not invalidate any of the agreements

between the parties.” (Petr.’s App. A2 at { 2 (citation

omitted) (emphasis added).) “Cusano’s entire appeal is

frivolous .. . ‘{and] the arguments of error are wholly

without merit.’” (/d. at | 5 (citations omitted).)

What better court to know the intent of its prior opinion

than the court which rendered that opinion? Petitioner’s new

argument that a copyright interest in the Lick It Up

Compositions somehow reverted to him upon discharge from

bankruptcy finds no support in the record of the lower courts,

and presents no basis for review by this Court.

IV. No Basis Exists for the Court to Exercise Its

Supervisory Authority.

Recognizing that the Petition fails to satisfy any

conceivable basis for review by this Court, Petitioner argues

that the Court should, nonetheless, consider the Petition based

on its supervisory authority. (Petr.’s Br. 23.) However,

Petitioner raises no issue important to the administration of

bankruptcy law that would remotely warrant this Court

exercising supervisory authority. Indeed, Petitioner’s

argument raises no disputed issue of law regarding application

of the Bankruptcy Code. Petitioner merely disputes the fact

that Respondents timely exercised the purchase-option

provision of the 1983 Agreement. That disputed fact does not

raise any issue affecting the administration of bankruptcy law

or the bankruptcy courts.

A. Petitioner Has Raised No Issue of Bankruptcy Law

Requiring Resolution.

Petitioner suggests that because the Court has granted

certiorari in certain cases important to the administration of

bankruptcy law or other important federal statutes (even in the

absence of a circuit split), certiorari is appropriate here.

(Petr.’s Br. 23.) Petitioner, however, merely cites cases for

that broad and uncontroversial principle, conveniently

ignoring the circumstances of the cases cited—which raised

significant legal questions begging resolution, unlike the case

here. See Callaway v. Benton, 336 U.S. 132, 136, 69S. Ct.

435, 439 (1949) (granting certiorari to resolve a conflict

between state and federal courts on the issue of whether a

corporation can convey property without the unanimous

consent of shareholders in bankruptcy); Wilkerson v.

McCarthy, 336 U.S. 53, 55, 69 S. Ct. 413, 414 (1949)

(granting certiorari because the district court directed a

verdict in a negligence case under the Federal Employer’s

Liability Act, which necessitated weighing evidence and thus

usurped the statutory right to a jury trial); Maggio v. Zeitz,

333 U.S. 56, 61, 68 S. Ct. 401, 404 (1948) (granting

certiorari because the issue of fraudulent bankruptcy was

particularly important and subject to dispute within the Second

Circuit).

Neither the disputed facts nor the legal principle in this

case even remotely rise to the level of presenting a significant

legal question requiring resolution by this Court as did the

cases referenced above. Indeed, Petitioner cites narrowly

focused cases for propositions so general that the case itself is

actually irrelevant. See, e.g., United States v. Ruzicka, 329

U.S. 287, 288, 67 S. Ct. 207, 207 (1946) (involving specific

questions regarding the administration of the Agricultural

Marketing Act of 1937, but cited by Petitioner for the

unremarkable proposition that certiorari is granted to resolve

" important questions in the administration of major federal

Statutes).

Petitioner also argues that, because the Court may grant

review to correct clear errors below in an exercise of its

supervisory powers, it should do so here. (Petr.’s Br. 24.)

In the cases cited by Petitioner, however, there are significant

reasons why the Court felt compelled to exercise that

authority. Nearly all of the cases cited involve either

constitutional rights or other primary civil rights that the

Court found necessary to protect. See, e.g., Florida v.

Rodriguez, 469 U.S. 1, 5, 105 S. Ct. 308, 310 (1984)

(involving a misinterpretation of prior Fourth Amendment

search-and-seizure case law);'? United States v. Hale, 422

U.S. 171, 173, 95 S. Ct. 2133, 2135 (1975) (involving the

parameters of the Fifth Amendment right to remain silent);

Montana v. Kennedy, 366 U.S. 308, 309, 81 S. Ct. 1336,

1338 (1961) (involving the deportation of a fifty-five year

alien who had resided in the United States since infancy); see

also City of Memphis v. Greene, 451 U.S. 100, 102, 101 S.

Ct. 1584, 1587 (1981) (involving alleged racial discrimination

under the Civil Rights Act of 1866, 42 U.S.C. § 1982, and

the Thirteenth Amendment); New York City Transit Auth. v.

