Under 11 USC 1141(d)(3), a Chapter 11 debtor is denied a discharge of debt if (a) the plan provides for liquidation of substantially all assets of the estate, (b) the debtor does not engage in business after consummation of the plan, and (c), if it was a Chapter 7 case, a discharge, would be denied under section 727(a). Here, an individual filed a Chapter 11 bankruptcy. His plan provided for liquidation of all assets of his bankrupt estate, and the debt he owed Spokane Rock was not dischargeable under section 727(a). The issue was whether he continued in business after consummation of the plan. For purposes of section 1141(d)(3), the court holds the bankrupt debtor does not “engage in business” after plan confirmation merely by acting as an employee of a business owned and operated by a third person. So discharge was properly denied.
Ninth Circuit Court of Appeals (Hurwitz, J.); September 14, 2018; 2018 U.S. App. LEXIS 26094