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Aim Recycling of Florida, LLC v. Metals USA, Inc.

United States District Court, S.D. Florida

January 13, 2020




         THIS CAUSE is before the Court upon Plaintiffs AIM Recycling of Florida, LLC (“AIM”) and LKQ Pick Your Part Southeast, LLC's (“LKQ”) (collectively, “Plaintiffs”) Renewed Motion for Partial Summary Judgment as to Liability, ECF No. [263] (“Plaintiffs' Motion for Summary Judgment”), and Defendants Metals USA, Inc. (“Metals USA”) and Obed Lendian's (“Lendian”) (collectively, “Defendants”) Motion for Summary Judgment, ECF No. [261] (“Defendants' Motion for Summary Judgment”), (collectively, the “Motions”). The Court has reviewed the Motions, all opposing and supporting submissions, the record in this case, the applicable law, and is otherwise fully advised. For the reasons set forth below, Plaintiffs' Motion for Summary Judgment is denied, and Defendants' Motion for Summary Judgment is denied.

         I. BACKGROUND

         On February 9, 2018, Plaintiffs initiated the instant RICO[1] action against Metals USA and Samuel Abreu (“Abreu”), alleging a multi-year conspiracy to steal valuable scrap metal from Plaintiffs' facility, ECF No. [1], and the case was originally assigned to the Honorable William J. Zloch, ECF No. [2]. On April 10, 2018, Plaintiffs amended their Complaint, naming Lendian and Universal Scrap Management, LLC (“Universal”) as additional Defendants. ECF No. [24] (“Amended Complaint”).[2] Plaintiffs' Amended Complaint asserts five counts: Count I (Civil RICO - Violations of 18 U.S.C. § 1962(c)); Count II (Civil RICO Conspiracy - Violations of 18 U.S.C. § 1962(d)); Count III (Florida Civil RICO and Remedies for Criminal Activities); Count IV (Florida Civil RICO and Remedies for Criminal Activities - Conspiracy); and Count V (Unjust Enrichment). Id.[3]

         Believing that the Department of Justice (“DOJ”) planned to indict them on criminal charges, on March 1, 2019, Defendants filed a Motion for Temporary Stay. ECF No. [122]. On April 4, 2019, Judge Zloch granted the Motion for Temporary Stay, pending the resolution of Defendants' parallel criminal case. ECF No. [146]. On June 27, 2019, the instant action was reassigned to the undersigned. ECF No. [147]. Moreover, on August 26, 2019, the DOJ provided Defendants with a declination letter, indicating that the criminal investigation was closed and that the DOJ would not be prosecuting. ECF No. [151] at 1-2. On August 28, 2019, after being advised that the DOJ was closing its criminal investigation into Defendants, this Court lifted the stay. ECF No. [154].

         Before this action was stayed pending Defendants' criminal prosecution, on February 15, 2019, Plaintiffs filed a Motion for Partial Summary Judgment as to Liability, ECF No. [120], and corresponding Statement of Material Facts in Support of Plaintiffs' Motion for Partial Summary Judgment as to Liability, ECF No. [119], which was never resolved prior to the case being stayed.

         On August 29, 2019, after this Court lifted the stay, Plaintiffs filed a Renewed Motion for Partial Summary Judgment, ECF No. [158], incorporating the Statement of Material Facts from their original Motion, ECF No. [119]. On September 23, 2019, Defendants filed a Motion for Summary Judgment, ECF No. [177], and accompanying Statement of Material Facts, ECF No. [178]. On October 28, 2019, Plaintiffs moved to supplement the summary judgment record with certified English translations of telephone recordings of allegedly incriminating conversations between Abreu and Lendian. ECF No. [238].[4] This Court granted Plaintiffs' motion to supplement the summary judgment record and ordered the parties to revise their summary judgment briefing to address this supplemental evidence. ECF No. [258].

         On November 26, 2019, pursuant to this Court's Order, Plaintiffs filed their Renewed Motion for Partial Summary Judgment, ECF No. [263], along with their corresponding Supplemented Statement of Material Facts, ECF No. [264] (“Plaintiffs' SOF”). Plaintiffs' SOF sets forth many facts that are premised upon adverse inferences derived from Lendian's invocation of his Fifth Amendment rights during his deposition due to the forthcoming criminal prosecution. Id. at 8-11. On December 10, 2019, Defendants filed their Response in Opposition to Plaintiffs' Motion for Summary Judgment, ECF No. [267] (“Response to Plaintiffs' Motion for Summary Judgment”), along with their Amended Counterstatement of Disputed Material Facts, ECF No. [272] (“Defendants' CSOF”). Defendants' CSOF included as an attachment Lendian's sworn affidavit asserting additional facts, to which he previously could not testify, in order to rebut the adverse inferences derived from his prior Fifth Amendment invocation. ECF No. [272] at 20-30. On December 17, 2019, Plaintiffs submitted their Reply, ECF No. [275].

