Learning Experience Systems, LLC, The v. Loganathan et al

Filing 20

ORDER GRANTING IN PART AND DENYING IN PART Plaintiff's Motion for Temporary Restraining Order and Preliminary Injunction 7 . SO ORDERED BY Judge Christine M. Arguello on 10/16/15. (cmalc1)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Christine M. Arguello
Civil Action No. 15-cv-02057-CMA-CBS
THE LEARNING EXPERIENCE SYSTEMS, LLC,
Plaintiff,
v.
BERNARD ALLAGESWARAN LOGANATHAN,
KATIJAH BEEVE BINTE SHAIK ALAUDEEN, and
NESTERVILLE PROPERTIES, LLC,
Defendants.
ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF’S MOTION FOR
TEMPORARY RESTRAINING ORDER (DOC. # 7)
This matter comes before the Court on Plaintiff The Learning Experience
Systems, LLC’s (“Plaintiff”) Motion for Temporary Restraining Order and Preliminary
Injunction (the “Motion”). (Doc. # 7.) The Court, having reviewed the Motion, all
exhibits thereto, all arguments made in relation thereto, the Court file, and applicable
law, and for good cause shown, hereby finds that the Motion should be GRANTED IN
PART AND DENIED IN PART.
I. BACKGROUND
A. PROCEDURAL HISTORY
Plaintiff is the Judgment Creditor and Defendants Bernard Allageswaran
Loganathan (“Loganathan”), Katijah Beeve Binte Shaik Alaudeen (“Alaudeen,” and

together with Loganathan referred to herein as the “Judgment Debtors”) are Judgment
Debtors with respect to a Final Judgment entered by the United States District Court for
the Southern District of Florida on August 4, 2015 in the principal amount of
$928,606.00. Judgment Creditors have not satisfied, in part or in whole, the Judgment
against them.
On August 12, 2015, Plaintiff’s Florida counsel informed the Judgment Debtors’
Florida counsel that Plaintiff intended to seek an order from the Florida Court certifying
the Final Judgment for registration in other jurisdictions pursuant to 28 USC §1963 on
an expedited basis. On August 17, 2015, Plaintiff filed a Motion to Certify the Final
Judgment for Registration in the Florida lawsuit.
The next day, Judgment Debtors recorded a General Warranty Deed purporting
to convey residential property located at 23453 Painted Hills Street, Parker, Colorado
80138 (the “Colorado Property”) to Defendant Nesterville Properties, LLC (“Nesterville,”
and collectively with the Judgment Debtors referred to herein as “Defendants”). The
Colorado Property has a fair market value of approximately $600,000, but was
transferred by the Judgment Debtors to Nesterville for stated consideration of only Ten
Dollars ($10.00).
B. TEMPORARY RESTRAINING ORDER
Plaintiff seeks a temporary restraining order: (1) enjoining Defendants from
further attempts to convey, sell, or otherwise transfer ownership of the Colorado
Property; and (2) enjoining Judgment Debtors from alienating or liquidating any other
assets owned by them or by any entity under their control. The Court notes that on

2

October 16, 2015, it entered a stipulated order granting the preliminary injunction as to
Defendant Nesterville Properties, LLC. (Doc. # 16.) It now enjoins Judgment Debtors
as well from further attempts to convey, sell, or otherwise transfer ownership of the
Colorado Property. However, the Court denies Plaintiff’s request to enjoin Judgment
Debtors from alienating or liquidating any other assets owned by them or by any entity
under their control.
II. STANDARD
This Court’s review of Plaintiff’s Motion is governed by Federal Rule of Civil
Procedure 65(b). In essence, a TRO “is designed to preserve the status quo until there
is an opportunity to hold a hearing on the application for a preliminary injunction and
may be issued with or without notice to the adverse party.” Charles Alan Wright, et al.,
11A Fed. Prac. & Proc. Civ. § 2951 (3d ed. Apr. 2014 update). Moreover, while “[t]he
issuance of a temporary restraining order is a matter that lies within the discretion of
the district court,” a party must demonstrate “irreparable injury” as “an essential
prerequisite to a temporary restraining order.” Id. And most courts hold that a party
“must demonstrate at least a reasonable probability of prevailing on the merits” in order
to obtain such relief. Id.
Finally, while a motion for a temporary restraining order is distinct from a motion
for a preliminary injunction, some courts in the District of Colorado adhere to the same
familiar four-part test for granting a preliminary injunction when considering whether to
grant a temporary restraining order. See, e.g., Salba Corp., N.A. v. X Factor Holdings,
LLC, No. 12-CV-01306-REB-KLM, 2014 WL 128147 (D. Colo. Jan. 14, 2014). That