Beazer, 440 U.S. 568, 570-71, 99 S. Ct. 1355, 1358 (1979)

(involving alleged discrimination under the Civil Rights Act

of 1964 and the Equal Protection Clause of the Fourteenth

Amendment). - '

'® Petitioner cites the dissent in Rodriguez, rather than the opinion, for

the general proposition that sometimes the Court must perform “a pure

error-correcting function.” (Petr.’s Br. 24 (citing 469 U.S. at 7 (Stevens,

J., dissenting). )

Here, there is no crucial constitutional or civil right issue

at stake, nor is there any irregularity in the rulings of the

lower courts. Petitioner merely desires a different result

because all prior courts ultimately have ruled in Respondents’

favor.

B. There Is No Basis For the Court to Issue Summary

Reversal.

Finally, Petitioner makes the wholly unsupported

argument that this case merits summary disposition by the

Court. (Petr.’s Br. 25-26.) The only authority cited by

Petitioner for this argument is Schweiker v. Hansen, 450

U.S. 785, 791, 101 S. Ct. 1468, 1472 (1981). Petitioner,

however, merely cites the dissent in that case for the

following language on the limited circumstances when

summary disposition may be appropriate: “[when] the law is

settled and stable, the facts are not in dispute, and the decision

below is clearly in error.” Id.

This Court has acknowledged that “[s]ummary reversals

of courts of appeals are unusual under any circumstances.”

Office of Personnel Mgmt. v. Richmond, 46 U.S. 414, 422,

110 S. Ct. 2465, 2470 (1990). Further, here, the facts are in

dispute, and error below is anything but clear; rather, there is

a consistent appellate record against Petitioner. Nothing in

the court of appeals’ decision in Cusano I] warrants the

extraordinary remedy of a summary reversal by the Court,

and the single case cited by Petitioner for its language alone

is utterly irrelevant.

CONCLUSION

For the foregoing reasons, Respondents respectfully

request that the Petition for Writ of Certiorari be denied.

Respectfully submitted,

Brian G. Wolf —

Counsel of Record

Henry L. Self Ill

Kristina Brittenham

LAVELY & SINGER, P.C.

2049 Century Park East

Suite 2400

Los Angeles, CA 90067

(310) 556-3501

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 03-56650

D.C. No. CV-97-04914-AHM

[Filed February 15, 2006]

VINCENT CUSANQO, individually d/b/a

Vinnie Vincent Music, d/b/a Streetbeat

Music f/k/a Vinnie Vincent,

Plaintiff- Appellant,

¥.

GENE KLEIN, an individual;

STANLEY EISEN, an individual;

THE KISS COMPANY, a New York Corporation;

GENE SIMMONS WORLDWIDE INC.,

a Delaware Corporation;

SIMSTAN MUSIC LTD., a Delaware Corporation;

KISSTORY LTD.; POLYGRAM RECORDS, INC.,

a Delaware Corporation;

HORIPRO ENTERTAINMENT GROUP,

a California Corporation;

PAUL STANLEY,

Defendants - Appellees.

ee ee

ORDER

Before: KOZINSKI, Circuit Judge.

Appellant’s motion for reconsideration is construed as a

motion to recall the mandate, and is DENIED. No additional

filings from Appellant will be accepted.

APPENDIX B

UNITED STATES BANKRUPTCY COURT

FOR THE CENTRAL DISTRICT OF CALIFORNIA

Case No. LA 89-04620-CA

[Executed March 21, 1989]

In re

VINCENT J. CUSANO

aka “VINNIE VINCENT”

Debtors

Manatt, Phelps, Rosenberg & Phillips

Simon Aron.

Lisa E. Bittan

Todd W. Mathers

Name

Address 11355 West Olympic Boulevard

Los Angeles, California 90064

Telephone (213) 312-4000

Attorney for Debtor(s)

STATEMENT OF EXECUTORY CONTRACTS

The debtor has the following executory contracts:

1. International Talent Group

729 7th Avenue

New York, NY 10019

(Booking Agency)

2. Brockum

850 7th Avenue, Room 301

New York, NY 10019

(Merchandising)

3. Nigel Thomas

c/o AXIS Worldwide, ;Ltd.

7 Gower Street

London, England

(Debtor contends contract was already terminated and is

not an executory contract. If it is, Debtor will reject

contract.)

I, VINCENT J. CUSANO, the debtor(s) named (or the

president or other officer or authorized agent of the

corporation named as debtor, or a member or an authorized

agent of the partnership named as debtor) in the forgoing

statement, do hereby declare, under penalty of perjury, that

the statements contained therein are true and correct. (and that

the filing of this statement on behalf of the corporation (or

partnership) has been authorized).

