Securities and Exchange Commission v. Fujinaga et al

Filing 392

ORDER Granting 374 Motion for Order. See Order for details. Signed by Judge James C. Mahan on 2/13/17. (Copies have been distributed pursuant to the NEF - ADR)

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Case 2:13-cv-01658-JCM-CWH Document 391 Filed 02/09/17 Page 1 of 5 1 2 3 4 5 6 Michael F. Lynch, Esq. Nevada Bar No. 8555 LYNCH LAW PRACTICE, PLLC 3613 S. Eastern Ave. Las Vegas, Nevada 89169 702.684.6000 702.543.3279 (fax) Attorney for the Receiver, Robb Evans & Associates LLC 7 8 9 10 11 12 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA SECURITIES AND EXCHANGE COMMISSION, Plaintiff, vs. EDWIN YOSHIHIRO FUJINAGA and MRI INTERNATIONAL, INC., Defendants, 13 and 14 CSA SERVICE CENTER, LLC THE FACTORING COMPANY, JUNE FUJINAGA, and THE YUNJU TRUST, 15 16 17 18 Case No.: 2:13-cv-01658-JCM-CWH ORDER GRANTING MOTION FOR ORDER (1) AUTHORIZING, APPROVING AND CONFIRMING SALE OF REAL PROPERTY LOCATED AT 5330, 5370, AND 5420 S. DURANGO DRIVE AND SALE AND OVERBID PROCEDURES AND FOR RELATED RELIEF; AND (2) GRANTING RELIEF FROM LOCAL RULE 66-5 PERTAINING TO NOTICE TO CREDITORS Relief Defendants. This came before the court on the Notice of Motion and Opportunity to Object, and 19 Motion for Order (1) Authorizing, Approving and Confirming Sale of Real Property Located at 20 5330, 5370, and 5420 S. Durango Drive and Sale and Overbid Procedures and for Related 21 Relief; and (2) Granting Relief from Local Rule 66-5 Pertaining to Notice to Creditors (the 22 “Motion”) [ECF. No. 374] and the Declaration of M. Val Miller in Support of the Motion (the 23 “Miller Declaration”) [ECF No. 375] brought by Robb Evans & Associates LLC, the court- 24 appointed receiver (the “Receiver”) by and through its undersigned counsel. The Motion and the 25 Miller Declaration were served via the ECF system on January 16, 2017, and by U.S. Mail on all 26 known non-consumer creditors of the estate on January 17, 2017, and by direct Email on January 27 17, 2017, to other parties who informally requested the Receiver provide notices. The dates and 28 Case 2:13-cv-01658-JCM-CWH Document 391 Filed 02/09/17 Page 2 of 5 1 manner of service are set for in in the Certificate of Service [ECF No. 381] of the Motion and 2 the Miller Declaration. 3 The Motion came on regularly before the Court for determination, the Honorable James 4 C. Mahan, United States District Judge, presiding. Pursuant to LR 7-2, an opposing party must 5 file points and authorities in response to a motion and failure to file a timely response constitutes 6 the party’s consent to the granting of the motion. See LR 7-2(d); United States v. Warren, 601 7 F.2d 471, 474 (9th Cir. 1979). Neither the Defendants nor any other party has filed any 8 opposition, objection, and/or points and authorities in response to the Motion and the deadline to 9 do so has passed. Nevertheless, the court reviewed the substantive merits and grants the 10 Receiver’s Motion in full. 11 IT IS ORDERED that: 12 1. The Motion, and all relief sought therein, is granted in its entirety; 13 2. Without limiting the generality of the foregoing: 14 2.1. The Receiver’s proposed sale and overbid procedures for the Durango 15 Property,1 located at 5330, 5370, and 5420 S. Durango Drive, Las Vegas, Nevada, and 16 the Receiver’s request for an order authorizing and confirming the sale on an “as is” basis 17 by private sale either (a) to IIP Durango 3, LLC and/or its assignee (the “Proposed 18 Buyer”), an arm’s length buyer, at a purchase price of $12,000,000.00 pursuant to the 19 Purchase and Sale Agreement attached as Exhibit 1 to the Miller Declaration or (b) to 20 such higher qualified overbidder who submits the highest qualified overbid at a 21 22 23 24 25 26 27 28 1 Capitalized terms not otherwise defined herein shall have the meanings set forth in the Motion. 2 Case 2:13-cv-01658-JCM-CWH Document 391 Filed 02/09/17 Page 3 of 5 1 subsequent overbid session, if any, to be conducted under the terms and conditions more 2 fully set forth herein; 3 4 5 2.2. The Court hereby authorizes the sale of the Durango Property subject to the following overbid procedures, which the Court hereby approves: 2.2.1. The overbid session shall be conducted after entry of this order 6 granting the Motion. The overbid session will be conducted at the Robb Evans & 7 Associates LLC, 5560 S. Ft. Apache Road, Suite 120, Las Vegas, Nevada 89148; 8 2.2.2. The Receiver will cause to be published a notice of the proposed 9 sale of the Durango Property to a qualified bidder at the overbid session, which 10 notice shall state the date, time and place of the overbid session, the requirement 11 for pre-qualification by overbidders and the terms and conditions of the 12 overbidding and sale of the Durango Property, as described below (“Overbid 13 Notice”). The Receiver will cause the Overbid Notice to be published in Las 14 Vegas Review Journal one time at least 10 calendar days prior