Tyson v. John R Service Center Inc. et al

Filing 155

ORDER granting in part 151 Emergency Motion for Restraining Order against Sterling Rental, Inc., Transfer of Assets, and Debtor-Creditor Examination. Signed by District Judge Judith E. Levy. (WBar)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
SeTara Tyson,
Plaintiff,

Case No. 13-13490
Judith E. Levy
United States District Judge

v.
John R. Service Center, Inc.,
Credit Acceptance Corp., Sterling
Car Rental, Inc., d/b/a Car Source,
Al Chami, and Rami Kamil,

Mag. Judge Mona K. Majzoub

Defendants.
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ORDER GRANTING IN PART PLAINTIFF’S EMERGENCY
MOTION FOR RESTRAINING ORDER AGAINST STERLING
RENTAL, INC., TRANSFER OF ASSETS, AND DEBTORCREDITOR EXAMINATION [151]
Before the Court is Plaintiff SeTara Tyson’s unopposed emergency
motion for restraining order against Sterling Rental, Inc., transfer of
assets, and debtor-creditor examination. (ECF No. 151.) Defendants were
ordered to respond no later than Friday December 6, 2019 and did not
respond. (ECF No. 152.) Having considered the unopposed motion and
applicable law, the Court grants in part and denies in part Plaintiff’s
motion for the reasons set forth below.

The Federal Rules of Civil Procedure expressly authorize discovery
“[i]n aid of the judgment or execution.” Fed. R. Civ. P. 69(a)(2). The Sixth
Circuit has confirmed that “the scope of postjudgment discovery is very
broad.” United States v. Conces, 507 F.3d 1028, 1040 (6th Cir. 2007.) Rule
69 states: “[a] money judgment is enforced by a writ of execution, unless
the court directs otherwise. The procedure on execution . . . must accord
with the procedure of the state where the court is located[.]” Fed. R. Civ.
P. 69(a)(1). Accordingly, the procedures of Michigan law apply.
First, Plaintiff seeks a debtor-creditor examination of a Sterling
Rental corporate representative, Al Chami, and Rami Kamil in order to
discover the assets held by Defendants. Both Federal Rule of Civil
Procedure 69(a)(2) and Michigan law authorize this type of postjudgment discovery. Michigan Compiled Laws § 600.6110(1) states:
[u]pon an affidavit, showing to the satisfaction of the judge that
any person has money or property of the judgment debtor, or is
indebted to him, the judge may issue a subpoena requiring the
judgment debtor or person or both to appear at a specified time
and place, and be examined on oath, and to produce for
examination any books, papers, or records in his or its possession
or control with have or may contain information concerning the
property or income of the debtor.

2

Plaintiff argues that Defendants have not satisfied payment of Plaintiff’s
award of damages, attorney fees, and costs in this case and has supported
this argument with an affidavit to this effect. (ECF No. 151-5,
PageID.1931.) Accordingly, Plaintiff is authorized to issue a subpoena
requiring Defendants Sterling Rental, Inc., Al Chami, and Rami Kamil
to attend a debtor-creditor examination as provided by Michigan law.
Next, Plaintiff seeks an order enjoining Defendant Sterling Rental,
Inc. from transferring assets. Michigan Compiled Laws § 600.6116
states:
(1) An order for examination of a judgment debtor may contain a
provision restraining the judgment debtor from making or
suffering any transfer or other disposition of, or interference
with any of his property then held or thereafter acquired by or
becoming due to him not exempt by law from application to the
satisfaction of the judgment, until further direction in the
premises, and such other provisions as the court may deem
proper.
(2) Unless previously vacated by order of the court or by
stipulation of the parties in writing, a restraining provision as
herein provided shall remain in full force and effect for a period
of 2 years from the date thereof, at which time it shall be deemed
vacated for all purposes unless extended by order of the court for
good cause shown.

3

Plaintiff argues that she has no information regarding Sterling Rental’s
assets. She argues that, as a used car lot, Sterling Rental could transfer
all of its assets to new ownership “simply by signing the titles to a new
company.” (ECF No. 151, PageID.1891.) She also states that since entry
of judgment, Defendant’s counsel indicated that Sterling would “go
bankrupt rather than pay the judgment.” (Id.)
The Court takes these allegations seriously and notes that
Defendant has not responded or otherwise offered another explanation
for why it has not paid Plaintiff’s award in full. Despite this concern, an
order enjoining Defendant from transferring any assets to a third party
may effectively halt Defendant’s business operations of selling and
leasing used cars, which may make it more likely that Defendant will not
pay Plaintiff her award. Accordingly, Plaintiff’s motion to enjoin the
transfer of assets is granted in part. Sterling Rental may continue to sell
and lease vehicles only in the ordinary course of business. If, after
conducting postjudgment discovery as set forth in this order, Plaintiff
discovers that Defendant has transferred any of its assets in bad faith or
for the purpose of avoiding payment of Plaintiff’s award, Plaintiff may
present this motion again.
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For the reasons set forth above, Plaintiff’s motion to conduct
postjudgment discovery is GRANTED and Plaintiff’s motion to enjoin
transfer of Sterling Rental’s assets is GRANTED IN PART.
IT IS SO ORDERED.
Dated: December 9, 2019
Ann Arbor, Michigan

s/Judith E. Levy
JUDITH E. LEVY
United States District Judge

CERTIFICATE OF SERVICE
I hereby certify that a copy of the foregoing document was served
upon counsel of record and/or pro se parties on this date, December 9,
2019, using the Electronic Court Filing system and/or first-class U.S.
mail.
s/William Barkholz
Case Manager

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