Executed on 3/21/1989 = /s/

~VINCENT J. CUSANO

Petitioner

APPENDIX C

UNITED STATES BANKRUPTCY COURT

CENTRAL DISTRICT OF CALIFORNIA

LOS ANGELES DIVISION

Case No. LA 89-04620-ES

Chapter 11

[Filed April 23, 1999]

In re

VINCENT J. CUSANO

aka VINNIE VINCENT,

Debtor.

Se i A A a

ORDER DENYING DEBTOR’S MOTION TO

REOPEN BANKRUPTCY CASE

DATE: March 2, 1999

TIME: 10:30 a.m.

CTRM: Courtroom 1652

The “Motion For Order Reopening Case Pursuant To 11

§ U.S.C. § 350" (the “Motion”) filed by Vincent Cusano (the

“Debtor”) came on regularly for hearing on March 2 at 10:30

a.m. in Courtroom “1652” located at 255 E. Temple Street,

Los Angeles, CA 90012. The Debtor appeared through his

counsel of record, Valensi, Rose & Magaram by Darren

Martinez. Gene Klein p/k/a Gene Simmons, Paul Stanley,

The Kiss Company, Gene Simmons Worldwide, Inc. , Simstan

Music, Ltd. Kisstory Ltd., and Polygram Records, Inc.

(collectively the “Kiss Parties”) appeared through their

attorneys of record, Leslie A. Cohen of Goldberg, Scott,

Belfield, Steinberg & Cohen, a Professional Law Corporation

and Brian G. Wolf of Lavely & Singer, a Professional

Corporation.

The Court, having considered the Motion, the Kiss

Parties’ Opposition and Supplemental Opposition (including

the declarations of Brian Wolf) thereto, the statements and

arguments of counsel at the hearing,

It is HEREBY ORDERED as follows:

A. The Motion is hereby denied.

B. The Bankruptcy Court will not reconsider the

findings that have already been made by the District Court in

the pending litigation in the United States District Court for

the Central District of California between the Debtor and the

Kiss Parties, including without limitation its findings that any

claims for unpaid royalties on _ prepetition musical

compositions did not revert to Debtor and that such claims

were never formally abandoned to Debtor.

C. To the extent the Debtor is seeking to reopen the

case so he can assert claims for unpaid royalties on pre-

petition musical compositions as claims of the Estate, that

request is denied.

D. To the extent the Debtor is seeking to reopen the

case so he can assert claims for unpaid royalties on pre-

petition musical compositions in his individual capacity, that

request is denied.

clarms-abandoned-to-Debtor-

F. All claims based on facts predating Debtor’s

bankruptcy, including claims for unpaid royalties on pre-

petition musical compositions remain assets of the estate, and

the Estate is Closed;

G. The Debtor’s Plan was fully consummated in 1993

and therefore pursuant to 11 U.S.C. § 1127(b), this Court has

no authority to allow the Debtor to amend the Plan for any

purpose, including the administration of the estate assets

through such plan entered in the Debtor’s case and cause does

not exist for the reopening of Debtor’s Chapter 11 bankruptcy

case.

H—-Fhe-Piar_ts_fuity—consummated-and-may-not-be

amended-

I. The doctrine of laches constitutes a separate and

independent ground for denying the motion.

DATED: 4/23/99 Re

ERITHE SMITH

United States Bankruptcy Judge

Submitted by:

/s/

LESLIE A. COHEN

GOLDBERG, SCOTT, BELFIELD,

STEINBERG & COHEN

Attorneys for the Kiss Parties

NOTICE OF ENTRY JUDGMENT OR ORDER

AND CERTIFICATE OF MAILING

TO ALL PARTIES IN INTEREST ON THE ATTACHED

SERVICE LIST:

1. You are hereby notified, pursuant to Local Bankruptcy

Rule 1 16(1)(a)(iv), that a judgment or order entitled (specify):

ORDER DENYING DEBTOR’S MOTION TO REOPEN

; BANKRUPTCY CASE

was entered on (specify date): Apr 27 1999

2. I hereby certify that I mailed a copy of this notice and a

true copy of the order or judgment of the persons and entities

attached service list on (specify date): Apr 27 1999

Dated: APR 27 1999

JON D. CERETTO

Clerk of the Bankruptcy Court

by:/s/___ Tina Johnson

Deputy Clerk

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.