         Likewise, on November 26, 2019, Defendants filed their Motion for Summary Judgment, ECF No. [261], and accompanying Statement of Material Facts, ECF No. [262] (“Defendants' SOF”). On December 10, 2019, Plaintiffs filed their Response to Defendants' Motion for Summary Judgment, ECF No. [270] (“Response to Defendants' Motion for Summary Judgment”), and their corresponding Counter Statement of Material Facts, ECF No. [271] (“Plaintiffs' CSOF”), to which Defendants filed a Reply, ECF No. [274].


         Based on the parties' statements and counterstatements of material facts, along with the evidence in the record, the following facts are not genuinely in dispute unless otherwise noted.

         Plaintiffs operate an industrial scrap metal facility with approximately forty employees. Dep. of Plaintiffs' Corp. Representative 36:5-7, ECF No. [272] at 42-216 (“Gerding Dep.”). Plaintiffs' facility “takes [] end-of-life crush cars and runs them through a massive shredding operation which separates - which hammers up the cars and separates the metals from the car and the waste into ferrous material, nonferrous material, and waste.” Hr'g on Mot. for Prelim. Inj. Tr. 10:18-21, [5] ECF No. [264-2] (“Hr'g Tr.”). Plaintiffs' facility primarily produces ferrous shred, which they then sell to customers domestically and internationally. Hr'g Tr. 14:18-20.

         Metals USA operates a metal recycling facility that buys, cuts, and resells different kinds of metals. Dep. of Javier Fleites 21:10-22:24, ECF No. [264-3] (“Fleites Dep.”); Dep. of Metals USA's Corp. Representative 13:16-17, ECF No. [264-4] (“Metals Dep.”). Lendian owns Metals USA and is involved in every aspect of Metals USA's operation and decision making, including hiring and firing employees, entering into contracts on behalf of the company, and determining the market rate for materials that Metals USA purchases. Fleites Dep. 51:16-25; Metals Dep. 107:19-21; Dep. of Roberto Rodriguez 98:15-17, ECF No. [264-5] (“Rodriguez Dep.”).

         Around December 2017, Plaintiffs' operations controller, Fritz Gerding, noticed a significant discrepancy between the physical amount of shred inventory stored at the facility and the amount of inventory listed in company records for accounting purposes. Hr'g Tr. 17:2-7; Gerding Dep. 39:14-41:24. Based on this discrepancy, Gerding and Plaintiffs' general manager, Walter Griessier, began an internal investigation to determine the cause of the inventory discrepancy. Hr'g Tr. 17:18-18:3; Gerding Dep. 42:9-16. During their investigation, Gerding and Griessier enlisted the help of another employee at Plaintiffs' facility, Pedro Torres (“Torres”), who they felt would provide valuable knowledge about the facility's systems and operations. Hr'g Tr. 18:17-19:11; Gerding Dep. 42:17-43:10. Torres operated the truck scale to measure the incoming and outgoing weights of vehicles passing through Plaintiffs' facility, which were then used to determine the amount of scrap metal purchased from particular customers. Hr'g Tr. 18:17-19:11. Ultimately, Torres confessed to Gerding and Griessier that he was aware of a theft scheme at Plaintiffs' facility that he had taken part in. Hr'g Tr. 19:16-19; Gerding Dep. 43:10-17. During his confession, Torres implicated numerous other employees who were involved in the theft scheme, including Samuel Abreu. Hr'g Tr. 22:1-6, 25:6-8; Gerding Dep. 58:19-60:11. With Torres's help, Gerding and Griessier were later able to capture Abreu on video paying Torres an envelope of $3, 000.00 in cash. Hr'g Tr. 56:3-16; Gerding Dep. 61:2-64:25.

