-LRL Federal Deposit Insurance Corporation v. Lake Elsinore 521, LLC, No. 2:2011cv00386 - Document 30 (D. Nev. 2011)
Court Description: ORDER granting 26 Motion to Seal 15 Reply to Response to Motion. Signed by Judge Gloria M. Navarro on 4/20/11. (Copies have been distributed pursuant to the NEF - ECS)
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-LRL Federal Deposit Insurance Corporation v. Lake Elsinore 521, LLC 1 2 3 4 5 6 7 8 9 Doc. 30 RANDOLPH L. HOWARD, ESQ. Nevada Bar No. 006688 GEORLEN K. SPANGLER, ESQ. Nevada Bar No. 003818 KOLESAR & LEATHAM, CHTD. 3320 W. Sahara Avenue, Suite 380 Las Vegas, Nevada 89102 Telephone: (702) 362-7800 Facsimile: (702) 362-9472 E-mail: rhoward@klnevada.com gspangl er(k1nevada.com Attorneys for FEDERAL DEPOSIT INSURANCE CORPORATION, AS RECEIVER FOR FIRST NATIONAL BANK OF NEVADA, SUCCESSORIN-INTEREST TO FIRST NATIONAL BANK OF ARIZONA UNITED STATES DISTRICT COURT 10 DISTRICT OF NEVADA 11 N 12 - r = - . ri = C N 13 14 FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for FIRST NATIONAL BANK OF NEVADA, successorin-interest by merger to FIRST NATIONAL BANK OF ARIZONA, N.A., a national banking association Plaintiff, 15 16 17 18 Case No.: 2:11 -cv-003 86-GNM-LRL [PROPOSED] ORDER ORDER GRANTINGGRANTING MOTION TO SEAL OR REDACT EXHIBITS FROM FDIC’S REPLY TO BRADLEY F. BURNS’ OPPOSITION TO REQUEST FOR 90-DAY STAY vs. LAKE ELSINORE 521, LLC a Nevada limited liability company; BRADLEY F. BURNS, an individual; and DOES 1 through 100 inclusive, 19 20 THIS MATTER came before the Court on Plaintiff FDIC’s Motion to Seal or Redact 21 Exhibits from FDIC’s Reply to Bradley F. Bums’ Opposition to Request for 90-Day Stay filed 22 on April 19, 2011. The Court, having reviewed the motion and other documents on file, being 23 fully advised in the premises, and good cause appearing therefore, hereby orders as follows: 24 25 IT IS HEREBY ORDERED that FDIC’s Motion to Seal or Redact Exhibits from FDIC’s Reply to Bradley F. Bums’ Opposition to Request for 90-Day Stay is GRANTED. 26 IT IS FURTHER ORDERED that the FDIC’s Reply to Bradley F. Burns’ Opposition to 27 /// Request for 90-Day Stay [Doc. No. 15] be replaced with the FDIC’s Reply to Bradley F. Bums’ 28 /Opposition to Request for 90-Day Stay, a copy of which is attached to this Order, and that the // 925840 (7211-5) Page 1 of Dockets.Justia.com 1 2 Clerk is directed to make such entry. 15] be SEALED by the Clerk of the Court. Request for 90-Day Stay [Doc. No. SEALED by the Clerk of the Court. IT IS SO ORDERED THIS day of April, 2011. IT IS SO ORDERED this 20th day of April, 2011. 3 4 ________________________________ UNITED STATES DISTRICT COURT JUDGE Gloria M. Navarro United States District Judge 5 6 KOLESAR & LEATHAM, CHTD. 7 8 9 10 11 <A 12 - 13 14 - Byth 3\ RANDOLPH L. HdWAi4, ESQ. Nevada Bar No. 006688 GEORLEN K. SPANGLER, ESQ. Nevada Bar No. 003818 3320 W. Sahara Avenue, Suite 380 Las Vegas, Nevada 89102 Attorneys for FEDERAL DEPOSIT INSURANCE CORPORATION, AS RECEIVER FOR FIRST NATIONAL BANK OF NEVADA, SUCCESSOR-IN -INTEREST TO FIRST NATIONAL BANK OF ARIZONA 15 16 17 18 19 20 21 22 23 24 25 26 27 28 925840 (7211-5) Page 2 of 2 RANDOLPH L. HOWARD, ESQ. Nevada Bar No. 006688 GEORLEN K. SPANGLER, ESQ. Nevada Bar No. 003818 1 2 3 KOLESAR & LEATHAM, CHTD. 3320 W. Sahara Avenue, Suite 380 Las Vegas, Nevada 89102 Telephone: (702) 362-7800 