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CP Investors Group, LLC v. Deutch

United States District Court, S.D. New York

April 3, 2014

CP INVESTORS GROUP, LLC, Plaintiff,
v.
IRWIN JAY DEUTCH, et al., Defendants.

OPINION AND ORDER

LORNA G. SCHOFIELD, District Judge.

Plaintiff CP Investors Group, LLC ("CP Investors") brought this case to enforce its settlement agreement with Defendants Irwin Jay Deutch, Century Pacific Holding Corporation ("Century Pacific") and CP Affordable Housing Value Fund I, LP ("CP Fund"). Defendants do not dispute the existence of the agreement or their failure to make payments as the agreement requires. Defendants do question this Court's subject matter jurisdiction, which is based on the parties' diversity of citizenship. Based on the undisputed facts, Plaintiff moves for summary judgment on the merits. Defendants cross-move to obtain discovery on the jurisdictional issue. Because Plaintiff has submitted evidence sufficient to establish diversity of citizenship, and because the underlying facts are undisputed, Defendants' Cross-Motion for Discovery is denied, and Plaintiff's Motion for Summary Judgment to enforce the settlement agreement is granted.

BACKGROUND

The following facts are taken from the Complaint, Plaintiff's Rule 56.1 Statement of Undisputed Facts, Defendants' Counter-Statement and exhibits accompanying the parties' submissions.

Plaintiff CP Investors is a limited liability company with 11 members, all of whom are natural persons. The Complaint alleges that each member is a citizen of either New York or New Jersey. Their membership interests in CP Investors have never been assigned or transferred to any other person or entity.

Defendant Deutch is a citizen of California. Defendant Century Pacific is a Delaware corporation with its principal place of business in California. Defendant CP Fund is a limited partnership, the partners of which are citizens of either California or Delaware.

On March 6, 2012, Plaintiff entered into an agreement with Defendants to settle certain claims that Plaintiff believed it had against Defendants. The agreement ("Settlement Agreement") provides, in relevant part:

1. Payment Obligations.
(a) Notwithstanding anything to the contrary contained in any agreement, instrument or document, or otherwise, including without limitation the Limited Partnership Agreement... of [CP Fund] ("LPA"), the parties hereto agree that the limited partnership interest in [CP Fund] is hereby redeemed by [CP Fund] in return for which (i) on June 30, 2013, [CP Investors] shall receive a payment equal to $412, 500 in cash, plus interest accruing from and after the date hereof at the rate of 5% per annum ("First Payment") and (ii) on January 15, 2015, [CP Investors] shall receive a payment equal to $1, 237, 500 in cash, plus interest accruing from and after the date hereof at the rate of 5% per annum ("Second Payment" and collectively with the First Payment, the "Payments")..
(b) In the first instance, the First Payment and the Second Payment shall be payable by [CP Fund]; provided that in the event [CP Fund] does not make a First Payment or the Second Payment for any reason whatsoever within 10 calendar days of each period contemplated in clause (a) above, [Century Pacific] shall make such payment immediately; provided, further, that in the event neither [CP Fund] nor [Century Pacific] has made a First Payment or the Second Payment for any reason whatsoever as contemplated above, Irwin Deutch shall make such Payment immediately....
2. Certain Actions. Notwithstanding the LPA or any other document, neither Irwin Deutch, nor [Century Pacific], shall take any action with the design or probable effect of affecting the rights or obligations of [CP Investors]....
...
13. Fees and Expenses.... [I]n the event of litigation stemming from enforcement of rights hereunder, the losing party shall be responsible for the payment of legal fees of the prevailing party.

Pursuant to the Settlement Agreement, the First Payment was due on June 30, 2013. Defendant CP Fund was required to make the Payments in the first instance; failing that, Defendant Century Pacific was required to make the Payments; and failing that, Defendant Deutch was required to make the Payments. On May 31, 2013, Plaintiff provided an account designation to Defendants to facilitate the wire transfer of the First Payment $412, 500 plus interest, or $439, 680. On June 17, 2013, Plaintiff again provided the account designation to Defendants, and asked that Defendants notify Plaintiff with respect to any disagreements on the requested amount. Defendants did not indicate any such disagreement. ...


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