Blasingame et al v. Church Joint Venture, L.P. et al

Filing 30

ORDER DENYING DEFENDANTS' MOTION TO CONSOLIDATE AND REFERRING PLAINTIFFS' MOTION TO DISQUALIFY COUNSEL 13 19 . Signed by Chief Judge J. Daniel Breen on 6/29/15. (Breen, J.)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
EASTERN DIVISION
EARL BERNARD BLASINGAME AND
MARGARET GOOCH BLASINGAME,
AS CO-TRUSTEES AND ON BEHALF
OF BLASINGAME FAMILY BUSINESS
INVESTMENT TRUST,
Plaintiffs,
v.

No. 15-1038

CHURCH JOINT VENTURE, L.P. AND
THE CADLE COMPANY,
Defendants.
_____________________________________________________________________________
ORDER DENYING DEFENDANTS’ MOTION TO CONSOLIDATE AND REFERRING
PLAINTIFFS’ MOTION TO DISQUALIFY COUNSEL
_____________________________________________________________________________
Before the Court is a motion to consolidate, pursuant to Rule 42 of the Federal Rules of
Civil Procedure, brought by the Defendants, Church Joint Venture, L.P. and The Cadle Company
(collectively “Defendants”). (Docket Entry (“D.E.”) 13.) Plaintiffs, Earl Bernard Blasingame
and Margaret Gooch Blasingame, as co-trustees and on behalf of the Blasingame Family
Business Investment Trust (collectively “Plaintiffs” or “Trust”), have responded in opposition.
(D.E. 17.) For the reasons discussed below, the motion is DENIED.
Background
I.

Bankruptcy Case No. 08-28289-L
On August 15, 2008, Earl and Margaret Blasingame filed for Chapter 7 bankruptcy in the

United States Bankruptcy Court for the Western District of Tennessee. (In re Earl Bernard
Blasingame and Margaret Gooch Blasingame, No. 08-28289-L (Bnkrpty. W.D. Tenn.)). On

September, 29, 2009, an adversary action was brought by several parties, including Church Joint
Venture, seeking to recover property of the estate and to object to the discharge of the estate’s
debts. These parties also brought claims against several non-debtor defendants, including the
Trust. On February 22, 2011, the bankruptcy court denied the estate’s discharge pursuant to 11
U.S.C. § 727(a)(4)–(5).
On October 19, 2011, the bankruptcy court approved the sale of the Chapter 7 trustee’s
claims and causes of action on behalf of the estate to Church Joint Venture. On April 6, 2012,
the non-debtor defendants moved to dismiss the claims brought against them, contending that the
bankruptcy court no longer had jurisdiction as the trustee was no longer a party. On July 30,
2012, the bankruptcy court recommended that the claims against the non-debtor defendants be
dismissed. On October 23, 2012, Church Joint Venture requested that the district court adopt the
recommendation so that it could refile in the proper forum. On November 5, 2012, the district
court adopted the recommendation and dismissed the claims against the non-debtor defendants.
II.

Civil Case No. 12-2999-SHM-tmp (“Western Division Action”)
On November 16, 2012, Church Joint Venture filed a complaint in the United States

District Court for the Western District of Tennessee, Western Division, against the Blasingames,
their children, Katherine Blasingame Church and Earl Bernard “Ben” Blasingame, Jr., the
Blasingame Family Business Investment Trust, the Blasingame Family Residence Generation
Skipping Children Trust, the Blasingame Trust, Flozone Services, Inc., Fiberzone Technologies,
Inc., GF Corporation, Blasingame Farms, Inc., and Aqua Dynamics Group Corporation.
(Church Joint Venture v. Earl and Margaret Blasingame, et al., No. 12-2999-SHM-tmp (W.D.
Tenn.), D.E. 1.) Church Joint Venture filed an amended complaint on June 14, 2013, seeking a

2

declaratory judgment that the trusts and corporations are the alter egos of the Blasingames and
were used to conceal their personal assets from creditors, an order setting aside certain transfers
as fraudulent, an injunction to prevent further waste, an accounting, and attorney’s fees. (Id.,
D.E. 81.) A motion to dismiss/motion for summary judgment is currently pending.
III.