         Abreu worked as a loader operator at Plaintiffs' scrap metals facility from April 2014 to February 2018. Aff. of Samuel Abreu, ECF No. [264-1] ¶ 2 (“Abreu Aff.”). In April 2014, Abreu's co-worker, Jose Rodriguez, [6] confided in him that multiple employees at Plaintiffs' facility had been stealing scrap metal. Id. ¶ 4. Jose Rodriguez explained that the employees involved would enter the facility with trucks early in the morning, load those trucks with Plaintiffs' scrap metal, and then direct those trucks out of Plaintiffs' facility to deliver the loads of stolen scrap to a location that Abreu later learned was Metals USA. Id. ¶¶ 4-5. After learning about the theft scheme, Jose Rodriguez began paying Abreu weekly for his silence, and these payments continued until the end of 2015. Id. ¶¶ 6-7. During this time, Jose Rodriguez was the “chief person working at AIM that was in charge of stealing and delivering these stolen goods.” Hr'g Tr. 151:23-152:5.

         Abreu testified that, at the end of 2015, he was approached by a man named Ruben Encarnacion about taking over for Jose Rodriguez in the theft operation because Jose Rodriguez had become too unreliable. Abreu Aff. ¶ 7; Hr'g Tr. 146:15-147:9. Although he was not employed by Plaintiffs, Encarnacion was a known broker who had previous business interactions at Plaintiffs' facility where he “would broker loads of cars to AIM for shredding.” Hr'g Tr. 90:7-9. In early 2016, Encarnacion facilitated an initial in-person meeting between Abreu and Lendian, during which Abreu alleged that Lendian offered him $100.00 for every ton of scrap metal stolen. Abreu Aff. ¶¶ 8-9; Hr'g Tr. 148:9-149:5. Defendants, however, contend that Lendian never instructed Abreu to steal anything, nor did Lendian offer to pay Abreu for Plaintiffs' stolen scrap. Defendants point to Metals USA's Customer History Report, which shows the fluctuating prices Metals USA paid per ton to Abreu on transactions from January 2015 through December 2017. Aff. of Obed Lendian, ECF No. [272] at 23, ¶ 19 (“Lendian Aff.”); ECF No. [264-7] (“Customer History Report”). Thereafter, Abreu took Jose Rodriguez's place as the main orchestrator of the theft scheme at Plaintiffs' facility and involved more employees to expand the operation. Abreu Aff. ¶¶ 10, 12; Hr'g Tr. 151:2-152:5.

         Abreu claims that Lendian was the ringleader of the theft ring who controlled all aspects of the scheme and instructed Plaintiffs' employees on when to steal, the quantity to steal, where to deliver the stolen items, and the price of the stolen goods. Hr'g Tr. 100:23-101:13. Defendants, on the other hand, state that Lendian had no knowledge that the materials Abreu delivered were stolen, and that he never instructed Plaintiffs' employees to steal anything, nor did he have any control over the individuals participating in the scheme. Lendian Aff. at 22, ¶¶ 12-15. The employees who confessed their involvement in the theft ring implicated Abreu during their confessions, not Lendian. Hr'g Tr. 24:22-25:8; Gerding Dep. 71:15-72:8.

         Defendants disagree with Plaintiffs' characterization of Metals USA's business relationship with Abreu. It is undisputed that Encarnacion was one of Lendian's business contacts who, around the end of 2014, approached Lendian about serving as a broker between Metals USA and a supplier who had scrap metal to sell. Lendian Aff. at 22, ¶¶ 6-7; Fleites Dep. 113:2-12. The supplier Encarnacion brokered for was Abreu. Fleites Dep. 120:10-13; Metals Dep. 27:5-6; Rodriguez Dep. 45:17-19. Pursuant to this agreement, Encarnacion worked as Abreu's broker to deliver loads of ferrous scrap and collect payments on behalf of Abreu's company. Fleites Dep. 121:19-23; Metals Dep. 27:25-28:6; Rodriguez Dep. 46:6-15. Lendian states that, around June 2015, Abreu approached him and told him that Encarnacion would no longer be his broker or have authorization to collect payments on Abreu's behalf. Lendian Aff. at 22, ¶¶ 10-11. Thereafter, Abreu stopped using Encarnacion as a broker to deliver loads of scrap to Metals USA. Fleites Dep. 121:3-5; Metals Dep. 35:1-3; Rodriguez Dep. 51:3-22.

         Plaintiffs contend that Abreu was Metals USA's only customer who delivered material that had been processed through a large industrial shredder. Fleites Dep. 157:9-12, 161:16-19; Metals Dep. 68:10-13. Defendants, however, dispute that the material Abreu was selling to Metals USA was produced by a large industrial shredder, explaining instead that the material “could have been produced by a small shredder. . . . Once metal has been processed through a shredder, it becomes indistinguishable from other metal that has run through a shredder. There is no way to determine the identity or size of the shredder.” Lendian Aff. at 25, ¶ 34.

