Avenue CLO Fund, Ltd. et al v. Bank of America, N.A., et al

Filing 79

CERTIFIED REMAND ORDER. MDL No. 2106. Signed by MDL (FLSD) on 1/14/14. (Attachments: # 1 Transmittal from FLSD, # 2 1 09-md-02106 Designation of Record, # 3 1 09-md-02106 Dkt. Sheet - flsd, # 4 09-MD-2106 DE 1, 2, 4-30, # 5 0 9-MD-2106 DE 32-36, # 6 09-MD-2106 DE 37 part 1 of 3, # 7 09-MD-2106 DE 37 part 2 of 3, # 8 09-MD-2106 DE 37 part 3 of 3, # 9 09-MD-2106 DE 38, 39, 41-47, 49, 50, # 10 09-MD-2106 DE 51, # 11 09-MD-2106 DE 52-59, 61-65, 68, 70, 72-76, # (1 2) 09-MD-2106 DE 78-84, 86-91, # 13 09-MD-2106 DE 93, 95-103, 106-108, # 14 09-MD-2106 DE 110-115, # 15 09-MD-2106 DE 116-125, 127-129, 132-134, # 16 09-MD-2106 DE 136-140, 142-158, # 17 09-MD-2106 DE 160-162, 164-167, 170-175, 177-190, # ( 18) 09-MD-2106 DE 191-199, 201-215, # 19 09-MD-2106 DE 217-229, 232-247, # 20 09-MD-2106 DE 248, # 21 09-MD-2106 DE 249 part 1 of 2, # 22 09-MD-2106 DE 249 part 2 of 2, # 23 09-MD-2106 DE 251-253, 262-266, 284-287, 300, 301, 310, 319, 326-3 31, # 24 09-MD-2106 DE 335, 336, 338-344, 346-349, # 25 09-MD-2106 DE 350, # 26 09-MD-2106 DE 351-358, # 27 09-MD-2106 DE 360-366, 368-374, # 28 09-MD-2106 DE 375 part 1 of 3, # 29 09-MD-2106 DE 375 part 2 of 3, # 30 09-MD-2106 DE 375 p art 3 of 3, # 31 09-MD-2106 DE 376 part 1, # 32 09-MD-2106 DE 376 part 2, # 33 09-MD-2106 DE 376 part 3, # 34 09-MD-2106 DE 376 part 4, # 35 09-MD-2106 DE 376 part 5, # 36 09-MD-2106 DE 376 part 6, # 37 09-MD-2106 DE 376 part 7, # 38 09-MD-2106 DE 376 part 8, # 39 09-MD-2106 DE 376 part 9, # 40 09-MD-2106 DE 377 part 1, # 41 09-MD-2106 DE 377 part 2, # 42 09-MD-2106 DE 378, # 43 09-MD-2106 DE 379, # 44 09-MD-2106 DE 380, # 45 09-MD-2106 DE 381 part 1, # 46 09-MD-2 106 DE 381 part 2, # 47 09-MD-2106 DE 382 part 1, # 48 09-MD-2106 DE 382 part 2, # 49 09-MD-2106 DE 382 part 3, # 50 09-MD-2106 DE 382 part 4, # 51 09-MD-2106 DE 383 part 1, # 52 09-MD-2106 DE 383 part 2, # 53 09-MD-2106 DE 383 part 3, # 54 09-MD-2106 DE 383 part 4, # 55 09-MD-2106 DE 383 part 5, # 56 09-MD-2106 DE 383 part 6, # 57 09-MD-2106 DE 383 part 7, # 58 09-MD-2106 DE 383 part 8, # 59 09-MD-2106 DE 383 part 9, # 60 09-MD-2106 DE 383 part 10, # 61 09-MD-2106 DE 383 part 11, # 62 09-MD-2106 DE 384 part 1, # 63 09-MD-2106 DE 384 part 2, # 64 09-MD-2106 DE 384 part 3, # 65 09-MD-2106 DE 384 part 4, # 66 09-MD-2106 DE 384 part 5, # 67 09-MD-2106 DE 384 part 6, # 68 09-MD-2106 DE 384 part 7, # ( 69) 09-MD-2106 DE 384 part 8, # 70 09-MD-2106 DE 384 part 9, # 71 09-MD-2106 DE 384 part 10, # 72 09-MD-2106 DE 384 part 11, # 73 09-MD-2106 DE 385 part 1, # 74 09-MD-2106 DE 385 part 2, # 75 09-MD-2106 DE 386 part 1, # 76 09-MD-2106 DE 386 part 2, # 77 09-MD-2106 DE 386 part 3, # 78 09-MD-2106 DE 386 part 4, # 79 09-MD-2106 DE 386 part 5, # 80 09-MD-2106 DE 386 part 6, # 81 09-MD-2106 DE 386 part 7, # 82 09-MD-2106 DE 387 part 1, # 83 09-MD-2106 DE 387 part 2, # 84 09-MD-2106 DE 388, # 85 09-MD-2106 DE 389 part 1, # 86 09-MD-2106 DE 389 part 2, # 87 09-MD-2106 DE 389 part 3, # 88 09-MD-2106 DE 389 part 4, # 89 09-MD-2106 DE 390, 392-394, # 90 1 10-cv-20236 Dkt. Sheet - flsd, # 91 10cv20236 DE #1-27, 29-31, 45, 53, 60-65, 67-70, 73, # 92 1 09-cv-23835 Dkt. Sheet - flsd, # 93 09cv23835 DE 112, 115-126, # 94 09cv23835 DE 130, 134, 135 and 145)(Copies have been distributed pursuant to the NEF - MMM)

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Case 1:09-md-02106-ASG Document 361 Entered on FLSD Docket 03/26/2013 Page 1 of 21
Case: 11-10468

Date Filed: 4)
(1 of 03/25/2013

Page: 1 of 1

MAR 25, 2013

UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
ELBERT PARR TUTTLE COURT OF APPEALS BUILDING
56 Forsyth Street, N.W.
Atlanta, Georgia 30303
John Ley
Clerk of Court

For rules and forms visit
www.ca11.uscourts.gov

March 25, 2013
Steven M. Larimore
U.S. District Court
400 N MIAMI AVE
MIAMI, FL 33128-1810
Appeal Number: 11-10468-AA ; 11-10740 -AA
Case Style: Avenue CLO Fund, Ltd., et al v. Bank of America, NA, et al
District Court Docket No: 1:09-cv-23835-ASG
Secondary Case Number: 1:09-md-02106-ASG
The enclosed judgment is hereby issued as the mandate of this court.
The record on appeal will be returned to you at a later date.
A copy of this letter, and the judgment form if noted above, but not a copy of the court's
decision, is also being mailed to counsel and pro se parties. A copy of the court's decision was
previously mailed to counsel and pro se parties on the date it was issued.
Sincerely,
JOHN LEY, Clerk of Court
Reply to: Eleanor Dixon/jsc
Phone #: [phone]
Enclosure(s)
MDT-1 Letter Issuing Mandate

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Case 1:09-md-02106-ASG Document 361 Entered on FLSD Docket 03/26/2013 Page 2 of 21
Case: 11-10468

Date Filed: 4)
(2 of 03/25/2013

Page: 1 of 3

UNITED STATES COURT OF APPEALS
For the Eleventh Circuit
______________
No. 11-10468
______________
District Court Docket Nos.
1:09-cv-23835-ASG,
1:09-md-02106-ASG
AVENUE CLO FUND LTD.,
AVENUE CLO II, LTD.,
AVENUE CLO III, LTD.,
AVENUE CLO IV, LTD.,
AVENUE CLO V, LTD.,
AVENUE CLO VI, LTD.,
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
BATTALION CLO 2007-I LTD.,
CASPIAN CORPORATE LOAN FUND, LLC.,
CASPIAN CAPITAL PARTNERS, L.P.,
CASPIAN SELECT CREDIT MASTER FUND, LTD.,
ING PRIME RATE TRUST,
ING SENIOR INCOME FUND,
ING INTERNATIONAL (II) -SENIOR BANK LOANS EURO,
ING INVESTMENT MANAGEMENT CLO I, LTD.,
ING INVESTMENT MANAGEMENT CLO II, LTD.,
ING INVESTMENT MANAGEMENT CLO III, LTD.,
ING INVESTMENT MANAGEMENT CLO IV, LTD.,
ING INVESTMENT MANAGEMENT CLO V, LTD.,
VENTURE II CDO 2002, LIMITED,
VENTURE III CDO LIMITED,
VENTURE IV CDO LIMITED,
VENTURE V CDO LIMITED,
VENTURE VI CDO LIMITED,
VENTURE VII CDO LIMITED,
VENTURE VIII CDO LIMITED,
VENTURE IX CDO LIMITED,
VISTA LEVERAGED INCOME FUND,
VEER CASH FLOW CLO, LIMITED,
MARINER LDC,
MARINER OPPORTUNITIES FUND,L.P.,
GENESIS CLO 2007-1 LTD.,
CANPARTNERS INVESTMENTS IV, LLC,
CANYON CAPITAL ADVISORS, LLC.,
CANYON SPECIAL OPPORTUNITIES MASHTER FUND (CANYON), LTD.,
SCROGGIN CAPITAL MANAGEMENT II,

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Case: 11-10468

Date Filed: 4)
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Page: 2 of 3

SCROGGIN INTERNATIONAL FUND LTD.,
SCROGGIN WORLDWIDE FUND LTD.,
CANTOR FITZGERALD SECURITIES,
OLYMPIC CLO I, LTD.,
SHASTA CLO I, LTD.,
WHITNEY CLO I LTD.,
SAN GABRIEL CLO I LTD.,
SIERRA CLO II LTD.,
SPCP GROUP, LLC,
STONE LION PORTFOLIO L.P.,
VENURE CAPITAL MASTER FUND, LTD.,
Plaintiffs - Appellants,
SANDS POINT FUNDING LTD., et al.,
Plaintiffs,
versus
BANK OF AMERICA,
NA, MERRILL LYNCH CAPITAL CORP.,
JPMORGAN CHASE BANK, N.A.,
BARCLAYS BANK, PLC,
DEUTSCHE BANK TRUST COMPANY AMERICAS,
ROYAL BANK OF SCOTLAND GROUP PLC, et al.,
Defendants - Appellees.
______________
No. 11-10740
______________
District Court Docket Nos.
1:10-cv-20236-ASG,
1:09-md-02106-ASG
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
MONARCH MASTER FUNDING, LTD.,
VENOR CAPITAL MASTER FUND, LTD., et al.,
Plaintiffs - Appellants,
versus

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Case: 11-10468

Date Filed: 4)
(4 of 03/25/2013

Page: 3 of 3

BANK OF AMERICA, NA,
MERRILL LYNCH CAPITAL CORP.,
JPMORGAN CHASE BANK, N.A.,
BARCLAYS BANK, PLC,
DEUTSCHE BANK TRUST COMPANY AMERICAS, et al.,
Defendants - Appellees.

__________________________________________
Appeals from the United States District Court for the
Southern District of Florida
__________________________________________
JUDGMENT
It is hereby ordered, adjudged, and decreed that the opinion issued on this date in this appeal is
entered as the judgment of this Court.
Entered: February 20, 2013
For the Court: John Ley, Clerk of Court
By: Djuanna Clark

Issued as Mandate:
March 25, 2013
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Case: 11-10468

Date Filed: 18)
(1 of 02/20/2013

Page: 1 of 17

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 11-10468
________________________
D.C. Docket Nos. 1:09-cv-23835-ASG,
1:09-md-02106-ASG
AVENUE CLO FUND LTD.,
AVENUE CLO II, LTD.,
AVENUE CLO III, LTD.,
AVENUE CLO IV, LTD.,
AVENUE CLO V, LTD.,
AVENUE CLO VI, LTD.,
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
BATTALION CLO 2007-I LTD.,
CASPIAN CORPORATE LOAN FUND, LLC.,
CASPIAN CAPITAL PARTNERS, L.P.,
CASPIAN SELECT CREDIT MASTER FUND, LTD.,
ING PRIME RATE TRUST,
ING SENIOR INCOME FUND,
ING INTERNATIONAL (II) -SENIOR BANK LOANS EURO,
ING INVESTMENT MANAGEMENT CLO I, LTD.,
ING INVESTMENT MANAGEMENT CLO II, LTD.,
ING INVESTMENT MANAGEMENT CLO III, LTD.,
ING INVESTMENT MANAGEMENT CLO IV, LTD.,
ING INVESTMENT MANAGEMENT CLO V, LTD.,
VENTURE II CDO 2002, LIMITED,
VENTURE III CDO LIMITED,
VENTURE IV CDO LIMITED,
VENTURE V CDO LIMITED,
VENTURE VI CDO LIMITED,
VENTURE VII CDO LIMITED,
VENTURE VIII CDO LIMITED,

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Case: 11-10468

Date Filed: 18)
(2 of 02/20/2013

Page: 2 of 17

VENTURE IX CDO LIMITED,
VISTA LEVERAGED INCOME FUND,
VEER CASH FLOW CLO, LIMITED,
MARINER LDC,
MARINER OPPORTUNITIES FUND,L.P.,
GENESIS CLO 2007-1 LTD.,
CANPARTNERS INVESTMENTS IV, LLC,
CANYON CAPITAL ADVISORS, LLC.,
CANYON SPECIAL OPPORTUNITIES MASHTER FUND (CANYON), LTD.,
SCROGGIN CAPITAL MANAGEMENT II,
SCROGGIN INTERNATIONAL FUND LTD.,
SCROGGIN WORLDWIDE FUND LTD.,
CANTOR FITZGERALD SECURITIES,
OLYMPIC CLO I, LTD.,
SHASTA CLO I, LTD.,
WHITNEY CLO I LTD.,
SAN GABRIEL CLO I LTD.,
SIERRA CLO II LTD.,
SPCP GROUP, LLC,
STONE LION PORTFOLIO L.P.,
VENOR CAPITAL MASTER FUND, LTD.,
Plaintiffs - Appellants,
versus
BANK OF AMERICA, NA,
MERRILL LYNCH CAPITAL CORP.,
JPMORGAN CHASE BANK, N.A.,
BARCLAYS BANK, PLC,
DEUTSCHE BANK TRUST COMPANY AMERICAS,
ROYAL BANK OF SCOTLAND GROUP PLC, et al.,
Defendants - Appellees.

2
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Case: 11-10468

Date Filed: 18)
(3 of 02/20/2013

Page: 3 of 17

________________________
No. 11-10740
________________________
D.C. Docket Nos. 1:10-cv-20236-ASG,
1:09-md-02106-ASG
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
MONARCH MASTER FUNDING, LTD.,
VENOR CAPITAL MASTER FUND, LTD., et al.,
Plaintiffs - Appellants,
versus
BANK OF AMERICA, NA,
MERRILL LYNCH CAPITAL CORP.,
JPMORGAN CHASE BANK, N.A.,
BARCLAYS BANK, PLC,
DEUTSCHE BANK TRUST COMPANY AMERICAS, et al.,
Defendants - Appellees.
________________________
Appeals from the United States District Court
for the Southern District of Florida
________________________
(February 20, 2013)
Before TJOFLAT, MARTIN and BUCKLEW, * Circuit Judges.
MARTIN, Circuit Judge:
*

Honorable Susan C. Bucklew, United States District Judge for the Middle District of Florida,
sitting by designation.
3

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This case presents more fallout from the failure of the ambitious
Fontainebleau development in Las Vegas, Nevada. In this appeal, we address a
contract dispute and two District Court decisions. The contract was entered into by
appellants Avenue CLO Fund, Ltd., and others, who provided term loans (the
Term Lenders); the appellee Bank of America, N.A., and others, who provided
revolving loans (the Revolving Lenders); and Fontainebleau Las Vegas LLC and
Fontainebleau Las Vegas II LLC, who borrowed the money (the Borrowers). The
Borrowers are represented here by Soneet R. Kapila, who is the Chapter 7
Bankruptcy Trustee for the Fontainebleau Estate. In separate actions, the
Borrowers and the Term Lenders sued the Revolving Lenders for breach of
contract. In one case, the District Court dismissed the Term Lenders’ claims
against the Revolving Lenders, finding that the Term Lenders lacked standing to
sue. In the other case, the District Court denied the Borrowers’ motion for
summary judgment against the Revolving Lenders, rejecting the Borrowers’
argument that the Revolving Lenders had breached the contract as a matter of law
and alternatively finding there are material issues of fact about whether the
Revolving Lenders breached the contract. After careful review, and having had the
benefit of oral argument, we affirm both rulings by the District Court.
I.

BACKGROUND
A.

FACTS
4

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The Borrowers were the owners and developers of a casino-resort to be built
in Las Vegas, Nevada (the Project). The Project was funded through a series of
agreements, including a Credit Agreement and a Disbursement Agreement. These
agreements set the terms by which the Borrowers could borrow the funds needed to
complete the Project.
Here, the parties dispute the meaning of section 2 of the Credit Agreement,
through which the Revolving Lenders promised to lend the Borrowers money by
an agreed-upon process, once the Borrowers satisfied certain conditions.
Specifically, under section 2.1(c)(iii) of the Credit Agreement, “each Revolving
Lender severally agree[d] to make Revolving Loans . . . to Borrowers . . . provided
that . . . unless the Total Delay Draw Commitments [had] been fully drawn, the
aggregate outstanding principal amount of all Revolving Loans and Swing Line
Loans shall not exceed $150,000,000.”
On March 2, 2009, the Borrowers requested $350 million in Delay Draw
Term Loans and $670 million in Revolving Loans.1 The next day, Bank of
America, as Administrative Agent,2 rejected the Borrowers’ request, explaining

1

The next day, the Borrowers re-submitted their request to correct a “scrivener’s error” by
reducing their Revolving Loan request to $656,522,698. Bank of America rejected the
Borrowers’ March 3, 2009 request—which corrected the scrivener’s error—for the same reason
it rejected the March 2, 2009 request.

2

The Credit and Disbursement Agreements established the Bank of America as both a Revolving
Lender and the Administrative Agent. The contract provided that the Borrowers would submit
lending requests to Bank of America as Administrative Agent. Then, Bank of America as
5

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that the request did not comply with Section 2.1(c)(iii) of the Credit Agreement, by
which the parties agreed that the outstanding principal amount of all Revolving
Loans would not exceed $150 million unless the Total Delay Draw Commitments
had been fully drawn. In other words, the Bank of America denied the Borrowers’
request because it asked for Delay Draw Term Loans and Revolving Loans at the
same time. The Borrowers responded to Bank of America’s rejection, stating that
their request complied with the Credit Agreement because “fully drawn” meant
“fully requested,” not “fully funded.” Thus, the Borrowers argued then, as they do
now, that the simultaneous request for the Delay Draw Term Loans and the
remainder of the Revolving Loans was in compliance with the Credit Agreement. 3
During March and April 2009, the parties talked about the financial
condition of the Project. On April 20, 2009, the Revolving Lenders told the
Administrative Agent that the Borrowers had defaulted on the lending conditions.
As a result, the Revolving Lenders refused to give more funding to the Borrowers
and the Project collapsed.

Administrative Agent would notify each lender of the request so that the lender could make its
pro rata share of the funds available to the Administrative Agent. Then, “[u]pon satisfaction or
waiver of the applicable conditions precedent specified in Section 2.1,” the Administrative Agent
was to make the funds available in the Bank Proceeds Account, as consistent with the conditions
set forth in the Disbursement Agreement.
3

Specifically, the Borrowers responded: “To be clear, Section 2.1(c)(iii) does not require the
Delay Draw Term Loan Commitment to have been funded prior to drawing down the Revolving
Loans; instead, this provision restricts the outstanding amount of the Revolving Loans unless the
Total Delay Draw Commitments have been fully drawn.” (emphasis in original).
6
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Case: 11-10468

B.

Date Filed: 18)
(7 of 02/20/2013

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PROCEDURAL HISTORY

On June 9, 2009, the Borrowers filed for bankruptcy in the Southern District
of Florida and sued the Revolving Lenders in that proceeding. The Borrowers
alleged that the Revolving Lenders breached their contract by, among other things,
refusing to fund the loan payment on March 2, 2009. On June 10, 2009, the
Borrowers moved for summary judgment in Bankruptcy Court, seeking a judgment
that the Revolving Lenders breached the Credit Agreement by failing to fund the
Borrowers’ March 2, 2009 request and asking for a Turnover Order pursuant to
section 542 of the Bankruptcy Code. Next, the District Court for the Southern
District of Florida withdrew the reference to the Bankruptcy Court and took over
the case. On August 26, 2009, the District Court denied the Borrowers’ motion for
partial summary judgment and request for an order directing the turnover of funds.
In separate law suits, various Term Lenders sued the Revolving Lenders.
Avenue CLO Fund, Ltd., and others, sued the Revolving Lenders in the District of
Nevada. ACP Master, Ltd., and others, sued the Revolving Lenders in the
Southern District of New York. On December 2, 2009, these cases were merged
into a multi-district litigation action in the Southern District of Florida. The
Revolving Lenders then moved to dismiss the Term Lenders’ complaints. On May
28, 2010, the District Court dismissed with prejudice the Delay Term Lenders’
claims against the Revolving Lenders, finding that the Term Lenders had no
7
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Date Filed: 18)
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Page: 8 of 17

standing to enforce the Revolving Lenders’ promise to lend to the Borrowers
because the Term Lenders were not the intended beneficiaries of that promise.
The Borrowers filed a notice of appeal on October 18, 2010. The Term
Lenders filed a notice of appeal on January 19, 2011. We consolidated the two
appeals, and have now had the benefit of the parties’ oral arguments.
II.

DISCUSSION

We review the District Court’s dismissal for lack of standing de novo.
Wright v. Dougherty Cnty., Ga., 358 F.3d 1352, 1354 (11th Cir. 2004). We also
review the District Court’s summary judgment decision de novo, applying the
same legal standard as the District Court. See Durruthy v. Pastor, 351 F.3d 1080,
1084 (11th Cir. 2003). “The interpretation of a contract is a question of law that
the court reviews de novo.” Daewoo Motor Am. v. Gen. Motors Corp., 459 F.3d
1249, 1256 (11th Cir. 2006). The parties agree that New York law governs the
interpretation of the contract.
A. DISMISSAL OF THE TERM LENDERS’ CLAIMS AGAINST THE
REVOLVING LENDERS FOR LACK OF STANDING
To establish standing for Article III purposes, the Term Lenders must show
that they held a legally protected interest in the Credit Agreement which was
injured by the Revolving Lenders. See Lujan v. Defenders of Wildlife, 504 U.S.
555, 560–61, 112 S. Ct. 2130, 2136 (1992); Mid-Hudson Catskill Rural Migrant
Ministry, Inc. v. Fine Host Corp., 418 F.3d 168, 173 (2d Cir. 2005) (“[A] plaintiff
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must have standing under both Article III of the Constitution and applicable state
law in order to maintain a [breach of contract] cause of action.”). We look to New
York law to determine if the Term Lenders had a legally protected interest in the
Credit Agreement that allows them to sue the Revolving Lenders. See MidHudson Catskill, 418 F.3d at 173. Under New York law, the Term Lenders may
enforce a promise made in the Credit Agreement if either the contract language
“clearly evidences an intent to permit enforcement” by the Term Lenders or if no
other party may recover for the alleged breach of contract. See Fourth Ocean
Putnam Corp. v. Interstate Wrecking Co., 66 N.Y.2d 38, 45 (N.Y. 1985).
The Term Lenders argue that the parties intended for them to enforce section
2.1(c) of the Credit Agreement. Specifically, they assert that the Term Lenders
were the intended beneficiaries of the Revolving Lenders’ promise to lend to the
Borrowers. Because the intended beneficiary of a promise may enforce that
agreement, the Term Lenders argue that they have standing to enforce the section
2.1(c) promise. While they concede that the language of section 2.1(c) “says
nothing about whether the parties intended to give the Term Lenders the benefit of
that obligation,” the Term Lenders point to a separate provision in the Credit
Agreement and provisions in the Disbursement Agreement to argue that they were
the intended beneficiaries of the section 2.1(c) promise.

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First, the Term Lenders direct us to section 10.6(a) of the Credit Agreement,
which provides that “[t]he provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.” From this, the Term Lenders argue that “all parties are intended
beneficiaries of all provisions” of the Credit Agreement. However, we are not
persuaded by this because the broad-sweeping language in section 10.6(a) does not
clearly show the parties’ intent for the Term Lenders to enforce or benefit from the
promise of the Revolving Lenders to fund the Borrowers. Stainless, Inc. v. Emp’r
Fire Ins. Co., 418 N.Y.S.2d 76, 80 (N.Y. App. Div. 1979) (“The terms contained in
the contract must clearly evince an intention to benefit the third person who seeks
the protection of the contractual provisions.”). Certainly, the Term Lenders’
argument that all parties were intended beneficiaries of section 2.1(c) does not
support the conclusion that the Term Lenders are the only party able to recover
under that provision. See Fourth Ocean Putnam Corp., 66 N.Y.2d at 45.
Second, the Term Lenders point to sections 2.3(d) and 10.5 of the
Disbursement Agreement. Generally, the Disbursement Agreement was structured
so that Disbursement Agreement Loans were paid into a Bank Proceeds Account.
The Borrowers could not access the funds in this account until they fulfilled
several conditions. During this time, the Lenders held a ratable security interest in
funds in the Bank Proceeds Account, which provided additional security for the
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Lenders “[t]o secure the payment and performance of each Borrower’s
obligations.” Based on this, the Term Lenders argue that they were the intended
beneficiaries of the loan from the Revolving Lenders to the Borrowers because
while the funds were in the Bank Proceeds Account, the Term Lenders gained the
benefit of a ratable security interest in that account.
Again, we look to the language of the contract and find no express intention
of the parties that the Term Lenders be the beneficiaries of the Revolving Lenders’
promise to fund the Borrowers under section 2.1(c). See Berry Harvester Co. v.
Walter A. Wood Mowing & Reaping Mach. Co., 46 N.E. 952, 955 (N.Y. 1897)
(“Whether the right or privilege conferred by the promise of one party to a
tripartite contract belongs to one or both of the other contracting parties depends
upon the intention as gathered from the words used.”); see also Stainless, Inc., 418
N.Y.S.2d at 80 (“The intention to benefit the third party must appear from the four
corners of the instrument.”). 4 That the Term Lenders may have indirectly
benefitted from a promise between the Revolving Lenders and Borrowers makes
them incidental beneficiaries, not intended beneficiaries. See Salzman v. Holiday
Inns, Inc., 369 N.Y.S.2d 238, 261–62 (N.Y. App. Div. 1975) (“An incidental
4

The Term Lenders ask us to consider the circumstances surrounding the contract. However,
we consider the background circumstances only when the language of the contract is ambiguous.
Berry Harvester Co., 46 N.E. at 955. Like the District Court we find no ambiguity in the
language of section 2.1(c) about the intended beneficiary, as it provides that “each Revolving
Lender severally agrees to make Revolving Loans . . . to Borrowers from time to time during the
Revolving Commitment Period.” (emphasis added).
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beneficiary is a person who may derive benefit from the performance of a contract
though he is neither the promisee nor the one to whom performance is to be
rendered . . . .”). As incidental beneficiaries, the Term Lenders are not in a
position to require the performance of the Revolving Lenders. See id. Beyond
that, the Term Lenders are not the only party able to recover for the breach. This
consolidated appeal also includes the Borrowers’ suit against the Revolving
Lenders for the purported breach of section 2.1(c), suggesting that other parties are
able to recover for the alleged breach of contract. 5 Cf. Fourth Ocean Putnam
Corp., 66 N.Y.2d at 45. Thus, we have concluded that the Term Lenders lack
standing to enforce the section 2.1(c) promise and affirm the District Court’s
dismissal of the breach of contract claims of the Term Lenders’ complaint.
B. DENIAL OF THE BORROWERS’ MOTION FOR SUMMARY
JUDGMENT AGAINST THE REVOLVING LENDERS AND MOTION
FOR TURNOVER
The Borrowers urge us to find that the Revolving Lenders broke their
promise to fund under section 2.1(c)(iii) when they did not lend to the Borrowers
5

The Term Lenders argue that they are the only party able to enforce the section 2.1(c)(iii)
promise. Specifically, they suggest that the Revolving Lenders breached because they were
required to fund the Borrowers, even though the Borrowers also breached by failing to disclose
an event of default. Because the Term Lenders are the only non-breaching party in this scenario,
the Term Lenders argue that they are the only party that may recover under section 2.1(c)(iii).
By way of this argument, the Term Lenders essentially ask us to assume the outcome of an
ongoing contract dispute and decide that the Term Lenders have standing on the basis of this
assumption. This we will not do. The language of the section 2.1(c)(iii) reveals an “intent to
permit enforcement” by the Borrowers. Fourth Ocean Putnam Corp., 66 N.Y.2d at 45.
We therefore conclude that the Term Lenders are not the only party able to enforce the section
2.1(c)(iii) promise.
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on March 2, 2009. Specifically, the Borrowers say that the Revolving Lenders
were required to fund once the Borrowers simultaneously requested funds from the
Delay Draw Term Loans and the Revolving Loans. The Revolving Lenders
respond that they were right to reject the Borrowers’ request because the Credit
Agreement did not allow for this type of simultaneous request. After careful
review, we have concluded that the relevant terms of the Credit Agreement are
ambiguous. For this reason, we decline to hold, as a matter of law, that the
Revolving Lenders breached the Credit Agreement when they did not fund the
March 2, 2009 request.
The provision of the Credit Agreement at issue, section 2.1(c)(iii), requires
the Revolving Lenders to make Revolving Loans to the Borrowers “unless the
Total Delay Draw Commitments have been fully drawn, the aggregate outstanding
principal amount of all Revolving Loans and Swing Line Loans shall not exceed
$150,000,000.” Section 2.1(c)(iii) is found within section 2, which contains three
provisions about the “amount and terms of [the loan] commitments” between the
Lenders and Borrowers. Subsection (a) governs the disbursement of the Initial
Term Loans, which were given to the Borrowers after the execution of the Credit
Agreement. Subsection (b) describes the disbursement process for Delay Draw
Term Loans. In relevant part, subsection (b) provides that “the proceeds of each
Delay Draw Term Loan will be applied first to repay any then outstanding
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Revolving Loans . . . and [any remaining funds will] second be credited to the
Bank Proceeds Account.” (emphasis in original). Subsection (c) covers Revolving
Loans and explains that the Revolving Lenders will make Revolving Loans to the
Borrowers provided that “unless the Total Delay Draw Commitments have been
fully drawn, the aggregate outstanding principal amount of all Revolving Loans
and Swing Line Loans shall not exceed $150,000,000.”
The Revolving Lenders argue that subsections (b) and (c) of the Credit
Agreement establish a “sequential funding process” by which the Revolving Loans
were the last loans to be funded to the Borrowers. The Revolving Lenders urge us
to read subsection (b)(i), which requires loans under the Delay Draw Commitments
to be $150 million or greater, together with subsection (c)(iii), which provides that
the Revolving Loans must not exceed $150 million “unless the Total Delay Draw
Commitments have been fully drawn.” When read in context, the Revolving
Lenders assert that the Delay Draw Term Loan Commitments could not be “fully
drawn” under subsection (c)(iii) “until there were no funds left to pay off the $150
million.”6 Thus, a simultaneous request for all of the funds from the Delay Draw
Term Loans and all of the funds from the Revolving Loans is not allowed under

6

This reasoning was articulated by the District Court in concluding that the term “fully drawn”
means “fully funded.” On appeal, the Revolving Lenders adopt this position in urging us to
agree with the District Court’s interpretation.
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the contract because the Delay Draw Term Loans are used to repay the Revolving
Loans.
The Borrowers argue that the funding arrangement established through
subsections (b) and (c) created a continuous flow-of-funds structure. The
Borrowers appear to agree that the contract established a “sequential funding
process,” but say that the sequential process did not allow for the funding to stop
when there was a simultaneous request for Revolving and Delay Draw Term
Loans. Rather, the Borrowers assert that the Delay Draw Term Loans were only
required to cover the Revolving Loans that were outstanding at the time the
Borrowers requested the loan. In March 2009, the Borrowers argue that the Delay
Draw Term Loans would have satisfied the outstanding Revolving Loan, meaning
that the remainder of available funds should have been placed in the Bank Proceed
Account to be disbursed to the Borrowers. Because the Revolving Lenders’
interpretation of subsections (b) and (c) stopped the lending, the Borrowers argue it
is at odds with the purpose of the agreement, which was to provide a steady flow of
funds to the Borrowers.
The Borrowers also present several arguments why the phrase “fully drawn”
in section 2.1(c)(iii) unambiguously means “fully requested.” The Borrowers’
primary argument is that the word “outstanding” is used other places in the
contract to mean “funded.” Because “outstanding” means “funded,” the Borrowers
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argue that the word “drawn” must mean “requested.” The Revolving Lenders
respond that “drawn” and “outstanding” have different meanings because they are
used to describe loans that have different features. 7
This seems to us a reasonable basis for disagreement over the interpretation
of the Revolving Lenders’ section 2.1(c)(iii) obligation and so we conclude that the
meaning of the provision is ambiguous. See Greenfield v. Philles Records, 98
N.Y.2d 562, 569 (N.Y. 2002) (explaining that a contract is unambiguous when it
has a “definite and precise meaning”). This is in keeping with New York law
which instructs that when there is a “reasonable basis for a difference of opinion”
attended by a “danger of misconception,” in a contract, it is to be deemed
ambiguous. See Breed v. Ins. Co. of N. Am., 46 N.Y.2d 351, 355 (1978); see e.g.,
Seiden Assoc., Inc. v. ANC Holdings, Inc., 959 F.2d 425, 430 (2d Cir. 1992)
(applying New York law in examining the interrelationship between two
provisions in an agreement and finding the contract susceptible to more than one
meaning and therefore ambiguous).
7

The Borrowers have also argued alternatively that the contract required the Revolving Lenders
to lend to them even if the Borrowers had entered into default. Specifically, section 2.1 provides
that “[t]he making of Revolving Loans which are Disbursement Agreement Loans to the Bank
Proceeds Account shall be subject only to the fulfillment of the applicable conditions set forth in
Section 5.2.” Section 5.2(a) provides that funding after the submission of a Notice of Borrowing
must comply with Section 2. From this, the Borrowers argue that the Revolving Lenders’
obligation to fund was only conditioned by the term set forth in section 2. Because the
Borrowers’ failure to disclose an Event of Default was a condition governed by a different
section, the Borrowers argue that the Revolving Lenders were obligated to fund because the
Borrowers were in non-compliance with a provision outside of section 2. Again, we agree with
the District Court that the clause cannot be read to make irrelevant the duties and obligations of
the parties which are carefully outlined in several sections of the Credit Agreement.
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Where, as here, “the language used is susceptible to differing interpretations
. . . and where there is relevant extrinsic evidence of the parties’ actual intent, the
meaning of the words become an issue of fact and summary judgment is
inappropriate.” Seiden Assoc., 959 F.2d at 428. “Because of the presence of an
ambiguity, an opportunity to present extrinsic evidence must be afforded to
establish what the original contracting parties intended.” Id. at 430. Based on this,
we cannot conclude, as a matter of law, that the Revolving Lenders broke their
promise to fund the Borrowers under section 2 of the Credit Agreement. For the
same reasons, we also affirm the District Court’s denial of the Borrowers’ request
for turnover of the loan proceeds and specific performance.
III.

CONCLUSION

We affirm the District Court’s dismissal of the Term Lenders’ claims for
lack of standing. We also affirm the District Court’s denial of the Borrowers’
summary judgment motion.
AFFIRMED.

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UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

AUG 28, 2013

ELBERT PARR TUTTLE COURT OF APPEALS BUILDING
56 Forsyth Street, N.W.
Atlanta, Georgia 30303
John Ley
Clerk of Court

August 28, 2013

For rules and forms visit
www.ca11.uscourts.gov

Steven M. Larimore
U.S. District Court
400 N MIAMI AVE
MIAMI, FL 33128-1810
Appeal Number: 12-11815-AA
Case Style: Avenue CLO IV, Ltd, et al v. Bank of America, NA
District Court Docket No: 1:09-md-02106-ASG
Secondary Case Number: 1:09-cv-23835-ASG
A copy of this letter, and the judgment form if noted above, but not a copy of the court's
decision, is also being forwarded to counsel and pro se parties. A copy of the court's decision
was previously forwarded to counsel and pro se parties on the date it was issued.
The enclosed copy of the judgment is hereby issued as mandate of the court. The court's opinion
was previously provided on the date of issuance.
Sincerely,
JOHN LEY, Clerk of Court
Reply to: Regina A. Veals-Gillis
Phone #: [phone]
Enclosure(s)
MDT-1 Letter Issuing Mandate

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UNITED STATES COURT OF APPEALS
For the Eleventh Circuit
______________
No. 12-11815
______________
District Court Docket No.
1:09-md-02106-ASG
AVENUE CLO FUND, LTD.,
et. al.,
Plaintiffs,
AVENUE CLO IV, LTD.,
AVENUE CLO V, LTD.,
AVENUE CLO VI, LTD.,
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
BATTALION CLO 2007-I LTD.,
CASPIAN CAPITAL PARTNERS, L.P.,
CASPIAN SELECT CREDIT MASTER FUND, LTD.,
ING PRIME RATE TRUST,
ING SENIOR INCOME FUND,
ING INTERNATIONAL (II) -SENIOR BANK LOANS EURO,
ING INVESTMENT MANAGEMENT CLO I, LTD.,
ING INVESTMENT MANAGEMENT CLO II, LTD.,
ING INVESTMENT MANAGEMENT CLO III, LTD.,
ING INVESTMENT MANAGEMENT CLO IV, LTD.,
ING INVESTMENT MANAGEMENT CLO V, LTD.,
VENTURE II CDO 2002, LIMITED,
VENTURE III CDO LIMITED,
VENTURE IV CDO LIMITED,
VENTURE V CDO LIMITED,
VENTURE VI CDO LIMITED,
VENTURE VII CDO LIMITED,
VENTURE VIII CDO LIMITED,
VENTURE IX CDO LIMITED,
VISTA LEVERAGED INCOME FUND,
VEER CASH FLOW CLO, LIMITED,
MARINER LDC,
GENESIS CLO 2007-1 LTD.,
CANPARTNERS INVESTMENTS IV, LLC,
SCROGGIN CAPITAL MANAGEMENT II,
SCROGGIN INTERNATIONAL FUND LTD.,
SCROGGIN WORLDWIDE FUND LTD.,
CASPIAN ALPHA LONG CREDIT FUND, L.P.,

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SOLA LTD,
MONARCH MASTER FUNDING, LTD.,
SOLUS CORE OPPORTUNITIES MASTER FUND LTD.,
CANTOR FITZGERALD SECURITIES,
OLYMPIC CLO I, LTD.,
SHASTA CLO I, LTD.,
WHITNEY CLO I LTD.,
SAN GABRIEL CLO I LTD.,
SIERRA CLO II LTD.,
NORMANDY HILL MASTER FUND, L.P.,
SPCP GROUP, LLC,
VENURE CAPITAL MASTER FUND, LTD.,
Plaintiffs - Appellants,

versus
SUMITOMO MITSUI BANKING CORPORATION,
et al.,
Defendants,
BANK OF AMERICA, NA,
Defendant - Appellee.
__________________________________________
Appeal from the United States District Court for the
Southern District of Florida
__________________________________________
JUDGMENT
It is hereby ordered, adjudged, and decreed that the opinion issued on this date in this appeal is
entered as the judgment of this Court.
Entered: July 26, 2013
For the Court: John Ley, Clerk of Court
By: Jeff R. Patch