Facsimile: (702) 362-9472 E-mail: rhoward@klnevada.com gspang1er(Zik1ncvada.com 4 5 6 Attorneys for FEDERAL DEPOSIT INSURANCE CORPORATION, AS RECEIVER FOR FIRST NATIONAL BANK OF NEVADA, SUCCESSOR[N-INTEREST TO FIRST NATIONAL BANK OF ARIZONA 7 8 9 10 11 H 00 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 12 FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for FIRST NATIONAL BANK OF NEVADA, successorin-interest by merger to FIRST NATIONAL BANK OF ARIZONA, N.A., a national banking association 13 H 14 Lr. cc tw 00 15 Case No.: 2:11 -cv-003 86-LRL FDIC’S REPLY TO BRADLEY F. BURNS’ OPPOSITION TO REQUEST FOR 90-DAY STAY 16 Plaintiff, C 17 vs. 18 LAKE ELSINORE 521, LLC a Nevada limited liability company; BRADLEY F. BURNS, an individual; and DOES I through 100 inclusive, 19 20 21 NOW COMES the Plaintiff, FEDERAL DEPOSIT INSURANCE CORPORATION, as 22 23 Receiver for FIRST NATIONAL BANK OF NEVADA, successor-in-interest by merger to 24 FIRST NATIONAL BANK OF ARIZONA, N.A., (hereinafter "FDIC") by and through its 25 counsel of record, and hereby responds to Defendant Bradley F. Bums’ Opposition to FDIC’s 26 Request for 90-Day Stay ("Opposition") of these proceedings pursuant to the provisions of 12 27 I U.S.C. § 1821 (d)(12)(A)(ii). 28 913836.doc (7211-5) Page 1 of MEMORANDUM OF LAW I The FDIC Is Entitled To A Stay Of These Proceedings 2 A. 3 In his Opposition, Burns argues that the FDIC is not entitled to a 90-day stay because 4 "this is not the FDIC’s first request for a 90-day stay in this case" because "the FDIC previously 5 was granted a 90-day stay when it was first appointed receiver for First National Bank of Nevada 6 on July 25, 2008." Opposition, page 3. However, the case pending before this Court is not the 7 "same case" in which the prior 90-day stay was granted. That case was in the United States 8 District Court for the Central District of California and it was that case which led to the judgment 9 that Bums is trying to enforce, by way of a Writ of Execution, in this case. In other words, this 10 action on the Writ is an entirely new case, brought in a different federal court, in a different 11 jurisdiction, and bearing a different case number. Consequently, the prior stay, granted in N 12 California, is irrelevant to these proceedings. N 13 U c ro H Burns then goes on to argue that the only time the FDIC is entitled to the 90-day stay is 14 within 90 days of its appointment. Opposition at page 4 citing to Praxis Properties. Inc. v. 15 (3t1 Cir. 1991), and its progeny. In making Colonial Savings Bank, S.L.A., 947 F.2d 49, 70-71 16 this argument, Bums ignores the language of the 12 USC § 1281(12)(A) which provides that the 17 FDIC may request a stay for a period not to exceed 90 days "in any judicial action or proceeding 18 to which such institution is or becomes a party." As recognized by the United States Bankruptcy 19 Court in in re George M Bumpus. Jr. Constructon Co., 144 B.R. 1 (Bankr. D.Mass. 1992): I. -C . N ’0 LL C 23 This Court disagrees with the Third Circuit. The Praxis interpretation would render superfluous that section of the statute that allows the liquidator to request a stay when it "becomes a party." In other words, if, under Praxis, the liquidating agent has been in a position for more than ninety days and litigation commences, it would not be able to request the stay that is clearly contemplated by the statute. This is not a fair reading of the words of the statute, which this court finds to be clear within the Ron Pair standard. 