Bank of New York Mellon Trust Company, NA, The v. Salem Nursing & Rehab Center of Reform Inc et al
Filing
55
MEMORANDUM OPINION. Signed by US Magistrate Judge T Michael Putnam on 3/18/2014. (MSN)
FILED
2014 Mar-18 PM 03:34
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
THE BANK OF NEW YORK
MELLON TRUST COMPANY, N.A.,
as Indenture Trustee,
Plaintiff,
v.
SALEM NURSING & REHAB
CENTER OF REFORM, INC., THE
MEDICAL CLINIC BOARD OF THE
CITY OF REFORM, ALABAMA, and
ALTACARE CORPORATION,
Defendants.
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Case No. 2:11-cv-01509-TMP
MEMORANDUM OPINION
This case is before the court on the Motion for Summary Judgment (doc. 43), filed
January 4, 2013, by The Bank of New York Mellon Trust Company (APlaintiff@), as
successor Indenture Trustee, on behalf of bondholders. Plaintiff=s claim arises from
alleged defaults by defendants Salem Nursing & Rehab Center of Reform, Inc., and The
Medical Clinic Board of the City of Reform, Alabama, on bonds issued May 1, 1995.
(Doc. 19, p. 3). In response to the alleged default, Plaintiff filed the instant lawsuit.
(Doc. 19). Plaintiff=s motion for summary judgment seeks for the court to:
(1) find that Events of Default have occurred and are continuing to occur
under the Bond Documents;
(2) enter a final judgment jointly and severally against The Medical Clinic
Board of the City of Reform, Alabama, and Salem Nursing & Rehab Center
of Reform, Inc.;
(3) appoint Derek Pierce of Healthcare Management Partners, LLC as
receiver over the Property;
(4) direct Salem Nursing & Rehab Center of Reform, Inc., and AltaCare, on
Salem Nursing & Rehab Center=s behalf, to provide the Trustee with an
accounting for each of Salem Nursing & Rehab Center=s fiscal years ending
in 2010, 2011, and 2012; and
(5) grant the Trustee leave to prove costs of collection, including attorney=s
fees and expenses.
(Doc. 43, p. 16). Defendants have filed a brief in opposition, along with exhibits, and
Plaintiff has filed a reply to that brief. The court has considered the evidence and the
arguments set forth by all parties.
The parties have consented to the exercise of
jurisdiction by the undersigned pursuant to 28 U.S.C. ' 636(c) (doc. 16).
SUMMARY JUDGMENT STANDARD
Under Federal Rule of Civil Procedure 56(c), summary judgment is proper Aif the
pleadings, depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law.@ Fed. R. Civ. P. 56(c). The
party asking for summary judgment Aalways bears the initial responsibility of informing
the district court of the basis for its motion, and identifying those portions of >the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the affidavits,
if any,= which it believes demonstrate the absence of a genuine issue of material fact.@
2
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ. P. 56(c)). The
movant can meet this burden by presenting evidence showing there is no dispute of
material fact, or by showing that the nonmoving party has failed to present evidence in
support of some element of its case on which it bears the ultimate burden of proof.
Celotex, 477 U.S. at 322-23. There is no requirement, however, Athat the moving party
support its motion with affidavits or other similar materials negating the opponent=s claim.@
Id. at 323.
Once the moving party has met his burden, Rule 56(e) Arequires the nonmoving
party to go beyond the pleadings and by her own affidavits, or by the >depositions, answers
to interrogatories, and admissions of file,= designate >specific facts showing that there is a
genuine issue for trial.=@ Id. at 324 (quoting Fed. R. Civ. P. 56(e)). The nonmoving party
need not present evidence in a form necessary for admission at trial; however, he may not
merely rest on his pleadings. Celotex, 477 U.S. at 324. A[T]he plain language of Rule
56(c) mandates the entry of summary judgment, after adequate time for discovery and
upon motion, against a party who fails to make a showing sufficient to establish the
existence of an element essential to that party=s case, and on which that party will bear the
burden of proof at trial.@ Id. at 322.
After the plaintiff has properly responded to a proper motion for summary
judgment, the court must grant the motion if there is no genuine issue of material fact, and
the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). The
substantive law will identify which facts are material and which are irrelevant. Anderson
3
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is genuine Aif the evidence is
such that a reasonable jury could return a verdict for the nonmoving party.@ Id. at 248.
