United States District Court, D. Arizona
G. Campbell United States District Judge.
Interior Design, LLC 401(k) Profit Sharing Plan, by and
through Athena Hart-Kolle, Trustee (“the Plan”),
has removed a complex state receivership case from Maricopa
County Superior Court to this Court. Doc. 1. The case is
IMH Special Asset NT 168, LLC v. Aperion Communities,
LLLP, et al., No. CV2010-010990 (“the State Court
Action”). Three participants in the State Court Action,
IMH Special Asset NT 168, LLC, IMH Special Asset NT 161, LLC,
and the Reaves Law Group, P.C. (collectively, the
“Movants”), have filed a motion to remand the
case to state court. Doc. 11. The motion has been briefed
(Docs. 11, 28), and the Court concludes that oral argument is
not necessary. For the reasons that follow, the Court will
remand this case to state court.
State Court Action began in 2010. IMH Special Asset NT 168,
LLC and IMH Special Asset NT 161, LLC (collectively, the
“Judgment Creditors”) are wholly owned
subsidiaries of IMH Financial Corporation
(“IMHFC”). Doc. 11 at 3. IMHFC is an Arizona
based real estate lender and investor. Id. Following
non-judicial foreclosures on real property in 2010, the
Judgement Creditors brought deficiency actions under A.R.S.
§ 33-814(a) against Aperion Communities, LLLP, Eladio
Properties, LLLP, David P. Maniatis, and the DPM-TT Trust
(collectively, the “Judgment Debtors”).
Id. The deficiency actions were consolidated in the
State Court Action, and, on December 21, 2012, the state
court entered a multi-million dollar judgment against the
Judgment Debtors. Id.
Movants note and the Plan does not dispute, “[t]he
original complaints did not name the Plan as a party, and the
Plan did not participate - at all - in either action.”
Id. In post-judgment collection proceedings, the
state court appointed two separate receivers over certain of
the Judgment Debtors' assets. Id. at 4. Movants
summarize the relevant portions of the post-judgment
collection proceedings as follows:
First, pursuant to post-judgment negotiations between
Maniatis and the Judgment Creditors, Maniatis stipulated to:
(i) transfer his and the DPM-TT Trust's shares of stock
in closely-held corporations to Stockholder, and (ii) appoint
[the Reaves Law Group as] the Stockholder Receiver pursuant
to an Order Appointing A Receiver Over Stockholder,
LLC dated and filed on June 12, 2013, in the State Court
(the “Stockholder Receivership Order”). By virtue
of the transfer of stock, Stockholder - an entity created and
owned by the Judgment Creditors/IMHFC - took ownership of
various closely-held corporations formerly owned by Maniatis
and the DPM-TT Trust. These corporations, among other things,
manage entities that own land and/or water interests in
Sandoval County, NM. The Removing Party invested in some of
Second, the court appointed MCA Financial Group, Ltd., by and
through Keith Bierman (“MCA Receiver”), receiver
over all other non-exempt assets owned and controlled by
Maniatis and the DPM-TT Trust pursuant to an Order
Appointing A Receiver Over the DPM-TT Trust and Property
Owned and Controlled by David P. Maniatis dated August
22, 2013, as amended by the Order Amending Order
Appointing a Receiver Over the DPM-TT Trust and Property
Owned and Controlled by David P. Maniatis dated April
18, 2014 (collectively, the “MCA Receivership
As part of the administration of their respective
receivership estates, the Stockholder Receiver and MCA
Receiver (collectively, the “State Court
Receivers”) stepped into Maniatis' shoes to manage
and, where appropriate, liquidate companies. In addition to
the Removing Party, over one-hundred other individual
investors (the “Individual Investors”) own
limited partnership or limited liability company membership
interests in the various companies subject to administration
by the State Court Receivers.
Doc. 11 at 5. The Plan does not dispute these facts.
December 16, 2013, the Plan filed an Amended Notice of
Appearance in the State Court Action. Doc. 11-2 (giving
notice of its appearance as a
“Party-in-Interest”). The Plan never moved to
formally intervene, but it did “file objections and
appear at hearings to oppose relief sought by the
Receivers.” Doc. 11 at 5. On May 13, 2014, the state
court issued an order establishing procedures and deadlines
for submitting claims against the receivership estate. Doc.
28-3. The state court noted that these procedures and
deadlines were “in the best interests of the Maniatis
Entities, their creditors, interest holders and other parties
in interest.” Id. at 3.
undisputed that the Stockholder Receiver controls six
entities which each own a 1/6 interest in two exploratory
deep groundwater wells in Sandoval County, New Mexico. Doc.
11 at 6. While the Plan contends that Movants have
exaggerated the extent of the emergency, Movants argue that
these wells are in a serious state of deterioration and
actively leaking hazardous contaminants. Id. at 6-7.
According to Movants, because the owners did not have money
to repair the wells, IMHFC, by and through one of its
subsidiaries, lent approximately $50, 000 to fund temporary
repairs of the wells in the summer of 2016. Id. at
7. The Plan did not attempt to remove the State Court Action
at that time.
filed an emergency motion with the state court on November
16, 2016 after an alleged increase in the amount of
contaminated water leaking from one of the wells
(id. at 8), and the state court set a hearing for
December 2, 2016 (Doc. 28 at 10). The emergency motion asked
the state court to approve a loan from IMHFC to complete
needed well repairs. Id. The Plan responded to the
emergency motion by filing an objection in state court on
November 25, 2016, the deadline set by the state court.
Id. The objection raised the issue of complete
federal preemption and the prospect of removal. Id.
Six days later, and one day before the emergency hearing in
state court, the Plan filed its notice of removal. Doc. 1.
after the filing of the emergency motion, the well allegedly
suffered a blowout and was discharging large amounts of
contaminated water. Doc. 11 at 8. The well has been stopped
with emergency but temporary repairs, funded by a good faith
advance from IMHFC. Id. at 9. Following the notice