3

standard requires a plaintiff to demonstrate likelihood of success and irreparable harm
but also “that the balance of equities tips in [Plaintiff’s] favor, and that an injunction is in
the public interest.” Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008). 1
III. APPLICATION
Plaintiff fulfills the standard for a temporary restraining order as to its request to
enjoin Judgment Debtors from further attempts to convey, sell, or otherwise transfer
ownership of the Colorado Property. As an initial matter, Plaintiff has met the technical
requirements of Rule 65(b) by alleging with specificity in an affidavit the immediate loss
or injury that will be caused by Judgment Debtors’ actions, see (Doc. # 7-1), and by
certifying in writing that it has provided notice to Judgment Debtors, see (Doc. # 18). 2
Furthermore, the Court is persuaded that Plaintiff’s request to enjoin Judgment
Debtors from further attempts to convey, sell, or otherwise transfer ownership of the
Colorado Property meets the standard required for issuance of a temporary restraining
order. Plaintiff has established: (a) that it is likely to succeed on the merits of its claim
for violations of the Colorado Uniform Transfer Act, C.R.S. § 38-8-101, et seq.; (b) that it
is suffering immediate and irreparable injury due to the Judgment Debtors transfer of
1

While courts in this district have considered these latter two factors, they can be
considered at the discretion of the Court. See, e.g., Charles Alan Wright, et al., 11A
Fed. Prac. & Proc. Civ. § 2951 (3d ed. Apr. 2014 update) (“The court also may balance
the harm that might be suffered by defendant if the order were issued against the injury
that would result to plaintiff if the application for the restraining order were denied. This
balancing of the hardships approach is fairly common, particularly when one of the
parties is a governmental unit. More generally, it also may be appropriate for the court
to consider the effect of the requested order on the public interest.” (footnotes omitted)).
2
On October 15, 2015, the Court granted Plaintiff’s Motion for Appointment of Agent for
Substituted Service. (Doc. # 15.) On October 16, 2015, Plaintiff served a complete set
of pleadings on Michael Einbinder, Esq., who had been designated to receive service
on behalf of Judgment Debtors. (Doc. # 18.)
4

the Colorado Property, which was done to frustrate collection of the Florida Judgment
and/or render Judgment Debtors judgment-proof; (c) that this injury to Plaintiff
outweighs any harm caused as a result of an injunction; and (d) that the entry of an
injunction in this case is not adverse to the public interest. However, the Court denies
Plaintiff’s request to enjoin Judgment Debtors from alienating or liquidating any other
assets owned by them or by any entity under their control as this request is overly broad
and outside of the scope of the relief requested in Plaintiff’s complaint.
The Court also concludes that Plaintiff need not post a bond as security given
that Plaintiff is presently a judgment creditor of the Judgment Debtors. RoDa Drilling
Co. v. Siegal, 552 F.3d 1203, 1215 (10th Cir. 2009) (district courts have wide discretion
in determining whether to require security under Federal Rule of Civil Procedure 65);
see also Dargan v. Ingram, Case No. 08-cv-1714, 2009 WL 1437564, at *8 (W.D.
Wash. May 22, 2009) (“The Court has determined that there is no need for [movant] to
post a bond as security in this case given that [movant] is already a judgment creditor
. . . and the likelihood of the injunction or freeze asset order causing any harm to the
defendants” is minimal).
IV. CONCLUSION
For the foregoing reasons, it is
ORDERED that Plaintiff’s Motion for a Temporary Restraining Order (Doc. # 7) is
GRANTED IN PART AND DENIED IN PART. It is further
ORDERED that Judgment Debtors, along with their agents, servants, employees,
confederates, assigns, attorneys, and/or any persons acting in concert or participation

5

with them, or having knowledge of this Order by personal service or otherwise be, and
hereby are, pending a trial on the merits, preliminarily enjoined from further attempts to
convey, sell, or otherwise transfer ownership of the real property located in Douglas
County, Colorado, at 23453 Painted Hills Street, Parker, Colorado 80138. It is further
ORDERED that Plaintiff’s Motion for a Temporary Restraining Order is denied in
all other respects beyond what is ordered above. It is further
ORDERED that, pursuant to Federal Rule of Civil Procedure 65(b)(2), this Order
shall expire on October 30, 2015, with a hearing on Plaintiff’s request for a preliminary
injunction to be heard on that day at 3:00 PM. It is further
ORDERED that Plaintiff shall provide notice of this order to Defendants.
It is further
ORDERED that Plaintiff is to submit briefing as to why this Court should grant
a motion for a preliminary injunction by no later than October 23, 2015. 3 Judgment
Debtors are to submit a response no later than October 27, 2015.

DATED: October 16, 2015 at 5:19 PM

BY THE COURT:

CHRISTINE M. ARGUELLO
United States District Judge

3

In this briefing, Plaintiff can advance an argument as to why it is entitled to injunctive
relief beyond what is provided by this Order, though it must support its position with
sufficient factual support and legal authority.
6