Kilgore et al v. Keybank, National Association et al

Filing 50

STIPULATION AND ORDER Extending Time for Defendants to Respond to Plaintiff's Complaint to 1/20/09. Signed by Judge Thelton E. Henderson on 10/8/08. (tdm, COURT STAFF) (Filed on 10/8/2008)

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Andrew A. August (SBN 112851 [e-mail] Kevin Rooney (SBN 184096) [e-mail] PINNACLE LAW GROUP, LLP 425 California Street, Suite 1800 San Francisco, California 94104 Telephone: [phone] Facsimile: [phone] Attorneys for Plaintiffs Matthew C. Kilgore, William Bruce Fuller and Kevin Wilhelmy

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

MATTHEW C. KILGORE, individually and on behalf of all others similarly situated; WILLIAM BRUCE FULLER, individually and on behalf of all others similarly situated; KEVIN WILHELMY, individually and on behalf of all others similarly situated,

) ) ) ) ) ) ) Plaintiffs, ) ) v. ) ) KEYBANK, NATIONAL ASSOCIATION, a ) national banking association organized under ) the laws of the United States of America and ) successor in interest to KEYBANK USA, N.A.; ) KEY EDUCATION RESOURCES, a division ) of KEYBANK, NATIONAL ASSOCIATION; ) GREAT LAKES EDUCATIONAL LOAN ) SERVICES, INC., a Wisconsin corporation; ) STUDENT LOAN XPRESS, a Delaware ) corporation; AMERICAN EDUCATION ) SERVICES, form of entity unknown; DOES ) 1-25, ) ) Defendants. ) )

Case No. C08-02958 TEH STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT [DECLARATION OF ANDREW A. AUGUST FILED CONCURRENTLY HEREWITH]

STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT CASE NO. C08-02958 TEH
LA1 1266232v.1

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WHEREAS, the Second Amended Complaint ("Complaint") asserts claims on behalf of a California-only putative class of student-borrowers who were attending a helicopter school ­ Silver State Helicopters ("SSH") ­ when the school ceased operations and filed a voluntary petition for relief under chapter 7 of title 11 of the United States Code, 11 U.S.C. § 101 et seq., in the United States District Court for the District of Nevada in February 2008; WHEREAS, SSH is not a party to this action, but rather, the Complaint asserts claims against Defendants who are the holders or servicers of loans made to students to finance their education at SSH; WHEREAS, the putative class is comprised of two classes: (a) a class of studentborrowers whose loans are held by Defendant Student Loan Xpress, Inc. ("SLX") and serviced by Defendant American Education Services ("AES") (the "SLX Class"); and (b) a class of student borrowers whose loans are held by Defendant KeyBank, N.A. ("KeyBank") and serviced by Defendant Great Lakes Education Loan Services, Inc. ("Great Lakes") (the "KeyBank Class"); WHEREAS, approximately 80% of the putative class members are part of the SLX Class because the vast majority of the loans at issue in this action are held by SLX and serviced by AES; WHEREAS, the Complaint asserts claims based on, among other things, Defendants' alleged involvement with SSH and the absence of the FTC Holder Notice in the students' loan documents; WHEREAS, this action is one of several putative class actions and one collective action pending against SLX arising from the closure and bankruptcy of SSH, including other actions pending in the Middle District of Florida (the "Florida Action"), the District of South Carolina, and in Georgia state court; WHEREAS, on July 11, 2008, the parties filed a stipulation to extend the time for Defendants to respond to the Complaint and to continue the Case Management Conference to afford Plaintiffs and Defendants an opportunity to participate in an early mediation regarding the claims asserted against Defendants; -1STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT CASE NO. C08-02958 TEH
LA1 1266232v.1

