Securities and Exchange Commission v. Nadel et al

Filing 1346

MOTION for leave to file Reply in Support of its Motion for Order Directing Receiver to Turnover Rents from Rite Aid Property (Doc. 1332) by Wells Fargo Bank, N.A.. (Wirth, Steven)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
SECURITIES AND EXCHANGE
COMMISSION
Plaintiff,
v.
ARTHUR NADEL,
SCOOP CAPITAL, LLC,
SCOOP MANAGEMENT, INC.,
Defendants,

CASE NO.: 8:09-0087-T-26TBM

SCOOP REAL ESTATE, L.P.,
VALHALLA INVESTMENT PARTNERS, L.P.,
VALHALLA MANAGEMENT, INC.,
VICTORY IRA FUND, LTD.,
VICTORY FUND, LTD.,
VIKING IRA FUND, LLC.,
VIKING FUND, LLC., and
VIKING MANAGEMENT, LLC.
Relief Defendants.
WELLS FARGO'S MOTION FOR LEAVE TO FILE A REPLY
AND INCORPORATED MEMORANDUM OF LAW
Wells Fargo Bank, N.A., pursuant to Local Rules 3.01(c)-(d), respectfully
requests leave to file a reply in support of its Motion for Order Directing Receiver to
Turnover Rents from Rite Aid Property [Doc. 1332] (the "Rents Motion") and states:
1.

Wells Fargo seeks leave to file a reply to address various issues raised in

the Receiver's December 22, 2017 Response [Doc. 1342] because Wells Fargo believes
that additional briefing will assist the Court in resolving the Rents Motion. Specifically,
Defendants would like the opportunity to address the following non-exclusive issues:

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•

The Receiver's erroneous argument regarding the Eleventh Circuit's decision
in SEC v. Wells Fargo Bank, N.A., 848 F.3d 1339 (11th Cir. 2017), which held
that a District Court cannot modify or extinguish a secured creditor’s state-law
property rights, and reversed the very rulings upon which the Receiver is
relying;

•

The Receiver’s refusal to acknowledge the Assignment of Rents; North
Carolina law; and the application of North Carolina law to the Assignment of
Rents, which requires a finding that the Rite Aid Rents became the exclusive
property of Wells Fargo upon default, not merely receivership property
subject to a lien;

•

The Receiver's erroneous position that Wells Fargo, a secured creditor, was
required to file a proof of claim at all, much less several amended claims
periodically as interest, attorneys' fees, and costs accrued during the
Receivership Proceedings;

•

The fact that even if the Receiver is correct that Wells Fargo’s claim should be
limited to the value of the collateral, Wells Fargo’s claim is or was secured by
over $3.5 million in collateral (i.e., the value of the real property plus the
value of the Rite Aid Rents); and

•

The Receiver’s misrepresentations of fact and misstatements of law
regarding the applicability of the March 2, 2012 Order granting his motion to
approve determination and priority of claims, etc. [Doc. No. 776], which
actually states, “the granting of this motion does not in any way affect any
claims or their priority asserted by Wells Fargo Bank, N.A.”).

2.

In addition, Wells Fargo would like an opportunity to brief the Court

regarding a recent intervening Eleventh Circuit decision in Title Max v. Northington (In

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re Wilber), no. 16-17467 (11th Cir. December 11, 2017), which confirms the Rents at
issue here (i) automatically became the exclusive property of Wells Fargo by operation of
state law before this receivership commenced, (ii) are not property of the receivership
estate, and (iii) are not subject to the jurisdiction of this Court.1
3.

Wells Fargo is prepared to address these issues in a reply of no more than

ten (10) pages, which will be filed and served no later than ten (10) days after the Court
enters an Order granting this motion, or January 12, 2018, whichever comes first.
4.

No prejudice will occur to any party by allowing a complete briefing of all

issues to the Court.
5.

Pursuant to Local Rules 3.01(c)-(d), a movant may request leave to file a

reply in support of its motion. Leave should be granted where the response raises new
questions of fact or law. See, e.g., Ottaviano v. Nautilus Ins. Co., 8:08-cv-2204-VMCTGW, Doc. 27 (finding sufficient grounds and granting leave to file a reply because,
according to the movant, the respondent had “misstated the facts" and "defendant’s case
law should not be applied to the facts of the present case”). Here, the issues raised in the
response warrant a short reply.
COMPLIANCE WITH LOCAL RULE 3.01(g)
Well Fargo's counsel has conferred with the Receiver's counsel who indicated that
she cannot agree to the relief sought in this Motion because she has not heard back from
the Receiver. Well Fargo's counsel has attempted to confer with the SEC's counsel, but
Well Fargo's counsel understands that the SEC’s counsel is unavailable.

1

A copy of Title Max v. Northington (In re Wilber), no. 16-17467 (11th Cir. December 11, 2017) has been
filed with the Court under the Notice of Supplemental Authority (Doc. 1344).

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WHEREFORE, Wells Fargo Bank, N.A. respectfully requests leave to file a tenpage reply on or before January 12, 2018.
Respectfully submitted,
/s/ Steven R. Wirth
AKERMAN LLP
L. Joseph Shaheen, Jr.
Florida Bar No.: 212385
Email: [e-mail]
Steven R. Wirth
Florida Bar No.: 170380
Email: [e-mail]
401 East Jackson Street, Suite 1700
Tampa, Florida 33602
Telephone: [phone]
Facsimile: [phone]
Counsel for Wells Fargo, N.A
CERTIFICATE OF SERVICE
I hereby certify that on December 27, 2017, I electronically filed the foregoing
with the Clerk of the Court by using the CM/ECF system.
Steven R. Wirth

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