Civil Case No. 15-1038-JDB-egb (“Eastern Division Action”)
Plaintiffs filed this action in the Circuit Court of McNairy County, Tennessee on

February 10, 2015, which Defendants removed to this Court on February 23, 2015. (D.E. 1.)
The Trust brought state law claims arising out of Defendants’ filing of a lis pendens against all of
the land and property it owned in McNairy County, Tennessee. (Id.) Defendants seek to
consolidate the Western and Eastern Division actions pursuant to Rule 42 of the Federal Rules of
Civil Procedure.
Law and Analysis
I.

Motion to Consolidate
Rule 42 of the Federal Rules of Civil Procedure states 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)(2). The purpose behind consolidating actions is to “administer the court’s business
‘with expedition and economy while providing justice to the parties.’” Advey v. Celotex Corp.,
962 F.2d 1177, 1180 (6th Cir. 1992) (quoting Charles A. Wright & Arthur R. Miller, 9 Federal
Practice and Procedure, § 2381 (1971)). “The party moving for consolidation bears the burden
of demonstrating the commonality of law, facts or both in cases sought to be combined[.]”
Banacki v. OneWest Bank, FSB, 276 F.R.D. 567, 571 (E.D. Mich. 2011) (citing Young v.
Hamric, No. 07-12368, 2008 WL 2338606, at *4 (E.D. Mich. June 4, 2008)).

3

This is only a threshold inquiry, and even after a common question has been shown, “the
decision to consolidate rests in the sound discretion of the district court.” Id. (citations omitted).
The court should weigh “the interests of judicial economy against the potential for new delays,
expense, confusion, or prejudice.” Id. (internal quotation marks omitted) (citation omitted). The
court also should consider “whether the specific risks of prejudice and possible confusion [are]
overborne by the risk of inconsistent adjudications of common factual and legal issues, the
burden on parties, witnesses and available judicial resources posed by multiple lawsuits, the
length of time required to conclude multiple suits as against a single one, and the relative
expense to all concerned of the single-trial, multiple-trial alternatives.” Id. at 571–72 (citation
omitted).
Here, Defendants request that the Western and Eastern Division actions be consolidated
because “[t]he factual basis for the contention that the lis pendens [was] improperly recorded lies
within the context and framework of the Alter Ego/Fraud Action.” (D.E. 13 at 2.) However,
they fail to explain what legal or factual questions are common to both actions such that
consolidation would be appropriate. A conclusory statement that “[t]he facts and legal issues
involved in the Alter Ego/Fraud Action are inextricably intertwined with and will be necessary to
establish, involve and relate to the claims in the instant Action involving and requesting
declaration and damages with respect to wrong filing of the lis pendens,” (id. at 3), is insufficient
to demonstrate common legal or factual questions. Defendants do not explain how the factual
and legal issues arising from the lis pendens filed in McNairy County, Tennessee are related to
the claims pending in the Western Division action. There is also a risk of confusion and
prejudice if the two matters were consolidated, since the Western Division action has been

4

pending for a longer period and contains additional parties and different legal claims.
Accordingly, the motion is DENIED.
II.

Motion to Disqualify Defense Counsel
Also before the Court is Plaintiffs’ motion to disqualify Defendants’ attorney, Bruce W.

Akerly.

(D.E. 19.)

This motion is referred to the United States Magistrate Judge for

determination, and/or report and recommendation. Any objections to the Magistrate Judge’s
order and/or report shall be made within fourteen days after service of the order and/or report,
setting forth particularly those portions of the order and/or report objected to and the reasons for
the objections. See Fed. R. Civ. P. 72.
Conclusion
Defendants’ motion to consolidate is DENIED and Plaintiffs’ motion to disqualify
counsel is REFERRED to the Magistrate Judge.
IT IS SO ORDERED this 29th day of June, 2015.
s/ J. DANIEL BREEN
CHIEF UNITED STATES DISTRICT JUDGE

5