A[T]he judge=s function is not himself to weigh the evidence and determine the truth of the
matter but to determine whether there is a genuine issue for trial.@
Id. at 249. His guide
is the same standard necessary to direct a verdict: Awhether the evidence presents a
sufficient disagreement to require submission to a jury or whether it is so one-sided that
one party must prevail as a matter of law.@ Id. at 251-52; see also Bill Johnson=s
Restaurants, Inc. v. N.L.R.B., 461 U.S. 731, 745 n.11 (1983). However, the nonmoving
party Amust do more than show that there is some metaphysical doubt as to the material
facts.@ Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).
If the evidence is merely colorable, or is not significantly probative, summary judgment
may be granted.
Anderson, 477 U.S. at 249 (citations omitted); accord Spence v.
Zimmerman, 873 F.2d 256 (11th Cir. 1989). Furthermore, the court must Aview the
evidence presented through the prism of the substantive evidentiary burden,@ so there must
be sufficient evidence on which the jury could reasonably find for the plaintiff. Anderson,
477 U.S. at 254; Cottle v. Storer Communication, Inc., 849 F.2d 570, 575 (11th Cir. 1988).
Nevertheless, credibility determinations, the weighing of evidence, and the drawing of
inferences from the facts are the function of the jury, and therefore the evidence of the
non-movant is to be believed and all justifiable inferences are to be drawn in his favor.
Anderson, 477 U.S. at 255. The non-movant need not be given the benefit of every
4
inference but only of every reasonable inference. Brown v. City of Clewiston, 848 F.2d
1534, 1540 n.12 (11th Cir. 1988).
FACTS
For purposes of summary judgment, the facts are as follows. 1 Plaintiff, The Bank
of New York Mellon Trust Company, NA, is the successor in interest to Compass Bank
and Chase Manhattan Bank. Plaintiff is serving as the Indenture Trustee. Defendant
Medical Clinic Board of the City of Reform, Alabama (the ABoard@), is the issuer of the
bonds giving rise to the instant action. Defendant Salem Nursing & Rehab Center of
Reform, Inc., (ASNRC@) is the Board=s lessee and the successor in interest to Salem
Housing Corporation. Defendant AltaCare is the current manager of an 85-bed nursing
facility, Salem Nursing & Rehab Center of Reform 2 (previously known as the Reform
Health Care Center), located in Reform, Alabama (the AProject@).
AltaCare is not
obligated under the bond documents giving rise to the instant action but, as manager of the
Project, asserts an interest in the Project and other collateral and controls the Project=s
records.
1
The nonmoving defendants did not include a full statement of facts in response to
Plaintiff=s motion for summary judgment. Therefore, Plaintiff=s statement of facts will be used for
summary judgment purposes, with the exception of any facts that are affirmatively disputed by the
defendants. (Doc. 46, p. 2).
2
Salem Nursing & Rehab Center of Reform, referred to as the AProject,@ is defined in the
Indenture and Lease Agreement as the Project Building, the Project Equipment, and the Project
Site (each of which also are defined in the documents). (Doc. 19-1, p. 25; Doc. 19-3, p. 14).
5
On May 1, 1995, the Board and Compass Bank entered into an Indenture of Trust, to
which plaintiff ultimately became Compass’s successor in interest. (Doc. 19-1). As a
part of the agreement, the Board issued bonds to Compass Bank to finance the costs of the
acquisition, expansion, and renovation of the Reform Health Care Center. (Id. at 6). The
Board agreed then to lease the facility to Salem Housing Corporation, a North Carolina
non-profit corporation, with the lease proceeds pledged for payment of the bonds. (Id.)
The Board issued the bonds in two series, a $2,720,000.00, First Mortgage Revenue Bond
(the ASeries 1995A Bonds@), and a $355,000.00, Taxable First Mortgage Revenue Bond
(the ASeries 1995B Bonds@) (together, the ABonds@), the aggregate amount totaling
$3,075,000.00. (Id.)
The Bonds are governed by (1) the Indenture of Trust dated May 1, 1995 (doc.
