Taylor et al v. Hawley Troxell Ennis & Hawley LLP et al

Filing 1291

MEMORANDUM DECISION AND ORDER - GemCap Limited I, LLCs Motion to Dismiss [Dkt. 1075 ] is DISMISSED as MOOT. GemCap Limited I, LLCs Motion for Leave to File Excess Pages [Dkt. 1078 ] is DISMISSED as MOOT. Miesens Motion to Sever and that the Autom atic Bankruptcy Stay Does Not Apply to the Remaining Parties [Dkt. 1272 ] is DISMISSED as MOOT. The Clerk of the Court shall lift the bankruptcy stay case designation. Signed by Judge David C. Nye. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (jd)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
DALE L. MIESEN, an individual who is
a shareholder and who is also bringing
this action on behalf of and/or in the right
of AIA Services Corporation and its
wholly owned subsidiary AIA Insurance,
Inc,

Case No. 1:10-cv-00404-DCN
MEMORANDUM DECISION AND
ORDER

Plaintiff,
v.
GEMCAP LENDING I, LLC, et al.,
Defendants.
I. INTRODUCTION
Before the Court are the following Motions:
1. Defendant GemCap Lending I, LLC’s Motion to Dismiss (Dkt. 1075).
2. Defendant GemCap Lending I, LLC’s Motion for Leave to File Excess Pages
(Dkt. 1078)
3. Plaintiff Dale Miesen’s Motion to Sever and that the Automatic Bankruptcy Stay
Does Not Apply to the Remaining Parties. (Dkt. 1272).
Having reviewed the record and briefs, the Court finds the facts and legal
arguments are adequately presented. Accordingly, in the interest of avoiding further
delay, and because the Court finds that the decisional process would not be significantly
aided by oral argument, the Court will decide the Motions without oral argument. Dist.
Idaho Loc. Civ. R. 7.1(d)(1)(B). Upon review, and for the reasons set forth below, the

MEMORANDUM DECISION AND ORDER - 1

Court DISMISSES all three Motions as MOOT.
II. BACKGROUND1
This case began as a derivative action filed by AIA shareholder Miesen on behalf
of the AIA Entities seeking relief for allegedly wrongful conduct by the individuals who
controlled those entities. On April 24, 2017, Miesen amended his complaint, adding
GemCap as a defendant and asserting a variety of claims against it. Dkt. 211. The only
remaining claims against GemCap involve Miesen’s allegation that GemCap aided and
abetted the Controlling AIA Defendants’ breach of fiduciary duties. Specifically, Miesen
contests the legality of a settlement agreement entered into by GemCap and the AIA
Entities after GemCap sought judgment to collect the more than $10 million in loans
guaranteed by the AIA Entities on which CropUSA defaulted. Miesen alleges that GemCap
knew or should have known that the AIA Entities did not have authorization to enter into
the settlement agreement, and that GemCap therefore knowingly negotiated and entered
into an unlawful agreement. GemCap sought, was denied, and has since twice revived its
motion for dismissal of the remaining claims. Dkts. 220, 548, 1075. GemCap’s most recent
Motion to Dismiss (at issue herein) was filed on January 29, 2021 (Dkt. 1075), concurrently
with its Motion for Leave to File Excess pages also before the Court (Dkt. 1078).
Nearly seven years have elapsed since GemCap filed its first motion to dismiss.
During that time, the parties have engaged in extensive discovery, hearings, appeals, stays,

1

This case has a long and tortured history, evidenced by a docket more than 1200 entries long. For the sake
of brevity, the Court includes here only those facts relevant to the motions before the Court in this decision.
Additionally, the Court uses the same definitions of the parties (i.e., the AIA Entities, AIA Defendants,
CropUSA, etc) as set forth in its previous decisions.

MEMORANDUM DECISION AND ORDER - 2

briefing, and, most recently, settlement negotiations related to this issue. On August 11,
2022, Miesen filed a Motion for Settlement, seeking the Court’s approval of the Settlement
Agreement entered into between Miesen and GemCap. Dkt. 1240. The Court issued an
order granting that request and issued a judgment dismissing with prejudice all claims
against GemCap, pursuant to the terms of the Settlement Agreement. Having approved the
Settlement Agreement, the Court now turns to the pending motions involving GemCap that
remain.
III. ANALYSIS
Under the Article III justiciability doctrine of mootness, “an action is mooted when
the issues presented are no longer live and therefore the parties lack a legally cognizable
interest for which the courts can grant a remedy.” Alaska Ctr. for Env’t v. United States
Forest Serv., 189 F.3d 851, 854 (9th Cir. 1999).
Pursuant to the Court’s Order Approving Settlement and Entering Final Judgment
Regarding GemCap Lending I, LLC (Dkt. 1289) all claims that have been or could be
asserted as between Miesen, the AIA Entities, and GemCap have been settled. As a result,
a live controversy no longer exists amongst these parties. Accordingly, all outstanding
motions by and against GemCap are MOOT.
Furthermore, in his Motion to Sever and that the Automatic Bankruptcy Stay Does
Not Apply to the Remaining Parties, Miesen seeks two forms of relief: first, severance of
his claims pertaining to GemCap; second, a determination that the automatic stay does not
apply to the remaining parties and should not halt litigation in this case. As discussed, all
claims by and against GemCap have been dismissed, mooting Miesen’s first request. In the
MEMORANDUM DECISION AND ORDER - 3

time since this Motion was filed, the bankruptcy court issued an order lifting the Automatic
Stay, mooting Miesen’s second request. See Dkt. 1276-2, at 35 (“This Court is lifting the
stay as to all parties, including the Trustee, to litigate the Action to its conclusion.”); see
also In re GCLI, LLC, 9:22-bk-10735-RC, at Dkt. 80. Thus, Miesen’s Motion to Sever and
that the Automatic Bankruptcy Stay Does Not Apply to the Remaining Parties is moot.2
IV. ORDER
The Court HEREBY ORDERS:
1. GemCap Limited I, LLC’s Motion to Dismiss [Dkt. 1075] is DISMISSED as
MOOT.
2. GemCap Limited I, LLC’s Motion for Leave to File Excess Pages [Dkt. 1078]
is DISMISSED as MOOT.
3. Miesen’s Motion to Sever and that the Automatic Bankruptcy Stay Does Not
Apply to the Remaining Parties [Dkt. 1272] is DISMISSED as MOOT.
4. The Clerk of the Court shall lift the bankruptcy stay case designation.

DATED: March 26, 2024
_________________________
David C. Nye
Chief U.S. District Court Judge

2

Upon receipt of GemCap’s Notice of Bankruptcy Filing (Dkt. 1259), the Court procedurally stayed this
case. As part of today’s decision, it will officially remove that designation. This change is for internal Court
purposes; no action by any party is necessary.

MEMORANDUM DECISION AND ORDER - 4