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Glenclova Investment Co. v. Trans-Resources, Inc.

United States District Court, Second Circuit

November 12, 2013

GLENCLOVA INVESTMENT CO., Plaintiff,
v.
TRANS-RESOURCES, INC., and TPR INVESTMENT ASSOCIATES, INC., Defendants. TPR INVESTMENT ASSOCIATES, INC., Third-Party Plaintiff,
v.
ARIE GENGER, Intervenor/Defendant, Third-Party Defendant, and Counterclaim Defendant. ARIE GENGER, Counterclaim Plaintiff,
v.
GLENCLOVA INVESTMENT CO., and TPR INVESTMENT ASSOCIATES, INC., Counterclaim Defendants, and SAGI GENGER, DALIA GENGER, THE SAGI GENGER 1993 TRUST, ROCHELLE FANG, Individually and as Trustee of THE SAGI GENGER 1993 TRUST, TR INVESTORS, LLC, NEW TR EQUITY I, LLC, NEW TR EQUITY II, LLC, JULES TRUMP, EDDIE TRUMP, MARK HIRSCH, and TRANS-RESOURCES, INC., Additional Counterclaim Defendants.

John Dellaportas, MORGAN, LEWIS & BOCKIUS LLP, for TPR Investment Associates, Inc. and Sagi Genger.

Paul Montclare, Lauren Wachtler, MITCHELL SILBERBERG & KNUPP LLP, for Arie Genger.

Douglas Herrmann, John Boyle, SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, for Glenclova Investment Co.; Tr Investors, LLC; New Tr Equity, I, LLC; New Tr Equity II, LLC; Jules Trump; Eddie Trump; and Mark Hirsch.

OPINION & ORDER

JOHN F. KEENAN, District Judge.

TPR Investment Associates, Inc. and its CEO, Sagi Genger (together, "TPR"), move to lift the temporary stay that this Court imposed in its Opinion dated June 24, 2012. See Glenclova Inv. Co. v. Trans-Resources, Inc. , 874 F.Supp.2d 292 (S.D.N.Y. 2012) (hereinafter, the "Omnibus Opinion" or Glenclova). For the reasons that follow, TPR's motion is denied.

I. Background

A. The Parties and the Procedural History

The Court presumes familiarity with this dispute. See generally Glenclova , 874 F.Supp.2d at 295-300; Genger v. TR Investors, LLC , 26 A.3d 180, 183-90 (Del. 2011). For the purposes of resolving the instant motion, it is enough to recall that this action and the related state court cases began as a bitter quasi-familial battle for control of Trans-Resources, Inc. ("Trans-Resources"), a Delaware corporation that manufactures and sells chemicals for agricultural use. The disputants have included Arie Genger ("Arie") and his adult daughter Orly Genger ("Orly") in one camp; Arie's former wife Dalia Genger ("Dalia"), who is the trustee of a trust benefitting her estranged daughter Orly in a second camp; Glenclova Investment Co., TR Investors, LLC, New TR Equity I, LLC, New TR Equity II, LLC, Eddie Trump, Jules Trump, and Mark Hirsch (collectively, the "Trump Group") in a third; and former Trans-Resources majority owner TPR and its CEO, Sagi, who is Arie and Dalia's adult son.

By last year, the interested parties had created a "headache-inducing jurisdictional conflict" through the filing of numerous actions in various fora. Glenclova , 874 F.Supp.2d at 300. This Court attempted to impose some semblance of order on the proceedings by, among other things, staying the instant Glenclova action pending the litigation and resolution of certain claims in state courts. This Court also suggested to the parties that they agree to litigate in New York Supreme Court, in part because that court had personal jurisdiction over all the interested parties. See id. at 314. Since then, the parties have litigated in that forum as well as in Delaware.

The New York court recently dismissed Arie and Orly's claims seeking beneficial ownership of the Orly Trust shares. Arie has filed, but not perfected, an interlocutory appeal of that ruling. Other claims between Arie/Orly and TPR/Sagi continue to be litigated in that case.

In a narrower action, the Delaware Chancery Court also denied Arie's claim to beneficial ownership of the Arie Shares, and determined that he is not a record or beneficial stockholder of Trans-Resources. Arie is not appealing the Delaware decision. Thus, while the New York state action remains ongoing, the Delaware case is apparently final.

Finally, on June 20, 2013, all claims and counterclaims between Arie and the Trump Group in the instant action were voluntarily dismissed with prejudice.

B. The Instant Motion

TPR argues that the question of beneficial ownership of the disputed shares has been "conclusively resolved" by the Delaware and New York state courts, as well as by the recent settlement between Arie and the Trump Group. (TPR Br. at 1, 4.) TPR cites language from the Omnibus Opinion stating that this case "is stayed pending resolution of the question of beneficial ownership of the Arie Shares and Orly Trust Shares in the state courts." Glenclova , 874 F.Supp.2d at 314. TPR thus urges that the time has come to lift the stay, and that it should ...


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