19-1), and (2) the First Supplemental Indenture dated September 1, 2000 (doc. 19-2). To
secure the obligations in the Indenture of Trust, the Board executed the Mortgage and
Fixture Filing (the AMortgage@) (doc. 19-7) and Security Agreement (doc. 19-5) to the
Trustee, as successor in interest to Compass Bank. The Mortgage grants the Trustee a
first priority mortgage lien on the Nursing Home, Project Site (as defined by the Mortgage
document), and Revenues (as defined by the Mortgage document). (Doc. 19-7).
To generate the revenue needed to pay the Bond obligation, the Board entered into a
Lease Agreement dated May 1, 1995, (doc. 19-3) with Salem Housing Corporation, in
6
which Salem Housing Corporation leased the Project from the Board. 3 The rights of the
Board to payments due pursuant to the Lease Agreement have been assigned to the Trustee,
and the amounts to be paid under the Lease Agreement have been specifically delegated to
the payment of the Bonds. (Doc. 19-1, p. 9). Accordingly, the Trustee is empowered to
enforce the rights of the Board under the Lease Agreement. (Doc. 19-1, ' 10.3). On or
about September 1, 2000, Salem Nursing & Rehab Center of Reform, Inc., (ASNRC@) and
the Trustee, as successor in interest to Chase Manhattan Bank and Compass Bank, entered
into an Assumption Agreement under which SNRC assumed all the covenants, conditions,
duties, and obligations of Salem Housing Corporation contained in the Mortgage,
Indenture, and Lease Agreement, including the payments and other obligations set forth in
the Lease Agreement. (Doc. 19-8). As a condition of the Assumption Agreement, Salem
Housing Corporation transferred its interest in the Project to SNRC. (Docs. 19-4, 19-8).
As of November 19, 2012, the Series 1995A Bonds were outstanding in the principal
amount of $2,425,000.00. (Doc. 43-1 at & 17).
The Bonds are special limited obligations of the Board, payable solely from the
payments made by SNRC under the Lease or, upon an event of default, from the proceeds
derived from the liquidation of the Project and any other personal property covered by the
Mortgage. (Doc. 19-1, '' 6.1, 10.3, 10.7; Doc. 19-7, ' 2.6; Doc. 43-1 at & 16). Under
3
On or about September 1, 2000, the Board and Salem Housing Corporation entered into
the First Supplemental Lease. (Doc. 19-4). Salem Housing Corporation filed Chapter 11
bankruptcy and the reorganization plan was confirmed by the bankruptcy court on August 31,
2000. (Doc. 19-4, p. 2). Under the reorganization plan, the lease of the Project was transferred
to SNRC. (Id.)
7
the Lease Agreement, SNRC must pay, as rent, the amounts required by the Lease
Agreement in installments that, in the aggregate, are sufficient to pay in full, when due, all
the outstanding Bonds, including the total interest due and payable, the total principal
amount of the Bonds, and the premium, if any, payable on the redemption of any Bonds.
(Doc. 19-4, Art. III). SNRC is required to operate the Project on a revenue-producing
basis, and fix, charge, and collect, or cause to be fixed, charged, and collected, rates, fees
and charges sufficient each year to produce Net Revenues Available for Debt Service 4
equal to at least one hundred twenty percent of the Annual Debt Service. (Doc. 19-3, '
6.7).
In the event of a default under the Lease Agreement, if the Trustee employs
attorneys or incurs other expenses in connection with the collection of payments required
under the Lease Agreement or the enforcement of performance of any obligations under
the Lease Agreement, SNRC is liable to the Trustee for reasonable attorneys= fees and
expenses. (Doc. 19-3, ' 10.4). Events of Default under the Lease Agreement include the
failure of SNRC to make payments required under '4.2(a) or (b) and the failure of SNRC
to observe and perform any covenant, condition, or agreement under the Lease Agreement.
(Doc. 19-3, ' 10.1). Events of Default under the Indenture are defined as, among others:
4
A>Debt Service Reserve Requirement= means an amount equal to the Maximum Annual
Debt Service on each series of the Series 1995A Bonds and the Series 1995B Bonds, unless such
amount would be greater than (a) 10% of the face amount of such series, or (b) 125% of the
Average Annual Debt Service on such series of Bonds, in which event the Debt Service Reserve
Requirement shall be reduced to the lesser amounts described in (a) and (b).@ (Doc. 19-3,
pp. 8-9).
