Ally Bank et al v. Wells Fargo Bank, N.A.

Filing 672

ORDER by Judge Yvonne Gonzalez Rogers denying 622 Motion for Payment of Fees and Expenses; denying without prejudice 622 Motion to Withdraw as Attorney ; denying 642 Motion to Lift Preliminary Injunction for Limited Purpose. (fs, COURT STAFF) (Filed on 4/30/2014)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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FIDELITY NATIONAL TITLE INSURANCE
COMPANY, et al,
Plaintiffs,

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vs.
JAMES C. CASTLE AKA J. CHRISTOPHER
CASTLE, et al,

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Defendants.

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Northern District of California

United States District Court

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CASE NO.: 11-CV-896 YGR
ORDER:
(1) DENYING PLAINTIFFS’ MOTION TO LIFT
PRELIMINARY INJUNCTION FOR LIMITED
PURPOSE OF ALLOWING JUDGMENT
CREDITOR TO EXECUTE ON FROZEN FUNDS
WITHOUT PREJUDICE (DKT. NO. 642);
(2) DENYING CASTLE’S MOTION FOR
PAYMENT OF FEES AND EXPENSES FROM
FROZEN ASSETS (DKT. NO. 622);
(3) DENYING ALTERNATIVE MOTION OF
CASTLE’S COUNSEL TO WITHDRAW
WITHOUT PREJUDICE

Defendant James C. Castle (“Castle”) has filed a Motion For Payment Of Fees And Expenses

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From Frozen Assets, or alternatively to allow his counsel to withdraw. (Dkt. No. 622.) Following

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shortly thereafter, Plaintiff Fidelity National Title Insurance Company (“FNTIC”) filed its Motion to

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Lift Preliminary Injunction For Limited Purpose of Allowing Judgment Creditor to Execute on Frozen

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Funds. (Dkt. No. 642.)

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I.

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Motions Concerning Use of Frozen Funds
Previously in this action, on December 5, 2011, the Court issued a Preliminary Injunction

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Order freezing funds in five bank accounts, belonging to three different defendants and a third party.

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(Dkt. No. 111.) Castle’s motion seeks to unfreeze those funds to pay his counsel, since he claims

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inability to pay her otherwise. However, none of those accounts are in Castle’s name. Although

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Castle argues that, as a principal of the entities (a limited liability company and an unincorporated

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association), he is authorized to make disbursements of the funds therein, he has not established that

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he is authorized to use those funds for his own personal purposes. The Preliminary Injunction Order

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expressly provided that Castle could petition for the use of the frozen funds for legal expenses if he

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could provide “evidence of his authorization to use business funds for personal purposes.” (See

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Document No. 111, 3:15-17.) Having failed to do so, the motion is DENIED.

FNTIC seeks to lift the preliminary injunction order to pay a judgment against Castle. As with

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Castle’s motion, there is no evidence or authority offered to show that allowing FNTIC to attach the

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funds in the frozen accounts would be permissible. Again, the funds are held in the name of other

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entities, not the judgment debtor Castle. As FNTIC concedes, the decision about whether these funds

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might be used to pay the judgment against Castle is a matter most appropriately decided by the court

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that entered the judgment. Consequently, the Court DENIES the motion to lift the preliminary

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injunction, but without prejudice to some further showing that the funds may be used to pay the state

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court judgment.

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II.

Motion to Be Relieved As Counsel
Castle’s motion seeks, in the alternative, to allow his counsel to withdraw. Based on the

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Northern District of California

present showing, the Court DENIES this motion WITHOUT PREJUDICE. The proof of service on the

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United States District Court

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motion and supporting papers do not indicate that Castle was served with a copy of the motion. There

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is no evidence in the record to indicate that Castle was informed that his counsel, Ann McFarland

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Draper (“Draper”), seeks to withdraw. Likewise, there is no evidence that Castle was notified of the

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consequences of Draper’s potential withdrawal.
Should Draper continue to seek leave to withdraw, she is directed to serve a notice of motion,

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declaration, and proposed form of order on Castle, and all remaining parties in the litigation, which

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contains all the information provided in California Judicial Council Forms MC-051, MC-052, and

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MC-053. (See http://www.courts.ca.gov/forms.htm.) Inclusion of all the information therein will

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ensure that Castle understands the consequences of the motion, and that Draper provides the Court

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and opposing parties with Castle’s contact information. However, Draper must complete the briefing

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on the outstanding discovery dispute.

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III.

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Discovery Dispute
As stated on the record, Plaintiffs are directed to file a formal motion regarding the relief they

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seek in connection with Castle’s alleged failure to provide adequate responses to their document

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demands. Said motion shall be filed no later than May 9, 2014. Castle’s response shall be filed by

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May 23, 2014. Any reply shall be filed by May 30, 2014. Hearing is scheduled for June 17, 2014, at

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2:00 p.m. in Courtroom1. Draper is hereby advised that the Court will only consider an extension if

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Draper is actively in trial and provides verification of the same by the assigned trial judge. Given the

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history of this litigation, and this dispute particularly, no other request for extension will be

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entertained.

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IV.

Conclusion

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For the reasons stated above, DENIES the motions.

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This Order terminates Dkt. Nos. 622 and 642.

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IT IS SO ORDERED.

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Date: April 30, 2014
____________________________________
YVONNE GONZALEZ ROGERS
UNITED STATES DISTRICT COURT JUDGE

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Northern District of California

United States District Court

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