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Regions Bank v. Kaplan

United States District Court, M.D. Florida, Tampa Division

May 14, 2018

REGIONS BANK, an Alabama banking corporation, Plaintiff,
v.
MARVIN I. KAPLAN, and individual; et al., Defendants.

          ORDER

          AMANDA ARNOLD SANS ONE United States Magistrate Judge

         Marvin Kaplan (“M. Kaplan”), Kathryn Kaplan (“K. Kaplan”), R1A Palms, LLC (“R1A Palms”), Triple Net Exchange, LLC (“TN Exchange”), MK Investing, LLC (“MK Investing”), BNK Smith, LLC (“BNK Smith”), and MIK Advanta, LLC (“MIK Advanta”) (collectively, the “Kaplan Defendants”), seek permission to substantively amend the joint pretrial statement. (Doc. 178). The Kaplan Defendants also request leave to file a reply in further support of their motion to amend the joint pretrial statement. (Doc. 185). Regions Bank (“Regions”) opposes both requests. (Docs. 183, 186).

         I. BACKGROUND

         In this action (one of three litigated by these parties), Regions seeks damages for alleged fraudulent transfers from R1A Palms, TN Exchange, and BNK Smith to K. Kaplan. (Doc. 48). Critical to the instant motion, Regions also alleges that M. Kaplan restructured his IRA and moved assets from MK Investing to MIK Advanta to avoid paying Regions' judgment in the underlying action, Regions Bank v. Marvin I. Kaplan, et al., No. 8:12-cv-1837-T-17MAP. (Id.).

         Until now, there has been no dispute that: (1) MK Investing owned a partial interest in 785 Holdings, LLC (“785 Holdings”) and transferred that interest to MIK Advanta; (2) MIK Advanta received additional funds from MK Investing valued at $273, 898.08; and (3) the IRA moved $214, 263.16 in cash received from MK Investing to MIK Advanta. M. Kaplan, MK Investing, and MIK Advanta admitted these facts in their respective pleadings and included these facts as stipulated in the original joint pretrial statement. (Docs. 67, 83, 84, 163).

         With only a few weeks remaining before the trial of Regions' claims, the Kaplan Defendants request to remove these stipulated facts from the joint pretrial statement. (Doc. 178, pp. 3-4). In addition, the Kaplan Defendants seek to add an exhibit as support for their new set of facts. (Id. at p. 2). The Kaplan Defendants now assert that: (1) the IRA, not MK Investing, owned an interest in 785 Holdings; (2) MIK Advanta did not receive $273, 898.08 in value from MK Investing; and (3) the IRA acquired MIK Advanta's units using $214, 236.16 in cash.[1] (Id. at pp. 3-4). The court will separately address each proposed amendment.

         A. MK Investing's interest in 785 Holdings.

         The Kaplan Defendants request to delete paragraph 17 of the joint pretrial statement. (Doc. 178, p. 3). Paragraph 17 states that “[o]n July 12, 2012, M[. Kaplan] caused to be formed 785 Holdings [], in which MK [Investing] owned a partial interest.” (Doc. 162, ¶ 17). The Kaplan Defendants now assert that MK Investing did not actually own an interest in 785 Holdings, LLC. (Doc. 178, p. 3).

         In their answers, M. Kaplan, MK Investing, and MIK Advanta “[a]dmitted that MK [Investing] maintained an ownership interest in 785 Holdings, LLC.” (Docs. 67, 83, 84). This fact was also affirmed during the trial in the underlying action (Doc. 183, Exh. A, p. 3), and during the deposition of M. Kaplan in this action (Doc. 128, p. 161). In support of the requested amendment, the Kaplan Defendants rely on three documents from early discussions of the IRA restructuring. (See Doc. 183, Exhs. C, D, E). These documents were superseded by other versions and were never consummated. (Id.).

         B. MIK Advanta's receipt of $273, 898.08 in funds from MK Investing.

         The Kaplan Defendants request to delete paragraph 20, footnotes 14-15, from the joint pretrial statement. (Doc. 178, p. 3). Footnotes 14-15 respectively state, “MK [Investing] also transferred its interest in a TN [Exchange] note to MIK [Advanta], ” and “M[. Kaplan], MK [Investing] and MIK [Advanta] admit MIK [Advanta] received ‘funds' of $273, 898.08.” (Doc. 162, ¶ 20).

         The Kaplan Defendants now assert that footnote 14 is not supported by the evidence in light of the ownership interests in 785 Holdings. (Doc. 178, p. 3). However, MK Investing's transfer of its $273, 898.08 interest to MIK Advanta involved a transaction separate from the ownership interest in 785 Holdings. The only other evidence the Kaplan Defendants cite in support of this amendment is the IRA Annual Report from January 1, 2012 to December 1, 2016. (Doc. 183, Exh. P). That document reflects MIK Advanta's 2016 market value and certain administrative fees and disbursements. (Id.).

         Concerning footnote 15, the Kaplan Defendants agree that a $273, 898.08 transaction occurred, but dispute that it represented actual value or that actual “funds” were involved in the transfer. (Doc. 178, p. 3). The joint pretrial statement stipulates that “[t]he IRA assigned the remaining value in MK [Investing] of $273, 898.08 to MIK [Advanta].” (Doc. 162, ¶ 20). The second amended complaint specifically alleges that the IRA assigned the remaining 229, 517.44 units of MK Investing (with a value of $273, 898.08) to MIK Advanta. (Doc. 48, ¶ 27(d)). M. Kaplan, MK Investing, and MK Advanta's answers also admitted that MIK Advanta received “funds” of $273, 898.08. (Docs. 67, 84, and 84, ¶ 27(d)). During M. Kaplan's deposition in this action, he agreed that the IRA moved a MK Investing asset worth $273, 898.08 to MIK Advanta. (Doc. 128, pp. 156, 158).

         C. MK Investing's receipt of $214, 236.16 in cash from MIK ...


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