24 Id. at 3. 25 As stated above, this is a new action to enforce a judgment in which the institution has 26 become a party. Therefore, it falls squarely within the plain language of the statute and this 27 action must be stayed for 90-days. 20 21 22 28 913836.doc (7211-5) Page 2 of I B. 2 Since the filing of this action to enforce the California judgment, the FDIC has issued a 3 I Receiver’s Certificate in the amount of $116,491.76 to Bradley F. Burns. A true and correct I copy of the Receiver’s Certificate and cover letter are attached hereto as Exhibit 1. 4 5 These Enforcement Proceedings Are Moot There is no question that the FDIC may pay creditors with receiver’s certificates instead 6 7 Corp., 36 F.3d 891, 891 (91h Cir. 1994)(per curium). Section 1821(d)(10)(A) authorizes the 8 FDIC, as receiver, to "pay creditor claims . . in such manner and amounts as are authorized 9 under this chapter." In Titan, the Ninth Circuit reasoned that the FDIC may use receiver’s 10 certificates as its manner of payment because requiring cash payments would subvert the 11 C) (9th Cir. 1999), citing to RTC v. Titan Fin. of cash. Battista v. F.D.I.C., 195 F.3d 1113, 1116 comprehensive scheme of FIRREA including § 1821 (i)(2)’ s limitation on an unsecured general 12’ creditor’s claim to only a pro rata share of the proceeds from the liquidation of the financial oe institution’s assets. See Titan, 36 F.3d at 892 (citing Franklin Bank v. FDIC, 850 F.Supp. 845 O N F- 14 r 1c1D 1:; (N.D.Cal. .1994)). To require the FDIC to pay certain creditors in cash would allow those 15 creditors to "jump the line," recovering more than their pro rata share of the liquidated assets, if 16 the financial institution’s debts exceed its assets. Battista, 195 F.3d at 1117. See also: F.D.I.C. v. Phoenix Casa Del Sol, LLC, 2011 WL 81858, *2 (D.Ariz. March 3, 201 1)(slip opinion). C 18 19 20 Because the FDIC has issued a Receiver’s Certificate to Bums, he has been paid. Therefore, this action is moot and should be dismissed. DATED this L1 ’ day of April, 2011. KOLESAR & LEATHAM, CHTD. 21 Mr 22 RANDOLPH L. HOWARD, SQ. Nevada Bar No. 006688 GEORLEN K. SPANGLER, ESQ. Nevada Bar No. 003818 3320W. Sahara Avenue, Suite 380 Las Vegas, Nevada 89102 23 24 25 26 Attorneys for FEDERAL DEPOSIT INSURANCE CORPORATION, AS RECEIVER FOR FIRST NATIONAL BANK OF NEVADA, SUCCESSOR-IN-INTEREST TO FIRST NATIONAL BANK OF ARIZONA 27 28 913836.doc (7211-5) Page 3 of CERTIFICATE OF SERVICE I hereby certify that I am an employee of Kolesar & Leathani, Chtd., and that on the 2 3 LO 4 REPLY TO BRADLEY F. BURNS’ OPPOSITION TO REQUEST FOR 90-DAY STAY in 5 the following manner: 6 day of April, 2011, I caused to be served a true and correct copy of foregoing FIMC’S (ELECTRONIC SERVICE) Pursuant to FRCP 5(b)(3) and LR 5-4, the above-referenced 7 document was electronically filed and served upon the parties listed below through the Court’s 8 Case Management and Electronic Case Filing (CM/ECF) system: 9 Christopher H. Byrd, Esq. Fennemore Craig 300 South Fourth Street, Suite 1400 Las Vegas, Nevada 89101 Attorneys for Defendant/Judgment CrT Bradley F. Burns 10 = 11 12 13 14 15 Cn 913836.doc (7211-5) Page 4 of 4 EXHIBIT 1 FDW Federal Deposit Insurance