         Although it is undisputed that Metals USA did not know the name of Abreu's company, Metals USA employees understood that Abreu owned the company responsible for making the deliveries. Fleites Dep. 119:8-17; Metals Dep. 59:12-16; Rodriguez Dep. 46:12-19 (“Q. How is it that you came to understand that Ruben was working for Samuel Abreu? A. Because Samuel was the owner of the business, the owner of the load. Q. How did you come to know that? Who told you? A. The people themselves who were working there. Guys from Samuel who were coming.”). Further, the parties do not dispute that Metals USA never recorded the driver's license information of any of Abreu's drivers, Fleites Dep. 33:7-14, and Defendants maintain that they were not legally required to record such information, Lendian Aff. at 24, ¶ 30; Fleites Dep. 33:7-35:3. Instead, Defendants allege that Metals USA was only required to record the driver's license information for the owner of the material being sold, which it did in Abreu's case, in addition to keeping detailed records of each delivery Abreu made. Lendian Aff. at 24, ¶ 30; Fleites Dep. 33:7-35:3.

         Defendants primarily paid Abreu in cash for the loads of scrap sold, although they also occasionally paid Abreu by check. Metals Dep. 55:17-56:2; see generally Customer History Report. Most of Metals USA's largest clients were paid in either cash or check, based on what the owner of the company requested, and payment would be disbursed to the owner of the company or any individuals authorized to collect payment on the owners' behalf. Metals Dep. 53:6-55:7. Either Abreu or an authorized family member went to Metals USA's facility multiple times a week to pick up Abreu's payment. Metals Dep. 55:8-16; Rodriguez Dep. 81:25-82:10. When collecting payment, Abreu would almost always remain in his vehicle outside of the Metals USA yard and either Fleites or Rodriguez would deliver the payment to him. Metals Dep. 52:20-25; Lendian Aff. at 25, ¶ 36; Rodriguez Dep. 84:18-85:2 (“Because he didn't want to get out. At the beginning he got out once or twice but then he did not want to get out so he would remain in his car, well-dressed. And then I would provide him with the money outside. The thing is that our yard has no parking. I would hand him his money, then he would leave.”).

         It is undisputed that Abreu made a total of 538 deliveries to Metals USA between 2015 and 2018, for which he was paid $4, 544, 282.95. Fleites Dep. 131:20-132:5; see generally Customer History Report. During this period, Abreu was one of Metals USA's five largest clients. Metals Dep. 18:12-15. Metals USA ultimately resold the scrap metal purchased from Abreu to clients domestically and abroad, including to Plaintiffs. Lendian Aff. at 23, ¶ 21; ECF No. [272] at 31-33.

         After uncovering the theft ring and obtaining confessions from numerous employees involved, Plaintiffs initiated the instant action on February 9, 2018. ECF No. [1]. Eventually, Abreu began cooperating with the DOJ. Hr'g Tr. 111:24-112:2. Beginning in February 2018, pursuant to this cooperation and unbeknownst to Lendian, Abreu began recording his telephone conversations with Lendian at the DOJ's request. Hr'g Tr. 120:14-18, 161:2-6.

         It is undisputed that, during these phone conversations, Lendian suggested that Abreu flee the country rather than face years in prison if convicted for his involvement in the theft ring.[7] ECF No. [264-8] at 18-20. Likewise, the parties do not dispute the fact that Lendian stated that he and Abreu needed to be on the “same page” regarding their testimony as to the quality of the materials Abreu sold to Metals USA. Id. at 64, 78. It is further undisputed that Lendian told Abreu not to divulge the identities of the truck drivers who worked for Abreu because they would “give [Abreu] up.” Id. at 83. Beyond these undisputed facts, however, the parties share differing versions of what transpired.

         On the one hand, Plaintiffs set forth the following facts based on the recordings: (1) Lendian started taking steps to transfer his assets out of the United States upon learning of this lawsuit, ECF No. [264-8] at 45; (2) Lendian asked Abreu to lie to his attorney to cover up for Lendian, id. at 27-28; (3) Lendian tried to destroy relevant Metals USA records, id. at 37; (4) Lendian asked Abreu to take the blame for the thefts and testify that Lendian did not know that the materials were stolen, id. at 47, 70; (5) Lendian offered Abreu $20, 000.00 for Abreu's legal fees if Abreu agreed to use a lawyer of Lendian's choosing, id. at 55, 72-74; and (6) Lendian instructed Abreu to purchase a new cell phone under a false name, ECF No. [264-9] at 2-3.