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(a) the failure of the Board to pay interest on the Bonds when due; (b) the failure of the
Board to pay principal on the Bonds when due; (c) default in the performance or
observance of any covenant by the Board and the failure to remedy the same after notice;
and (d) the occurrence of an Event of Default under the Mortgage or Lease Agreement.
(Doc. 19-1, ' 10.1).
Upon the occurrence of an Event of Default under the Indenture, the Lease
Agreement, or the Mortgage, the Trustee is entitled to the appointment of a receiver over
the Property as a matter of right. 5 (Doc. 19-1, ' 10.5; Doc. 19-3, ' 10.2(d); Doc. 19-7, '
2.5).
The Lease Agreement provides that, upon the occurrence of an Event of Default,
the Trustee may take any action at law or in equity to enforce performance and observance
of any obligation, agreement, or covenant of SNRC under the Lease Agreement. (Doc.
19-3, ' 10.2). The Lease Agreement requires SNRC to provide annually to the Trustee a
complete audit report and opinion, certified by an Independent Accountant, containing a
balance sheet, income statement, results of operations, and statement of cash flows at the
end of each fiscal year. (Doc. 19-3, ' 6.5(a)). Neither SNRC nor AltaCare, on SNRC=s
behalf, has provided the Trustee with the required audit report for the fiscal years ending in
2010, 2011, or 2012. (Doc. 43-1 at & 38; Doc. 43-2, 153:8-15, 154:21-155:2).
5
Section 10.2(d) of the Lease Agreement allows the Trustee to A[f]oreclose on its liens
under the Mortgage and the Security Agreement and take any other action or remedy specified in
the Mortgage and the Security Agreement. Section 2.5 of the Mortgage allows for the
appointment of a receiver as a matter of Astrict right.@
9
I. Payment Default under the Indenture
The Board has failed to make the payments to the Trustee required under '' 3.6(b)
and (c) of the Indenture. Those required payments consist of:
(a) Seventy Thousand Dollars ($70,000.00) on or before May 1, 2009, in
order to redeem those Series 1995 Bonds maturing on that date;
(b) Seventy-five Thousand Dollars ($75,000.00) on or before May 1, 2010,
in order to redeem those Series 1995 Bonds maturing on that date;
(c) Eighty Thousand Dollars ($80,000.00) on or before May 1, 2011, in order
to redeem those Series 1995 Bonds maturing on that date; and
(d) Eighty-Five Thousand Dollars ($85,000.00) 6 on or before May 1, 2012,
in order to redeem those Series 1995 Bonds maturing on that date.
(Doc. 19-1, '' 3.6(b), 3.6(c)). The Board has failed to make the payments to redeem the
Bonds maturing in 2010, 2011, or 2012. The Board also has failed to pay the required
semiannual installments of interest, of $105,495.63 each, on the Bonds due for payment on
and after November 1, 2009. (Doc. 43-1 at && 19-20). As of November 15, 2012, the
Board has failed to cure the defaults described above. (Id. at & 21).
The Trustee is owed the following sums on the Bonds: unpaid principal and interest,
interest due on unpaid and overdue interest, and interest due on unpaid and overdue
principal. Interest continues to accrue at the Late Payment Rate of $669.65 per day.
(Doc. 43-1 at & 24). There is a dispute of fact as to the amounts owed. Specifically,
6
Plaintiff=s Motion for Summary Judgment claims that $85,000.00 was due on or before
May 1, 2012. (Doc. 43, p. 8). However, the original Indenture lists $90,000.00 as the amount
payable on May 1, 2012. (Doc. 19-1 ' 3.6(c)).
10
Defendants contend that there exists $305,053.13, of acknowledged Aon hand@funds being
held by the Plaintiff/Trustee which should be applied as a credit against alleged payment
due on the Bonds. (Doc. 46, p. 1). This arrangement was discussed in a Apayoff letter@
sent by Plaintiff to Defendants on December 6, 2012.
(Doc. 46-2, p. 2).
Also,
Defendants contend that the Plaintiff has not presented sufficient proof of its claimed
expenses and the reasonableness of those expenses, specifically the reasonableness of
attorney’s fees claimed as expenses of the Trustee.