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WHEREAS, on July 15, 2008 the Court entered an order setting the Case Management Conference for October 20, 2008 at 1:30 p.m. and requiring Defendants (in accordance with the parties' stipulation) to respond to the Complaint by that same date; WHEREAS, Plaintiffs, SLX and Plaintiff's counsel in the Florida Action participated in two full days of mediation before the Honorable William J. Cahill (Ret.) on August 21 and September 23, 2008; WHEREAS, as a result of the mediation, Plaintiffs in this action, Plaintiffs in the Florida Action and SLX have reached an agreement in principle on the material terms of settlement that would resolve the claims asserted against SLX and AES through a proposed nationwide class action settlement; WHEREAS, the settlement between Plaintiffs and SLX would thus dispose of approximately 80% of the claims in this action; WHEREAS, given the complexity of this case and the existence of several other pending actions against SLX arising from SSH's closure and bankruptcy, Plaintiffs and SLX anticipate that it will take several months to document and finalize their proposed settlement, during which time the parties expect to, among other things, discuss the settlement with counsel in the other pending actions, negotiate the remaining terms of the settlement, negotiate and draft a comprehensive settlement agreement, and engage in confirmatory discovery in connection with the settlement; WHEREAS, as part of confirmatory discovery, Plaintiffs and SLX anticipate requesting and reviewing certain records from SSH, which are now in the possession of the Bankruptcy Trustee, including, but not limited to, records that should confirm which studentborrowers were attending SSH at the time the school closed and declared bankruptcy in February 2008; WHEREAS, counsel for the Trustee has advised Plaintiffs' counsel that records pertaining to SSH will first become available this month (see Declaration of Andrew A. August, ¶ 11); -2STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT CASE NO. C08-02958 TEH
LA1 1266232v.1

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WHEREAS, the Defendants in the KeyBank Class ­ KeyBank and Great Lakes ­ have advised Plaintiffs that they too are amenable to discussing an early resolution of the claims asserted against them in this action, and that the information likely to be obtained from SSH's Bankruptcy Trustee in connection with the confirmatory discovery process in the settlement with SLX will significantly facilitate any efforts to resolve the claims against KeyBank and Great Lakes; WHEREAS, in light of the substantial progress that has already been made towards resolving the vast majority of claims in this action and to conserve further the resources of the parties and this Court, the parties have agreed that the deadline for Defendants' response to the Complaint should be extended until January 20, 2009 to afford (1) Plaintiffs and SLX a reasonable opportunity to finalize and fully document the terms of their settlement (which, again, would also dispose of the claims asserted against Defendant AES), and (2) Plaintiffs and the remaining Defendants ­ KeyBank and Great Lakes ­ an opportunity to resolve their dispute after receipt and review of records from SSH's bankruptcy trustee; and WHEREAS, all parties agree that this extension will significantly facilitate their efforts to resolve this matter by allowing them to concentrate on the settlement process without simultaneously being required to fully brief and litigate the threshold legal issues raised in the Complaint. /// /// ///

-3STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT CASE NO. C08-02958 TEH
LA1 1266232v.1

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NOW, THEREFORE, IT IS HEREBY STIPULATED by and between the parties hereto, through their respective counsel of record, that all Defendants shall have up to and including January 20, 2009 to answer, move, or otherwise respond to the Complaint. Respectfully submitted, PINNACLE LAW GROUP LLP

Dated: October 7, 2008

By: /s/ Andrew A. August __________________ Andrew A. August (SBN 112851) Attorneys for Plaintiffs SIDLEY AUSTIN LLP

Dated: October 7, 2008

__________ By: /s/ Jennifer A. Landau Jennifer Altfeld Landau (SBN 153780) Attorneys for Defendant STUDENT LOAN XPRESS, INC. NIXON PEABODY LLP

Dated: October 7, 2008

By: /s/ Courtney Q. Brooks _________________ Courtney Q. Brooks Attorneys for Defendants KEYBANK, NATIONAL ASSOCIATION AND ITS DIVISION KEY EDUCATION RESOURCES, AND GREAT LAKES EDUCATIONAL LOAN SERVICES, INC. MCKENNA LONG & ALDRIDGE LLP

Dated: October 7, 2008
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By: /s/ Ann G. Grimaldi ___________________ Ann G. Grimaldi (SBN 160893) Attorneys for Defendant AMERICAN EDUCATION SERVICES

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LA1 1266232v.1

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STIPULATION TO EXTEND TIME TO RESPOND TO COMPLAINT CASE NO. C08-02958 TEH