United States District Court, N.D. Indiana, Hammond Division
JAMES L. GAGAN, Plaintiff/Judgment Creditor,
JAMES A. MONROE, SBC CABLEVISION, et al., Defendants/Judgment Debtors.
ORDER AND OPINION
ANDREW P. RODOVICH, Magistrate Judge.
This matter is before the court on the Motion for Finding of Contempt and Sanctions and to Compel Discovery [DE 709] filed by the plaintiff, James L. Gagan, on August 5, 2014, the Motion to Stay Discovery [DE 711] filed by the defendant, James A. Monroe, on August 19, 2014, and the Motion to Provide Accounting and for Partial Satisfaction of Judgment [DE 714] filed by Monroe on September 23, 2014. For the following reasons, the Motion for Finding of Contempt and Sanctions and to Compel Discovery [DE 709] is GRANTED in part and DENIED in part, the Motion to Stay Discovery [DE 711] is DENIED, and the Motion to Provide Accounting and for Partial Satisfaction of Judgment [DE 714] is DENIED.
On June 20, 1994, the court entered a judgment against the defendants in the amount of $1, 710, 000.00 plus post-judgment interest at the rate of 5.31%. Since 1994, the plaintiff, James L. Gagan, has attempted to collect the judgment in multiple jurisdictions including California, Nevada, Oklahoma, Pennsylvania, and Arizona. He filed a Motion for Proceedings Supplemental on September 10, 2012 in this court. On September 11, 2012, the court granted the motion and ordered the defendant, James A. Monroe, to appear on October 16, 2012 for questioning and to respond to Gagan's discovery requests at least seven days before the October 16, 2012 hearing.
On the morning of the October 16, 2012 hearing, Monroe filed a Motion to Dismiss Proceeding Supplemental, which the court denied and rescheduled the Proceeding Supplemental hearing for December 17, 2012. On December 14, 2012, Monroe moved to continue the December 17, 2012 hearing. The court denied the motion, and Monroe failed to appear at the December 17, 2012 hearing or the January 3, 2013 hearing to show cause why he did not appear at the December 17, 2012 hearing. