CCR International, Inc. v. Elias Group, LLC et al
Filing
106
OPINION. For the foregoing reasons, Elias Group's motion to consolidate is granted. It is so ordered. re: (94 in 1:15-cv-06563-RWS) MOTION to Consolidate Cases 16-cv-6280, 17-cv-6697 filed by Elias Group, LLC. (Signed by Judge Robert W. Sweet on 6/26/2018). Filed In Associated Cases: 1:15-cv-06563-RWS, 1:17-cv-06697-RWS. (rjm)
UNITED STATE S DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
. ---------------------- - ------ ----- --- x
CCR INTERNATIONAL, IN C.,
15 Civ . 6563
- against -
(RWS)
OP INI ON
THE ELIAS GROUP, LLC,
Defendant .
--------------------------------- ----x
THE ELIAS GROUP, LLC ,
s1 •··...
_
.,
USDC \..,.. LJ.!..'-; ,
DOC Ut¼i.Ei''-JT
ELECTRONICALLY FILED
DOC#:
DATE Fl-LE_D_:__,6 ..,.,.;fd€,..,,._..,...,....._
__
-against -
't
CCR DEVELOPMENT GROU P,
JOSE FUERT ES ,
INC . and
Defendants .
------------------------------------- x
BANCO COOPERATIVO DE PR ,
Plaintiff,
-against THE ELIAS GROUP , LLC ,
Defendant/
Third-Par ty Plaintiff ,
-a gainst CCR INTERNATIONAL , INC. , CCR DEVELOPMENT
GROUP , INC. , and JOSE FUERTES
Third - Party
Defendants .
----------------------------- - --- ----x
1
APPEARANCES:
Attorneys for CCR International,
CCR Development Group , Inc. , and
Jose Fuertes
LAW OFFICES OF JANE BECKER WHITAKER
P . O. Box 9023914
San Juan , PR 00902
By :
Jane Becker , Esq .
Attorneys for Elias Group
SHERMAN , SILVERSTEIN , KOHL ,
ROSE & PODOLSKY , P . A.
308 Harper Drive , Suite 200
Moorestown , NJ 08057
By:
Jeffrey P. Resnick , Esq .
Attorneys for Banco Cooperativo
de Puerto Rico
FRIEDMAN SANCHEZ , LLP
16 Court Street , Suite 2600
Brooklyn , New York 11241
By: Andrew M. Friedman, Esq.
ADSUAR MUNIZ GOYCO SEDA &
PEREZ - OCHOA , PSC
P.O . Box 70294
San Juan , PR 00936
By : Sarika J. Angulo , Esq.
Eric Perez-Ochoa, Esq .
2
Sweet, D.J.
Defendant and Third-Party Plaintiff the Elias Group,
LLC ("Elias Group") has moved , pursuant to Federal Rule o f Civil
Procedure 42(a ) , to consolidate this action, CCR International,
Inc . v . The Elias Group , LLC , 15 Ci v . 6563
(RWS)
1,
with Banco
Cooperativo de Puerto Rico v . Elias Group, LLC , 17 Civ . 6697
(RWS). See Fed. R. Civ . P . 42(a). Th ese actions emerge from the
agreements relating to the ownership and transfer of the
facilities and trademarks of the carbonated soda Coco Rico
("Coco Rico " ) and the actions taken by the parties t o those
agreements. Based upon the conclusions set forth below, the
motion is granted .
I.
Facts & Prior Proceedings
Prior to March 31 , 2008 , CCR International , Inc.
(" CCR" ) was the owner of the soda brand Coco Rico . On March 3 1,
2008 , CCR and CCR Development Group, In c .
(" CCRDG") entered into
an Asset Purchase Agreement (t he "March 2008 Asset Purchase
The Elias Group , LLC v . CCR Development Group , Inc ., 16 Civ . 6280 (RWS)
was consolidated with CCR International , Inc . v . The Elias Group , LLC, 15
Civ . 6563 (RWS) pursuant to this Court ' s order dated January 11 , 2017 . See
Order on Motion to Consolidate , ECF No. 81 .