         On the other hand, Defendants contend that the recordings support the existence of issues of fact and present a narrative consistent with their assertions that Defendants neither knew of the thefts, nor directed or participated in them. Defendants also emphasize that these recordings were taken as a result of Abreu's cooperation with, and likely coaching by, the federal officials in an effort to bait Lendian into making incriminating statements. Defendants dispute the version of facts that Plaintiffs derive from these recordings and allege the following facts instead: (1) Lendian produced his bank records and those records contain no proof that Lendian transferred his assets out of the United States, Lendian Aff. at 29, ¶ 75; (2) The transcript cited by Plaintiffs demonstrates that, contrary to what they allege, it was Abreu who suggested lying to his own attorney, not Lendian, ECF No. [264-8] at 11; (3) The record indicates that it was Abreu who sought to destroy Metals USA records, Rodriguez Dep. 65:1-67:23, and the recording transcript cited shows that Lendian told Abreu that he could not destroy the records in order to avoid a confrontation with someone who Lendian believed could exonerate him, ECF No. [264-8] at 46-47; (4) Lendian spoke with Abreu in an effort to clear his name and the transcript contradicts Plaintiffs' allegations that Lendian asked Abreu to take the blame for the thefts, instead establishing that Abreu suggested that he “bear the guilt for everything, ” id. at 46-47; (5) Lendian offered to help Abreu with his legal fees, but the offer was not conditioned upon a lawyer of Lendian's choosing, and the recording transcript contains no support for this alleged conditional offer, id. at 55, 72-74; and (6) There is no indication in the recording transcript cited that Lendian instructed Abreu to purchase a new cell phone under a false name, ECF No. [264-9] at 2-3. Defendants also note that the recordings support the following facts: (1) Neither Lendian nor Abreu indicated that Lendian “orchestrated” the theft scheme, see generally ECF Nos. [264-8] & [264-9]; (2) Neither Lendian nor Abreu indicated that Lendian was a “ringleader, ” see generally id.; (3) Neither Lendian nor Abreu indicated that Lendian directed Abreu to steal from Plaintiffs, see generally id.; (4) Neither Lendian nor Abreu indicated that Lendian knew the material purchased from Abreu was stolen, see generally id.; (5) Neither Lendian nor Abreu suggested that Lendian was responsible for Abreu's thefts, see generally id.; (6) Lendian did not know any of the alleged participants in the theft scheme, id. at 65; and (7) Lendian did not know that the materials were stolen, id. at 70.


         The standard of review on cross-motions for summary judgment does not differ from the standard applied when only one party files such a motion. See Am. Bankers Ins. Grp. v. United States, 408 F.3d 1328, 1331 (11th Cir. 2005). A court may grant a motion for summary judgment “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The parties may support their positions by citations to materials in the record, including, among other things, depositions, documents, affidavits, or declarations. See Fed. R. Civ. P. 56(c). An issue is genuine if “a reasonable trier of fact could return judgment for the non-moving party.” Miccosukee Tribe of Indians of Fla. v. United States, 516 F.3d 1235, 1243 (11th Cir. 2008) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986)). A fact is material if it “might affect the outcome of the suit under the governing law.” Id. (quoting Anderson, 477 U.S. at 247-48).

         A court views the facts in the light most favorable to the non-moving party, draws “all reasonable inferences in favor of the nonmovant and may not weigh evidence or make credibility determinations, which ‘are jury functions, not those of a judge.'” Lewis v. City of Union City, Ga., 934 F.3d 1169, 1179 (11th Cir. 2019) (quoting Feliciano v. City of Miami Beach, 707 F.3d 1244, 1252 (11th Cir. 2013)); Davis v. Williams, 451 F.3d 759, 763 (11th Cir. 2006); see also Crocker v. Beatty, 886 F.3d 1132, 1134 (11th Cir. 2018) (“[W]e accept [the non-movant's] version of the facts as true and draw all reasonable inferences in the light most favorable to him as the non-movant.”). “The mere existence of a scintilla of evidence in support of the [non-moving party's] position will be insufficient; there must be evidence on which a jury could reasonably find for the [non-moving party].” Anderson, 477 U.S. at 252. “If more than one inference could be construed from the facts by a reasonable fact finder, and that inference introduces a genuine issue of material fact, then the district court should not grant summary judgment.” Bannum, Inc. v. City of Fort Lauderdale, 901 F.2d 989, 996 (11th Cir. 1990). The Court does not weigh conflicting evidence. See Skop v. City of Atlanta, Ga., 485 F.3d 1130, 1140 (11th Cir. 2007) (quoting Carlin Comm'n, Inc. v. S. Bell Tel. & Tel. Co., 802 F.2d 1352, 1356 (11th Cir. 1986)).

