Black et al v. Owen et al

Filing 181

ORDER granting 180 Motion for a TRO. Please see attached Order for details. Signed by Judge Robert N. Chatigny on 2/9/18. (Jones, P.)

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
JOSEPH N. and RUTH A. BLACK,
Plaintiff,
v.
NICHOLAS E. OWEN, II,
ET AL.
Defendants.

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Case No. 3:14-CV-23 (RNC)

ORDER
Plaintiffs Joseph N. and Ruth A. Black move for a temporary
restraining order (“TRO”) restraining the assets of defendant
Nicholas E. Owen (ECF No. 180). For reasons that follow, the
motion for a TRO is granted.
I. Background
Plaintiffs seek to enforce a Massachusetts state court
judgment entered in 2009 against Owen in the amount of
$2,386,816.34 (“2009 judgment”). This action was brought in 2014
against Owen and several limited liability companies (“LLCs”)
seeking a determination that Owen was the alter ego of the LLCs,
such that the LLCs are liable for the Massachusetts judgment. In
December 2016, this Court entered a consent judgment in favor of
plaintiffs (“2016 judgment”). The 2016 judgment found that Owen
was the alter ego of the LLCs, which had at various times
throughout 2012 and 2013 controlled upwards of $1.6 million. See
Judgment (ECF No. 173). The judgment ordered Owen to “provide
good faith cooperation” in satisfying his legal obligations. It

did not, however, include a specific monetary award because Owen
maintained that he had no significant personal assets at the
time. To date, Owen has failed to pay plaintiffs any amount
pursuant to the 2009 judgment.
On February 2, 2018, plaintiffs filed a motion seeking an
order to show cause why Owen should not comply with the 2016
judgment and produce documents related to Owens’s control of
Rolling Thunder II, LLC (“underlying motion”) (ECF No. 175). The
motion seeks an order directing that any payments to Owen from
Rolling Thunder be made instead to plaintiffs. Along with the
underlying motion, plaintiffs filed a motion for a TRO or
preliminary injunction (ECF No. 174). The Court dismissed the
motion for a TRO without prejudice for failure to comply with
Rule 65(b) (ECF No. 176). A status conference regarding the
underlying motion and the motion for preliminary injunction is
scheduled for February 14, 2018, at 10:30 a.m. The present motion
renews plaintiff’s motion for a TRO.
II. Legal Standard
“The purpose of a temporary restraining order is to preserve
an existing situation in statu quo until the court has an
opportunity to pass upon the merits of the demand for a
preliminary injunction.” Garcia v. Yonkers Sch. Dist., 561 F.3d
97, 107 (2d Cir. 2009) (quotation omitted). A plaintiff seeking a
TRO must show (1) “either (a) a likelihood of success on the

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merits or (b) sufficiently serious questions going to the merits
to make them a fair ground for litigation and a balance of
hardships tipping decidedly in the plaintiff’s favor”; (2) “the
plaintiff is likely to suffer irreparable injury in the absence
of an injunction”; (3) “the balance of hardships between the
plaintiff and defendant . . . tips in plaintiff’s favor”; and (4)
“the public interest would not be disserved by the issuance of a
[TRO].” Salinger v. Colting, 607 F.3d 68, 79-80 (2d Cir. 2010)
(standard for preliminary injunction); Spencer Trask Software &
Info. Servs., LLC v. RPost Int'l Ltd., 190 F. Supp. 2d 577, 580
(S.D.N.Y. 2002) (same standard applies to a TRO).
In addition, under Rule 65(b), a court may only issue a TRO
without notice and a hearing1 if:
(A) specific facts in an affidavit or a
verified complaint clearly show that
immediate and irreparable injury, loss, or
damage will result to the movant before the
adverse party can be heard in opposition; and
(B) the movant's attorney certifies in
writing any efforts made to give notice and
the reasons why it should not be required.

