FNB Bank v. Park National Corporation et al
ORDER denying 110 Motion for Summary Judgment by Park National Corporation. Signed by Chief Judge William H. Steele on 12/27/2013. copies to parties. (sdb)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
PARK NATIONAL CORPORATION, )
CIVIL ACTION 13-0064-WS-C
This matter is before the Court on the motion of defendant Park National
Corporation (“Park”) for summary judgment. (Doc. 110). The parties have
submitted briefs and evidentiary materials in support of their respective positions,
(Docs. 111-12, 114, 140-41, 144, 151), and the motion is ripe for resolution. After
careful consideration, the Court concludes that the motion is due to be denied.
According to the second amended complaint, (Doc. 130), non-party Vision
Bank (“Vision”) made a $5 million loan (“the Loan”) to non-party Marine Park,
LLC (“Marine”) for a real estate development project, secured by certain realty
and guarantied by multiple guarantors. In March 2007, Vision sold a 100%
participation interest in the loan to the plaintiff, with the parties’ obligations
memorialized in a written agreement (“the Agreement”). Later the same month,
Vision consummated a merger agreement with Park, a bank holding company, and
Vision became Park’s subsidiary. Park thereafter became closely involved in
supervising Vision. Over the next two years, Vision made a number of
misstatements, repeatedly failed to disclose important information, and engaged in
other conduct to which the plaintiff objects. The Loan matured without payment
in January 2009, and litigation with Marine and the guarantors is ongoing.
In February 2012, Park sold certain “good” assets of Vision to non-party
Centennial Bank. In February 2012, Park merged Vision into defendant SE
Property Holdings, LLC (“SEPH”), a wholly owned subsidiary of Park, and
Vision ceased to exist. Among the “bad” assets retained by Vision and transferred
to SEPH was the Loan.
In January 2013, the plaintiff sent the defendants a letter identifying
multiple defaults under the Agreement and demanding that the defaults be cured or
its participation interest repurchased as provided for in the Agreement. The
defendants neither cured nor repurchased.
The four counts against the defendants assert the following: (1) breach of
contract; (2) negligence; (3) willful misconduct; and (4) specific performance.
Park seeks summary judgment as to all claims.
Summary judgment should be granted only if “there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56(a). The party seeking summary judgment bears “the initial
burden to show the district court, by reference to materials on file, that there are no
genuine issues of material fact that should be decided at trial.” Clark v. Coats &
Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). The moving party may meet its
burden in either of two ways: (1) by “negating an element of the non-moving
party’s claim”; or (2) by “point[ing] to materials on file that demonstrate that the
party bearing the burden of proof at trial will not be able to meet that burden.” Id.
“Even after Celotex it is never enough simply to state that the non-moving party
cannot meet its burden at trial.” Id.; accord Mullins v. Crowell, 228 F.3d 1305,
1313 (11th Cir. 2000); Sammons v. Taylor, 967 F.2d 1533, 1538 (11th Cir. 1992).
“When the moving party has the burden of proof at trial, that party must
show affirmatively the absence of a genuine issue of material fact: it must support
its motion with credible evidence ... that would entitle it to a directed verdict if not
controverted at trial. [citation omitted] In other words, the moving party must
show that, on all the essential elements of its case on which it bears the burden of
proof, no reasonable jury could find for the nonmoving party.” United States v.
Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir. 1991) (en banc)
(emphasis in original); accord Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115
(11th Cir. 1993).
“If the party moving for summary judgment fails to discharge the initial
burden, then the motion must be denied and the court need not consider what, if
any, showing the non-movant has made.” Fitzpatrick, 2 F.3d at 1116; accord
Mullins, 228 F.3d at 1313; Clark, 929 F.2d at 608.
“If, however, the movant carries the initial summary judgment burden ...,
the responsibility then devolves upon the non-movant to show the existence of a
genuine issue of material fact.” Fitzpatrick, 2 F.3d at 1116. “If the nonmoving
party fails to make ‘a sufficient showing on an essential element of her case with
respect to which she has the burden of proof,’ the moving party is entitled to
summary judgment.” Clark, 929 F.2d at 608 (quoting Celotex Corp. v. Catrett,
477 U.S. 317 (1986)) (footnote omitted); see also Fed. R. Civ. P. 56(e)(2) (“If a
party fails to properly support an assertion of fact or fails to properly address
another party’s assertion of fact as required by Rule 56(c), the court may …
consider the fact undisputed for purposes of the motion ….”).