to the scheduled 15 overbid session date; 16 2.2.3. Any person wishing to overbid at the overbid session shall be 17 required to pre-qualify with the Receiver no later than 10:00 a.m., two business 18 days preceding the overbid session, by delivering to the Receiver’s office located 19 at 5560 S. Ft. Apache Road, Suite 120, Las Vegas, Nevada 89148: (a) notice in 20 writing of the prospective overbidder’s intent to overbid, together with (b) written 21 verification from a financial institution demonstrating to the Receiver’s 22 satisfaction, in the Receiver’s sole opinion, discretion and judgment, the 23 prospective overbidder’s ability to complete and close a purchase of the Durango 24 Property through sufficient funds or credit facilities within 10 days of the date of 25 the overbid session, and (c) a cashier’s check in the sum of $250,000.00 payable 26 to “Robb Evans & Associates LLC, Receiver of MRI International, Inc. et al.”, 27 28 3 Case 2:13-cv-01658-JCM-CWH Document 391 Filed 02/09/17 Page 4 of 5 1 which cashier’s check shall become non-refundable upon acceptance of the 2 overbidder’s overbid at the conclusion of the overbid session; 3 2.2.4. Overbidders bidding at the overbid session will be deemed to 4 have completed all inspections of the Durango Property and will be deemed to 5 have waived and/or removed all contingencies in favor of the buyer under the 6 Purchase and Sale Agreement, including, without limitation any contingency 7 pertaining to inspection of title, and will be required to complete a cash purchase 8 of the Durango Property and close escrow for the purchase within 10 days of the 9 date of the overbid session. The successful overbidder will be required to execute 10 a purchase agreement for the Durango Property substantially in the form of the 11 Purchase and Sale Agreement together with a waiver of all buyer contingencies 12 promptly after conclusion of the overbid session; 13 2.2.5. The initial overbid shall be in the amount of $13,200,000.00 (a 14 sum that is $1,200,000.00, or 10%, higher than the purchase price under the 15 Purchase and Sale Agreement, and all subsequent overbids shall be in an amount 16 at least $25,000 higher than the preceding bid; and 17 2.2.6. Pursuant to the Purchase and Sale Agreement and the Listing 18 Agreement with the Brokers, a sales commission in the amount of 5% of the 19 purchase price paid for the Durango Property shall be paid by the Proposed 20 Buyer, or if a higher overbid is received and accepted at the overbid session, by 21 the wining overbidder, from the proceeds of sale of the Durango Property at close 22 of escrow, to the Brokers as listing agent under the Listing Agreement and a 23 cooperating broker representing the buyer, if any, under the terms of the Listing 24 Agreement; and 25 2.2.7. The sale of the Durango Property by private sale to the 26 Proposed Buyer under the Purchase and Sale Agreement, or to the person who 27 submits the highest qualified overbid at the overbid session to be conducted 28 pursuant to the foregoing procedures, is hereby confirmed without further notice 4 Case 2:13-cv-01658-JCM-CWH Document 391 Filed 02/09/17 Page 5 of 5 1 or hearing and without the necessity of any subsequent motion for confirmation of 2 the sale; 3 3. The Receiver is authorized to execute all documents and instruments necessary or 4 convenient to complete, implement, effectuate and close the sale of the Durango Property to the 5 purchaser, including but not limited to a deed conveying title to the Durango Property free and 6 clear of all existing liens, claims, accrued and unpaid taxes and/or outstanding utility charges as 7 of the closing; 8 9 4. The Receiver is authorized to permit and/or cause to be paid from the proceeds of the sale of the Durango Property: (a) all ordinary and customary closing costs, all costs and 10 expenses required to be paid under the terms of the Purchase and Sale Agreement by the seller 11 from the proceeds of sale, (b) the discounted settlement payment of $140,000.00 to satisfy the 12 lien, and disburse to a judgment creditor/lien holder, as discussed in more detail in the Motion 13 and Exhibit 2 to the Miller Declaration, (c) all commissions provided for in the Purchase and 14 Sale Agreement and the Receiver’s Listing Agreement for the Durango Property, and (d) all real 15 property tax liens and prorated real property taxes due up to the date of closing; and 16 5. Notice of the Motion is deemed to be sufficient under LR 66-5 based on the 17 service of the Motion, which Motion contains notice of the Motion and opportunity to object, 18 and by serving the Motion on all known non-consumer creditors of the estate concurrent with the 19 filing of this Motion with the Court, but not on the tens of thousands of potential foreign 20 creditors. 21 IT IS SO ORDERED. 22 Dated: February 13, 2017 23 24 25 26 The Honorable James C. Mahan UNITED STATES DISTRICT JUDGE 27 28 5

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