United States District Court, D. Arizona
ORDER
BRIDGET S. BADE UNITED STATES MAGISTRATE JUDGE.
Petitioners/Judgment
Creditors Rickman Brown, Jeff Ross, Evans, Sholz, Williams
& Warncke LLC, and Ross and Orenstein LLC f/k/a Ross,
Orenstein & Baudry LLC (“Petitioners”) have
filed a Motion to Compel Compliance with Subpoenas. (Doc.
256.) The motion pertains to subpoenas to testify at a
deposition that Petitioners served on Respondents Joseph and
Helen Baldino. (Docs. 252, 254; Doc. 256, Exs. A, B.) The
Baldinos objected to the subpoenas and Petitioners filed the
pending motion to compel.[1] (Docs. 250, 256.) The motion to compel
is fully briefed. (Docs. 262, 267.)
Petitioners
have also filed a Motion to Authorize Service of Subpoenas.
(Doc. 293.) This motion pertains to subpoenas that
Petitioners intend to serve on non-parties Vantage Retirement
Plans LLC, Mortgages Ltd. Opportunity Fund MP15 LLC, and
Mortgages Ltd. Opportunity Fund MP17 LLC (collectively the
“Non-Party LLCs”). Petitioners filed a notice of
intent to serve subpoenas on the Non-Party LLCs (Doc. 279),
and the Baldinos filed an objection to the notice of intent
to serve subpoenas. (Doc. 285.) In response to the objection,
Petitioners did not serve the subpoenas and filed the pending
motion to authorize service of the subpoenas. (Doc. 293.) The
motion to authorize service of subpoenas is fully briefed.
(Docs. 295, 299.)
In
their motion to compel, Petitioners request an order (a)
granting their motion, (b) instructing the Baldinos to
produce the documents described in the subpoenas, and (c)
instructing the Baldinos to appear for depositions at
mutually-convenient dates and times, but in any event no
earlier than seven days and no later than fourteen days after
production of the documents. (Doc. 256.) In the motion to
authorize service of subpoenas, Petitioners request an order
that (a) overrules the Baldinos' objections to subpoenas
that Petitioners intend to serve on the Non-Party LLCs, and
(2) authorizes Petitioners to serve the subpoenas on the
Non-Party LLCs. (Doc. 293.) As set forth below, the Court
grants Petitioners' motions.[2]
I.
Background
On
December 16, 2016, the Court entered a judgment (the
“Judgment”) in this action affirming an
arbitrator's July 27, 2016 award in favor of Petitioners
and against Respondents Eva Sperber-Porter, Baseline &
Val Vista Associates, LP, Litchfield Road Associates, LP,
Joseph Baldino and Helen Baldino, husband and wife, the
Baldino Family Revocable Living Trust, and the Meridian
Financial Corporation Profit Sharing and Retirement Trust
(collectively the “Respondents”). (Doc. 33.) That
Judgment entitled Petitioners to a 21.5 percent contingency
fee in connection with the GT Settlement, post-settlement
interest, attorneys' fees, and costs.[3] (Doc. 33;
see Doc. 313 at 2.) The Judgment provided for two
types of damages: legal fees and costs (“Current
Amount”), and contingency fees and post-settlement
interest (“Delay Damages”). (Doc. 33; Doc. 313 at
3.)
On
November 27, 2017, Petitioners filed a petition for a
charging order against the Baldinos' interest in
Mortgages Ltd. Opportunity Fund MP17 LLC
(“MP17”). (Doc. 168.) The Baldinos objected to
this petition for a charging order, in part, because they
asserted that Judgment Debtor Meridian's interest in MP17
was held in an individual retirement account (IRA) at Vantage
Retirement Plans LLC for the benefit of Joseph Baldino. (Doc.
213.) On April 2, 2018, the Court held a hearing to address
the petition and the Baldinos' objections. (Doc. 245.) At
the parties' request, the Court set a discovery schedule
and set a July 2, 2018 evidentiary hearing on the petition
for a charging order.[4] (Docs. 168, 247.)
On
January 25, 2018, Petitioners obtained a general writ of
execution against the Baldinos. (Doc. 224.) On February 16,
2018, Petitioners obtained an amended writ of general
execution (the “amended writ”) against the
Baldinos that calculated damages after applying interest and
recoveries already received. (Doc. 233.) On March 23, 2018,
Petitioners served on Helen and Joseph Baldino subpoenas to
appear at depositions. (Doc. 256, Exs. A, B.) On April 6,
2018, the Baldinos filed an objection to the subpoenas and,
on April 10, 2018, Petitioners filed the pending motion to
compel. (Docs. 250, 256.)