         The moving party shoulders the initial burden to demonstrate the absence of a genuine issue of material fact. Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th Cir. 2008). If a movant satisfies this burden, “the nonmoving party ‘must do more than simply show that there is some metaphysical doubt as to the material facts.'” Ray v. Equifax Info. Servs., LLC, 327 Fed.Appx. 819, 825 (11th Cir. 2009) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)). Instead, “the non-moving party ‘must make a sufficient showing on each essential element of the case for which he has the burden of proof.'” Id. (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)). The non-moving party must produce evidence, going beyond the pleadings, and by its own affidavits, or by depositions, answers to interrogatories, and admissions on file, designating specific facts to suggest that a reasonable jury could find in the non-moving party's favor. Shiver, 549 F.3d at 1343. Yet, even where a non-movant neglects to submit any alleged material facts in dispute, a court must still be satisfied that the evidence in the record supports the uncontroverted material facts proposed by the movant before granting summary judgment. Reese v. Herbert, 527 F.3d 1253, 1268-69, 1272 (11th Cir. 2008); United States v. One Piece of Real Prop. Located at 5800 S.W. 74th Ave., Miami, Fla., 363 F.3d 1099, 1103 n.6 (11th Cir. 2004) (“One Piece of Real Prop.”). Indeed, even “where the parties agree on the basic facts, but disagree about the factual inferences that should be drawn from those facts, ” summary judgment may be inappropriate. Warrior Tombigbee Transp. Co., Inc. v. M/V Nan Fung, 695 F.2d 1294, 1296 (11th Cir. 1983).

         Additionally, “cross motions for summary judgment may be probative of the nonexistence of a factual dispute, but this procedural posture does not automatically empower the court to dispense with the determination whether questions of material fact exist.” Ga. State Conference of NAACP v. Fayette Cty. Bd. of Comm'rs, 775 F.3d 1336, 1345-46 (11th Cir. 2015). Indeed, even where the issues presented on motions for summary judgment overlap, a court must consider each motion on its own merits, “resolving all reasonable inferences against the party whose motion is under consideration.” S. Pilot Ins. Co. v. CECS, Inc., 52 F.Supp.3d 1240, 1243 (N.D.Ga. 2014) (citing Am. Bankers Ins. Grp., 408 F.3d at 1331). In particular, where “the parties respond[] to each respective summary judgment motion with disputes as to the ‘undisputed' facts, add[] ‘material facts' of their own, and then repl[y] with subsequent objections to the other party's additional facts, ” the mere filing of cross motions for summary judgment is not conclusive. Id. Thus, where the parties disagree as to the facts, summary judgment cannot be entered unless one of the parties meets its burden of demonstrating that “there is no dispute as to any material facts with the evidence and all inferences drawn therefrom viewed in the light most favorable” to the non-moving party. Shook v. United States, 713 F.2d 662, 665 (11th Cir. 1983) (citing M/V Nan Fung, 695 F.2d at 1296-97).


         Plaintiffs' Motion for Summary Judgment argues that no genuine issue of material fact exists as to any of the elements of their federal and Florida RICO claims in Counts I, II, III, and IV of their Amended Complaint. Plaintiffs' arguments rely in part on adverse inferences derived from Lendian's prior invocation of his Fifth Amendment rights during his deposition, which they contend the Court should consider instead of Lendian's subsequent affidavit submitted at summary judgment. Defendants, on the other hand, move for summary judgment on all counts of Plaintiffs' Amended Complaint, arguing that Plaintiffs cannot establish the enterprise and continuity elements of their RICO claims and that they cannot establish a benefit conferred by Plaintiffs on their unjust enrichment claim. Defendants' Motion for Summary Judgment relies heavily on the statements set forth in Lendian's affidavit, which they contend the Court may properly consider as a valid withdrawal of a prior Fifth Amendment invocation. Thus, before examining the merits of the Motions, the Court must first address the propriety of the withdrawal of Lendian's Fifth Amendment invocation and his subsequent summary judgment affidavit.

         A. Withdrawal of Lendian's Fifth Amendment Invocation and Supplemental Affidavit

         Plaintiffs argue that the Court should draw adverse inferences against Defendants and that Lendian's affidavit should be disregarded for two reasons: (1) Lendian invoked the Fifth Amendment during his testimony at the preliminary injunction hearing and at his deposition and he should not now be allowed to submit an affidavit at summary judgment asserting facts he previously refused to provide, and (2) Lendian's statements in his affidavit are stale, self-serving, conclusory, and have no probative value as competent summary judgment evidence. Defendants argue against drawing adverse inferences, stating that Lendian's affidavit is permissible here because a party may properly withdraw a Fifth Amendment invocation in certain circumstances.