3
Agreement " ) in which CCR sold , transferred , and assigned to
CCRDG all rights , title , and interest in the Coco Rico brand ,
including all trademark rights . In return , CCRDG agreed to
provide CCR monies to be paid over time . After CCRDG defaulted
in its obligations to make payment to CCR of at least
$9 , 000 , 000 , Elias Group began discussions regarding the
possibility of acquiring all rights , title , and interest in the
Coco Ri co brand from CCRDG and provid i ng CCRDG and CCR with
consideration sufficient to terminate CCRDG ' s obligations to
CCR .
On January 30 , 2013 , CCR and Elias Group entered into
the Assignment Agreement (the "Assignment Agreement " ) , in which
CCR assigned CCRDG ' s purchase obligations to Elias Group in
exchange for Elias Gr oup ' s agreement to pay CCR pursuant to a
formula centered on Elias Group ' s efforts to purchase the Coco
Rico brand from CCRDG. Pursuant to the Assignment Agreement ,
Elias Group was to make an init i al payment amount up to $300 , 000
to CCR , and then , subject to certa i n terms and conditions set
forth in the Assignment Agreement , make mont h ly payments for
some period of time in a sum not to exceed $400 , 000 per year. In
the event that Elias Group purchased the rights to the Coco Rico
brand from CCRDG , the Assignment Agreement provided that Elias
Group ' s monthly payment obligation to CCR terminated and Elias
4
Group would make either a year l y paymen t of $450 , 000 to CCR (the
" Yearly Payment " opt i on) , o r El ias Group wo u ld prov i de CCR with
a one - time payment of $5 , 000 , 000 , l ess t h e initia l payment to
CCR by Elias Group , l ess monies previously paid to CCR by Elias
Group , less any other payments or other consideration paid by
Elias Group to CCRDG and/or th i rd parties pursuant to El ias
Group ' s acquisit i on of the Coco Rico brand , as we l l as a
possib l e deduction pursuant to a sales fo rmula set for t h i n t h e
Ass i gnment Ag r eement (t h e " Bu yout Payment " optio n ) .
On Apr i l 15 , 2015 , CCRDG , as seller of the r i ghts ,
tit l e and interest in the Coco Rico brand , and Elias Group , as
buyer , entered into an Asset Purchase Agreement
(" Apri l 2015
Asset Purchase Agreement " ) in which Elias Group purchased all of
CCRDG ' s rights , title and i nterest in the Coco Rico brand for
consideration of over $6 , 000 , 000 and a re l ease of CCRDG ' s
obl i gation to pay any outstanding mon i es owed to Eli as Gro u p
pursuant to CCR ' s ass i gnment of CCRDG ' s purchase ob li gations
under the March 2008 Asset Pu rchase Agreement to Elias Group .
Purs u a n t to the Apri l 20 1 5 Asset Purchase Agreement , on May 2 1,
2015 , Elias Group executed a promisso r y note in the amount of
one million dollars in favor of CCRDG (the " Note " ) .
5
By letter dated June 9 , 2015 , Elias Group advised CCR
that it elected to pay CCR pursuant to the Buyout Payment option
and that based upon the formulas in the Assignment Agreement ,
Elias Group did not owe CCR any further monies .
CCR then filed suit against El ias Group on August 19 ,
201 5 , alleging monies owed under the Assignment Agreement . See
CCR International, Inc. v . The Elias Group , LLC , 15 Civ . 6563
(RWS) , ECF 0kt . No . 1. Elias Group filed a counterclaim and
third - party complaint al l eging conspiracy to frustrate the
Assignment Agreement , the Asset Purchase Agreement and an
Independent Contractor Agreement , as well as breach of contract
and fraud. Moreover , the Elias Group filed suit against CCRDG on
August 8 , 2016 , alleging breach of the Asset Purchase Agreement
and material misrepresentations . See Elias Group , LLC v . CCR
Development Group, Inc ., 16 Civ . 6280
(RWS) , ECF Dkt. No . 1.
CCRDG and Defendant Jose Fuertes ("Fuertes") counterclaimed. By
order of January 12 , 2017 , the CCR Action and the Elias Group
Action were consolidated, and a joint discovery p l an was adopted
on February 22 , 2017.