In
April 2018, Respondents paid $436, 340.86 of the $641.899.29
due on the Current Amount. (Doc. 313 at 4.) Respondents
deposited the remainder, $205, 558.42, with the Court.
(Id.) On April 20, 2018, the Baldinos filed a motion
for relief from judgment pursuant to Rule 60(b)(5) and
asserted that the Judgment had been satisfied. (Doc. 260.)
Respondents Eva Sperber-Porter, Baseline & Val Vista
Associates, LP, and Litchfield Road Associates LP
(collectively “Sperber-Porter”) filed a joinder
to the Baldinos' motion for relief from judgment. (Doc.
272.) Sperber-Porter also filed a motion to release judgment
lien. (Doc. 276.) Similar to the Baldinos' motion for
relief from judgment, Sperber-Porter's motion argued that
the Judgment was satisfied and, therefore, the lien must be
released. (Id.)
On May
14, 2017, as part of the discovery related to the
Baldinos' objection to the petition for a charging order,
Petitioners filed a notice of intent to serve subpoenas
duces tecum on the Non-Party LLCs. (Doc. 279.)
Before Petitioners served the subpoenas on the Non-Party
LLCs, the Baldinos filed an objection to the subpoenas on the
ground that the Judgment had been satisfied. (Doc. 285.)
Petitioners withheld service of the subpoenas pending
resolution of the objection and, on May 23, 2018, filed the
pending motion to authorize service of the subpoenas. (Doc.
293.) In their motion to authorize service of the subpoenas,
Petitioners argued that the Judgment had not been paid and,
therefore, the subpoenas are appropriate. (Id. at
4-5.)
On July
20, 2018, while their motion for relief from judgment was
pending, the Baldinos filed an Amended Motion for
Satisfaction from Judgment Pursuant to Rule 60. (Doc. 302.)
In the amended motion, the Baldinos again ask the Court to
find that the Judgment was satisfied based on
Petitioners' receipt of the GT Settlement funds.
(Id.) Petitioners filed a response to the amended
motion and dispute that the Judgment has been satisfied by
the GT Settlement funds because they have not received the GT
Settlement funds and, when they receive the funds, they will
be interpleading those funds in the state court matter. (Doc.
307.) On August 6, 2018, the Baldinos filed a reply is
support of their amended motion. (Doc. 314.) On August 10,
2018, Petitioners filed a motion for leave to file a
sur-reply. (Doc. 316.)
Meanwhile,
on August 2, 2018, the Court denied the Baldinos' motion
for relief from judgment and Sperber-Porter's motion to
release judgment lien. (Doc. 313.) The Court noted that as of
April 2018, the Current Amount was $641, 899.29.
(Id. at 3.) In April 2018, Respondents paid $436,
340.86 of the $641.899.29 due on the Current Amount.
(Id. at 4.) Respondents deposited the remainder,
$205, 558.42, with the Court. (Id.) The Delay
Damages were subject to, and contingent upon,
Respondents' appeal of the GT Settlement. (Id.)
On July 3, 2018, the Arizona Supreme Court denied
Respondents' review petition and, therefore, the Court
concluded that the “alleged contingency of the Delay
Damages is moot.” (Id. at 3, 10.)
In the
August 2, 2018 Order, the Court stated that with the deposit
of the $205, 558.43, “Respondents pay the remainder of
the April 20, 2018 calculation of the Current Amount.”
(Id. at 9.) The Court directed the Clerk of Court to
pay Petitioners the $205, 558.43 that Respondents had
deposited with the Court. (Id. at 10; see
Docs. 315, 323.) The Court stated that “[t]he Judgment
will not be satisfied until the funds are paid from the GT
Settlement, as well as accrued interest since April 20,
2018.” (Doc. 313 at 9-10.) Therefore, the Court denied
Respondents' motion for relief from judgment under Rule
60(b)(5). (Id. at 9.) The Court also denied
Sperber-Porter's motion to release judgment lien.
(Id.) The Court has not ruled on the Baldinos'
amended motion for satisfaction of the judgment.
II.
Requests ...