Issued as Mandate:
August 28, 2013
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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 12-11815
________________________
D.C. Docket Nos. 1:09-md-02106-ASG, 1:09-cv-23835-ASG
AVENUE CLO FUND, LTD.,
et. al.,
Plaintiffs,
AVENUE CLO IV, LTD.,
AVENUE CLO V, LTD.,
AVENUE CLO VI, LTD.,
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.,
BATTALION CLO 2007-I LTD.,
CASPIAN CAPITAL PARTNERS, L.P.,
CASPIAN SELECT CREDIT MASTER FUND, LTD.,
ING PRIME RATE TRUST,
ING SENIOR INCOME FUND,
ING INTERNATIONAL (II) -SENIOR BANK LOANS EURO,
ING INVESTMENT MANAGEMENT CLO I, LTD.,
ING INVESTMENT MANAGEMENT CLO II, LTD.,
ING INVESTMENT MANAGEMENT CLO III, LTD.,
ING INVESTMENT MANAGEMENT CLO IV, LTD.,
ING INVESTMENT MANAGEMENT CLO V, LTD.,
VENTURE II CDO 2002, LIMITED,
VENTURE III CDO LIMITED,
VENTURE IV CDO LIMITED,
VENTURE V CDO LIMITED,
VENTURE VI CDO LIMITED,
VENTURE VII CDO LIMITED,
VENTURE VIII CDO LIMITED,
VENTURE IX CDO LIMITED,
VISTA LEVERAGED INCOME FUND,

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VEER CASH FLOW CLO, LIMITED,
MARINER LDC,
GENESIS CLO 2007-1 LTD.,
CANPARTNERS INVESTMENTS IV, LLC,
SCROGGIN CAPITAL MANAGEMENT II,
SCROGGIN INTERNATIONAL FUND LTD.,
SCROGGIN WORLDWIDE FUND LTD.,
CASPIAN ALPHA LONG CREDIT FUND, L.P.,
SOLA LTD,
MONARCH MASTER FUNDING, LTD.,
SOLUS CORE OPPORTUNITIES MASTER FUND LTD.,
CANTOR FITZGERALD SECURITIES,
OLYMPIC CLO I, LTD.,
SHASTA CLO I, LTD.,
WHITNEY CLO I LTD.,
SAN GABRIEL CLO I LTD.,
SIERRA CLO II LTD.,
NORMANDY HILL MASTER FUND, L.P.,
SPCP GROUP, LLC,
VENURE CAPITAL MASTER FUND, LTD.,
Plaintiffs - Appellants,
versus
SUMITOMO MITSUI BANKING CORPORATION,
et al.,
Defendants,
BANK OF AMERICA, NA,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(July 26, 2013)
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Before TJOFLAT and MARTIN, Circuit Judges, and BUCKLEW, * District Judge.
MARTIN, Circuit Judge:
This case is one of many resulting from the failure of the project to build a
Fontainebleau Resort in Las Vegas. The Fontainebleau Las Vegas was a hotel and
casino development project on an approximately 24.4 acre parcel at the north end
of the Las Vegas Strip. Here, a group of lenders and their successors in interest
(Term Lenders) appeal the District Court’s grant of summary judgment in favor of
Bank of America. See In re Fontainebleau Las Vegas Contract Litigation MDL
No. 2106, No. 09-MD-02106-CIV, 2012 WL 930290, *1 (S.D. Fla. March 19,
2012). After careful review, and with the benefit of oral argument, we affirm in
part, reverse in part, and remand for further proceedings consistent with this
opinion.
I. FACTUAL BACKGROUND
This case is a contract dispute related to the funding of the development of
the Fontainebleau Las Vegas (the Project). See In re Fontainebleau, 2012 WL
930290, at *1–49. On one side of the dispute are the Term Lenders, which loaned
money to Fontainebleau Las Vegas, LLC and Fontainebleau Las Vegas II, LLC
(the Borrowers). The Borrowers’ parent company, Fontainebleau Resorts, LLC,
was the developer of the Fontainebleau Las Vegas. On the other side of the
*

Honorable Susan C. Bucklew, United States District Judge for the Middle District of Florida,
sitting by designation.
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dispute is Bank of America, which was the Disbursement Agent responsible under
the funding agreements for disbursing the Term Lenders’ funds to the Borrowers.
A. THE FUNDING STRUCTURE
At the beginning, the Project’s budget was $2.9 billion, with $1.85 billion to
be funded by a senior secured debt facility (Senior Credit Facility). 1 The Senior
Credit Facility was set up by the Credit Agreement and consisted of three
components: a $700 million Initial Term Loan Facility; a $350 million Delay Draw
Term Loan Facility; and an $800 million Revolving Loan Facility.
The Term Lenders own Initial Term Loan and Delay Draw Term Loan
notes. The Initial Term Loans were due on the closing date. The Delay Draw
Term Loans and Revolving Loans were disbursed on a periodic basis under the
terms of the Disbursement Agreement. Bank of America was the Disbursement
Agent responsible for distributing the funds under the terms of the Disbursement
Agreement.
B. DISPERSING THE MONEY
The process set up for the Borrowers to get the money had a lot of moving
parts. The Credit Agreement required the Borrowers to first submit a Notice of
Borrowing to the Administrative Agent (Bank of America). This would prompt
1

The balance of the Project was funded by a $675 million Second Mortgage Note offering and a
$400 million Retail Facility. The Retail Facility was the sole source of funding for the retail
portion of the Fontainebleau Las Vegas. The resort budget included $83 million in costs that
were to be funded through the Retail Facility.
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the Term Lenders and/or Revolving Lenders to give the money to the
Administrative Agent. If the Notice of Borrowing included the proper information
and the Borrowers submitted no more than one Notice per month, the
Administrative Agent would transfer the loan funds into the Bank Proceeds
Account. One difference between the Delay Draw Term Loans and Revolving
Loans was that “the proceeds of each Delayed Draw Term Loan [was] applied first
to repay in full any then outstanding Revolving Loans . . . and second, to the extent
of any excess, [was] credited to the Bank Proceeds Account.”
Once funds were in the Bank Proceeds Account, the Borrowers had to
submit another request, called the Advance Request, which included a series of
general representations and certifications, to the Disbursement Agent (Bank of
America). When it received the Advance Request, Bank of America, as
Disbursement Agent, as well as the Construction Consultant were required to
review the Advance Request and determine whether all the required documentation
was provided. The Construction Consultant was also required to deliver a
certificate to Bank of America either approving or disapproving the Advance
Request.
Under the Disbursement Agreement, the next step turned on whether the
conditions precedent set forth in Article 3 of the Disbursement Agreement were

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satisfied.2 If the conditions precedent were met, Bank of America, in its role as
Disbursement Agent, was required to execute an Advance Confirmation Notice
and the funds would be disbursed to the Borrowers. If, on the other hand, the
conditions precedent were not met then Bank of America was required to issue a
Stop Funding Notice. Bank of America’s duties as Disbursement Agent, with
respect to determining whether the conditions precedent were or were not satisfied,
is one of the disputes between the parties that will be the subject of our discussion
in Part IV.A of this Order.
C. MONEY DISPERSED DURING THE TIME IN DISPUTE
For each Advance Request from September 2008 through March 2009, Bank
of America, as Disbursement Agent, received the required Advance Request
certifications from the Borrowers, the Construction Consultant, the contractor, and
the architect. Throughout this period Bank of America continued to disburse funds
to the Borrowers and never issued a Stop Funding Notice.
However, the Term Lenders have pointed to a number of events, beginning
in September 2008, which they say “caused the failures of multiple conditions
precedent.” They delineate these events as: “the Lehman bankruptcy and the
2

The conditions included, for example, that “[n]o Default or Event of Default shall have
occurred and be continuing”; “there shall not have occurred any change in the economics or
feasibility of constructing and/or operating the Project, or in the financial condition, business or
property of Fontainebleau, any of which could reasonably be expected to have a Material
Adverse Effect”; and “the Retail Agent and the Retail Lenders shall . . . make any Advances
required of them.” Other conditions that the parties believe are relevant to this case are set forth
in §§ 3.3.2, 3.3.8, 3.3.21, and 3.3.24 of the Disbursement Agreement.
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funding of the Retail Facility; Fontainebleau’s failure to disclose anticipated
Project costs; repudiation by the FDIC of First National Bank of Nevada’s
commitments; select lenders’ failure to fund with respect to the March 2009
Advance; and the ‘untimely’ submission of the March 2009 Advance.” See In re
Fontainebleau, 2012 WL 930290, at *15. How much Bank of America knew about
these events is another source of dispute between the parties. That dispute will be
the subject of our discussion in Part IV.B of this Order.
In April 2009, the “Total Revolving Commitments” were ended because the
Revolving Lenders determined that there had been Events of Default. In May
2009, Bank of America commissioned a “cost-complete review” of the Project,
which revealed that Fontainebleau had been concealing cost overruns. Finally, on
June 9, 2009, the Borrowers and some of their affiliates filed for bankruptcy.

II. PROCEDURAL HISTORY
On January 15, 2010, the Term Lenders filed a Second Amended Complaint
alleging, as relevant to this appeal, that Bank of America breached the
Disbursement Agreement. 3 Following discovery, the parties filed cross-motions
for summary judgment.

3

The Complaint also alleged breach of the Credit Agreement, breach of the implied covenant of
good faith and fair dealing, and requested declaratory relief.
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The District Court granted summary judgment in favor of Bank of America
because it determined that “the Term Lenders, with all inferences in their favor,
have failed to raise a genuine issue of material fact as to whether Bank of America,
as Disbursement Agent or Bank Agent, breached the Disbursement Agreement, or
whether Bank of America acted with bad faith, gross negligence, or willful
misconduct.” In re Fontainebleau, 2012 WL 930290, at *26. In reaching that
conclusion, the District Court made several preliminary findings. First, the District
Court held that “[i]n determining whether the conditions precedent to an Advance
Request were satisfied, Bank of America was explicitly authorized to rely on
Fontainebleau’s certifications . . . and was explicitly not required to conduct ‘any
independent investigation as to the accuracy, veracity, or completeness’ of those
certifications.” Id. at *28. Second, the District Court determined that “Bank of
America, as Disbursement Agent, did not act in bad faith or with gross negligence
or willful misconduct in performing its duties under the Disbursement Agreement.”
Id. at *34. Third, the District Court found that there was no evidence on summary
judgment that Bank of America breached the Disbursement Agreement by
disbursing funds despite having actual knowledge that a condition precedent was
not satisfied. Id. at * 35.
The Term Lenders timely filed a Notice of Appeal on March 22, 2012.

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III. STANDARD OF REVIEW
“This Court reviews the granting of summary judgment de novo, applying
the same legal standards which bound the district court.” Whatley v. CNA Ins.
Companies, 189 F.3d 1310, 1313 (11th Cir. 1999). “Summary judgment is
appropriate only when there is no genuine issue as to any material fact and . . . the
moving party is entitled to a judgment as a matter of law.” Id. (quotation marks
omitted). “An issue of fact is material if it ‘might affect the outcome of the suit
under governing law’” and it is “genuine ‘if the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.’” Western Grp. Nurseries,
Inc. v. Ergas, 167 F.3d 1354, 1360 – 61 (11th Cir. 1999) (quoting Anderson v.
Liberty Lobby, Inc., 466 U.S. 242, 248, 106 S. Ct. 2505, 2510 (1986)).
All “evidence must be viewed in the light most favorable to the party
opposing the motion for summary judgment.” Blackston v. Shook and Fletcher
Insulation Co., 764 F.2d 1480, 1482 (11th Cir. 1985). The Court “must avoid
weighing conflicting evidence or making credibility determinations.” Stewart v.
Booker T. Washington Ins., 232 F.3d 844, 848 (11th Cir. 2000). “All reasonable
inferences arising from the undisputed facts should be made in favor of the
nonmovant, but an inference based on speculation and conjecture is not
reasonable.” Blackston, 764 F.2d at 1482 (internal citation omitted).

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IV. DISCUSSION
In its appeal, the Term Lenders argue that the District Court erred in
granting summary judgment to Bank of America because: 1) it based its
determination on a misunderstanding of Bank of America’s duties under the
Disbursement Agreement; 2) there remain genuine issues of material fact about
whether Bank of America breached the Disbursement Agreement; and 3) there
remain genuine issues of material fact about whether Bank of America was grossly
negligent. We will discuss each of these issues in turn.
A. BANK OF AMERICA’S DUTIES UNDER THE DISBURSEMENT
AGREEMENT
In ruling on the summary judgment motion, the District Court necessarily
had to determine what Bank of America’s duties were under the relevant portions
of the Disbursement Agreement. Both parties agree that if the conditions
precedent were satisfied, Bank of America was supposed to deliver an Advance
Confirmation Notice so that the Term Lenders’ funds could be disbursed to the
Borrowers. Both parties also agree that if any of the relevant conditions precedent
were not satisfied Bank of America was required to issue a Stop Funding Notice.
The parties disagree, however, on whether Bank of America had an affirmative
duty to determine that the conditions precedent were satisfied or whether Bank of
America was permitted to rely on the Borrowers’ certifications that the conditions
precedent were satisfied unless it had actual knowledge to the contrary.
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The District Court determined that “[t]he Disbursement Agreement imposed
on Bank of America no duty to inquire or investigate whether [the Borrower’s]
representations that all conditions precedent had been met were accurate.” In re
Fontainebleau, 2012 WL 930290, at *48. For the reasons set out here, we agree
with this determination.
“Under New York Law, the initial interpretation of a contract is a matter of
law for the court to decide.” Alexander & Alexander Servs., Inc. v. These Certain
Underwriters at Lloyd’s, London, 136 F.3d 82, 86 (2d Cir. 1998) (quotation marks
omitted). 4 A court must enforce a contract provision that is “complete, clear and
unambiguous on its face . . . according to the plain meaning of the terms.”
Greenfield v. Phillies Records, Inc., 780 N.E.2d 166, 170 (N.Y. 2002). When
interpreting a contract, a court should look at the whole agreement and try to give
meaning to all of the contract’s provisions. See RLI Ins. Co. v. Smiedala, 947
N.Y.S.2d 850, 853 (App. Div. 2012). But, in the face of any inconsistency
between a general provision and specific provisions, the specific provisions
prevail. See Muzak Corp. v. Hotel Taft Corp., 133 N.E.2d 688, 690 (N.Y. 1956).
The specific provision of the Disbursement Agreement that most directly
addresses this issue is § 9.3.2. That section explains that:
Notwithstanding anything else in this Agreement to the contrary, in
performing its duties hereunder, including approving any Advance
4

The Disbursement Agreement says that it is to be governed by New York law. [D.A. § 11.6]
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Requests . . . the Disbursement Agent shall be entitled to rely on
certifications from the Project Entities . . . as to the satisfaction of any
requirements and/or conditions imposed by this Agreement.
The clear language of this provision supports Bank of America’s interpretation of
its duties under the Disbursement Agreement: Bank of America had to determine
that the conditions precedent were satisfied, but in doing so it was permitted to rely
on the Borrower’s certifications.
Bank of America, as Disbursement Agent, would not have been permitted to
rely on the Borrowers’ certifications that the conditions precedent were met if it
had actual knowledge to the contrary. If Bank of America actually knew that a
condition precedent was not satisfied, it would not be commercially reasonable to
interpret the Agreement to allow Bank of America to disregard that knowledge by
pointing to a certification by the Borrower, which it knows to be false. See In re
Lipper Holdings, LLC, 766 N.Y.S.2d 561, 562 (App. Div. 2003) (explaining that a
contract “should not be interpreted to produce a result . . . commercially
unreasonable, or contrary to the reasonable expectations of the parties” (internal
citations omitted)).
However, if Bank of America merely had information that was inconsistent
with the Borrowers’ certification, it did not have an affirmative duty to determine
whether the condition precedent was actually satisfied. Section 9.3.2 does not
include any language requiring Bank of America, as Disbursement Agent, to verify

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the accuracy of the Borrowers’ certifications. Instead, immediately following the
language quoted above, § 9.3.2 includes language suggesting that the opposite is
true:
The Disbursement Agent shall not be required to conduct any
independent investigation as to the accuracy, veracity or
completeness of any such items . . . .
In addition, according to § 9.10 of the Agreement, “nothing in this Agreement . . .
shall be so construed as to impose” obligations on Bank of America “except as
expressly set forth herein.”
Under this interpretation of Bank of America’s duties as Disbursement
Agent, Bank of America would still have to determine whether each condition
precedent was satisfied if it did not have a certification it could rely on. For
example, as the Term Lenders point out, there are some conditions for
disbursement that the Borrowers could not certify, such as the condition in
§ 3.3.24, requiring that the Bank Agent “receive[] such other documents and
evidence as are customary . . . as the Bank Agent may reasonably request.” Also,
it is not hard to imagine a circumstance in which the Borrowers chose not to give
such a certification or where Bank of America had actual knowledge that the
certification was false. In situations like these, § 9.3.2 would play no role because
there would be no certification Bank of America, as Disbursement Agent, could
rely on when determining whether the condition precedent was satisfied. It is

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under these circumstances that other provisions of the Agreement – such a § 9.2.1,
giving Bank of America the right to review information supporting the Advance
Requests, and § 2.5.1, requiring that Bank of America “specify, in reasonable
detail, the conditions precedent which [it] has determined have not been satisfied”
– would have had more relevance
B. DID BANK OF AMERICA BREACH THE DISBURSEMENT
AGREEMENT?
Bank of America was permitted to rely on the Borrowers’ certifications
unless it had actual knowledge that the conditions precedent were not satisfied.
During the relevant period, the Borrowers certified that the conditions precedent
were met. Therefore, Bank of America could have only been in breach by
disbursing funds to the Borrowers if it had actual knowledge that the conditions
precedent were not satisfied.
In granting summary judgment to Bank of America, the District Court
determined that “with all inferences in favor of the Term Lenders, the Term
Lenders . . . failed to present a genuine issue of material fact as to whether Bank of
America, as Disbursement Agent or Bank Agent, had actual knowledge of the
failure of any conditions precedent to disbursement.” In re Fontainebleau, 2012
WL 930290, at *48. For the reasons we will outline here, we have come to a
different conclusion.

