PNC Bank NA et al v. 2013 Travis Oak Creek GP LLC et al

MOTION for Leave to File Intervenor's Complaint

W.D. Tex.June 28, 2018

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS AUSTIN DIVISION PNC BANK, N.A. COLUMBIA HOUSING SLP CORPORATION, and 2013 TRAVIS OAK CREEK, LP Plaintiffs, v. 2013 TRAVIS OAK CREEK GP, LLC, 2013 TRAVIS OAK CREEK DEVELOPER, INC., CHULA INVESTMENTS, LTD., and RENE 0. CAMPOS Defendants. § § § § § § § § § § § § § § § Civil Action No. 1:17-cv-584-RP (Consolidated with 1:17-cv-560-RP) 2013 TRAVIS OAK CREEK GP, LLC and 2013 TRAVIS OAK CREEK, LP, Plaintiffs, v. PNC BANK, N.A. and COLUMBIA HOUSING SLP CORPORATION Defendants. § § § § § § § § § § § MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT 2007 Travis Heights, LP ("Movant") files this Motion to Intervene Including Memorandum Brief in Support, pursuant to FRCP 24(a)(2) or (b)(l)(B), and respectfully shows as follows: 1. Movant has an interest in the subject matter of this lawsuit, and disposition of the suit without its participation may, as a practical matter, impair or impede its ability to protect its interests. Alternatively, Movant has a claim that shares with the main action, one or more common MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT Page 1 Case 1:17-cv-00584-RP Document 141 Filed 06/28/18 Page 1 of 5 questions of law or fact and should be permitted to intervene for reasons of judicial economy. Accordingly, intervention of right or permissively should be ordered by the Court. 2. Movant's proposed Intervenor's Complaint is attached hereto as Exhibit "1". 3. On June 7, 2017, Columbia Housing SLP Corporation and PNC Bank, N.A. notified 2013 Travis Oak Creek GP, LLC ("GP") that they were removing GP as the general partner of 2013 Travis Oak Creek, LP (the "Partnership"), that such a putative removal was automatic and constituted an automatic event of withdrawal by GP from the Partnership, and the relinquishment by GP and any and all of its affiliates, without limitation, of the entirety of their Partnership interest and all unpaid fees, deferred development fees, reimbursements of amounts advanced or other amounts, distributions, profits, deferred fees and other amounts, whether earned or not. Columbia and PNC filed this lawsuit seeking, among other things, a declaratory judgment to validate their putative removal and corresponding relinquishment claims and contentions seeking to avoid the Partnership's payment obligations to various GP affiliates including Movant. 4. As the Court already has been informed, 2007 Travis Heights, LP, is an affiliate of GP that sold the real property upon which the Lucero Apartments were constructed, to the Partnership, on a basis where 2007 Travis Heights, LP agreed to defer receipt of the purchase price for the sale of the land, and accepted a promissory note in the amount of $7,330,000.00 that was payable on a subordinated basis in the transaction. In the injunction proceedings in this case, the Court made reference to aspects of Columbia's and PNC's relinquishment and payment avoidance claims both as to parties who Columbia and PNC had sued (i.e., GP and 2013 Travis Oak Developer, Inc.)1, and these parties' rights to payment are the subject of their counterclaims. [See Doc. 78, ,r,r 115 - 118]. The Court also made reference to Intervenor's "Seller Loan", and some 1 See Order, Doc. 73. MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT Page2 Case 1:17-cv-00584-RP Document 141 Filed 06/28/18 Page 2 of 5 ambiguity as to whether it is or is not validly the subject of Columbia's and PNC Bank's payment avoidance or forfeiture arguments. [Doc. 73, fn. 2 at p. 24] 5. Movant clearly has an interest in this suit and its existing subject matter that is direct, substantial and legally protectable. See, Brumfield v. Dodd, 749 F.3d 339, 343 (5th Cir. 2014). Like its affiliates already have done, Movant now desires and has a right and need to protect its right to be paid for its real property under its promissory note or otherwise, and to personally defend against Plaintiffs' implied claim for affirmative relief against it (as an affiliate alleged to have relinquished or forfeited its payment rights) to avoid such payment obligation, and to further address Plaintiffs' obvious repudiation of that payment obligation. Plaintiffs' existing claims present a tangible threat to Movant's right to be paid, and unless Movant intervenes to protect that right, it stands at risk that its repayment right may be impaired by a disposition of claims in this case, without its participation. No other party in this case will fully protect Movant's interest, and no other party can assert its rightful claims to be paid. 6. Indeed, the claims Movant seeks to assert via its attached Intervenor's Complaint have much in common with the claims already pending by the Court as asserted by its affiliates in their counterclaim. The only difference is that Movant was not initially named in Plaintiffs Original or Amended Complaint and thus could not assert its proposed claims as Counterclaims. As such, in the interest of judicial economy and to save judicial resources were satellite litigation to occur, and because the claims proposed to be asserted by Movant have a common question of law or fact with the claims already pending, Movant' s Motion to Intervene should be granted. 7. This Motion to Intervene is timely made as trial is not set until January 28, 2019 giving all parties ample time to discover whatever information necessary regarding Movant's role in the actions giving rise to its claim. See In re Lease Oil Antitrust Litig., 570 F.3d 244, 248 (5th MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT Page3 Case 1:17-cv-00584-RP Document 141 Filed 06/28/18 Page 3 of 5 Cir. 2009). In addition, there is no prejudice to the original parties if this intervention is permitted, there will be prejudice to Movant if this intervention is denied because it will not properly be able to protect its interests as affected by this Court's adjudication of similar rights, of other parties, in this case. WHEREFORE, Movant 2007 Travis Heights, LP prays that the Court permit it to intervene and be heard in this action via the filing of the proposed Intervenor's Complaint attached hereto as Exhibit "l", and that the Court order the attached Intervenor's Complaint to be filed. Respectfully submitted, Isl Karl S. Stern Karl S. Stern State Bar No. 19175665 karlstern@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 711 Louisiana Street, Suite 500 Houston, Texas 77002 (713) 221-7000 (713) 221-7100 (Facsimile) ATTORNEYS FOR 2007 TRAVIS HEIGHTS,LP CERTIFICATE OF CONFERENCE I certify that Kenneth Chaiken conferred with John Gerhart, counsel for the Plaintiffs, on this 28th day of June, 2018, and that my email Mr. Gerhart informed all counsel in this case that he opposes this motion to intervene. Isl Karl S. Stern Karl S. Stern MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT Page 4 Case 1:17-cv-00584-RP Document 141 Filed 06/28/18 Page 4 of 5 CERTIFICATE OF SERVICE I hereby certify that the foregoing document was served on all counsel of record via the Court's electronic filing system on this 28th day of June, 2018. Isl Karl S. Stern Karl S. Stern MOTION TO INTERVENE INCLUDING MEMORANDUM BRIEF IN SUPPORT Page 5 Case 1:17-cv-00584-RP Document 141 Filed 06/28/18 Page 5 of 5