II. Payment Default Under the Lease Agreement
The last lease payment received by the Trustee on behalf of SNRC was in the
amount of $178,426.88 on or about May 1, 2009, and the Trustee has not received any
lease payments since. (Doc. 43-1 at & 26; see also Doc. 43-2, 53:16-20; 144:22-147:20).
These missed payments have resulted in Events of Default as defined in the Lease
Agreement. (Doc. 19-3, ' 10.1(a); Doc. 43-1 at && 26-27). The Indenture provides that
the failure of SNRC to make payments to the Trustee as provided in the Lease Agreement
also is an Event of Default under the Indenture. (Doc. 19-1, ' 10.1(d)). As of November
15, 2012, SNRC owed $1,121,266.79 as a result of unpaid lease payments. (Doc. 43-1 at
& 28).
III. Covenant Defaults Under the Indenture and Lease Agreement
Covenant Defaults under ' 10.1(c) of the Indenture ripen into Events of Default if
the Covenant Default is not cured within 30 days of receipt of notice through first class
mail. (Doc. 19-1, ' 10.12(d); Doc. 19-3, ' 10.1(b); Doc. 43-1 at & 48). The Trustee
11
provided SNRC with notice of the Covenant Defaults and, as of January 4, 2013, SNRC
had failed to cure the Covenant Defaults. 7 (Doc. 43-1 at && 46-47).
A. Repair and Replacement Fund Default
Pursuant to the Lease Agreement, the Repair and Replacement Fund is required to
maintain a balance of $40,000.00 8. (Doc. 43-1 at & 29). If the Repair and Replacement
Fund falls below $40,000.00, SNRC is required to make monthly deposits of $2,200.00,
until the amount is restored. (Doc. 19-3, ' 4.2(d)). As of November 15, 2012, the Repair
and Replacement Fund had a balance of $23,626.90, and SNRC had failed to make any
payments as required by the Lease Agreement. (Doc. 43-1 at && 30-31).
B. Audited Financial Statement Default
Under the Lease Agreement, SNRC is required to provide the Trustee with audited
balance sheets, income statements, and results of operations on an annual basis. (Doc.
19-3, ' 6.5(a)). As of November 15, 2012, SNRC had failed to provide the required
documents for fiscal years ending June 30 of 2010, 2011, and 2012. (Doc. 43-1 at & 38;
7
Plaintiff=s Motion for Summary Judgment claims that notice was served on October 18
and October 31 of 2012, and uses the affidavit of Bridget M. Schessler, the Vice President for The
Bank of New York Mellon Trust Company, as evidence of the fact. However, none of the
exhibits cited to within the affidavit is included in the Plaintiff=s filing, and the affidavit does not
provide the dates on which notice was served. Therefore, the court will not construe the dates of
notice to be undisputed facts because they are not supported by evidence.
8
Plaintiff cites to ' 6.9 of the Indenture, presumably to cite the required balance of the
Repair and Replacement Fund. However, the page upon which ' 6.9 of the Indenture is located
was not filed as part of the record, and thus will not be considered by the court as evidence.
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Doc. 43-2, 153:8-15, 154:10-17; Doc. 43-3, 81:5-9 (stating he is unaware of whether audits
were done)).
C. Rate Covenant Default
Under the Lease Agreement, SNRC is required to set its rates at levels that will
generate revenues sufficient to meet SNRC=s obligations under the Lease Agreement.
(Doc. 19-3, ' 6.7). If SNRC is not generating sufficient revenue to meet its obligations
under the Lease Agreement, it is required to employ independent accountants or
consultants to examine its operations. (Id.) As of November 15, 2012, despite its
payment defaults, SNRC had not hired independent accountants or consultants as required
by the Lease Agreement. (Doc. 43-2, 161:6-4; see also Doc. 43-1 at & 40 (stating that the
Trustee has not been informed of the hiring of independent accountants or contractors by
SNRC)).
D. Intercompany Loans
SNRC is not permitted under the Lease Agreement to make intercompany loans
until it has fulfilled all of its monthly obligations under the Lease Agreement. (Doc. 19-3,
' 6.13). However, SNRC=s audited financial statements for the fiscal year ending June 30,
2009, show a Current Asset labeled AIntercompany@ in the amount of $1,375,740.00.