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As detailed in the District Court’s thorough opinion, the Term Lenders
contend that Bank of America should have stopped disbursing funds to the
Borrowers because, at some point between September 2008 and March 2009, Bank
of America became aware of certain events, discussed below, that it knew caused
the failure of seven separate conditions precedent listed in § 3.3 of the
Disbursement Agreement. Id. at *8–9, 15–24. Under the terms of that agreement,
once the Bank of America knew that conditions precedent were not satisfied, it was
required to issue a Stop Funding Notice to temporarily halt disbursal of the funds.
1. Lehman Brothers’ Bankruptcy and Failure to Fund
Lehman Brothers Holdings, Inc. (Lehman) was the largest lender under the
Retail Facility and the Administrative Agent of the Retail Facility. No one
disputes that Lehman filed for bankruptcy on September 15, 2008. Neither is it
disputed that Fontainebleau funded Lehman’s approximately $2.5 million share of
the September 2008 Retail Advance and essentially funded Lehman’s portion of
the Retail Advances from December 2008 through March 2009 by reimbursing
ULLICO, a Co-Lender under the Retail Facility, for funding those amounts.
The failure of Lehman may have caused the failure of several conditions
precedent in and of itself. For example, Fontainebleau’s funding of Lehman’s
share of the September Retail Advance was a failure of the condition in § 3.3.23,
requiring that the Retail Lenders make all advances required of them. Also, if
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Lehman’s bankruptcy was a “change in the economics” of the Project “which
could reasonably be expected to have a Material Adverse Effect,” there would have
been a failure of the condition in § 3.3.11, requiring that no such change shall have
occurred. 5
What the parties do dispute is whether Bank of America had actual
knowledge of these events and whether the impact of these events on the
conditions precedent was such that the disbursing of funds constituted a breach of
contract. The Term Lenders argue that Bank of America had actual knowledge
that Lehman did not fund its share of the September Retail Advance and that
Fontainebleau paid the money for Lehman. In support of this view of the facts, the
Term Lenders point to a number of things: 1) a series of letters from Highland
Capital Management, one of the original term lenders, alerting Bank of America to
the serious impact Lehman’s bankruptcy could have on the Project and suggesting
that Fontainebleau funded Lehman’s share of the September Retail Advance; 2)
testimony by McLendon Rafeedie, the primary contact at TriMont Real Estate
5

The Term Lenders also argue that Lehman’s bankruptcy and its failure to fund could have led
to the failure of several other conditions precedent in the Disbursement Agreement: § 3.3.21,
requiring that the Bank Agent shall not have become aware of information that is materially
inconsistent with the information disclosed to them; § 3.3.3, requiring that no “Default or Event
of Default” has occurred and is continuing ; and § 3.3.2, requiring that the Borrowers’
representation that there was no “Event of Default” was true in all material respects. Our
analysis of Bank of America’s actual knowledge applies equally to these conditions precedent
even though we do not specifically discuss them. The Term Lenders made other arguments on
appeal about why genuine issues of material fact remain with respect to Bank of America’s
knowledge of the failure of these conditions. However, our analysis in this section makes it
unnecessary for us to address them.
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Advisors, Inc. about TriMont’s role as servicer of the Retail Facility, explaining
that he knew Fontainebleau funded for Lehman and suggesting that it was possible
that he informed Bank of America about this; 3) an October 2008 meeting among
executives of Fontainebleau, Bank of America, and certain Retail Co-Lenders
where the implications of Lehman’s bankruptcy were discussed; and 4)
Fontainebleau’s suspicious evasiveness on the topic of Lehman’s bankruptcy and
its nonresponsive answers to Bank of America’s questions about who funded
Lehman’s share of the September Advance.
As the District Court’s opinion details, there are ways to discount each of
these categories of evidence as showing, at most, a reason that Bank of America
should have been suspicious that Fontainebleau funded Lehman’s share of the
September Retail Advance. See In re Fontainebleau, 2012 WL 930290, at *37–40.
However, taken together and viewed in the light most favorable to the Term
Lenders, we conclude that this circumstantial evidence creates a genuine issue of
material fact with respect to whether Bank of America had actual knowledge that
Fontainebleau paid Lehman’s share of the September Retail Advance. Cf. United
States v. Santos, 553 U.S. 507, 521, 128 S. Ct. 2020, 2029 (2008) (explaining that
the “knowledge element” of the offense “will be provable (as knowledge must
almost always be proved) by circumstantial evidence”).

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Forwarding a similar argument, the Term Lenders also say that Bank of
America had actual knowledge that Lehman’s bankruptcy was a “change in the
economics . . . which could reasonably be expected to have a Material Adverse
Effect.” To support this proposition, the Term Lenders highlight: 1) the large share
of the Retail Facility that Lehman was responsible for funding; 2)
contemporaneous statements made by Bank of America employees about the
potential impact Lehman’s bankruptcy would have on the Project together with
their later explanations of those statements; 3) the letters from Highland Capital
Management mentioned above; and 4) discussions at the October 2009 meeting
(also mentioned above) about the impact of Lehman’s bankruptcy on the Project
and the Retail Co-Lenders’ unwillingness to pay Lehman’s portion if Lehman was
unable to pay.
The District Court’s opinion accurately details how, despite Lehman’s
bankruptcy, “there was no indication that there would be a shortfall in Retail Funds
or that the Retail Lenders would fail to honor their obligations under the Retail
Facility.” In re Fontainebleau, 2012 WL 930290, at * 17. However, when taken
together and viewed in the light most favorable to the Term Lenders, we conclude
that the Term Lenders’ evidence raises a genuine question of material fact about
whether Bank of America had actual knowledge that Lehman’s bankruptcy was a

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change in the economics of the Project “which could reasonably be expected to
have a Material Adverse Effect.” (emphasis added).
2. First National Bank of Nevada’s Repudiation, Cost Overruns, and the
Default of Several Delay Draw Term Lenders
That several other events of consequence happened during the period of
September 2008 through 2009 is also undisputed. First, in late December 2008,
the Federal Deposit Insurance Corporation, which had been appointed as receiver
of First National Bank of Nevada (a Delay Draw Term Loan and Revolving Loan
Lender), formally repudiated First National Bank of Nevada’s unfunded Senior
Credit Facility commitments. These commitments amounted to $1,666,666 under
the Delay Draw Term Loan and $10,000,000 under the Revolver Loan.
Second, in January and March 2009, the Construction Consultant issued
Project Status Reports expressing concerns that the Borrowers’ Anticipated Cost
Report did not accurately reflect increases in the Project budget. In March, the
Consultant issued a Construction Consultant Advance Certificate declaring that
there were material errors in the Advance Request and that the budget did not
accurately reflect costs. By the end of March, the Borrowers increased the Project
budget by more than $114,000,000.6

6

The Borrowers first increased construction costs by $64,854,000. Based on the Construction
Consultant’s Advance Certificate, the Borrowers increased the budget by another $50,000,000.
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Third, in March 2009, the Borrowers submitted a Notice of Borrowing
requesting a Delay Draw Term Loan for the entire $350 million facility.
Guggenheim (which controlled five Delay Draw Term Loan investment funds) and
Z Capital Finance, LLC (a Delay Draw Term Lender) failed to give Bank of
America funds as they were obligated to under the Credit Agreement.
Guggenheim’s portion of the Delay Draw Term Loan was $10,000,000 and Z
Capital was responsible for $11,666,666. Despite their failure to fund, Bank of
America included these commitments as “Available Funds” to calculate whether
the Project was “In Balance.”
No one disputes that these events may be relevant to several conditions
precedent. For example, if either First National Bank of Nevada’s repudiation or
Guggenheim’s and Z Capital’s failures to fund “could reasonably be expected to
result in a Material Adverse Effect,” this would have been an Event of Default
under the Credit Agreement. Based on this, the condition in § 3.3.3 of the
Disbursement Agreement would not have been satisfied. 7 Also, if these events,

7

This condition required that “No Default or Event of Default shall have occurred and be
continuing.” “Event of Default” was defined as being an “Event of Default under any of the
Facility Agreements.” One “Event of Default” under the Credit Agreement was any breach or
default by any party to the agreements of any term of the agreements provided that it “could
reasonably be expected to result in a Material Adverse Effect.”
If Bank of America had actual knowledge that the condition in § 3.3.3 was not satisfied
because there was an “Event of Default,” the condition in § 3.3.2 would also be implicated
because Bank of America would have had actual knowledge that Fontainebleau’s representation
that there was no “Event of Default” was not “true and correct.”
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considered together with Lehman’s bankruptcy, amounted to a “change in the
economics” of the Project “which could reasonably be expected to have a Material
Adverse Effect,” then the condition in § 3.3.23 would not have been satisfied.
However, the parties do dispute whether these events did, in fact, cause
failures of the conditions precedent and whether Bank of America had actual
knowledge of the failures. The primary basis for the District Court’s determination
that these events did not constitute failures of conditions precedent, which Bank of
America urges us to adopt, was its determination that each of these events was not
material, as a matter of law. See In re Fontainebleau, 2012 WL 930290, at *43–44.
In arguing to defeat this materiality determination by the District Court, and to
support their own view that these events “could reasonably be expected to have a
Material Adverse Effect,” the Term Lenders: 1) take issue with the District Court’s
finding that the loan amounts of the Senior Credit Facility that were not available
due to First National Bank of Nevada’s repudiation and Guggenheim’s and Z
Capital’s failures to fund were immaterial as a matter of law; 2) point out that, as
the District Court acknowledged, Guggenheim’s and Z Capital’s failures to fund
caused the Project’s budget to be out of balance; 3) highlight Bank of America’s
recognition of how difficult it would be to secure alternative lenders; and 4) argue
that “[t]he intricate, interlocking agreements reflected the reality that no reasonable

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lender would fund without assurances that other lenders would also fund to
completion.”
Considering all of this together, the Term Lenders have raised genuine
issues of material fact about whether there were “Events of Default” to the extent
that these events “could reasonably be expected to have a Material Adverse Effect”
and whether Bank of America had actual knowledge of this fact. Cf. e.g., Lucas v.
Fla. Power & Light Co., 765 F.2d 1039, 1040–41 (11th Cir. 1985) (explaining that
“questions of materiality” are “[m]ixed questions of law and fact” that “involve
assessments peculiarly within the province of the trier of fact”); Willjeff, LLC v.
United Realty Mgmt. Corp., 920 N.Y.S.2d 495, 497 (N.Y. App. Div. 2011)
(explaining that materiality is generally a question for the finder of fact unless “the
evidence concerning the materiality is clear and substantially uncontradicted”).
Even if First National Bank of Nevada’s repudiation, and Guggenheim’s and Z
Capital’s failures to fund could not have been expected to result in a Material
Adverse Effect when considered one by one, taken together and in conjunction
with the large increase in the Project budget and Lehman’s bankruptcy, we have no
problem concluding there is a genuine issue of material fact regarding whether
Bank of America knew that there was a “change in the economics” of the Project

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“which could reasonably be expected to have a Material Adverse Effect,” thereby
implicating the condition in § 3.3.11. 8
C. WAS BANK OF AMERICA GROSSLY NEGLIGENT?
Under § 9.10 of the Disbursement Agreement, Bank of America, as
Disbursement Agent, had no responsibility “except for any bad faith, fraud, gross
negligence or willful misconduct” and could not be held liable for any loss “except
as a result of [its] bad faith, fraud, gross negligence or willful misconduct.” Under
New York law, these are high standards. For example, New York law defines
gross negligence as “conduct that evinces a reckless disregard for the rights of
others or smacks of intentional wrongdoing,” Colnaghi, U.S.A., Ltd. v. Jewelers
Protection Servs., Ltd., 81 N.Y.2d 821, 823–24 (N.Y. 1993) (quotation marks
omitted), or “the failure to exercise even slight care,” Food Pageant, Inc. v.
Consolidated Edison Co., Inc., 54 N.Y.2d 167, 172 (N.Y. 1981).
However, “[g]enerally, the particular standard of care which a defendant is
judged against in a given case is a factual matter for the jury.” Food Pageant, Inc.,
54 N.Y.2d at 172. Thus, “[w]here the inquiry is to the existence or nonexistence of
gross negligence . . . the question . . . [is] a matter for jury determination.” Id. at
8

The Term Lenders argue that Bank of America was in breach of the Disbursement Agreement
because it disbursed funds even though it had actual knowledge that seven conditions precedent
had failed. Because we have concluded that there were genuine issues of material fact as to five
of these conditions, we decline to address the remaining two conditions precedent. Neither will
we address Term Lenders’ arguments about several other purported failures of the conditions
precedent we have discussed. We leave it to the District Court to reevaluate these issues, as
necessary, in light of this opinion and further proceedings before that court.
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173. “While gross negligence may be found as a matter of law in some limited
instances,” Trump Int’l Hotel & Tower v. Carrier Corp., 524 F. Supp. 2d 302, 315
(S.D.N.Y. 2007), it cannot be resolved as a matter of law in this case.
Here, there is an issue of fact about whether Bank of America was grossly
negligent. For example, under our interpretation of the Disbursement Agreement,
Bank of America would have been in breach of the Agreement if it disbursed the
Term Lenders’ funds to the Borrowers even though it had actual knowledge that
any one of the conditions precedent had failed. We have discussed why we believe
there are genuine issues of material fact about whether Bank of America had actual
knowledge that a number of conditions precedent had failed. In addition to those
things we discussed, the Term Lenders have also established a dispute of material
fact on the subject of whether Bank of America had actual knowledge that some of
these conditions precedent had failed months before it disbursed funds to the
Borrowers or that Bank of America had actual knowledge that some of these
conditions precedent had failed for several different reasons. A jury could find that
the cumulative effect of Bank of America’s disbursing funds despite having actual
knowledge about the failure of many different conditions precedent amounted to
gross negligence. A jury could also find that certain conditions precedent were so
material to the Agreement that Bank of America’s conduct, including disbursing

24

Case 1:09-md-02106-ASG Document 362 Entered on FLSD Docket 08/28/2013 Page 28 of 29
Case: 12-11815 Date Filed: 07/26/2013 Page: 25 of 26

funds to the Borrowers, showed a reckless disregard for the Term Lenders’ rights
to the extent it knew that those conditions were not satisfied.
V. SEALED DOCUMENTS
Many of the documents filed in this case, including the parties’ motions for
summary judgment and appeal briefs, were filed under seal. An example of the
documents filed under seal is the Disbursement Agreement, which is central to this
case. This same document was publicly filed in other proceedings, including a
case we heard at oral argument on the same day as this one.
At the request of the court, the parties have filed a joint letter agreeing that
the underlying Agreements and many of the other documents in the record should
be unsealed. The parties also listed certain documents they wish to continue to
keep under seal. Upon remand of this case to the District Court, the Clerk is
directed to unseal all of the documents in the record, except those delineated in the
parties’ request to retain them as sealed.
VI. CONCLUSION
Having concluded that under the Disbursement Agreement Bank of America
was permitted to rely on the Borrowers’ certifications that the conditions precedent
were satisfied unless it had actual knowledge to the contrary, and finding that there
remain genuine issues of material fact about whether Bank of America had such
knowledge and whether its actions amounted to gross negligence, we affirm in part
25

Case 1:09-md-02106-ASG Document 362 Entered on FLSD Docket 08/28/2013 Page 29 of 29
Case: 12-11815 Date Filed: 07/26/2013 Page: 26 of 26

and reverse in part the District Court’s order. Specifically, we affirm the District
Court’s denial of the Term Lenders’ Motion for Partial Summary Judgment and the
District Court’s interpretation of Bank of America’s obligations under the
Disbursement Agreement. We reverse the District Court’s grant of summary
judgment in favor of Bank of America. We also remand the case to the District
Court for further proceedings consistent with this opinion.
AFFIRMED IN PART, REVERSED IN PART, and REMANDED

26

Case 1:09-md-02106-ASG Document 363 Entered on FLSD Docket 08/30/2013 Page 1 of 3

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO 09-MD-02106-CIV-GOLD/GOODMAN
IN RE: FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL No. 2106
_____________________________________/
ORDER UPON MANDATE; SUGGESTING REMAND BY THE UNITED STATES
PANEL ON MULTIDSTRICT LITIGATION TO THE DISTRICT OF NEVADA
This Cause is before the Court upon Mandate of the Eleventh Circuit Court of
Appeals [ECF 362], in which the Eleventh Circuit affirmed my denial of the Term
Lenders’ Motion for Partial Summary Judgment and interpretation of Bank of America’s
obligations under the Disbursement Agreement, reversed the grant of final summary
judgment in favor of Bank of America, and remanded the case for proceedings
consistent with the opinion. This multi-district litigation (“MDL”) arose out of alleged
breaches of various agreements for loans to construct and develop a casino resort in
Las Vegas, Nevada. On July 7, 2009, Fontainebleau Las Vegas, LLC v. Bank of
America, N.A., et al., Case No. 09-cv-21879 (the “Fontainebleau Action”), was filed in
the Southern District of Florida and assigned to me. Subsequently, Avenue CLO Fund,
Ltd., et al. v. Bank of America, et al., Case No. 09-cv-1047 (the “Avenue Action”) was
filed in the District of Nevada.
On December 2, 2009, the United States Judicial Panel on Multidistrict Litigation
1

(“JPML”) [ECF No. 1]

1

consolidated the Fontainebleau and Avenue Actions for

All references to the docket refer to Case No. 09-md-02106, unless otherwise indicated.

Case 1:09-md-02106-ASG Document 363 Entered on FLSD Docket 08/30/2013 Page 2 of 3

coordinated or consolidated pretrial proceedings pursuant to 28 U.S.C. § 1407, and
transferred the MDL to me, reasoning, inter alia, that the Fontainebleau Action was the
2

more advanced of the two actions. The JPML also noted there was a potential tagalong action pending in the Southern District of New York, ACP Master, LTD, et al. v.
Bank of America, et al, Case No. 09-cv-8064 (the “Aurelius Action”), and, on January 4,
2010 [ECF No. 21], the JPML transferred the Aurelius Action to me.

3

In April 2011, upon agreement by the relevant parties, I dismissed the Aurelius
Action without prejudice so that the Aurelius plaintiffs, whose interests had been
acquired by the Avenue plaintiffs, could pursue their claims against Bank of America in
4

the Avenue Action [ECF No. 238; see also ECF Nos. 212, 212-1]. In August 2012,
while various appeals relating to the MDL were pending before the Eleventh Circuit, the
parties to the Fontainebleau Action settled their case [ECF No. 353; 09-cv-21879, ECF
No. 161]. Therefore, pending before me upon Mandate is the Avenue action only.
Additionally, upon review of the case file and the Eleventh Circuit’s Mandates [ECF Nos.
361 and 362], I conclude all common pretrial proceedings in this MDL have been
completed.

2

Upon transfer to the Southern District of Florida, the Avenue Action was assigned Case No.
09-cv-23835.
3

Upon transfer to the Southern District of Florida, the Aurelius Action was assigned Case No.
10-cv-20236.
4

I had previously dismissed Counts I and II of the Aurelius Amended Complaint for lack of
standing. The Eleventh Circuit affirmed the dismissal by mandate issued March 25, 2013 [ECF
No. 361].

2

Case 1:09-md-02106-ASG Document 363 Entered on FLSD Docket 08/30/2013 Page 3 of 3

Accordingly, pursuant to 28 U.S.C. § 1407 and the Rules of Procedure of the
JPML, and for the just and efficient handling of this matter, I respectfully request that the
JPML remand this case to its original forum, the District of Nevada. See 28 U.S.C. §
1407(a) (“Each action so transferred shall be remanded by the panel at or before the
conclusion of such pretrial proceedings to the district from which it was transferred
unless it shall have been previously terminated ….”); Rules of Procedure of the United
States Judicial Panel on Multidistrict Litigation, Rule 10.1(b); MDL No. 2005, In Re: Air
Crash at Tegucigalpa, Honduras, ECF No. 63, August 6, 2010 Remand Order.

DONE AND ORDERED in Chambers at Miami, Florida, this 30th day of August, 2013.

_____________________________________
THE HONORABLE ALAN S. GOLD
UNITED STATES DISTRICT COURT JUDGE

cc:

Clerk of the United States Judicial Panel on Multidistrict Litigation
Magistrate Judge Jonathan Goodman
All Counsel of Record

3

Case 1:09-md-02106-ASG Document 364 Entered on FLSD Docket 09/05/2013 Page 1 of 1

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Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 1 of 7

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
DEFENDANT’S MOTION FOR RECONSIDERATION OF ORDER UPON
MANDATE; SUGGESTING REMAND BY THE UNITED STATES PANEL
ON MULTIDISTRICT LITIGATION TO THE DISTRICT OF NEVADA
Defendant Bank of America, N.A. (“BANA”) respectfully requests that the Court
reconsider and vacate its August 30, 2013 sua sponte Order Upon Mandate; Suggesting Remand
by the United States Panel on Multidistrict Litigation to the District of Nevada [D.E.# 363] (the
“Order”) because the Order incorrectly assumes that “all common pretrial proceedings in this
MDL have been completed.” (Order at 3.) In fact, as demonstrated below, common pretrial
proceedings—fact and expert discovery regarding Plaintiffs’ alleged damages—remain.