In deciding a motion for summary judgment, “[t]he evidence, and all
reasonable inferences, must be viewed in the light most favorable to the
nonmovant ….” McCormick v. City of Fort Lauderdale, 333 F.3d 1234, 1243
(11th Cir. 2003).
There is no burden on the Court to identify unreferenced evidence
supporting a party’s position.1 Accordingly, the Court limits its review to the
exhibits, and to the specific portions of the exhibits, to which the parties have
expressly cited. Likewise, “[t]here is no burden upon the district court to distill
every potential argument that could be made based upon the materials before it on
summary judgment,” Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 599
(11th Cir. 1995), and the Court accordingly limits its review to those arguments the
parties have expressly advanced.
I. Breach of Contract.
Park first argues that it is entitled to summary judgment for the reasons
expressed in the motion for summary judgment filed by SEPH. (Doc. 111 at 1).
The Court has by separate order denied SEPH’s motion for summary judgment in
its entirety, so it is of no assistance to Park.
Count One alleges that Park is liable for breach of contract because, “as the
alter ego, principal or successor of Vision, [it] is obligated under the Participation
Agreement.” (Doc. 130 at 19, ¶ 70). 2 Count One further alleges that Park is liable
“because it has undertaken the duty to fulfill Vision’s contractual obligations.”
(Id., ¶ 71). Despite these clear allegations that Park’s liability is based on its
relationship with Vision and its voluntary undertaking, Park does not address any
of these theories. Instead, Park argues only that SEPH is not its alter ego and that
SEPH is not its agent. (Doc. 111 at 6-11). Because Count One does not rest on
Park’s relationship with SEPH but on its relationship with Vision (and on its
Fed. R. Civ. P. 56(c)(3) (“The court need consider only the cited materials, but it
may consider other materials in the record.”); accord Adler v. Wal-Mart Stores, Inc., 144
F.3d 664, 672 (10th Cir. 1998) (“The district court has discretion to go beyond the
referenced portions of these [summary judgment] materials, but is not required to do
The plaintiff has abandoned its “successor” theory of Park’s liability. (Doc. 140
at 9 n.4).
voluntary undertaking), Park’s argument is wholly inapposite and cannot support
After the plaintiff in its brief pointed out Park’s error, Park in its reply brief
retrained its guns in the right direction. But its effort comes too late. “District
courts, including this one, ordinarily do not consider arguments raised for the first
time on reply.” Gross-Jones v. Mercy Medical, 874 F. Supp. 2d 1319, 1330 n.8
(S.D. Ala. 2012) (citing cases and explaining the underlying rationale). Park
identifies no reason to depart from this well-established rule, and the Court
declines to do so, especially since the basis of the plaintiff’s claim is stated
explicitly in the body of Count One.
II. Negligence and Willfulness.
Park’s entire argument consists of the ipse dixit that it “did not owe [the
plaintiff] any duties of care” because it “never administered the loan, and never
assumed any duty to” the plaintiff. (Doc. 111 at 11-12). Park cites to no evidence
that establishes these propositions and engages in no discussion of the law
concerning the circumstances under which a duty of care arises. Park’s treatment
falls far below the minimum needed to carry its initial burden on motion for
summary judgment. In its reply brief, Park complains that the plaintiff’s brief in
opposition fails to establish the existence of a duty, (Doc. 151 at 12), but, since
Park never carried its initial burden, the plaintiff’s treatment of the issue is
irrelevant. E.g., Imaging Business Machines, LLC v. BancTec, Inc., 459 F.3d
1186, 1190 (11th Cir. 2006).
III. Specific Performance.
Park argues that, since specific performance is a remedy provided by the
Agreement, and since it is not a party to the Agreement, it cannot be compelled by
specific performance to repurchase the plaintiff’s participation interest. (Doc. 111
at 13-14). The plaintiff responds that Park’s alleged status as Vision’s alter ego
and principal exposes it to specific performance of the repurchase obligation.
(Doc. 140 at 25). Park offers no reply. Since Park’s status as alter ego and/or
principal of Vision remains open, and since Park has not refuted the proposition
that such a status would permit enforcement of the repurchase option against it, its
motion for summary judgment must fail.3
For the reasons set forth above, Park’s motion for summary judgment is
DONE and ORDERED this 27th day of December, 2013.
s/ WILLIAM H. STEELE
CHIEF UNITED STATES DISTRICT JUDGE
However, in ruling on the plaintiff’s motion for partial summary judgment, the
Court has definitively ruled that Sections 1 and 14 of the Agreement preclude the plaintiff
from seeking to enforce the repurchase option. That ruling protects Park as much as it
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