United States District Court, M.D. Florida, Tampa Division
EDWARD T. SAADI, Plaintiff,
PIERRE A MAROUN, et al., Defendants.
REPORT AND RECOMMENDATION
MARKA.PIZZO, UNITED STATES MAGISTRATE JUDGE.
persistent efforts since October 2009, Edward T. Saadi has
been unable to collect his $90, 000 judgment against Pierre
Maroun (docs. 225, 230). But after some financial spadework,
he now contends that Maroun, through a limited liability
company (LLC), has an interest in a Clearwater condominium
that is either ripe for a judicial sale (Saadi's main
demand) or a charging order (his alternative demand).
See doc. 280. Recommending the correct alternative
to the district judge is what is before me, and that
determination depends on the application of Fla. Stat. §
605.0503, a statute that deals with charging orders in the
context of a limited liability company. In sum, if the LLC
has Maroun as its only member, the Court “may”
order the sale of Maroun's interest (assuming Saadi meets
the statute's other predicates). See §
605.0503(4). If the LLC has more members than Maroun, then a
charging order, which acts as a lien on Maroun's
transferable interest in the LLC, is the sole statutory
option. See § 605.0503(1). After the benefit an
evidentiary hearing and the motion papers, I recommend the
district judge issue a charging order as to Maroun's
interest in Maroun's International, LLC.
69(a)(1) dictates that “[t]he procedure on execution -
and in proceedings supplementary to and in aid of judgment or
execution - must accord with the procedure of the state where
the court is located[.]” And that puts Florida's
Revised Limited Liability Company Act and § 605.0503
Fla. Stat. (2014) in particular front and center. That
section provides generally that “a charging order is
the sole and exclusive remedy by which a judgment creditor
... may satisfy a judgment” from a member's
interest in a limited liability company or distributions
therefrom. § 605.0503(3). That remedy “constitutes
a lien upon a judgment debtor's transferable interest and
requires the limited liability company to pay over to the
judgment creditor a distribution that would otherwise be paid
to the judgment debtor.” § 605.0503(1). And where
the limited liability company has only one member, the
statute allows a court to order a foreclosure sale, if a
judgment creditor establishes that a charging order will not
satisfy the judgment. Fla. Stat. § 605.0503(4); Regions
Bank v. Hyman, No. 8:09-cv-1841-T-17MAP, 2015 WL
1912251, *5 (M.D. Fla. April 27, 2015).
disputes that Maroun lives at the Clearwater condominium, or
that Maroun's International, LLC (“LLC”)
holds the deed to the place, or that Maroun has an interest
in the LLC. What is hotly disputed, however, is the LLC's
makeup - is it just Maroun or do others have an interest in
it too? Deciding which from the evidence is a hazy
proposition. Neither side's evidence is persuasive.
Complicating all this is the fact that Florida's LLC
scheme does not require an LLC to publicly reveal all its
says the LLC is just Maroun, relying primarily upon Florida
Department of State records and Maroun's and the
LLC's responses to Saadi's interrogatories. For
example, the Electronic Articles of Organization for
Maroun's International, LLC filed with the Secretary of
State on May 6, 2006, and the annual reports for Maroun's
International, LLC for the years 2007-2017 mention only
Maroun and no one else. See doc. 335, Ex. 3, 4, and
5. From this, he posits the LLC is a single entity structure
- and Maroun is the only stakeholder. But that conclusion
assumes that Florida's LLC scheme requires an LLC to list
all its members in such filings. And that is not the case. In
fact, the process for setting up an LLC in Florida can be
unsophisticated. Under the version of the statute applicable
at the time the LLC was established, Florida required the
filing of “articles of organization ... with the
Department of State” ... “by one or more members
or authorized representatives of the [LLC].”
§608.407(1), Fla. Stat. (2006). The articles of
organization were only required to include the following
(a) The name of the limited liability company. ...
(b) The mailing address and the street address of the
principal office of the limited liability company. ...
(c) The name and street address of its initial registered
agent for service of process in the state. ...
Id. Nothing in the Act required the LLC to identify
in its articles of organization all its members of the LLC.
Similarly, the LLC's annual reports show Maroun as the
“Managing Member/ Manager” for the years
2009-2012 and the “Authorized Person” for the
years 2013-2017. But as with the articles of organization,
the legislative scheme did not require the LLC to list in the
annual report all its members. Fla. Stat § 6-5.0212.
That makes Saadi's conclusion that these filings evince a
single-member LLC unconvincing.
response to interrogatories, Maroun stated he was “sole
managing member, founder, and registered agent of
Maroun's International, LLC.” See doc.
335, Ex.3, 4. Bank records show too that Maroun uses the
LLC's bank account to pay his rent, child support
obligations, personal gifts, and the LLC's condo fees.
Saadi adds that the LLC's failure to file tax returns
shows that it must be singly owned since single member LLCs
are not required to file tax returns; that the Defendant
resides rent-free in the condo owned by the LLC; and that a
multiple member LLC would not title its bank account in the
manner this LLC has titled its Regions Bank account.
See doc. 335, Ex. 11 and 13 (personal bank account
titled “Pierre A. Maroun d/b/a MI7USA” and LLC
account titled “Maroun's International LLC d/b/a/
represented himself at the hearing; the LLC appeared through
counsel. Both contend that Maroun is not the only member and
presented an Operating Agreement of Maroun's
International, LLC purportedly executed in Jordan on August
28, 2012. See doc. 308, Ex.A; doc. 331-1, Ex. 1.
Schedule A annexed to the Operating Agreement indicates that
Pierre Maroun's interest in the LLC is 21%, Omar T.
Qawasmi's interest is 49%, Jian Suleiman Maroun's
interest is 15%, and Ahmad S. Kamel's interest is 15%.
The LLC also presented a Promissory Note with the same date
(August 28, 2012) signed only by Maroun. See doc.
309, Ex. B; doc. 331-2, Ex.2. The Promissory Note provides:
I, Pierre A. Maroun, Chairman of Maroun's International,
LLC, (DBA M17USA) have received a loan from Mr. Omar Toufic
ElQawasmi in the amount of $300, 000.00USD (THREE HUNDRED
THOUSAND USD) with the interest rate of 1.25%. This loan is
to be used in business related expenses and or to invest in
real estate properties.
In return, Mr. ElQawasmi will become a shareholder in the
abovementioned company with 49% interest. He will enjoy the
full rights of a shareholder in accordance with the articles
of the attached “Operating Agreement” between the
parties. In case of failure to repay said loan, Mr. ElQawasmi
will have a first lien right on any or all properties,