This

Court is best equipped to oversee these pretrial proceedings to their conclusion, given the deep
familiarity with the complex factual record that the Court has developed during the nearly four
years that it has been presiding over these MDL proceedings.
I.

PRETRIAL PROCEEDINGS ARE NOT COMPLETE
Although the parties have completed fact discovery concerning the events underlying

Plaintiffs’ claims and summary judgment motions have been decided, the parties never
completed discovery. This and other pretrial proceedings thus remain. “[P]re-trial, as an
adjective, means before trial - [thus,] all judicial proceedings before trial are pretrial

1

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 2 of 7

proceedings.” In re Multidistrict Private Civil Treble Damage Litig. Involving Plumbing
Fixtures, 298 F. Supp. 484, 494 (J.P.M.L. 1968). Pretrial proceedings are not completed until a
final pretrial order is entered. See U.S. ex rel. Hockett v. Columbia/HCA Healthcare Corp., 498
F. Supp. 2d 25, 37 (D.D.C. 2007) (“[P]re-trial proceedings do not conclude until a final pretrial
order is entered, and … all prior proceedings—including rulings on motions for summary
judgment—are pretrial proceedings that may properly remain before the transferee court.”); see
also In re Rhone–Poulenc Rorer Pharms., Inc., 138 F.3d 695, 697 (7th Cir.1998) (final pretrial
order under Fed. R. Civ. P. 16 is “an order that a judge presiding over pretrial proceedings by
reference from the Multidistrict Litigation Panel has (or so all the cases we’ve found on the
question hold or assume) the power to issue.”). Here, as described below, several additional
proceedings must be completed before all pretrial proceedings are complete and this case is trialready.
A.

Fact Discovery Relating to Plaintiffs’ Alleged Damages is not Complete.

Pretrial fact discovery regarding Plaintiffs’ alleged damages is not complete. Many of
the Plaintiffs are hedge funds that have acquired—and continued to acquire—Fontainebleau Las
Vegas Term Loans on the secondary market long after the events giving rise to this lawsuit. It is
BANA’s understanding based on a review of the Fontainebleau Las Vegas bankruptcy docket
that in the two-plus years since serving their damages expert’s report, certain Plaintiffs have
purchased tens of millions of dollars of additional Fontainebleau Las Vegas Term Loans on the
secondary market, increasing the damages they seek from BANA. (Decl. of Daniel L. Cantor in
Support of Defendant’s Motion for Reconsideration of Order Upon Mandate; Suggesting
Remand by the United States Panel on Multidistrict Litigation to the District of Nevada (“Cantor
Decl.”), at ¶ 4.) Fed. R. Civ. P. 26(e)(1)(A) requires Plaintiffs to update their previous discovery

2

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 3 of 7

responses detailing each Plaintiff’s current Term Loan holdings and claimed damages. This has
not happened yet. Moreover, to the extent that any disputes arise concerning this additional
discovery, that would also be a pretrial proceeding requiring this Court’s attention.
B.

Expert Discovery Relating to Plaintiffs’ Alleged Damages is not Complete.

The parties never completed expert discovery regarding Plaintiffs’ alleged damages.
Although the parties exchanged expert reports in mid-2011, they agreed to defer the damages
experts’ depositions pending resolution of the summary judgment motions, recognizing that the
summary judgment rulings might alter the damages experts’ opinions, or moot them entirely.
(Cantor Decl. ¶ 8.) Moreover, before expert damages depositions can move forward, the parties
need to update their respective expert reports to reflect, among other things, the following:
•

Changes in Plaintiffs’ Term Loan holdings over the past two years, and the
accrual since 2011 of additional prejudgment interest we expect Plaintiffs claim.

•

Developments in other litigations arising from the Fontainebleau Las Vegas
Project’s financial collapse over the past two years, including the settlement that
Plaintiffs (and other Term Lenders) have nearly finalized with mechanics
lienholders that will resolve their competing claims to the proceeds from the
Project’s sale to Carl Icahn. (See Cantor Decl. ¶¶ 9-10.)

The damages experts’ reports must be updated to reflect these and other developments
that could affect Plaintiffs’ claimed damages—and this process cannot begin until the discovery
discussed in Section I.A above is completed.
II.

THE SUGGESTION OF REMAND SHOULD BE RECONSIDERED IN VIEW OF
THE REMAINING PRETRIAL PROCEEDINGS
A motion for reconsideration should be granted when the “Court has … made an error

not of reasoning, but of apprehension.” Burger King Corp. v. Ashland Equities, Inc., 181 F.

3

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 4 of 7

Supp. 2d 1366, 1369 (S.D. Fla. 2002) (citation omitted); see also Sanzone v. Hartford Life &
Accident Ins. Co., 519 F. Supp. 2d 1250, 1257-58 (S.D. Fla. 2007) (Gold, J.) (granting motion to
reconsider where Court’s initial ruling was “based on … incorrect assumptions”). Grounds
justifying reconsideration include “the need to correct clear error or prevent manifest injustice.”
Safari Ltd. v. Adonix Transcomm, Inc., No. 09-CV-21289, 2011 WL 465334, at *1 (S.D. Fla.
Feb. 4, 2011) (citation omitted). We respectfully submit that in entering the remand order, the
Court overlooked the additional pretrial proceedings that must be completed before this case is
trial-ready.
Although remand prior to the completion of all pretrial proceedings is not prohibited
under 28 U.S.C. § 1407, “[t]he transferee court should consider when remand will best serve the
expeditious disposition of the litigation.” Manual for Complex Litigation (Fourth), § 20.133
(2004). Courts have found that even where “virtually all the actions with which [a] case was
consolidated have ... been settled,” remand is not required. In re Integrated Res. Inc., No. 92
Civ. 4555 (RWS), 1995 WL 234975, at *4 (S.D.N.Y. Apr. 21, 1995); see also In re Wilson, 451
F.3d 161, 170 (3d Cir. 2006) (“[A] proceeding that relates only to a single individual’s case or
claim can nonetheless be coordinated, as coordination can be found even if common issues are
present only in relation to cases that have already been terminated.”) (internal quotation marks
and citation omitted)). Thus, even if only one case remains in an MDL, that case need not be
remanded to the transferor district if discovery has not been completed. See In re CBS Color
Tube Patent Litig., 342 F. Supp. 1403, 1405 (J.P.M.L. 1972) (denying motion to remand because
“we are not convinced … that an action, in which discovery is not yet completed, should be
remanded simply because all other consolidated cases in the transferee court have been
dismissed or terminated in some way.”).

4

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 5 of 7

The parties here would benefit from this Court’s supervision of the remaining pretrial
proceedings. The Court’s handling of this MDL has given it a deep understanding of the legal
and factual issues arising from the complex Fontainebleau Las Vegas financing agreements and,
in particular, the enormous factual record relating to Plaintiffs’ claims. Thus, this Court is bestpositioned to address—knowledgably and efficiently—any potential issues relating to the
remaining damages expert discovery and other pretrial proceedings.
III.

CONCLUSION
Pretrial proceedings in this case, including fact and expert discovery on damages, are not

yet complete. Accordingly, BANA respectfully requests that the Court grant its motion for
reconsideration, vacate the Order, and schedule a conference with the parties to discuss the
remaining pretrial proceedings.
LOCAL RULE 7.1(a)(3) CERTIFICATION
Pursuant to Local Rule 7.1(a)(3), BANA certifies that it conferred with Plaintiffs’ counsel
on September 4, 2013, in a good faith effort to resolve the need for filing this motion. Plaintiffs
disagree that the Order should be reconsidered and intend to oppose this motion.

5

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 6 of 7

Dated: September 5, 2013

Respectfully submitted,
HUNTON & WILLIAMS LLP
By:

/s/ Jamie Zysk Isani
Jamie Zysk Isani
Florida Bar No. 728861
1111 Brickell Avenue, Suite 2500
Miami, Florida 33131
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
- and O’MELVENY & MYERS LLP
Bradley J. Butwin (pro hac vice)
Jonathan Rosenberg (pro hac vice)
Daniel L. Cantor (pro hac vice)
William J. Sushon (pro hac vice)
7 Times Square
New York, New York 10036
Telephone: [phone]
Facsimile: [phone]
E-mails:
[e-mail];
[e-mail];
[e-mail];
[e-mail]

Attorneys for Bank of America, N.A.

6

__

Case 1:09-md-02106-ASG Document 365 Entered on FLSD Docket 09/05/2013 Page 7 of 7

CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing was served by transmission
of Notice of Electronic Filing generated by CM/ECF on September 5, 2013 on all counsel or
parties of record on the Service List below:
J. Michael Hennigan, Esq.
Kirk Dillman, Esq.
Robert Mockler, Esq.
MCKOOL SMITH, P.C.
865 South Figueroa Street, Suite 2900
Los Angeles, California 90017
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]
[e-mail]
[e-mail]

David A. Rothstein, Esq.
Lorenz Michel Pruss, Esq.
DIMOND KAPLAN & ROTHSTEIN, P.A.
2665 South Bayshore Drive
Penthouse 2-B
Miami, Florida 33133
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]
[e-mail]

Attorneys for Plaintiffs Avenue CLO Fund, Ltd. et al.
By:

7

/s/ Jamie Zysk Isani
Jamie Zysk Isani, Esq.

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 1 of 45

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
DECLARATION OF DANIEL L. CANTOR IN SUPPORT OF DEFENDANT’S
MOTION FOR RECONSIDERATION OF ORDER UPON MANDATE;
SUGGESTING REMAND BY THE UNITED STATES PANEL ON
MULTIDISTRICT LITIGATION TO THE DISTRICT OF NEVADA
I, Daniel L. Cantor, hereby declare as follows:
1.

I am a member of the law firm of O’Melveny & Myers LLP, counsel for

defendant Bank of America, N.A. (“BANA”), and I am familiar with the facts and circumstances
in this action.
2.

I make this declaration in support of Defendant’s Motion for Reconsideration of

Order Upon Mandate; Suggesting Remand by the United States Panel on Multidistrict Litigation
to the District of Nevada.
A.

Fact Discovery Relating to Plaintiffs’ Alleged Damages is not Complete.

3.

Since June 2011, there have been a number of developments that are likely to

affect the amount of alleged damages Plaintiffs claim to have suffered.
4.

The Term Lenders have continued to trade Fontainebleau Las Vegas Term Loans.

Certain Plaintiffs have purchased tens of millions of dollars of additional Fontainebleau Las
Vegas Term Loans on the secondary market, increasing the damages they seek from BANA.

OMM_US:71802867.3

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 2 of 45

The docket for the Fontainebleau Las Vegas bankruptcy, which is captioned In re Fontainebleau
Las Vegas Holdings, LLC, Case No. 09-21481-AJC (Bankr. S.D. Fla.), reflects numerous such
transactions by Plaintiffs, including most recently:
•

On April 26, 2013, plaintiff Brigade Leveraged Capital Structures Fund, Ltd. filed a
notice of Partial Transfer of Claim for the transfer to Brigade of $40,841,901.44 in
Initial Term Loan and $20,420,950.73 in Delay Draw Term Loan from non-party
Citigroup Financial Products Inc. (D.E. # 3950) A true and correct copy of the
notice is attached hereto as Exhibit 1.

•

On June 25, 2013, plaintiff Sola Ltd. filed a notice of Partial Transfer of Claim for the
transfer to Sola of $1,679,480.54 in Initial Term Loan and $565,496.40 in Delay
Draw Term Loan from non-party Kelts LLC. (D.E. # 4038) A true and correct copy
of the notice is attached hereto as Exhibit 2.

•

And on June 25, 2013, plaintiff Solus Core Opportunities Master Fund, Ltd. filed a
notice of Partial Transfer of Claim for the transfer to Solus of $616,867.06 in Initial
Term Loans from non-plaintiff The Royal Bank of Scotland plc. (D.E. # 4046.) That
same day, Solus also filed a notice of Partial Transfer of Claim to Solus of $8,930.11
in Initial Term Loan and $210,711.61 of Delay Draw Term Loan from non-party
Kelts LLC. (D.E. # 4049) True and correct copies of the notices are attached hereto
as Exhibits 3 and 4.

•

On July 9, 2013, plaintiff Caspian Select Credit Master Fund, Ltd. filed notices of
Partial Transfer of Claim for the transfer of $923,208.29 in claims from non-plaintiff
Morgan Stanley Senior Funding, Inc. (D.E. #s 4056, 4057) True and correct copies
of the notices are attached hereto as Exhibits 5 and 6.

B.

Expert Discovery Relating to Plaintiffs’ Alleged Damages is not Complete.

5.

On May 23, 2011, Plaintiffs served three expert reports, including the expert

report of Saul Solomon, whom they claimed was a damages expert.
6.

In calculating Plaintiffs’ alleged damages, Solomon estimated that Plaintiffs

accounted for 73.73% of the Delay Draw Term Loans and 82.76% of the Initial Term Loans.
Solomon also calculated Plaintiffs’ damages based on the assumption that each disbursement to
Fontainebleau between September 2008 and March 2009 was improper.

2
OMM_US:71802867.3

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 3 of 45

7.

On June 29, 2011, BANA served three expert reports, including the expert report

of Christopher M. James. James’ report analyzed and commented on Solomon’s damages
analysis.
8.

On June 30, 2011, the parties agreed to postpone the Solomon and James

depositions until summary judgment motions were resolved. The parties recognized that the
ruling on the summary judgment motions could narrow or moot the damages experts’ opinions.
9.

The Fontainebleau Las Vegas lenders have been engaged in litigation with

numerous entities that filed mechanics liens on the Project to determine the validity of the
mechanics lienholders’ claims, and whether the mechanics lienholders’ claims are subordinated
or subrogated to the rights and liens of the Project lenders. The proceeding is captioned
Wilmington Trust FSB v. A1 Concrete Cutting & Demolition LLC, et al., Adv. No. 09-2480-AJC
(Bankr. S.D. Fla.). That litigation’s outcome will determine those parties’ respective rights to
the remaining assets in the Fontainebleau Las Vegas bankruptcy estate—namely, the proceeds
from the Project’s sale to Carl Icahn. Plaintiffs’ alleged damages in this case must be reduced by
the amount, if any, they recover from the Fontainebleau bankruptcy estate.
10.

The parties to the A1 Concrete lawsuit have filed documents reflecting an

imminent settlement. On June 7, 2013, they reported to the bankruptcy court that: “The parties
have continued to negotiate and are very close to finalizing a settlement agreement, Rule 9019
Motion, and proposed order approving the settlement agreement.” A true and correct copy of the
Second Agreed Ex Parte Motion to Continue Hearing on Motions to Dismiss and Status
Conference (D.E. # 625) is attached hereto as Exhibit 7. The parties’ respective damages expert
reports will need to be updated to reflect the settlement’s impact.

3
OMM_US:71802867.3

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 4 of 45

11.

I declare under penalty of perjury and 28 U.S.C. § 1746 that the foregoing is true

and correct to the best of my knowledge, information, and belief.
Date: September 5, 2013
New York, New York
__

4
OMM_US:71802867.3

/s/ Daniel L. Cantor
DANIEL L. CANTOR

______

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 5 of 45

EXHIBIT 1

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 6 of 45
Case 09-21481-AJC Doc 3950 Filed 04/26/13 Page 1 of 14

United States Bankruptcy Court

Southern District of Florida

In re: Fontainebleau Las Vegas Holdings, LLC et al.

Case No. 09-21481(AJC) (Jointly Administered)

PARTIAL TRANSFER OF CLAIMS OTHER THAN FOR SECURITY
A CLAIM HAS BEEN FILED IN THIS CASE or deemed filed under II U.S.c. § 1111(a).
Transferee hereby gives evidence and notice pursuant to Rule 3001 (e)(2), Fed. R. Bankr. P., of
the transfer, other than for security, of the claim referenced in this evidence and notice.
Brigade Leveraged Capital Structures Fund, LTD.
Name of Transferee

Citigroup Financial Products Inc.
Name of Transferor

Name and Address where notices to transferee
should be sent:

Court Claim No. See attached Proof of Claim

~

Brigade Leveraged Capital Structures Fund,
LTD.
399 Park Avenue, 16th Floor
New York, NY 10022
Attention: Joanna Bensimon
Telephone: [phone]
Fax:
1-469-304-2966
Email:
[e-mail]

,

..,

:",
!\ ..

Amount of Claim Transferred:
;'E;
(i) $40,841,901.44 outstanding principal
,"',
amount ofInitial Term Loans, plus
!:~::
interest, fees, expenses and other amounts::~;
'''''
owed thereon asserted . the Proof of
In
::;:
Claim; and
,,~~
(ii) $20,420,950.73 outstanding principal
~i;
amount of Delayed Draw Term Loans,
plus interest, fees, expenses and other
amounts owed thereon asserted in the
Proof of Claim
::~

Date Claim Filed: October 9, 2009
Last Four Digits of Acct #: _ _ _ _ _ _­

Phone: [phone]

Last Four Digits of Acct. #:._ _ _ _ _ __

I declare under penalty of perjury that the information provided in this notice is true and correct to the
best of my knowledge and belief.
BRIGADE LEVERAGED CAPITAL STRUCTURES FUND, LTD.
By: Brigade Capital Management, LLC
As Investment Manager

BY:~b
Trans

Date:

elTransferee's Agent

Penalty for making afalse statement: Fine of up to $500,000 or imprisonment for up to 5 years, or both. 18 YSc. §§ 152 & 3571.

Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 7 of 45
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United States Bankruptcy Court

Southern District of Florida

In re: Fontainebleau Las Vegas Holdings, LLC et al.

Case No. 09-2148HAJe} (Jointly Administered)

PARTIAL TRANSFER OF CLAIMS OTHER THAN FOR SECURITY
A CLAIM HAS BEEN FILED IN THIS CASE or deemed filed under II U.S.c. § 1111(a).
Transferee hereby gives evidence and notice pursuant to Rule 3001 (e)(2), Fed. R. Bankr. P., of
the transfer, other than for security, of the claim referenced in this evidence and notice.

Brigade Leveraged Capital Structures Fund, LTD.
Name of Transferee

Citigroup Financial Products Inc.

Name of Transferor

Address of Alleged Transferee:

Citigroup Financial Products Inc.

c/o Citibank, N.A.

1615 Brett Road Ops III

New Castle, DE 19720

Brigade Leveraged Capital Structures Fund, LTD.
399 Park Avenue, 16th Floor
New York, NY 10022
Attention: Joanna Bensimon
Telephone: [phone]
Fax:
1-469-304-2966
Email:
[e-mail]

Tel:

Attn:

302-324-6660/302-894-6175
E-Mail: brian.m.blessing@citLcom
[e-mail]
Brian Blessing / Brian Broyles

-DEADLINE OF OBJECT TO TRANSFER-

The alleged transferor of this claim is hereby notified that objections must be filed with the court within
twenty-one (21) days of the mailing of this notice. If no obj ection is timely received by the court, the
transferee will be substituted as the original claimant without further order ofthe court.

Date:

------------------------

CLERK OF THE COURT

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Case 1:09-md-02106-ASG Document 365-1 Entered on FLSD Docket 09/05/2013 Page 8 of 45
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UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

www.flsb.uscourts.gov

In re:

Chapter 11

FONTAINEBLEAU LAS VEGAS
HOLDINGS, LLC,

Case No. 09-21481-BKC-AJC

Debtor.

_______________________________1

ADDENDUM TO PROOF OF CLAIM OF BANK OF SCOTLAND PLC AGAINST

FONTAINEBLEAU LAS VEGAS HOLDINGS. LLC

1.

