Receivership News was pleased to interview Bankruptcy Judge René Lastreto II shortly after his appointment in the Eastern District of California, Fresno Division. Judge Lastreto and one other bankruptcy judge hear all bankruptcy matters in the Central California area up to Merced, south through Fresno, and down to Bakersfield.

Judge Lastreto lived his first 11 years in the East Bay, then his family moved to Fresno. After completing high school, and two years of college at California State University Fresno, Judge Lastreto received a scholarship for his competitive debate skills from the University of Utah. He completed his undergraduate degree, cum laude, as a Ute and then received his law degree with moot court honors from the University of San Francisco.

Before his judicial appointment, Judge Lastreto completed a 30+ year legal career. Judge Lastreto began practicing law with a firm in Fresno and was there for 13 years, beginning and continuing a bankruptcy specialty. After a two year solo practice, and two years with another local firm, Judge Lastreto joined the Fresno firm of Lang Richert & Patch. He continued as a partner with the firm for 16 years until he was appointed to the Bankruptcy bench.

Much of Judge Lastreto’s legal career and practice involved bankruptcy matters, but also included other litigation. His bankruptcy practice primarily represented lenders and other creditors, trustees, and creditor committees, including litigating contested matters and adversary proceedings, in Chapter 7 and Chapter 11 cases. Judge Lastreto also represented lenders and creditors in civil litigation in both state and federal courts. His civil litigation practice included litigation that sought the appointment of receivers, and he also represented receivers.

Judge Lastreto was a member of the California Receivers Forum for several years and participated in educational programs and Loyola symposiums. His most recent contribution was to produce and participate in a thorough and complete Loyola VI panel on agricultural receiverships.

Below are some comments from Judge Lastreto about his introduction to the judicial bench, his observations about the contrast of working as an attorney and serving as a bankruptcy judge, and some interesting issues and aspects of his bankruptcy cases.

Question: How did you get prepared to make the change from a practicing attorney to a bankruptcy judge?

Judge Lastreto: Fortunately, the judicial system provides a detailed and extremely helpful orientation for new bankruptcy judges. Believe me, I quickly learned there is a big difference between practicing as an attorney and sitting on the judicial bench deciding matters. The instructors are either district judges or bankruptcy judges who have been on the bench for many years. There are a series of topics or seminars that cover many issues ranging from managing the chamber staff to dealing with evidence, and discussions about Chapter 7, Chapter 11, and Chapter 13. The topics also discuss how to manage cases.

This is all delivered in a practical format that is very helpful to begin to know and understand how to function as a newly appointed bankruptcy judge. We also have the opportunity to make new friendships and connections with new judges from different parts of the country and learn about their slightly different operating practices.

Question: Sitting on the bench, how does it feel to be a neutral arbitrator in front of debtors and creditors compared to your former role as an advocate?

Judge Lastreto: It’s interesting. One thing I learned quickly is to put any preconceived notions about a situation out the window. When I was in my 30+ year legal practice, I experienced many different legal contexts and situations. I formed ideas and early conclusions about claims and issues as a legal advocate. But when sitting as a judge and being asked to make decisions about disputed issues, any preconceived ideas and notions will actually hinder the judgment process.

Question: What other situations or conditions are substantially different from your practice as an attorney and that of a bankruptcy judge?

Judge Lastreto: In my legal practice, especially in the last 20 years, I did very little work with Chapter 13 bankruptcy. On the bench, much of our work deals with individuals in Chapter 13 and in Chapter 7. And so, there was a learning curve. It’s been quite fascinating to learn how complex and interesting Chapter 13 really is, and very different from my experience as an attorney.

One of the most interesting differences I have experienced arises when I am preparing for hearings or in the courtroom. Often, I deal with a case involving a $2,000 or $3,000 problem for an individual, and then two or three matters down the calendar, deal with a case in the millions. I didn’t fully expect such a disparity from case-to-case in any given day. Perhaps I sort of knew I would be facing these size differences, but until I faced it head on, I didn’t really appreciate the vastness of the work I would be doing.

Question: Can you talk a bit about substantial cases that have been assigned to you?

Judge Lastreto: One of the first big cases assigned to me was a Chapter 11 case involving a cardroom casino. It’s a very detailed and complicated case with lots of dollars at stake. The parties are very well represented so we have lots of productive exchanges. There have also been some eye-opening issues that have arisen in some of the Chapter 7 cases involving trustees suing debtors who are objecting to discharge, and ruling on challenges to dischargeability. Some of these cases involve substantial dollars and some do not, but all of these cases have been complicated and educational.

I also have a pending Chapter 11 case involving a petroleum jobber. What’s interesting is that this situation is an example of what we are reading in the headlines about the economics of the oil economy. One of the exciting things about bankruptcy practice and bankruptcy law is seeing the conditions facing the local economy trickle down to the bankruptcy court.

Question: Have any of your cases started with a receiver in place and, if so, was the receiver kept in place or removed?

Judge Lastreto: Not yet. However, in the cardroom casino case I discussed earlier, the creditors had been seeking a receiver in the Superior Court. However, the bankruptcy petition was filed before the receiver was appointed. So, I haven’t faced any 543 or 564 issues yet. But I expect with the current economic climate in the petroleum industry there will be contract disputes and receivers appointed before a bankruptcy filing.

Question: Was your father an attorney?

Judge Lastreto: No, he was not. However, my grandfather was an attorney in San Francisco for many years. I did not know him. He died during World War II. But, in my chambers I have his original attorney licenses issued by the Northern District of California and the Supreme Court of California. Both are dated 1890. So, there is attorney family history, but it skipped my father’s generation.

Question: Are you married and do you have children?

Judge Lastreto: I have a wife, Rebecca whom I just married in September. It was quite a weekend. I got married on the 12th of September and sworn in as a Bankruptcy Judge on the 14th. There is nothing like two life changes in a weekend. I have a son, Vince, who is married and employed at North Carolina State University. He structures curriculum to be compatible with computers for “online learning.”

Question: What about time off the bench? What you like to do?

Judge Lastreto: I really love to play golf. I enjoy it a lot. My new job has cut into my golf time a bit. But people depend upon the court and the judges, so I have to be sure I can do my job. It’s not as easy to get away for a round as it used to be, but I still enjoy golf very much. I love to cook. I used to do a lot more amateur acting. The new job has really cut into that, along with the golf. I used to do a lot of local community theater, but it’s been hard to get back into that because of the time commitment involved with acting and theater. Those are things I like to do and enjoy very much.

Question: Is there anything else that I missed or you would like to include?

Judge Lastreto: I really appreciate this interview. I’ve always liked the Receiver’s forum. I’ve been on the faculty a couple of times and I’ve always enjoyed it. Perhaps sometime in the future if they need me I can participate again. It would be a different perspective from a Bankruptcy Judge. I’ve always enjoyed the forum and thought it was a very good educational system.

*Kenton Johnson is Executive Vice President of Robb Evans & Associates LLC in Sun Valley, CA and is a federal receiver. He has served as the Co-Chair of the CRF LA-OC Chapter forseveral terms and is a frequent speaker at receivership conferences.