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Owen’s counsel has received electronic and written notice
of plaintiff’s motion for a TRO. See Klingman Cert. (ECF No. 1803). Although the text of Rule 65(b) limits its application to
TROs issued “without written or oral notice,” because Owen has
not had an opportunity to be heard on the motion, I apply the
requirements of Rule 65(b). See Tootsie Roll Indus. V. Sathers,
Inc., 666 F. Supp. 655, 657-58 (D. Del. 1987); accord PharmaSeq,
Inc. v. Estate of Griess, No. CIV.A. 15-00041, 2015 WL 620802, at
*2 (E.D. Pa. Feb. 11, 2015); Real Estate Disposition Corp. v.
Nat'l Home Auction Corp., No. CV 08-01331 SJO (EX), 2008 WL
11338210, at *2 (C.D. Cal. Mar. 7, 2008).
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III. Discussion
Plaintiffs have made the required showing for a TRO.
Plaintiffs provide documentation, including Rolling Thunder’s
Articles of Organization and an affidavit apparently signed by
Owen, indicating that Owen is Rolling Thunder’s “manager.” See
Underlying Motion, Ex. B-F (ECF No. 175). The documents show that
certain addresses and an attorney associated with Owen’s other
LLCs are linked to Rolling Thunder. See id. Rolling Thunder is
currently a party to at least two Connecticut Superior Court
actions indicating that it has an interest in two pieces of real
estate, both of which may soon result in substantial funds being
paid to Rolling Thunder. See Rolling Thunder II, LLC v. The St.
James Building Assoc., Inc., No. FBT CV 17-6061545-S (Bridgeport
Dist.) (Rolling Thunder seeking to enforce offer to purchase
property); Norma Berry v. Zoning Comm. Of Stratford, NO. FBT CV
17-6066842-S (Bridgeport Dist.) (Jan. 31, 2018, zoning settlement
approving development of apartment complex). Plaintiffs submit an
affidavit discussing these facts and expressing concern that Owen
will, as he has previously, transfer to third parties any funds
paid to Rolling Thunder, leaving no money to satisfy the 2009
judgment. See Black Aff. (ECF No. 180-2). Plaintiff’s counsel has
certified that notice has been provided to defense counsel. See
Klingman Cert. (ECF No. 180-3).
Based on plaintiff’s submissions and this Court’s findings
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in the 2016 judgment, I find that plaintiff has made the showing
required to obtain the requested TRO. Owen has failed to pay
plaintiffs any amount pursuant to the 2009 judgment and he has a
history of using LLCs to conceal his assets. Though “irreparable
harm” typically means an “injury for which a monetary award
cannot be adequate compensation,” Jayaraj v. Scappini, 66 F.3d
36, 39 (2d Cir. 1995), “an injunction may issue to stop a
defendant from dissipating assets in an effort to frustrate a
judgment,” Chemical Bank v. Haseotes, 13 F.3d 569, 573 (2d Cir.
1994). Although courts do not have authority to order an asset
freeze prior to the entry of a money judgment,2 here, a money
judgment has already entered against Owen. See Tiffany (NJ) LLC
v. Forbse, No. 11 CIV. 4976 NRB, 2015 WL 5638060, at *4 (S.D.N.Y.
Sept. 22, 2015) (ordering postjudgment asset restraint). This
showing satisfies Rule 65(b) and the “irreparable harm”
requirement for a TRO.
Plaintiffs have also satisfied the other requirements for a
TRO. They are likely to succeed on the merits in the underlying
motion: Owen is liable for the 2009 judgment and, as discussed
above, appears to be in possession, or may soon be in possession,
of undisclosed assets. The balance of hardships is in plaintiffs’
favor: Owen has paid nothing to satisfy the 2009 judgment and

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See Grupo Mexicano de Desarrollo S.A. v. Alliance Bond
Fund, Inc., 527 U.S. 308, 332 (1999).
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appears to be in violation of the 2016 judgment, which required
him to make good faith attempts to pay plaintiffs. Moreover, if
Owen does in fact have no assets, as he has consistently
represented, he will not be prejudiced by a restraining order.
Last, “[t]he public has an interest in the enforcement of
judgments.” State Farm Mut. Auto. Ins. Co. v. Am. Rehab And
Physical Therapy, Inc., 376 F. App'x 182, 184 (3d Cir. 2010).
IV. Conclusion
Accordingly, plaintiff’s motion for TRO (ECF No. 180) is
GRANTED. The TRO applies until the Court decides plaintiff’s
motion for preliminary injunction (ECF No. 174) or plaintiff’s
motion for order to show cause (ECF No. 175).
1.

Defendant shall hold and retain all funds, assets or
property over which he has control or in which he has a
financial interest (including, but not limited to,
interests in limited liability companies, limited
liability partnerships or corporations) (“Interests”),
in whatever form such Interests may exist and wherever
such Interests are located, and is hereby enjoined,
restrained and prohibited from transferring,
concealing, withdrawing, removing, diminishing,
selling, exchanging, dissipating, encumbering,
pledging, assigning, liquidating, alienating, disposing
of, or otherwise intentionally reducing the value of,

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such Interests (whether or not for his direct or
indirect gain).
2.

This Order applies to all Interests currently held by
trusts of which Defendant is a manager, trustee or
direct or indirect beneficiary. Defendant shall give a
copy of this Order to the trustee or manager of any
such trust, with a copy to Plaintiffs' counsel, upon
entry of this Order.

3.

No provision of this Order shall limit or in any way
restrict Plaintiffs' rights to conduct post-judgment
discovery, prosecute their pending motions, or to
enforce their judgment in accordance with applicable
law.

So ordered this 9th day of February 2018.
/s/
Robert N. Chatigny
United States District Judge

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