Lender. The undersigned, Julia R. Franklin, is an Assistant Vice President of

Bank of Scotland pIc ("Bank of Scotland"), a public limited company registered in Scotland,
United Kingdom and doing business at 1095 Avenue of the Americas, New York, New York,
10036. Bank of Scotland is a Term Lender and a Revolving Lender under the Credit Agreement
(as defined below) and files this proof of claim in such capacities pursuant to Section 501 of the
Bankruptcy Code and Bankruptcy Rule 3003. (Capitalized terms used but not defined herein
shall have the meanings ascribed to them in the Credit Agreement and other Loan Documents (as
defined in the Credit Agreement).)
2.

Bankruptcy Proceedings.

Fontainebleau Las Vegas Holdings, LLC (the

"Debtor"), Fontainebleau Las Vegas, LLC (the "FBLV"), and Fontainebleau Las Vegas Capital
Corp. ("Capital" and, collectively with the Debtor, and FBLV, the "Companies"), filed petitions
under Chapter J 1 of the Bankruptcy Code on June 9, 2009 (the "Petition Date"). Since the
Petition Date, the Companies have managed their businesses and properties as Debtors-in­

84404962vS

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45

possession under Bankruptcy Code §§ 1107 and I I OS. The Companies' cases are being jointly
administered under case number 09-214SI-BKC-AJC.
3.

Supporting Documents. FBLV, Fontainebleau Las Vegas II, LLC {"FBL V II"} I,

the lenders from time to time party thereto, including Bank of Scotland {collectively, the
"Lenders"}, and Bank of America, N.A., as Administrative Agent are parties to the Credit
Agreement dated as of June 6, 2007 {the "Credit Agreement"}. Concurrently with the Credit
Agreement, the Companies, FBLV II, Fontainebleau Las Vegas Retail, LLC, Bank of America,
N.A., as bank agent, Wells Fargo Bank, N.A., as trustee {"Trustee"}, Lehman Brothers Holdings
Inc., as retail agent, and Bank of America, N.A., as initial disbursement agent {"Disbursement
Agent"}, entered into a Master Disbursement Agreement dated as of June 6, 2007 (the
"Disbursement Agreement"), pursuant to which the parties thereto agreed, inter alia, as to the
manner in which certain loan proceeds were to be disbursed to the Companies.
4.

Copies of the Credit Agreement and each Loan Document referenced herein,

together with all amendments thereto, are attached to the proof of claim filed in connection with
the above-referenced case by the Administrative Agent and are hereby incorporated herein {the
"Master Proof of Claim"). In addition, copies of all Loan Documents referenced herein are
available (at the expense of the requesting party) upon written request to Kenneth E. Noble,
Katten Muchin Rosenman LLP, 575 Madison Avenue, New York, NY 10022.
5.

Pursuant to the Guarantee and Collateral Agreement dated as of June 6, 2007 (the

"Guarantee and Collateral Agreement"), by FBLV, FBLV II, the Debtor, and Capital in favor of
the Administrative Agent, the Debtor guaranteed payment and performance of all of the
"Obligations" as defmed in the Credit Agreement.
I Subsequent to the execution of the Credit Agreement, but prior to the Petition Date, FBLV II was merged into
FBLV.

84404962,5

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6.

Principal, Interest and Commitment Fees. Bank of Scotland asserts a claim on

account of the Debtor's guarantee of FBLV's obligations to pay for principal, interest and
commitment fees owed under the Credit Agreement. As of the Petition Date, the Debtor was
indebted to Bank of Scotland under the Guarantee and Collateral Agreement on account of its
guarantee of principal and interest owed under the Credit Agreement, in the aggregate amount of
not less than $72.5 million, including principal due on the Initial Tenn Loans in the aggregate
amount of not less than $48.33 million, principal due on the Delay Draw Tenn Loans in the
aggregate amount of not less than $24.2 million, plus its pro rate share of (i) unpaid interest
accrued on the Loans and (ij) unpaid commitment fees accrued with respect to the Loans.
Interest continues to accrue at the applicable rate set forth in the Credit Agreement to the extent
permitted by law. As of September 30, 2009, the interest and commitment fees due to Bank of
Scotland in respect of the Loans is in the aggregate amount ofnot less than $1.005,933.42.
7.

Letter of Credit Reimbursement Obligations. Bank of Scotland asserts a claim for

its pro rata share of amounts owed with respect to the Debtor's guarantee of certain letter of
credit reimbursement obligations. Pursuant to (a) the Guarantee and ColJateral Agreement (b)
Section 3.3 of the Credit Agreement and (c) each letter of credit application (each an "LC
Application" and collectively, the "LC Applications") entered into in connection with the letters
of credit (a "Letter of Credit" and collectively, the "Letters of Credit") issued by the Issuing
Lenders pursuant to the Credit Agreement, the Debtor is required to reimburse the Issuing
Lenders for any drawings made under any Letters of Credit and is required to pay such other
amounts as are more particularly described therein. As of the Petition Date, the aggregate
undrawn amount of all issued and outstanding Letters of Credit issued by the Issuing Lenders
was not less than $13,477,302.00. After the Petition Date, the beneficiaries of Letter of Credit

84<104961v5

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number 3090031 in the amount of $117,630 and Letter of Credit number 3088823 in the amount
of$11,750.000 drew upon such Letters ofCredit.
8.

In addition, pursuant to the Guarantee and Collateral Agreement and Section 3.9

of the Credit Agreement, the Debtor is required to pay a Letter of Credit fee (the "Letter of
Credit Fee") to the Administrative Agent, for the account of each Revolving Lender, on the daily
amount available to be drawn under any Letter of Credit.

As of September 30, 2009, the

aggregate amount of the Letter of Credit Fees owed by the Debtor to Bank of Scotland was not
less than $145,876.53.
9.

Bank of Scotland asserts a claim for not less than $1,234,258.33 under the

Guarantee and Collateral Agreement in respect of its pro rata share of all drawn Letters of Credit,
Letter of Credit Fees and interest due thereon as of September 30, 2009, and further asserts a
claim for its pro rata share of the amount of all undrawn Letters of Credit, and any and all other
amounts owed under the LC Applications and the Credit Agreement.
10.

Bank of Scotland reserves its right to supplement or modify this proof of claim

with additional information regarding any reimbursement obligations owed to Bank of Scotland.
11.

Fees. Expenses and Indemnities.

Bank of Scotland asserts a claim for fees,

expenses and indemnities under the Credit Agreement, the Disbursement Agreement, the
Guarantee and Collateral Agreement and the other Loan Documents. The Debtor is obligated
pursuant to the Guarantee and Collateral Agreement in respect of certain covenants and
indemnities contained therein and in the Credit Agreement, the Disbursement Agreement and the
other Loan Documents, including without limitation the covenants and indemnities set forth in
Sections 2.19 and 10.5 of the Credit Agreement, Section 11.15 of the Disbursement Agreement
and Section 8.4 of the Guarantee and Collateral Agreement to indemnify the Administrative

84404962vS

4

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Agent and the Lenders and to pay certain fees and expenses as more particularly set forth therein.
As of September 30, 2009, the amount of liquidated expenses and indemnities, including,
without limitation, those owed by the Debtor to Bank of Scotland for fees and expenses of
professionals, includes amounts paid to (i) Katten Muchin Rosenman LLP totaling not less than
$411,096.00, (ii) Steams Weaver Miller Weissler Alhadeff & Sitterson, P.A. totaling not less
than $57,369.20, and (iii) amounts paid by Bank of Scotland to the Administrative Agent for
reimbursement of the Agent's professional fees and expenses under the Credit Agreement
totaling not less than $47,209.68.
12.

All of the above fees and expenses have grown and continue to grow, to the extent

permitted by law. Any amounts arising after the Petition Date are entitled to administrative
priority to the extent provided in Sections 507(a)(1) and 503(b) of the Bankruptcy Code or
applicable court order.
13.

Bank of Scotland asserts a claim for indemnification in connection with, among

other things, any litigation heretofore or hereafter brought against Bank of Scotland, related to
the Fontainebleau Resort and Casino in Las Vegas, Nevada, including in connection with the
financing or construction thereof.

In particular, Bank of Scotland asserts a claim for

indemnification in respect of any claims, fees (including attorney's fees) or costs associated with
lawsuits heretofore or hereafter filed by any person, including the Companies, certain Lenders,
Tumberry West Construction, or any purported mechanic's lien claimant.
14.

1

After the Petition Date, Bank of Scotland received certain adequate protection

payments which have not been credited against the claim amounts set forth above.

84404962v)

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15.

Bank of Scotland further reserves all of its rights to supplement this proof of

claim with additional information regarding any such claims. Bank of Scotland is entitled to
post-petition interest, attorneys' fees and expenses to the extent provided by law.
16.

Secured Claim. As more fully described in the Master Proof of Claim, the Debtor

granted to the Administrative Agent for the ratable benefit of the Secured Parties, ipcluding Bank
of Scotland, a security interest in substantially all of the Debtor's property (the "Collateral").
Prior to the Petition Date, the Administrative Agent duly perfected such security interests
pursuant to applicable law. The security interests referred to above were granted in favor of
Administrative Agent for the ratable benefit of the Secured Parties, including Bank of Scotland,
in order to secure, inter alia, the Obligations (as defined in the Guarantee and Collateral
Agreement), including, without limitation, each of the claims described above. Accordingly,
Bank of Scotland asserts a secured claim to the extent of the value of the Collateral and an
unsecured claim for any deficiency (subject to an election, if any, made under II U.S.C. §

llll(b».
17.

The Administrative Agent, for the benefit of itself and the Lenders, including

Bank of Scotland, has been granted additional perfected security interests in, and liens upon,
property of the Debtor and the other Companies pursuant to (i) the Interim Order (I) Authorizing
Use of Cash Collateral Pursuant to Section 363 of the Bankruptcy Code, (II) Providing Adequate
Protection To Prepetition Secured Parties Pursuant to Section 361, 362, and 363, of the
Bankruptcy Code, and (III) Scheduling Final Hearing, entered on June 1 I, 2009, (ii) the Second
Interim Order (1) Authorizing Use of Cash Collateral Pursuant to Section 363 of the Bankruptcy
Code, (II) Providing Adequate Protection To Prepetition Secured Parties Pursuant to Section
361, 362, and 363, of the Bankruptcy Code, and (III) Scheduling Final Hearing, entered on July

84404961v5

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7,2009, (iii) the Third Interim Order (I) Authorizing Use of Cash Collateral Pursuant to Section
363 of the Bankruptcy Code, (II) Providing Adequate Protection to Prepetition Secured Parties
Pursuant to Sections 361, 362, 363 and 364 of the Bankruptcy Code. and (III) Scheduling Final
Hearing, entered on July 31, 2009. (iv) the Amended Third Interim Order (I) Authorizing Use of
Cash Collateral Pursuant to Section 363 of the Bankruptcy Code, (II) Providing Adequate
Protection to Prepetition Secured Parties Pursuant to Sections 361. 362. 363 and 364 of the
Bankruptcy Code, and (III) Scheduling Final Hearing, entered August 7, 2009. (v) the Fourth
Interim Order (I) Authorizing Use of Cash Collateral Pursuant to Section 363 of the Bankruptcy
Code, (II) Providing Adequate Protection to Prepetition Secured Parties Pursuant to Sections
361, 362. 363 and 364 of the Bankruptcy Code, and (III) Scheduling Final Hearing. entered
August 19,2009. and (vi) the First Interim Order (I) Authorizing the Nonconsensual Use of Cash
Collateral Pursuant to Section 363 of the Bankruptcy Code, (II) Providing Adequate Protection
to Prepetition Secured Parties Pursuant to Sections 361. 362. 363 and 364 of the Bankruptcy
Code, and (III) Scheduling Final Hearing, entered September 18, 2009, as supplemented by the
Bankruptcy Court (the Orders described in clauses (i)-(v) and this clause (vi). collectively, the
"Cash Collateral Orders").
18.

To the extent that the adequate protection previously provided or approved

pursuant to the Cash Collateral Orders or hereinafter provided or approved (including, without
limitation, any of the same that the Debtor has agreed will relate back to the Petition Date)
proves to be inadequate, Bank of Scotland is entitled to an administrative priority and super­
priority claim pursuant to 11 U.S.C. §§ 507(8)(1) and (b).
] 9.

Right of Setoff. The Debtor's indebtedness to Bank of Scotland is also secured,

pursuant to §§ 506(a) and 553 of the Bankruptcy Code, by any funds on deposit on the Petition

84404962"S

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Date with the Administrative Agent or any of the Lenders, which funds were subject to the
Administrative Agent's or Lenders' rights of setoff under applicable law and the Loan
Docwnents.
20.

Subordinated Claims.

Tumberry West Construction, Inc. (the "General

Contractor"), Tumberry Residential Limited Partner, L.P. (the "Completion Guarantor").
Fontainebleau Resorts, LLC ("Parent" and, collectively with the General Contractor and the
Completion Guarantor, the "Fontainebleau Affiliates"), the Debtor, FBLV and FBLV II entered
into the Affiliate Subordination Agreement dated as of June 6, 2007 (the "Affiliate Subordination
Agreement"), in favor of the Administrative Agent and Trustee.

Pursuant to the AffIliate

Subordination Agreement, the Fontainebleau Affiliates subordinated certain claims against the
Debtor to the claims of the Lenders. Section 2.04(b) of the Affiliate Subordination Agreement
provides that until all of the debt owed to the Lenders is paid in full, "any payments of the
Subordinated Obligations to which any Fontainebleau Affiliate would be entitled but for this
Article 2 will be made to [the Administrative Agent]." By this proof of claim, Bank of Scotland
asserts its right to any distributions made on account of any Subordinated Obligations (as defined
in the Affiliate Subordination Agreement) that would otherwise be made to Fontainebleau
Affiliates on account of any such claim they may have made or make against the Debtor.
21.

Setoff. Counterclaim. The claims set forth in this proof of claim are not subject to

any valid setoff or counterclaim in favor of tile Debtor.
22.

No Judgment. No judgment has been rendered on the claims set forth in this

proof of claim.
23.

RiMt to Amend.

Bank of Scotland reserves the right to (i) amend and/or

supplement this proof of claim from time to time hereafter as it may deem necessary and proper,

84404962vS

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including, but not limited to, for purposes of fIxing, increasing or amending in any respect the
amounts referred to herein, and adding or amending documents and other infonnation and further
describing this proof of claim; (ii) fIle additional proofs of claim for additional claims which may
be based upon the same or additional documents, andlor (iii) file a request for payment of
administrative expenses in accordance with 11 U.S.C. §§ 503 and S07 with respect to claims
covered by this proof of claim or any other claims.
24.

Notices. All notices in respect of this proof of claim should be sent to:

Bank of Scotland pIc

1095 Avenue of the Americas, 34th Floor

New York, NY 10036

Tel: (646) 264·6361

Facsimile: (212) 479·2806

Attn: Julia R. Franklin, Assistant Vice

President - Loan Documentation

• andKatten Muchin Rosenman LLP

575 Madison A venue

New York, NY 10022-2585

Tel: [phone]

Facsimile: [phone]

Attn: Kenneth E. Noble

25.

Bar Date. Reservation of Rights. This proof of claim is fIled under compulsion of

the bar date applicable in these cases and pursuant to Bankruptcy Rule 3003. and is filed to
protect Bank of Scotland from forfeiture of claims by reason of said bar date. Filing of this proof
of claim is not and should not be construed to be, inter alia: (i) a consent by Bank of Scotland to
the jurisdiction of this Court with respect to the subject matter of the claims set forth in this proof
of claim, any objection or other proceeding commenced with respect thereto or any other
proceeding commenced in these cases against or otherwise involving Bank of Scotland; (ii) a

84404961vS

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waiver of the right of Bank of Scotland to trial by jury in any proceedings so triable in these
cases or any controversy or proceedings related to these cases; (iii) a waiver or release of any of
Bank of Scotland's rights against any of the Companies, their non-debtor parents and affiliates,
including the Fontainebleau Affiliates, Jeffrey Soffer or any other entity or person liable for all
or part of any claim described herein; (iv) a waiver of the right to seek to have the reference
withdrawn with respect to the subject matter of these claims, any objection or other proceedings
commenced with respect thereto, or any other proceedings commenced in this case against or
otherwise involving Bank of Scotland; (v) a waiver of any right of subordination in favor of
Bank of Scotland of indebtedness or liens held by creditors of the Companies; (vi) an election of
remedies; (vii) a waiver of any rights Bank of Scotland may have pursuant to section 506(b) of
the Bankruptcy Code; (viii) a waiver or limitation on the right of Bank of Scotland to vote
separately on any plan or plans of reorganization proposed in any of the above-captioned cases;
or (ix) a waiver of any additional claims or other rights Bank of Scotland may have against the
Companies.

***Remainder ofPage Intentionally Left Blank·"

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Dated: October 8, 2009

BANK OF SCOTLAND PtC

By:

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This form is intentionally blank.
The notice is scheduled to be processed by the Bankruptcy Noticing Center (BNC).
Refer to the BNC Certificate of Notice entry to view the actual form.

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EXHIBIT 2

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This form is intentionally blank.
The notice is scheduled to be processed by the Bankruptcy Noticing Center (BNC).
Refer to the BNC Certificate of Notice entry to view the actual form.

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EXHIBIT 3

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This form is intentionally blank.
The notice is scheduled to be processed by the Bankruptcy Noticing Center (BNC).
Refer to the BNC Certificate of Notice entry to view the actual form.

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EXHIBIT 4

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This form is intentionally blank.
The notice is scheduled to be processed by the Bankruptcy Noticing Center (BNC).
Refer to the BNC Certificate of Notice entry to view the actual form.

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EXHIBIT 5

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EXHIBIT 6

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EXHIBIT 7

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UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
www.flsb.uscourts.gov
In re:
FONTAINEBLEAU LAS VEGAS
HOLDINGS, LLC, ET AL,1

Chapter 7
Case No.: 09-21481-BKC-AJC

Debtors.
______________________________________/

(Jointly Administered)

WILMINGTON TRUST N.A., as
Administrative Agent,
Adversary No. 09-02480-AJC
Plaintiff,
v.
A1 CONCRETE CUTTING &
DEMOLITION, LLC, et al,
Defendants.

SECOND AGREED EX PARTE MOTION TO CONTINUE HEARING ON MOTIONS
TO DISMISS AND STATUS CONFERENCE
Defendants

(exclusive

of

Turnberry West

Construction,

Inc.

(“TWC”),

the

“Subcontractors”), by and through co-lead counsel, the law firms of Gordon Silver, Ehrenstein
Charbonneau Calderin, and Shraiberg, Ferrara & Landau, P.A.,2 move ex parte with the consent
of the Plaintiff, Wilmington Trust, N.A. (“Wilmington”) and Defendant TWC, and pursuant to
Local Rule 9013-1(C)(1) to continue the hearing on the pending Motions to Dismiss and Status
1

In re Fontainebleau Las Vegas Holdings, LLC, Case No. 09-21481-BKC-AJC; In re Fontainebleau Las Vegas,
LLC, Case No. 09-21482-BKC-AJC; In re Fontainebleau Leas Vegas Capital Corp., Case No. 09-21483-BKC-AJC;
In re Fontainebleau Las Vegas Retail Parent, LLC, Case No. 09-36187-BKC-AJC; In re Fontainebleau Las Vegas
Retail Mezzanine, LLC, Case No. 09-36191-BKC-AJC; and In re Fontainebleau Las Vegas Retail, LLC, Case No.
09-36197-BKC-AJC.
2

In compliance with the Agreed Order Regarding Scheduling and Discovery Management and Coordination Among
Defendants [ECF No. 276], co-lead counsel files this Motion on behalf of all of the Subcontractors named in this
adversary proceeding.

1

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45

Conference scheduled for June 12, 2013 at 3:00 p.m. (the “Agreed Motion”). In support of the
Agreed Motion, Subcontractors state as follows:
1.

