A California state court found a professor (the “debtor”) liable for negligence, defamation, and intentional infliction of emotional distress against a graduate student (the “creditor”). The creditor brought the state court claims after the debtor repeatedly accused the creditor of “committ[ing] scientific misconduct through plagiarism and data falsification.” The debtor made numerous accusations and complaints that the creditor’s research papers were improper for various reasons. The debtor made these accusations through emails, complaints, public presentations, and various other methods to the university, fellow scientists, and employers and co-workers of the creditor. The state court awarded the creditor $776,000 for damages for negligence, intentional infliction of emotional distress, and defamation. The debtor then filed for bankruptcy. The creditor initiated the adversary proceeding seeking a determination by the bankruptcy court that the debtor’s state court judgment debt was non-dischargeable under 11 U.S.C. § 523(a)(6) of the bankruptcy code because the debt resulted from willful and malicious injury by the debtor. The creditor argued that the state court had already found that the debtor was willful and malicious in committing defamation and intentional infliction of emotional distress, and collateral estoppel prevented the debtor from relitigating the willful and malicious issue in bankruptcy court. The bankruptcy court entered summary judgment in favor of the creditor. However, the district court reversed, finding that, despite the state court’s finding of willful and malicious injury, collateral estoppel did not apply to the question of the debtor’s intent for non-dischargeability purposes because the state court’s finding was “‘insufficient to prove [the debtor]’s intent’ under § 523(a)(6) by a preponderance of the evidence.”
In Bikkina v. Mahadevan (In re Mahadevan), No. 21-30545, Adv. No. 21-3054, 2025 WL 583361, 2025 Bankr. LEXIS 388 (Bankr. S.D. Tex. Feb. 21, 2025) (opinion not yet released for publication), the bankruptcy court found the debtor was substantially certain that his willful and malicious injury would cause harm, and, therefore, the state court judgment debt was nondischargeable under § 523(a)(6). The Supreme Court has held that a debt arising from a willful and malicious injury is only nondischargeable under § 523(a)(6) if the “‘act[] [was] done with the actual intent to cause injury.’” In re Williams, 337 F.3d 504, 508 (5th Cir. 2003). Therefore, a debt is only nondischargeable under (a)(6) if “there exists ‘either an objective substantial certainty of harm or a subjective motive to cause harm’ on the part of the debtor.” In re Vollbracht, 276 F. App’x 360, 362 (5th Cir. 2007). The bankruptcy court then explained that the creditor bore “the burden of proving that [the debtor] acted with subjective intent to cause harm or with substantially certainty of harm by a preponderance of the evidence” in order to be successful on the § 523(a)(6) nondischargeability determination. The bankruptcy court first determined that there was no subjective intent to cause harm. To show a subjective intent to cause harm, “a creditor must show that a debtor ‘intend[ed] the consequences of an act,’ not merely ‘the act itself.’” Kawaauhau v. Geiger, 523 U.S. 57, 59 (1998). It explained that although there was “clear animosity” between the debtor and creditor based on the allegations, it was not enough for the creditor to prove the debtor intended to cause harm. Next, the bankruptcy court discussed whether there was a substantial certainty of harm, finding there was because the debtor “acted with knowledge that his actions were substantially certain to injure [the creditor] when he defamed and inflicted emotional distress upon [the creditor].” The court explained that it may infer that a debtor’s “subjective intent was to inflict a willful and malicious injury” when the debtor’s actions, “from a reasonable person’s standpoint were substantially certain to result in harm.” In re Kahn, 533 B.R. 576, 588 (Bankr. W.D. Tex. 2015). Substantial certainty requires a “realization that there is a strong probability that harm may result,” not just mere recklessness or negligence on the debtor’s part. In re D’Amico, 509 B.R. 550, 558 (Bankr. S.D. Tex. 2014). The bankruptcy court explained that a debtor’s knowledge when the injury occurred is an important factor in determining whether there was a substantial certainty of harm. Therefore, in order for the state court judgment debt to be nondischargeable under § 523(a)(6), the creditor had to “have acted with substantial certainty that his allegations of scientific misconduct were false, and he must have spread them knowing they would harm [the creditor].” The bankruptcy court found that the debtor knew with substantial certainty that his accusations of plagiarism and data falsification were false. The debtor made allegations of the creditor’s wrongdoing to the university; however, the university had informed the debtor various times that the creditor did not do any wrong related to his research papers. The debtor initially withdrew many of his complaints against the creditor, indicating he knew they were false. Further, the court found that the debtor, as a scientist himself, knew that the false allegations against the creditor would harm the creditor’s “livelihood as a scientist” because “the reputation of a scientist depends on his truthfulness and accuracy of his scientific research.” The bankruptcy court also found that the debtor was substantially certain that his “outrageous conduct” of continued false allegations of the creditor’s wrongdoing to people who had influence over the creditor’s career would cause emotional distress on the part of the creditor. Finally, the bankruptcy court found that the debtor was not substantially justified under the facts when he acted with substantial certainty of harm. The court explained that because the debtor did not plead any affirmative defenses under the state law justifying the harm, it had to determine if the debtor was substantially justified in knowingly harming the creditor by looking at the facts. The bankruptcy court found that by repeatedly making serious allegations with “no reasonable basis for believing the allegations were true,” the debtor was not substantially justified in the harm caused. The bankruptcy court ultimately found that because the debtor acted with substantial certainty of causing willful and malicious injury, the state court judgment debt was nondischargeable under § 523(a)(6).
By Kristin Meurer [email protected]
Edited By Callighan Ard [email protected]
Edited By Hayden Mariott [email protected]