(Doc. 43-1 at & 42). SNRC=s unaudited financial statements and Medicare and Medicaid
Cost Reports for fiscal years ending June 30 of 2010, 2011, and 2012, each reflect
accounting entries that appear to represent the Current Asset labeled AIntercompany.@
(Doc. 43-1 at & 43). Because SNRC has not made the payments required under the Lease
13
Agreement since at least May 2009, it was not permitted to make intercompany loans after
that date (presuming SNRC met its obligations in May 2009). (Doc. 19-3, ' 6.13).
E. Working Capital Default
Pursuant to the Lease Agreement, SNRC is required to maintain working capital in
the amount of at least Two Hundred Fifty Thousand Dollars ($250,000.00). (Doc. 19-3, '
6.10). As of November 15, 2012, SNRC did not have the required amount of working
capital. (Doc. 43-2, 177:21-178:7, 193:22-194:10; Doc. 43-1 at & 45).
IV. Defaults Under the Medical Clinic Board Mortgage
An Event of Default under either the Indenture or the Lease Agreement constitutes
an Event of Default under the Mortgage. (Doc. 19-7, ' 2.1(d)). Because undisputed
Events of Default have occurred and continue to occur, under both the Indenture and the
Lease Agreement, as set forth, supra, an Event of Default has occurred and continues to
occur under the Mortgage. (Doc. 19-7, ' 2.1(d); Doc. 43-1 at & 50).
DISCUSSION
Summary judgment is appropriate in a breach of contract action where the contract
is unambiguous and the facts undisputed.
Nunnelley v. GE Capital Information
Technology, 730 So. 2d 238, 241 (Ala. Civ. App. 1999) (citing Gabrielson v. Healthcorp of
Eufaula, Inc., 628 So. 2d 411, 415 (Ala. 1993)). In Defendants= Response to Plaintiff=s
Motion for Summary Judgment, Defendants dispute only two of Plaintiff=s assertions.
First, Defendants argue that there is $305,053.13 of Aon hand@ funds being held by Plaintiff
14
that should be applied as a credit against the payment due on the Bonds. Defendants argue
that this dispute as to whether the damages, as alleged, are accurate constitutes a question
of material fact that precludes summary judgment. Defendants claim that the dispute
illustrates that Plaintiff cannot conclusively prove every element of its claim, and,
therefore, summary judgment is inappropriate. Defendants also dispute the Plaintiff=s
calculation of Trustee=s fees and expenses, claiming that A[w]ithout a breakdown of the fees
and expenses, it is impossible for these Defendants (and this Court) to determine whether
the fees and expenses incurred are, in fact, reasonable.@ (Doc. 46, p. 5).
Although the court agrees that questions remain as to the amount of damages to
which Plaintiff is entitled and the amount of Trustee fees and expenses that are reasonable,
these questions do not preclude summary judgment in favor of the moving party on
questions of liability for breach of the Indenture and Lease Agreement, and for forms of
relief not related to the actual amount of money damages. The undisputed evidence
presented by Plaintiff establishes that Defendants entered into the agreements herein
willingly and have defaulted on these agreements, and have remained in default for over
four years, as set out by Plaintiff in the motion for summary judgment. The evidence
establishes that Defendants are liable to Plaintiff, although the amount of liability remains
in question. Defendants have offered no evidence to dispute Plaintiff=s claim. Because
there is no issue of material fact, summary judgment is appropriate as to finding the
Defendants liable to the Trustee, as well as the Trustee’s entitlement to relief such as the
appointment of a receiver and other equitable relief..
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CONCLUSION
Premised on the foregoing, Plaintiff=s motion for summary judgment is due to be
GRANTED. By separate Orders, the court will GRANT summary judgment to the
Plaintiff on the liability of the Defendants, and will order the appointment of a receiver to
take over the operations of the Project nursing home, and will order the Defendants to
make an accounting to the Plaintiff for all funds, revenues, and expenditures since May 1,
2009. The court reserve to a later time the determination whether the plaintiff is entitled
to a money judgment for damages.
DONE this 18th day of March, 2014.
________________________________
T. MICHAEL PUTNAM
U.S. MAGISTRATE JUDGE
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