On January 10, 2013, Wilmington filed an Amended Complaint [ECF# 552]

against the Subcontractors and Turnberry West Construction, Inc.
2.

On January 22, 2013, the Court held a Status Conference regarding the Amended

Complaint and various response deadlines related to the Amended Complaint. On the
January 30, 2013, the Court issued the Order (i) Establishing Response Date for the Amended
Complaint, (ii) Briefing Schedule and (iii) Scheduling Hearing (the “Scheduling Order”). [ECF#
562].
3.

On March 1, 2013, Subcontractors filed their Motion to Dismiss and, in the

Alternative, for Partial Dismissal and a More Definite Statement (the “Subcontractor Motion”)
[ECF# 577]. On March 15, 2013, TWC filed its Motion to Dismiss Amended Complaint, or in the
Alternative for a More Definite Statement (the “TWC Motion”). [ECF# 607]. On
March 22, 2013, Wilmington filed Plaintiff’s Response in Opposition to Motion to Dismiss and
for a More Definite Statement (the “Response”). [ECF# 610].
4.

The parties then conducted a settlement conference in Miami on April 9 and 10.

The settlement conference was substantially successful, and the parties reached an agreement in
principal that was memorialized in a nearly final term sheet. After the settlement conference, the
parties continued to work toward finalizing the term sheet. In order to facilitate continued
negotiations, the parties filed the Agreed Motion Ex Parte Motion to Continue Hearing on
Motions to Dismiss and Status Conference (the “First Agreed Motion”). The Court set the First
Agreed Motion for hearing.

2

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45

5.

On Thursday, April 25, 2013 at 2:30 p.m., the Court held a hearing on the First

Agreed Motion at which undersigned counsel announced that the parties were negotiating a
settlement, and that they required a 30-day continuance in order to continue negotiating the terms
of settlement. The Court granted the First Agreed Motion and continued the hearing on the
Motions to Dismiss and Status Conference until June 12, 2013 at 3:00 p.m. (the “Hearing”).
6.

The parties have continued to negotiate and are very close to finalizing a

settlement agreement, Rule 9019 Motion, and proposed order approving the settlement
agreement. After finalizing and executing the settlement agreement, the Trustee will file a Rule
9019 Motion, seeking the settlement’s approval and the parties will intend to use the continued
hearing date as a hearing to approve the settlement.
7.

In order to allow the parties to complete that process, the parties respectfully

request that the Court grant them a second thirty (30) day continuance of the currently scheduled
Hearing and status conference.
8.

An agreed order, substantially in the form of Exhibit A attached hereto, will be

uploaded via CM/ECF.
WHEREFORE, the Subcontractors respectfully request that the Court grant the Agreed
Motion, and enter an order substantially in the form of Exhibit A, continuing the Hearing for
thirty (30) days, and grant such other relief as is just.

[Signature page follows]

3

Case 1:09-md-02106-ASG Document 365-1625 Filedon FLSD Docket 09/05/2013 Page 42 of
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45

I certify that I am admitted to the Bar of the United States District Court for the Southern
District of Florida and I am in compliance with the additional qualifications to practice in this
Court set forth in Local Rule 2090-1(A).

Dated: June 7, 2013.
EHRENSTEIN CHARBONNEAU CALDERIN
Counsel for JMB Capital Partners
Master Fund, L.P.
501 Brickell Key Dr., Suite 300
Miami, FL 33131
T. 305.722.2002 F. 305.722.2001

GORDON SILVER
Counsel for the M&M Lienholders
3960 Howard Hughes Parkway, Ninth Floor
Las Vegas, NV 89160
T. 702.396.5555 F. 702.369.2666

By:

By:

/s/ Daniel Gold
DANIEL L. GOLD, ESQ.
Florida Bar No. 761281
[e-mail]

/s/
GREGORY E. GARMAN, ESQ.
Nevada Bar No.: 6654
[e-mail]
Admitted pro hac vice
GABRIELLE A. HAMM, ESQ.
Nevada Bar No. 11588
[e-mail]
Admitted pro hac vice

SHRAIBERG, FERRARA & LANDAU, P.A.
Counsel for the M&M Lienholders
2385 N.W. Executive Center Dr., Suite 300
Boca Raton, FL 33431
T. 561.443.0800 F. 561.998.0047
By:

/s/
PHILIP J. LANDAU, ESQ.
Florida Bar No.: 504017
[e-mail]

Certificate of Service
I certify that a copy of the foregoing was served this 7th day of June, 2013 on the
following:
James H. Post
Stephen D. Busey
Smith Hulsey & Busey
225 Water Street, Suite 1800
Jacksonville, FL 32201

Sidney Levinson
Jones Day
555 South Flower Street
Fiftieth Floor
Los Angeles, California 90071-2300

4

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45

I further certify that a true and correct copy of the foregoing was provided on June 7,
2013 to all counsel for Defendants by posting to Defendants’ website pursuant to the Agreed
Order Regarding Scheduling and Discovery Management and Coordination Among Defendants
(Docket No. 276).
GORDON SILVER
Counsel for the M&M Lienholders
3960 Howard Hughes Parkway, Ninth Floor
Las Vegas, NV 89160
T. 702.396.5555 F. 702.369.2666
By:

5

/s/
GABRIELLE A. HAMM, ESQ.
Nevada Bar No. 11588
[e-mail]

Case 1:09-md-02106-ASG Document 365-1625 Filedon FLSD Docket 09/05/2013 Page 44 of
Case 09-02480-AJC Doc Entered 06/07/13 Page 6 of 7
45

EXHIBIT “A”

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
www.flsb.uscourts.gov
In re:

Chapter 7

FONTAINEBLEAU LAS VEGAS
HOLDINGS, LLC, ET AL,3

Case No.: 09-21481-BKC-AJC
(Jointly Administered)

Debtors.
______________________________________/
WILMINGTON TRUST N.A., as
Administrative Agent,

Adversary No. 09-02480-AJC

Plaintiff,
v.
A1 CONCRETE CUTTING &
DEMOLITION, LLC, et al,
Defendants.

3

In re Fontainebleau Las Vegas Holdings, LLC, Case No. 09-21481-BKC-AJC; In re Fontainebleau Las Vegas,
LLC, Case No. 09-21482-BKC-AJC; In re Fontainebleau Leas Vegas Capital Corp., Case No. 09-21483-BKC-AJC;
In re Fontainebleau Las Vegas Retail Parent, LLC, Case No. 09-36187-BKC-AJC; In re Fontainebleau Las Vegas
Retail Mezzanine, LLC, Case No. 09-36191-BKC-AJC; and In re Fontainebleau Las Vegas Retail, LLC, Case No.
09-36197-BKC-AJC.

6

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Case 09-02480-AJC Doc Entered 06/07/13 Page 7 of 7
45

ORDER GRANTING SECOND AGREED EX PARTE MOTION TO CONTINUE
HEARING ON MOTIONS TO DISMISS AND STATUS CONFERENCE
This Matter came before the Court ex parte on the Second Agreed Ex Parte Motion to
Continue Hearing on Motions to Dismiss and Status Conference (the “Motion”) [ECF#__]. The
Court has considered the Motion and the consent to continue the Hearing and Status Conference
by Wilmington Trust, N.A. and Turnberry West Construction, Inc. and finds that good cause
exists to grant the requested continuance. Accordingly, the Court ORDERS and ADJUDGES:
1.

The Motion is GRANTED.

2.

The Hearing and Status Conference are continued until _______________, 2013

in the United States Bankruptcy Court, 51 S.W. 1st Avenue, 14th Floor, Room 1410, Miami, FL
33130.
####
Submitted by:
Daniel L. Gold, Esq.
Florida Bar No. 0761281
Ehrenstein Charbonneau Calderin
Counsel for JMB Capital Partners Master Fund, L.P.
501 Brickell Key Drive, Suite 300
Miami, FL 33131
T: 305.722.2002
[e-mail]

7

Case 1:09-md-02106-ASG Document 366 Entered on FLSD Docket 09/09/2013 Page 1 of 3

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO 09-MD-02106-CIV-GOLD/GOODMAN
IN RE: FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL No. 2106
_____________________________________/
ORDER DENYING DEFENDANT’S
MOTION FOR RECONSIDERATION [ECF No. 365]
This Cause is before the Court on Defendant’s Motion for Reconsideration [ECF
No. 365]. On August 30, 2013, I entered an Order [ECF No. 363] suggesting remand of
this multi-district litigation (“MDL”) to the District of Nevada. I noted that the only action
pending before me upon the Eleventh Circuit Court of Appeals’ mandate was Avenue
CLO Fund, Ltd., et al. v. Bank of America, et al., Case No. 09-cv-1047, originally filed in
the District of Nevada. I noted that Fontainebleau Las Vegas, LLC v. Bank of America,
N.A., et al., Case No. 09-cv-21879, the case originally assigned to me, had settled, and
the tag-along action, ACP Master, LTD, et al. v. Bank of America, et al, Case No. 09-cv8064, had been dismissed. I also stated that all common pretrial proceedings in the
MDL had been completed [see ECF No. 251, MDL Order Number 51, setting pre-trial
deadlines]. The Judicial Panel on Multidistrict Litigation (“JPML”) issued a Conditional
Remand Order on September 4, 2013.
In its Motion for Reconsideration, filed September 5, 2013, Defendant states
pretrial proceedings, namely fact and expert witness discovery on damages, are not yet
complete. Specifically, Defendant contends certain Plaintiffs must update their damages
disclosures because they have purchased additional Fontainebleau Las Vegas Term

Case 1:09-md-02106-ASG Document 366 Entered on FLSD Docket 09/09/2013 Page 2 of 3

Loans on the secondary market, and expert discovery must be revised to reflect these
changes in Plaintiffs’ holdings as well as settlement recoveries in pending bankruptcy
proceedings. Defendant contends the parties would benefit from this Court’s supervision
of the remaining pretrial proceedings.
Upon review of the case file, I deny Defendant’s Motion for Reconsideration. The
damages discovery that remains outstanding does not overlap with the Fontainebleau
case, the case originally before me. Further, I do not believe I have obtained any
particular expertise from supervising the MDL that would render me more capable than
the District of Nevada in presiding over damages discovery. To the contrary, I conclude
the central purpose of the JPML referral has been achieved through my orders on
motions to dismiss and motions for summary judgment, and it will promote the just and
efficient conduct of this action to have any remaining damages discovery supervised by
the judge trying the case, in conjunction with trial-related issues and pleadings. I
therefore recommend the JPML exercise its discretion and remand the case to the
District of Nevada. See 28 U.S.C. § 1407(a) (“Each action so transferred shall be
remanded by the panel at or before the conclusion of such pretrial proceedings ….
(emphasis added)); In re Evergreen Valley Project Litig., 435 F. Supp. 923 (Jud. Pan.
Mult. Lit. 1978) (“It is not contemplated that a Section 1407 transferee judge will
necessarily complete all pretrial proceedings in all actions transferred and assigned to
him by the Panel, but rather that the transferee judge in his discretion will conduct the
common pretrial proceedings with respect to the actions and any additional pretrial
proceedings as he deems otherwise appropriate.”); In re Air Crash Disaster at Tenerife,
461 F.Supp., 671 (Jud. Pan. Mult. Lit. 1978) (remanding select plaintiffs’ case to

2

Case 1:09-md-02106-ASG Document 366 Entered on FLSD Docket 09/09/2013 Page 3 of 3

transferor district where remaining discovery concerned damages and remaining pretrial
proceedings in plaintiffs’ case were unique to those plaintiffs).
Accordingly, it is hereby ORDERED and ADJUDGED that Defendant’s Motion for
Reconsideration [ECF No. 365] is DENIED.

DONE AND ORDERED in Chambers at Miami, Florida, this 9th day of
September, 2013.

_____________________________________
THE HONORABLE ALAN S. GOLD
UNITED STATES DISTRICT COURT JUDGE

cc:

Clerk of the United States Judicial Panel on Multidistrict Litigation
Magistrate Judge Jonathan Goodman
All Counsel of Record

3

Case 1:09-md-02106-ASG Document 368 Entered on FLSD Docket 10/04/2013 Page 1 of 1

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO 09-MD-02106-CIV-GOLD/GOODMAN
IN RE: FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL No. 2106
_____________________________________/
ORDER UPON MANDATE; REQUIRING FILING OF JOINT
NOTICE REGARDING DOCUMENTS FILED UNDER SEAL
This Cause is before the Court upon Mandate of the Eleventh Circuit Court of Appeals [ECF 362].
While this case was on appeal, the parties filed before the Eleventh Circuit a joint letter agreeing that
certain documents should be unsealed, but listing certain documents they wished remain under seal.
[Eleventh Circuit Case No. 12-11815, Letter dated December 14, 2012]. In the Mandate, the Eleventh
Circuit directed the Clerk, upon remand, to unseal all of the documents in the record, except those
delineated in the parties’ request to retain them as sealed.” [ECF No. 362, 25]. To assist the Court in
determining which documents should be unsealed, it is hereby ORDERED and ADJUDGED as follows:
On or before October 18, 2013, the parties shall file a Joint Notice specifying, by district court
docket entry number, which documents should be unsealed, and which documents the parties wish to
remain under seal. The designations in the Joint Notice should correspond to the December 14, 2012
letter submitted to the Eleventh Circuit.

DONE AND ORDERED in Chambers at Miami, Florida, this 4th day of October, 2013.

_____________________________________
THE HONORABLE ALAN S. GOLD
UNITED STATES DISTRICT COURT JUDGE

cc:

Clerk of the United States Judicial Panel on Multidistrict Litigation
Magistrate Judge Jonathan Goodman
All Counsel of Record

Case 1:09-md-02106-ASG Document 369 Entered on FLSD Docket 10/08/2013 Page 1 of 1

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO 09-MD-02106-CIV-GOLD/GOODMAN
IN RE: FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL No. 2106
_____________________________________/
ORDER DENYING WITHOUT PREJUDICE MOTION TO UNSEAL OR, IN THE
ALTERNATIVE, MOTION TO PARTIALLY LIFT SEAL FOR PURPOSES OF
COPYING PERTINENT DOCUMENTS [ECF No. 367]
This Cause is before the Court on the Motion of non-parties Glenn Schaeffer, et
al., to Unseal or Partially List Seal for Purposes of Copying Pertinent Documents [ECF
No. 367]. The Motion was filed under seal. The Court has requested the parties to
specify, in accordance with the Eleventh Circuit’s Mandate, which documents should be
unsealed, and which should remain under seal [ECF No. 368]. Accordingly, at this
juncture, I find it prudent to deny the Motion without prejudice.
It is hereby ORDERED and ADJUDGED that the Motion to Unseal or Partially Lift
Seal for Purposes of Copying Pertinent Documents [ECF No. 367] is DENIED
WITHOUT PREJUDICE.
DONE AND ORDERED in Chambers at Miami, Florida, this 7th day of October,
2013.
_____________________________________
THE HONORABLE ALAN S. GOLD
SENIOR UNITED STATES DISTRICT JUDGE
cc:

Clerk of the United States Judicial Panel on Multidistrict Litigation
Magistrate Judge Jonathan Goodman
All Counsel of Record
Freidin Dobrinsky Brown & Rosenbaum, P.A.
One Biscayne Tower, Ste. 3100
2 South Biscayne Blvd., Miami, FL 33131

Case 1:09-md-02106-ASG Document 370 Entered on FLSD Docket 10/17/2013 Page 1 of 2

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO 09-MD-02106-CIV-GOLD/GOODMAN
IN RE: FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL No. 2106
_____________________________________/
SUA SPONTE ORDER REGARDING MANDATE AND
DOCUMENTS FILED UNDER SEAL
This Cause is before the Court sua sponte. On October 4, 2013, pursuant to the
Mandate of the Eleventh Circuit Court of Appeals [ECF 362] directing the Clerk of Court,
upon remand, “to unseal all of the documents in the record, except those delineated in
the parties’ request to retain them as sealed.” [ECF No. 362, 25; see also Eleventh
Circuit Case No. 12-11815, Letter dated December 14, 2012], I issued an Order Upon
Mandate; Requiring Filing of Joint Notice Regarding Documents Filed Under Seal [ECF
No. 368] directing the parties to file a Joint Notice specifying, by district court docket
entry number, which documents should be unsealed, and which documents the parties
wish to remain under seal. It has come to the Court’s attention that the parties cannot
view the sealed entries on the electronic CM/ECF docket in this case, and, therefore,
cannot, by viewing the CM/ECF docket, determine which district court docket entry
numbers correspond to each sealed document. The Court cannot grant the parties
electronic CM/ECF access to the sealed documents.
The Eleventh Circuit’s mandate is still outstanding, and one option of complying
with the mandate is to require the parties to conduct a physical review of the sealed
documents in the Clerk’s office. Recognizing that this may be burdensome, I find it

Case 1:09-md-02106-ASG Document 370 Entered on FLSD Docket 10/17/2013 Page 2 of 2

prudent to allow the parties to propose an alternate solution. If no viable alternative is
presented, I will instruct the parties to appear in person at the Clerk’s office and review
the physical sealed files to file a Joint Notice in compliance with my Order [ECF No.
369]. It is hereby ORDERED and ADJUDGED as follows:
1.

On or before November 1, 2013, the parties shall file a joint

recommendation on how they propose to comply with the Eleventh Circuit’s mandate
that select documents be unsealed and my Order [ECF No. 368] requiring the parties to
specify, by district court docket entry number, which documents should be unsealed. If
no viable joint recommendation is presented, the parties will be required to comply with
the mandate and my Order by conducting a physical review of the sealed files.
2.

The October 18, 2013 deadline to file a Joint Notice, as specified in my

Order [ECF No. 368] is held in abeyance pending further Court order.

DONE AND ORDERED in Chambers at Miami, Florida, this 17th day of October,
2013.

_____________________________________
THE HONORABLE ALAN S. GOLD
UNITED STATES DISTRICT COURT JUDGE

cc:

All Counsel of Record

2

Case 1:09-md-02106-ASG Document 371 Entered on FLSD Docket 10/22/2013 Page 1 of 3

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
UNOPPOSED MOTION TO WITHDRAW APPEARANCE OF
ATTORNEY KENNETH T. MURATA
Pursuant to S.D. Fla. Local Rule 11.1(d), Defendant Bank of America, N.A. (“BANA”)
respectfully requests leave to withdraw the appearance of attorney Kenneth T. Murata as its
counsel in the above-captioned action. In support of this motion, BANA states as follows:
1.

Mr. Murata is no longer associated with O’Melveny & Myers LLP (“OMM”),

which is counsel to BANA in this action.
2.

Granting this motion will not prejudice BANA because OMM and Hunton &

Williams LLP continue to represent BANA in this action. The OMM attorneys currently
representing BANA in this matter are Bradley J. Butwin ([e-mail]), Jonathan
Rosenberg ([e-mail]), Daniel L. Cantor ([e-mail]), and William J.
Sushon (wsushon@)omm.com). In addition, Hunton & Williams LLP attorney Jamie Zysk Isani
([e-mail]) continues to represent BANA in this matter.
WHEREFORE, BANA respectfully requests that this Court direct the Clerk to remove
Kenneth T. Murata as counsel for BANA for all purposes relating to the proceedings in the
above-styled matter and cease delivering notices of electronic filing in this action to Mr. Murata

1

Case 1:09-md-02106-ASG Document 371 Entered on FLSD Docket 10/22/2013 Page 2 of 3

at [e-mail]. A proposed order is being submitted separately via e-mail, pursuant to
this Court’s posted CM/ECF procedures.
LOCAL RULE 7.1(a)(3) CERTIFICATION
Pursuant to Local Rule 7.1(a)(3), BANA certifies that it conferred with Plaintiffs’ counsel
on October 20, 2013, regarding this motion. Plaintiffs have stated that they do not oppose this
motion.
Dated: October 22, 2013

Respectfully submitted,
HUNTON & WILLIAMS LLP
By:

/s/ Jamie Zysk Isani
Jamie Zysk Isani
Florida Bar No. 728861
1111 Brickell Avenue, Suite 2500
Miami, Florida 33131
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
- and O’MELVENY & MYERS LLP
Bradley J. Butwin (pro hac vice)
Jonathan Rosenberg (pro hac vice)
Daniel L. Cantor (pro hac vice)
William J. Sushon (pro hac vice)
7 Times Square
New York, New York 10036
Telephone: [phone]
Facsimile: [phone]
E-mails:
[e-mail];
[e-mail];
[e-mail];
[e-mail]

Attorneys for Bank of America, N.A.