Corporation 1601 Bryan Street, Dallas, TX 75201 Division of Resolutions and Receiverships March 22, 2011 Bradley F. Burns C/O Christopher H. Byrd, Esq. 300 South Fourth St Suite 1400 Las Vegas, NV 89101 SUBJECT: 10008 - FIRST NATIONAL BANK OF NEVADA RENO, NVIn Receivership NOTICE OF ALLOWANCE OF CLAIM Dear Claimant: On July 25, 2008 (the ’Closing Date"), the FIRST NATIONAL BANK OF NEVADA, 6275 NEIL RD, RENO, NV, 89511 (the ’Failed Institution") was closed by the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (the "FDIC") was appointed Receiver (the "Receiver"). Enclosed you will find a Receiver’s Certificate in the amount of $116,491.76. The enclosed Receivership Certificate represents a formal record of your claim as allowed. As the FDIC acting as Receiver liquidates the assets of the Failed Institution, you may periodically receive payments on your claim through dividends. The Receiver pays dividends according to the priorities established by applicable law. The Receiver will send your dividends to the address shown on your Receivership Certificate, please notify this office if your address changes. If you have uninsured deposits, as established by the FDIC’s insurance determination, you automatically have a claim for such funds. In the event you disagree with the FDIC’s determination with respect to your uninsured deposits, you may seek a review of the FDIC’s determination In the United States District Court for the federal judicial district where the principal place of business of the Failed Institution was located. You must request this review no later than 60 days after the date of this letter. If you have any questions, please call (972) 761-8677. RLS721 3 10008 - FIRST NATIONAL BANK OF NEVADA RENO, NV (Name and Location of Bank) RECEIVERSHIP CERTIFICATE OF PROOF OF CLAIM - NO.383 March 22, 2011 THIS IS TO CERTIFY THAT Bradley F. Burns -6214 (Name) (Tax No) Of C/O Christopher H. Byrd, Esq., 300 South Fourth St, Suite 1400, Las Vegas, NV (Address) has made satisfactory proof that Bradley F. Bums is a creditor of the 10008 - FIRST NATIONAL BANK OF NEVADA in the amount of One hundred sixteen thousand four hundred ninety one and seventy six 1100 Dollars upon the following claim to wit: CLAIM NUMBERS L ACCOUNT NUMBERS 500009291-000 TOTALS I 1 FDIC USE ONLY DPC#ITAX CODE AMOUNTS 940.0 $114,971.00 940.1 $1,520.76 TOTALS $116,491.76 AMOUNTS $116,491.76 $116,491.76 Balance due in excess of any amount paid by and assigned the Federal Deposit Insurance Corporation and said creditor or the lawful assignee of this claim will alone be entitled to any distributions made hereon. No assignment of this claim, or any portion thereof, will be recognized as to any distribution unless written notice of assignment has been given to the Receiver and accepted by it and entered thereon before such distribution has been paid. Please complete the section below only if you are assigning your claim to another person or entity. Claimant should notify the Receiver promptly of any change in claimant’s address. RANCEQ&P6RATION, RECEIVER By (Receiver) ASSIGNMENT OF RECEIVER’S CERTIFICATE Date: For value received claimant herein named hereby transfers and assigns the within claim to: (Name and Address) (Original Claimant Signature) FDIC accepted/entered on Date: RLS7213 (Date Signed) by 2
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