On September 1, 2017 , Banco Cooperativo de PR ( " Ban
Coop " ) filed a complaint , 17 Civ . 6697
(the " Ban Coop Action " ) ,
which was assigned to the Honorable Alvin Hellerstein , alleging
6
breach of contract based on the Note executed by Elias Group in
favor of CCRDG on May 21 , 2015 , and assigned to Ban Coop at that
time.
See Banco Co operativo de PR v. Elias Group, LLC, 17 Civ .
6697
(AKH) , ECF 0kt . No. 1 . On October 18, 2017 , Ban Coop filed
its amended complaint . On December 5, 2017 , the Elias Group
filed its answer and third-party complaint ( " ATPC " ) realleging
its causes of action against CCR , CCRDG , and Fuertes as set
forth in the CCR and Elias Group Actions . See id ., ATPC , ECF
0kt . No . 18 . The ATPC also alleges that Section 3 of the
Promissory Note provided that a claim for indemnification would
reduce the principal of the Note and permit the Elias Group to
hold back the amount of disputed funds . See id.
~
30 . The
indemnification is provided in the Asset Purchase Agreement and
is one of the subjects of the Elias Group Action. The Ban Coop
Action was reassigned to this Court as related on Apri l
12,
2018 .
The instant motion for consolidation by the Elias
Group , opposed by Ban Coop , was taken on submission and marked
fully submitted on March 7 , 2018 .
7
II .
The Elias Group's Motion to Consolidate is Granted
Federal Rule of Civil Procedure 42(a) provides that
"[i]f actions before the court involve a common question of law
or fact,
the court may .
. consolidate the actions. " Fed . R .
Civ. P . 42(a) . When common issues of law and fact are present,
the "trial court has broad discretion to determine whether
consolidation is appropriate," and is empowered to find that
"judi c ial economy favors consolidation." Johnson v . Celotex
Corp. , 899 F.2d 1281 , 1285 (2nd Cir . 1990), cert . denied,
S . Ct . 297
(1990)
110
(citations omitt ed) . While " the discretion to
consolidate is not unfettered and considerations of convenience
and economy must yield to a paramount concern for a fair and
impartial trial," Primavera Familientstiftung v . Askin, 173
F . R . D. 115 , 12 9 ( S . D. N . Y . 1 9 9 7 )
at 1284 - 85)
( c i ting Ce 1 o t ex Corp . , 8 9 9 F . 2 d
(alteration and internal quotation marks omitted ) ,
"s o long as any confus ion or prejudice does not outweigh
efficiency concerns , consol idati on will generally be
appropriate." See Primavera Familientstiftung , 173 F . R.D. at 129
(citing Int 'l Paving Sys., Inc. v . Van-Tulco, Inc ., 806 F . Supp .
17, 22
(E .D.N. Y. 1 992) .
8
The party seeking consolidation bears the burden of
demonstrating that the interest of judicial economy is
outweighed by the possibility of prejudice or delay . KGK Jewelry
LLC v . ESDNetwork,
at *2
No. 11 Civ. 9236 (LTS) (RLE), 2014 WL 7333291 ,
(S.D.N . Y. Dec . 24, 2014)
Fee Antitrust Litigation ,
(citing In re Currency Conversion
No. 01 MDL 1409 , 2009 WL 1834351 , at
* 2 ( S . D. N. Y. June 18 , 2 0 0 9) ) .
As evidenced by the pleadings as set forth above, both
the CCR Action and the Ban Coop Action arise out of the same
factual scenario and relate to the same agreements. Elias Group
has alleged that under the terms of the Note on which Ban Coop
has sued, it is entitled to withhold payment and t o reduce its
principal to the amount of its losses and indemnification cla ims
against CCR , CCRDG , the Fuertes brothers and others allegedly
conspiring with them. Accordingly , there are common fa ctua l
issues, such that consolidation of the CCR and the Ban Coop
Actions for discovery purposes is proper . Subsequent motions may
clarify the issues and require revisiting this determination.
The order and priority of issues to be tried will be
determined after the close of discovery .
9
III . Conclusion
For the foregoing reasons , Elias Group's motion t o
consolidate is granted.
It is so ordered .
New York, NY
June
2018
1rJ,
T
U . S . D.J.
10
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?