2

__

Case 1:09-md-02106-ASG Document 371 Entered on FLSD Docket 10/22/2013 Page 3 of 3

CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing was served by transmission
of Notice of Electronic Filing generated by CM/ECF on October 22, 2013 on all counsel or
parties of record on the Service List below:
David A. Rothstein, Esq.
Lorenz Michel Pruss, Esq.
DIMOND KAPLAN & ROTHSTEIN, P.A.
2665 South Bayshore Drive
Penthouse 2-B
Miami, Florida 33133
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]
[e-mail]

J. Michael Hennigan, Esq.
Kirk Dillman, Esq.
Robert Mockler, Esq.
MCKOOL SMITH, P.C.
865 South Figueroa Street, Suite 2900
Los Angeles, California 90017
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]
[e-mail]
[e-mail]

Attorneys for Plaintiffs Avenue CLO Fund, Ltd. et al.
By:

1

/s/ Jamie Zysk Isani
Jamie Zysk Isani, Esq.

Case 1:09-md-02106-ASG Document 371-1 Entered on FLSD Docket 10/22/2013 Page 1 of 2

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
ORDER GRANTING UNOPPOSED MOTION TO WITHDRAW
APPEARANCE OF ATTORNEY KENNETH T. MURATA
THIS CAUSE having come before the Court on Bank of America, N.A.’s (“BANA”)
Unopposed Motion to Withdraw Appearance of Attorney Kenneth T. Murata, and the Court,
having reviewed the file and being otherwise advised, it is hereby:
ORDERED and ADJUDGED that:
1.

The Motion is GRANTED.

2.

Kenneth T. Murata is withdrawn as counsel for Defendant BANA, for all

purposes relating to the proceedings in the above-styled matter.
3.

The Clerk shall remove Mr. Murata from the docket and cease delivery of

notifications of electronic filings to Mr. Murata. Mr. Murata’s e-mail address to be removed is
[e-mail].

Case 1:09-md-02106-ASG Document 371-1 Entered on FLSD Docket 10/22/2013 Page 2 of 2

DONE and ORDERED in Chambers in Miami-Dade County, Florida this ___ day of
October __, 2013.

THE HONORABLE ALAN S. GOLD
UNITED STATES DISTRICT JUDGE
cc:
Counsel of Record

2

Case 1:09-md-02106-ASG Document 372 Entered on FLSD Docket 10/28/2013 Page 1 of 2

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
ORDER GRANTING UNOPPOSED MOTION TO WITHDRAW
APPEARANCE OF ATTORNEY KENNETH T. MURATA [ECF NO. 371]
THIS CAUSE having come before the Court on Bank of America, N.A.’s
(“BANA”) Unopposed Motion to Withdraw Appearance of Attorney Kenneth T. Murata
[ECF No. 371], and the Court, having reviewed the file and being otherwise advised, it is
hereby ORDERED and ADJUDGED that:
1.

The Motion [ECF No. 371] is GRANTED.

2.

Kenneth T. Murata is withdrawn as counsel for Defendant BANA, for all

purposes relating to the proceedings in the above-styled matter.
3.

The Clerk shall remove Mr. Murata from the docket and cease delivery of

notifications of electronic filings to Mr. Murata. Mr. Murata’s e-mail address to be
removed is [e-mail].

Case 1:09-md-02106-ASG Document 372 Entered on FLSD Docket 10/28/2013 Page 2 of 2

DONE and ORDERED in Chambers in Miami-Dade County, Florida this 24th day
of October, 2013.

_____________________________________
THE HONORABLE ALAN S. GOLD
SENIOR UNITED STATES DISTRICT JUDGE
cc:
Counsel of Record

2

Case 1:09-md-02106-ASG Document 373 Entered on FLSD Docket 11/01/2013 Page 1 of 5

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Miami Division
CASE NO.: 09-md-2106-GOLD/GOODMAN
IN RE:
FONTAINEBLEAU LAS VEGAS
CONTRACT LITIGATION
MDL NO. 2106
This document relates to all actions.
______________________________________/
JOINT NOTICE REGARDING PROPOSAL FOR
PARTIALLY UNSEALING SUMMARY JUDGMENT FILINGS
This Joint Notice by Defendant Bank of America, N.A. (“BANA”) and the Avenue Term
Lender Plaintiffs (“Plaintiffs”) is made in response to the Court’s Sua Sponte Order Regarding
Mandate and Documents Filed Under Seal [D.E. #370] (the “Sua Sponte Order”). The Order
required the parties to make a recommendation by November 1, 2013 regarding how they
propose to comply with this Court’s October 4, 2013 Order Upon Mandate [D.E. #368] requiring
the parties to specify, by district court docket entry number, which documents should be
unsealed. As this Court noted in its Sua Sponte Order, because the parties cannot view the
sealed entries on the electronic CM/ECF docket in this case, they cannot, by viewing the
CM/ECF docket, determine which district court docket entry numbers correspond to each sealed
document.
Because the summary judgment materials contain commercially sensitive information,
good cause remains for keeping under seal certain party documents and information cited
therein. In addition, the parties have been instructed by certain third parties that produced
documents under this Court’s Amended MDL Order Number 24 Confidentiality Stipulation and

939987

Case 1:09-md-02106-ASG Document 373 Entered on FLSD Docket 11/01/2013 Page 2 of 5

Protective Order [D.E. #116] (the “Protective Order”), that they do not consent to the unsealing
of any of their documents or information that were included in the parties’ summary judgment
filings.
Accordingly, the parties propose jointly submitting to the Court redacted copies of the
joint binders of all summary judgment filings that were previously submitted to this Court on
October 28, 2011 in response to MDL Order No. 51 Granting Joint Motion for Extension of
Certain Pre-Trial Deadlines Nunc Pro Tunc [D.E. #251]. As per the Court’s Order, those binders
contained copies of the parties’ summary judgment motions and all responses, replies, exhibits,
memoranda of law, and case law cited therein. In preparation for compiling these joint binders,
the parties met and conferred. In an effort to reduce the burden on the Court of reviewing such a
voluminous record, the parties determined that although certain exhibits were cited in both
BANA’s motion for summary judgment and the Plaintiffs’ motion for partial summary
judgment—or responses and replies thereto—and thus, were filed multiple times, it would be
less burdensome for the Court if the joint binders contained only one copy of each exhibit and a
single compilation of each witness’s deposition transcript excerpts cited in all memoranda of
law. When compiling the joint binders, the parties conducted a thorough review of the entire
record and ensured that a copy of all documents filed with the Court in connection with the
parties’ summary judgment motions were contained in those binders. The parties delivered the
joint binders to this Court on October 28, 2011, along with a letter attaching an index that
detailed all documents included in each binder. The October 28, 2011 letter from Hunton &
Williams to the Honorable Alan S. Gold is attached hereto as Exhibit A.
The parties now propose submitting to the Court redacted copies of the memoranda of
law, statements of undisputed/disputed material facts, and exhibits contained in these joint

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binders, which could be made available to the public because they will omit all party and third
party documents and information that should remain under seal.1 The parties will also include in
these joint binders redacted copies of all documents included in their supplemental summary
judgment filings dated November 14, 2011 and November 16, 2011. Because these two filings
occurred after the parties submitted their joint binders on October 28, 2011, they were not
included in the original copy set. The parties will either send hardcopies of the redacted joint
binders to the Court by FedEx or will file the documents via ECF, if the Court prefers. The
parties request that they are allowed four weeks from the date the Court approves this joint
proposal in order to complete the cumbersome redaction process.
This proposal reduces the onus on both the parties and the Clerk because it prevents the
need for a manual review of all paper documents and information included in each individual
filing to determine which documents the parties and certain third-parties have requested remain
under seal. A manual review of the entire record would be particularly burdensome because, as
described above, certain exhibits were filed multiple times in connection with the summary
judgment motions. This approach significantly reduces the number of documents that would
need to be reviewed and redacted and will promote both efficiency and consistency in terms of
the material that remains sealed.
Should the Court find that this proposal does not adequately meet its request, the parties
recommend in the alternative electronically filing redacted copies of all memoranda of law,
statements of undisputed/disputed fact and any other documents that require redactions, along
with an updated chart detailing all documents that the parties and certain third parties request
1

The parties anticipate the need to redact certain memoranda of law and statements of facts to
the extent they disclose information contained in documents that will remain under seal.
Although the vast majority of exhibits will be refiled publicly, the parties anticipate that a
handful of deposition transcripts and exhibits will need to be redacted prior to public filing.
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remain under seal in full. A list of such documents was previously provided to the Eleventh
Circuit upon request on December 14, 2012. A copy of the December 14, 2012 letter from
Bancroft to John Ley, Clerk of the Court for the United States Court of Appeals for the Eleventh
Circuit, is attached hereto as Exhibit B. Recently one of the third parties has responded to the
parties’ inquiry as to the continued confidentiality of its documents and has agreed to un-seal its
documents. The updated chart would reflect this change.
In connection with this alternative proposal, the parties could include on the updated
chart additional columns indicating—instead of docket numbers, which are unavailable to the
parties for the sealed filings—the titles of the documents in which the exhibits listed are cited
and the corresponding filing dates. While this alternative proposal would enable the Court to
identify which filings in the original record contain the documents that must remain under seal,
including duplicate copies, it would likely create more work for the Clerk than the parties’ initial
proposal described above. The parties could electronically file copies of all documents requiring
redactions and the chart described herein four weeks from the date the Court approves this
proposal.
The parties respectfully request that the Court inform the parties at its earliest
convenience which of their proposals is amenable to the Court.

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Case 1:09-md-02106-ASG Document 373 Entered on FLSD Docket 11/01/2013 Page 5 of 5

Date: Miami, Florida
November 1, 2013
By:

By:

/s/ Jamie Zysk Isani
Jamie Zysk Isani

HUNTON & WILLIAMS LLP
1111 Brickell Avenue, Suite 2500
Miami, Florida 33131
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]

/s/ Lorenz Michel Prüss
Lorenz Michel Prüss

DIMOND KAPLAN & ROTHSTEIN, P.A.
2665 South Bayshore Drive, PH-2B
Miami, Florida 33133
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]

-and-

-and-

Bradley J. Butwin (pro hac vice)
Jonathan Rosenberg (pro hac vice)
Daniel L. Cantor (pro hac vice)
William J. Sushon (pro hac vice)
O’MELVENY & MYERS LLP
7 Times Square
New York, New York 10036
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
[e-mail]
[e-mail]
[e-mail]

J. Michael Hennigan (pro hac vice)_
Kirk D. Dillman (pro hac vice)
MCKOOL SMITH
865 S. Figueroa Street, Suite 2900
Los Angeles, California 90017
Telephone: [phone]
Facsimile: [phone]
E-mail:
[e-mail]
[e-mail]
Attorneys for Plaintiffs Avenue CLO Fund,
Ltd., et al

Attorneys for Defendant Bank of America, N.A.

CERTIFICATE OF SERVICE
WE HEREBY CERTIFY that on November 1, 2013, the foregoing document was
electronically filed with the Clerk of the Court using CM/ECF and served upon counsel of
record.
By: /s Lorenz Michel Prüss
Lorenz Michel Prüss

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Case 1:09-md-02106-ASG Document 373-2 Entered on FLSD Docket 11/01/2013 Page 1 of 4
Case: 12-11815 Date Filed: 12/14/2012 Page: 1 of 4

December 14, 2012
By ECF
John Ley
Clerk of the Court
United States Court of Appeals for the 11th Circuit
56 Forsythe Street, N.W.
Atlanta, GA 30303
Re:

Avenue CLO IV, Ltd., et al. v. Bank of America, No. 12-11815-AA

Dear Mr. Ley:
During oral argument in the above-captioned case on December 4, 2012, the panel asked
counsel for both parties about the sealed nature of the documents in the proceedings and whether
the parties might take steps to enable the court to issue an opinion that does not require sealing or
redactions. Counsel for both parties advised the panel that they would need to consult with their
clients, and the Court subsequently entered an order on December 4 directing counsel to “file in
10 days if the sealed material can be unsealed.”
Having consulted with their respective clients as well as certain third parties, counsel now
advise the Court that the panel may consider all documents in the record transmitted to the Court
in this case, including the Disbursement Agreement, Credit Agreement, and Retail Agreement,
non-confidential and unsealed with the exception of the following documents, which the parties
and third parties have requested to keep confidential:
Deposition Exhibit No.

Declaration Exhibit No.

Bates No.

Dep. Ex. 11

Cantor Reply Decl. Ex. 20

ULL-FLVR 7582.002706-18

Dep. Ex. 14

Cantor Decl. Ex. 40, Cantor
Opp. Decl. Ex. 52

TRIM 028440-41

Dep. Ex. 16

ULL-FLVR 7582.006644-48

Dep. Ex. 21

ULL-FLVR 0004224

Dep. Ex. 23

Cantor Opp. Decl. Ex. 74

Dep. Ex. 26
Dep. Ex. 28

ULL-FLVR 0004214
Cantor Opp. Decl. Ex. 78

Dep. Ex. 29
Dep. Ex. 30
Dep. Ex. 31

ULL-FLVR 0004221-23
ULL-FLVR 7582.006807-08
ULL-FLVR 0004254-56

Cantor Decl. Ex. 58, Cantor
Opp. Decl. Ex. 79

ULL-FLVR 0004249-53
ULL-FLVR 0004237

1919 M Street, N.W. • Suite 470 • Washington D.C. 20036
Telephone [phone] • www.bancroftpllc.com • Facsimile 202.234.2806

Case 1:09-md-02106-ASG Document 373-2 Entered on FLSD Docket 11/01/2013 Page 2 of 4
Case: 12-11815 Date Filed: 12/14/2012 Page: 2 of 4
John Ley
December 14, 2012
Page 2 of 4

Dep. Ex. 32

TRIM 030208-10

Dep. Ex. 34

ULL-FLVR 7582.006877-79

Dep. Ex. 35

Cantor Opp. Decl. Ex. 83

ULL-FLVR 7582.004314-16

Dep. Ex. 36

Cantor Decl. Ex. 60, Cantor
Opp. Decl. Ex. 80

ULL-FLVR 7582.002960-63

Dep. Ex. 37

ULL-FLVR 0004279

Dep. Ex. 38

ULL-FLVR 7582.002958-59

Dep. Ex. 40

MUS2_001888-89

Dep. Ex. 41

Cantor Opp. Decl. Ex. 87

ULL-FLVR 7582.006934-36

Dep. Ex. 43

MUS2_001858

Dep. Ex. 45

ULL-FLVR 0004282

Dep. Ex. 46

Cantor Opp. Decl. Ex. 69

ULL-FLVR 7582.000816

Dep. Ex. 47

ULL-FLVR 7582.001622

Dep. Ex. 48

MUS2_002473-76

Dep. Ex. 50

ULL-FLVR 7582.0008161-62

Dep. Ex. 53

ULL-FLVR 7582.0008448-49

Dep. Ex. 54

ULL-FLVR 0006805

Dep. Ex. 56

TRIM 038104-05

Dep. Ex. 57

TRIM 039519

Dep. Ex. 58

TRIM 029187

Dep. Ex. 59

TRIM 038913-14

Dep. Ex. 61

TRIM 031501-02

Dep. Ex. 62

TRIM 040241

Dep. Ex. 63

TRIM 030253-60

Dep. Ex. 126

Cantor Opp. Decl. Ex. 36

SLN 000318-20

Dep. Ex. 127

Cantor Opp. Decl. Ex. 37

SLN 000315-17

Dep. Ex. 128

Cantor Opp. Decl. Ex. 38

SLN 000312-14

Dep. Ex. 129

Cantor Opp. Decl. Ex. 39

SLN 000323-25

Dep. Ex. 137

Cantor Decl. Ex. 30, Cantor
Opp. Decl. Ex. 35

MON 00044-45

Dep. Ex. 268

Cantor Decl. Ex. 81

JPM_FB 00001711-48

Dep. Ex. 456
Dep. Ex. 458

Highland 010411-12
Cantor Decl. Ex. 45, Cantor

Highland 010419-20

Case 1:09-md-02106-ASG Document 373-2 Entered on FLSD Docket 11/01/2013 Page 3 of 4
Case: 12-11815 Date Filed: 12/14/2012 Page: 3 of 4
John Ley
December 14, 2012
Page 3 of 4

Opp. Decl. Ex. 57
Dep. Ex. 463

AVE 010281-83

Dep. Ex. 470

Highland 010416-17

Dep. Ex. 642

BANA_FB00806884-903

Dep. Ex. 902

BANA_FB00801558-62

Ex. 1512

BANA_FB00920141-44

Ex. 1513

BANA_FB00920133-34

Ex. 1514

BANA_FB00916869-83

Ex. 1515

BANA_FB00920068-69

Ex. 1516

BANA_FB00917843-45
Cantor Decl Ex. 31, Cantor
Opp. Decl. Ex. 32

VEN 000803-06

Cantor Decl. Ex. 32, Cantor
Opp. Decl. Ex. 33

SPT 000179-81

Cantor Decl. Ex. 33, Cantor
Opp. Decl. Ex. 34

BGD 004016-18

Full deposition transcripts of Scott Macklin, Todd Miranowski, Roger Schmitz, Michael Scott,
Chaney Sheffield, and Mitchell Sussman.
The following deposition transcript excerpts: Brandon Bolio at 21:10-20 (testimony regarding
personal information); David Howard at 10:18-11:11 and 20:17-25 (testimony regarding
personal information and other transactions); Jeff Susman at 16:5-22 and 17:24-18:25 (testimony
regarding personal information and other transactions)
Should the panel wish to include information in any of the foregoing documents in a
publicly available opinion, counsel respectfully request that the Court employ appropriate
measures to maintain the confidentiality of such information. Should the Court desire updated
versions of the parties’ briefs reflecting the non-confidential nature of all documents except the
foregoing, the parties are happy to so provide upon request.
If there are any questions or concerns about this or any other issue, please do not hesitate
to contact us. Thank you very much.

Case 1:09-md-02106-ASG Document 373-2 Entered on FLSD Docket 11/01/2013 Page 4 of 4
Case: 12-11815 Date Filed: 12/14/2012 Page: 4 of 4
John Ley
December 14, 2012
Page 4 of 4

Yours truly,

/s/
.
Paul D. Clement
BANCROFT PLLC
1919 M Street, NW, Suite 470
Washington, D.C. 20036
[phone]

/s/
.
Jonathan D. Hacker
O’MELVENY & MYERS LLP
1625 Eye Street, NW
Washington, DC 20006
[phone]

Counsel for Appellants Avenue
CLO IV, Ltd. et al.

Counsel for Appellee Bank of America

Case 1:09-md-02106-ASG Document 374 Entered on FLSD Docket 11/05/2013 Page 1 of 2

UNI
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Case 1:09-md-02106-ASG Document 374 Entered on FLSD Docket 11/05/2013 Page 2 of 2

THE HONORABLE ALAN S.GOLD
UNI
TED STATES DI
STRI COURT JUDGE
CT
cc:

M agitat Judge Jonat Goodman
sr e
han
Al CounselofRec d
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