         1. Fifth Amendment Invocation and Withdrawal

         The United States Supreme Court has explained that the Fifth Amendment protects an individual from self-incrimination, in part, by affording the privilege “not to answer official questions put to him in any [] proceeding, civil or criminal, formal or informal, where the answers might incriminate him in future criminal proceedings.” Baxter v. Palmigiano, 425 U.S. 308, 316 (1976) (quoting Lefkowitz v. Turley, 414 U.S. 70, 77 (1973)); see also Davis-Lynch, Inc. v. Moreno, 667 F.3d 539, 547 (5th Cir. 2012) (“As a preliminary matter, it should be noted that a party may invoke the privilege against self-incrimination in a civil proceeding.” (footnote omitted)); Wehling v. Columbia Broad. Sys., 608 F.2d 1084, 1086 (5th Cir. 1979)[8] (“[I]t is clear that the Fifth Amendment would serve as a shield to any party who feared that complying with discovery would expose him to a risk of self-incrimination. The fact that the privilege is raised in a civil proceeding rather than a criminal prosecution does not deprive a party of its protection.”). “Accordingly, a party may invoke the Fifth Amendment privilege during the discovery process to avoid answering questions at a deposition, responding to interrogatories or requests for admissions, or to produce documents.” Davis-Lynch, Inc., 667 F.3d at 547 (footnote omitted).

         “Though constitutionally protected, a civil litigant's invocation of the privilege against self-incrimination during the discovery process is far from costless.” United States v. Certain Real Prop. & Premises Known as 4003-4005 5th Ave., Brooklyn, N.Y., 55 F.3d 78, 82 (2d Cir. 1995) (“Certain Real Prop.”). “[D]istrict courts possess wide discretion in response to a party's invocation of the Fifth Amendment.” Sec. & Exch. Comm'n v. Monterosso, 746 F.Supp.2d 1253, 1262 (S.D. Fla. 2010) (citing Sec. & Exch. Comm'n v. Colello, 139 F.3d 674, 677 (9th Cir. 1998); Wehling, 608 F.2d at 1089). Further, the Eleventh Circuit has stated that, in a civil action, “the court may draw adverse inferences against a party that invokes the Fifth Amendment.” Eagle Hosp. Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298, 1304 (11th Cir. 2009); Arango v. U.S. Dep't of the Treasury, 115 F.3d 922, 926 (11th Cir. 1997) (“[T]he Fifth Amendment does not forbid adverse inferences against civil litigants . . . who assert the privilege against self- incrimination. A party who asserts the privilege may not ‘convert [it] from the shield against compulsory self-incrimination which it was intended to be into a sword whereby [he] would be freed from adducing proof in support of a burden which would otherwise have been his.'” (citations omitted)). Accordingly, “a ‘party who asserts the privilege against self-incrimination must bear the consequence of lack of evidence,' and the claim of privilege will not prevent an adverse finding or even summary judgment if the litigant does not present sufficient evidence to satisfy the usual evidentiary burdens in the litigation.” Certain Real Prop., 55 F.3d at 83 (citations omitted).

         Nevertheless, the Supreme Court has also emphasized that the Constitution limits “the imposition of any sanction which makes assertion of the Fifth Amendment privilege ‘costly.'” Spevack v. Klein, 385 U.S. 511, 515 (1967). Moreover, under certain case-specific circumstances, a party may withdraw its invocation of the Fifth Amendment privilege against self-incrimination in a civil case. See Davis-Lynch, Inc., 667 F.3d at 547 (“Courts have weighed the specific facts of each case in which a civil litigant has attempted to withdraw his invocation of the Fifth Amendment privilege.”); Sec. & Exch. Comm'n v. BIH Corp., No. 2:10-CV-577-FTM-29, 2013 WL 6571472, at *2 (M.D. Fla. Dec. 13, 2013) (“Withdrawal ‘is dependent on the particular facts and circumstances of each case.'” (quoting Sec. & Exch. Comm'n v. Smart, 678 F.3d 850, 855 (10th Cir. 2012))). “Given this consideration - and because all parties should have a reasonable opportunity to litigate a civil case fully - courts should seek out ways to permit ‘as much testimony as possible to be presented in the civil litigation, despite the assertion of the privilege.'” Davis-Lynch, Inc., 667 F.3d at 547 (quoting Certain Real Prop., 55 F.3d at 84). As such, courts must “carefully balance the interests of the party claiming protection against self-incrimination and the adversary's entitlement to equitable treatment. Because the privilege is constitutionally based, the detriment to the party asserting it should be no more than is necessary to prevent unfair and unnecessary prejudice to the other side.” Monterosso, 746 F.Supp.2d at 1262 (citations omitted); Wehling, 608 F.2d at 1088.

