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LVB-Ogden Marketing LLC v. Bingham

United States District Court, W.D. Washington, Seattle

May 3, 2019

LVB-OGDEN MARKETING, LLC, Plaintiff,
v.
DAVID S. BINGHAM, SHARON BINGHAM, CHRISTOPHER BINGHAM, CHERISH BINGHAM, KELLY BINGHAM, BINGO INVESTMENTS, LLC, CCRB ENTERPRISES, LLC, PARK PLACE MOTORS, LTD., HYTECH POWER, INC., HENRY DEAN, as Trustee for the SHARON GRAHAM BINGHAM TRUST, and BGH HOLDINGS, LLC Defendants.

          ORDER

          Thomas S. Zilly United States District Judge

         THIS MATTER comes before the Court on Plaintiff's Ex Parte Motion for Freeze, docket no. 297. Having reviewed all papers filed in support of, and in opposition to, the motion, as well as the papers filed in response to the Court's Order to Show Cause, docket no. 299, the Court enters the following order.

         Background

         The facts of this long-running dispute have been summarized elsewhere. For purposes of this Order, the Court notes the following facts. On December 7, 2018, the Court entered an Order recognizing that “Plaintiff is entitled to seize any distributions made or hereafter distributed to Sharon Bingham and/or the [Sharon Graham Bingham 2007] Trust from the Fisher Trusts.” Order, docket no. 182, at 12. At the time, the Fisher Trust assets were subject to a separate garnishment action, No. 18-786, during which the assets were subject to a statutory freeze. See RCW 6.27.120. On February 27, 2019, the Court conducted a hearing in the garnishment proceeding, and concluded the Fisher Trust assets were not Sharon Bingham's property subject to garnishment. See Minutes and Judgment, No. 18-786, docket nos. 63 & 64. The Court denied Plaintiff's controversion of the answer and entered judgment in favor of the garnishee and Defendant Sharon Bingham. Id.

         Plaintiff then filed a notice of appeal in the garnishment action and moved ex parte for a freeze on the Fisher Trust assets pending that appeal. See Pltf.'s Ex Parte Motion for Freeze, No. 18-786, docket no. 65. The Court denied that motion by Minute Order on March 4, 2019, because the Court lacked jurisdiction in light of Plaintiff's appeal, and also because the Court had previously denied an oral motion requesting the same relief at the hearing. See Minute Order, No. 18-786, docket no. 67.

         Plaintiff then moved ex parte for a freeze in this action, not against the Fisher Trustee, but against dissipation of the assets by Defendants Sharon Bingham and Henry Dean as Trustee for the Sharon Graham Bingham 2007 Trust. See Pltf.'s Ex Parte Motion for Freeze, docket no. 297. The Court issued an order to show cause why the December 7, 2018 Order did not already prohibit dissipation of any distributions received by Sharon Bingham or the Sharon Graham Bingham 2007 Trust and ordered briefing on the issue. See Order, docket no. 299.

         Discussion

         The Court will grant Plaintiff's Motion for Freeze. The Court finds that because Plaintiff is seeking, in part, equitable remedies, this Order is appropriate to preserve assets. See In re Focus Media, Inc., 387 F.3d 1077, 1084-85 (2004) (holding that where a party alleges equitable causes of action, Grupo Mexicano de Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308 (1999) does not bar the issuance of a preliminary injunction freezing assets); see also Dargan v. Ingram, No. 08-1714, 2009 WL 1437564, *3 (W.D. Wash. May 22, 2009) (“The Court has inherent equitable power to issue provisional remedies, such as a freeze asset order, which are ancillary to its authority to provide final equitable relief.”).

         I. Likelihood of Success

         Plaintiff has already prevailed on its claim of entitlement to seize distributions to Defendants from the Fisher Trusts. See Order, docket no. 182 at 11. Plaintiff has therefore demonstrated more than a likelihood of success on the merits related to this claim.

         II. Irreparable Harm

         Since the initiation of this action in early 2018, the Sharon Graham Bingham 2007 Trust's assets have been dramatically reduced. Defendant Dean, as Trustee, testified in late 2018 that the Sharon Graham Bingham 2007 Trust “has no money” despite assets in excess of $18 million at the outset of this proceeding. See docket no. 215, Ex. A at 48:9-11. Defendants have also acted to circumvent this Court's orders regarding the so-called Self-Settled assets, by executing on those assets shortly after the Court entered an order deeming those assets self-settled and subject to seizure.

         III. Balance of Equities

         The equities favor an injunction. See Virtue Global Holdings Ltd. v. Rearden LLC, No. 15-797, 2016 WL 9045855, at *9 (N.D. Cal. June 17, 2016). Defendants do not argue the Sharon Graham Bingham 2007 Trust will be harmed in any way by an injunction ...


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