Securities and Exchange Commission v. Founding Partners Capital Management, Co. et al

Filing 461

OPINION AND ORDER granting in part and denying in part 451 Motion for Relief from Order Requiring Stay of Louisiana State Court Proceedings. The stay set forth in the Court's May 20, 2009 73 , October 26, 2009 173 , and June 22, 2010 [22 4] Orders is lifted as it pertains to The Roman Catholic Church of the Archdiocese of New Orleans v. Sun Capital Healthcare, Inc. et al. See Opinion and Order for details. The Clerk is directed to send a certified copy of this Order to the Clerk of Court for the Civil District Court for the Parish of Orleans, State of Louisiana. Signed by Judge John E. Steele on 6/8/2015. (MAW)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
SECURITIES
COMMISSION,

AND

EXCHANGE

Plaintiff,
v.

Case No: 2:09-cv-229-FtM-29CM

FOUNDING PARTNERS STABLEVALUE FUND, LP, FOUNDING
PARTNERS STABLE-VALUE FUND
II, LP, FOUNDING PARTNERS
GLOBAL FUND, LTD, FOUNDING
PARTNERS HYBRID-VALUE FUND,
LP, PAMELA L GUNLICKS, and
REGIONS BANK,
Defendants.
OPINION AND ORDER
This matter comes before the Court on The Roman Catholic
Church for the Archdiocese of New Orleans’s (the Archdiocese)
Motion for Relief from Order Requiring Stay of Louisiana State
Court Proceedings (Doc. #451) filed on April 3, 2015.

Daniel S.

Newman, solely in his capacity as Receiver, (the Receiver) filed
a Response (Doc. #454) on April 27, 2015.

Sun Capital Healthcare,

Inc. and Sun Capital, Inc. (the Sun Companies) filed a Response
(Doc. #455) on April 27, 2015.
filed a Reply.

On June 3, 2015, the Archdiocese

(Doc. #458.)

On May 20, 2009, the Court entered an Order transferring to
the Receiver control over all assets of Founding Partners Capital
Management

Company

(FPCMC)

and

the

Founding

Partners

Relief

Defendants.

(Doc. #73.)

The entities subject to the Receiver’s

control are known as the Receivership Entities.

The Order also

enjoined all persons “from prosecuting any actions or proceedings
which involved the Receiver or which affect the property of
Founding Partners or the Founding Partners Relief Defendants”
during the period of receivership.

(Id.)

Among the cases stayed

as a result of that Order is the case at issue here, The Roman
Catholic Church of the Archdiocese of New Orleans v. Sun Capital
Healthcare, Inc. et al., Civil Docket No. 09-12364, Division "B",
Section 15, currently pending in Civil District Court for the
Parish of Orleans, State of Louisiana (the Louisiana Action).

In

the Louisiana Action, the Archdiocese asserts causes of action
against FPCMC (a Receivership Entity) and other entities not
subject to the receivership (Non-Receivership Entities) such as
the Sun Companies.

The stay was temporarily lifted twice to allow

the Archdiocese to preserve certain rights in the Louisiana Action.
(Docs. ##173, 224.)
The Archdiocese now seeks to lift the stay permanently as it
concerns Non-Receivership Entities while continuing to stay the
Louisiana Action as to the Receivership Entities.

The Archdiocese

and the Receiver are in agreement that the stay should be lifted
as to the Non-Receivership Entities so that the Archdiocese may
proceed against them.
Archdiocese

cannot

Additionally, the parties agree that the
pursue

causes

- 2 -

of

action

against

the

Receivership Entities in the Louisiana Action because recovery
against

Receivership

Entities

receivership claims process.

is

available

only

via

the

However, the Receiver and the Sun

Companies disagree with the Archdiocese’s request for a partial
lifting of the stay, arguing that there is no reason to stay causes
of

action

against

Receivership

Entities

when

all

interested

parties (including the Archdiocese) agree such claims are to be
resolved via the receivership.

Instead, the Receiver and the Sun

Companies suggest that lifting the stay as to the Non-Receivership
Entities should be conditioned on the Archdiocese dismissing with
prejudice its claims against FPCMC, the only Receivership Entity
named in the Louisiana Action.

The Archdiocese has offered to

dismiss FPCMC from the Louisiana Action without prejudice, but
objects to dismissal with prejudice.
The Court agrees that the stay should be lifted as to the
Non-Receivership entities.

Additionally, the Court agrees with

the Receiver and the Sun Companies that there is no reason to
continue staying the Archdiocese’s cause of action against FPCMC
now that the Archdiocese’s claim in the receivership has been
recommended for approval by the Receiver and approved by the Court.
(Doc. #430.)

Accordingly, the Court will lift the stay in its

entirety as it applies to the Louisiana Action.

To the extent the

receivership proceedings have rendered the claims against FPCMC in
the Louisiana Action subject to dismissal, the parties to the

- 3 -

Louisiana Action are free to move for appropriate relief in
Louisiana state court.

However, the Court will not condition the

lifting of the stay on the dismissal of claims in the Louisiana
Action.
Accordingly, it is hereby
ORDERED:
1.

The Roman Catholic Church for The Archdiocese of New

Orleans’s Motion for Relief from Order Requiring Stay of Louisiana
State Court Proceedings (Doc. #451) is GRANTED in part and DENIED
in part.
2.

As set forth herein, the stay of proceedings set forth

in the Court’s May 20, 2009, October 26, 2009, and June 22, 2010
Orders (Docs. ##73, 173, 224) is hereby lifted as it pertains to
The Roman Catholic Church of the Archdiocese of New Orleans v. Sun
Capital

Healthcare,

Inc.

et

al.,

Civil

Docket

No.

09-12364,

Division "B", Section 15.
3.

The Clerk is directed to send a certified copy of this

Order to the Clerk of Court for the Civil District Court for the
Parish of Orleans, State of Louisiana.
DONE and ORDERED at Fort Myers, Florida, this

8th

day of

June, 2015.

JOHN E. STEELE
SENIOR UNITED STATES DISTRICT JUDGE
Copies:
Counsel of Record

- 4 -