Generally, “[t]he court should be especially inclined to permit withdrawal of the privilege if there are no grounds for believing that opposing parties suffered undue prejudice from the litigant's later-regretted decision to invoke the Fifth Amendment.” Conversely, withdrawal is not permitted if the litigant is trying to “abuse, manipulate or gain an unfair strategic advantage over opposing parties.” The timing and circumstances under which a litigant withdraws the privilege are relevant factors in considering whether a litigant is attempting to abuse or gain some unfair advantage.

Davis-Lynch, Inc., 667 F.3d at 547 (footnotes omitted). Thus, “a party may withdraw its assertion of the Fifth Amendment privilege, even at a late stage in litigation, if circumstances indicate that (1) the litigant was not using the privilege in a tactical, abusive manner, and (2) the opposing party would not experience undue prejudice as a result.” Id. at 548 (citing Sec. & Exch. Comm'n v. Graystone Nash, Inc., 25 F.3d 187, 193 (3d Cir. 1994)).

         “In the end, exactly how a trial court should respond to a request to withdraw the privilege - or indeed, more generally, how it should react to any motion precipitated by a litigant's assertion of the Fifth Amendment in a civil proceeding - necessarily depends on the precise facts and circumstances of each case.” Certain Real Prop., 55 F.3d at 85. In making this determination, however, courts must be cautious not to, “through inappropriate procedural remedies or unwarranted sanctions, unduly burden litigants' valid attempts to seek the protection that the privilege against self-incrimination provides.” Id. “Therefore, a party may withdraw its invocation of the Fifth Amendment privilege, even at a late stage in the process, when circumstances indicate that there is no intent to abuse the process or gain an unfair advantage, and there is no unnecessary prejudice to the other side.” Davis-Lynch, Inc., 667 F.3d at 548; Smart, 678 F.3d at 854-55 (“But ‘to prevent a party from converting the Fifth Amendment privilege from its intended use as a shield against compulsory self-incrimination into an offensive sword,' ‘a district court may strike conclusory testimony if the witness asserts the Fifth Amendment privilege to avoid answering relevant questions, yet freely responds to questions that are advantageous to his cause.'” (citing United States v. $148, 840 in U.S. Currency, 521 F.3d 1268, 1277 (10th Cir. 2008))).

         Plaintiffs first argue that the Court should draw adverse inferences against Defendants based on Lendian's prior, repeated Fifth Amendment invocations. Thus, Plaintiffs contend that the Court should disregard Lendian's affidavit because permitting Lendian to submit an affidavit on issues that were previously said to be privileged in order to defeat summary judgment would be prejudicial to Plaintiffs. Defendants argue that Lendian's affidavit is a valid and permissible withdrawal of his prior Fifth Amendment invocation after learning that the DOJ was declining prosecution and closing the pending criminal investigation. Likewise, Defendants state that Lendian is available for a deposition, should Plaintiffs wish to take it instead of continuing to reply on stale adverse inferences.

         Although many Circuits across the country have addressed the withdrawal of a prior Fifth Amendment invocation, the Eleventh Circuit has not specifically addressed the issue. See, e.g., Davis-Lynch, Inc., 667 F.3d at 546 n.10 (collecting cases); Graystone Nash, Inc., 25 F.3d at 190-92 (collecting cases). However, “district courts possess wide discretion in response to a party's invocation of the Fifth Amendment.” Monterosso, 746 F.Supp.2d at 1262. Moreover, the Fifth Circuit has previously recognized the balance-of-interests approach in responding to parties' Fifth Amendment invocations, explaining that courts should “measure[] the relative weights of the parties' competing interests with a view toward accommodating those interests, if possible . . . [to] ensure[] that the rights of both parties are taken into consideration before the court decides whose rights predominate.” Wehling, 608 F.2d at 1088; Graystone Nash, Inc., 25 F.3d at 191 (“In a civil trial, a party's invocation of the privilege may be proper, but it does not take place in a vacuum; the rights of the other litigant are entitled to ...

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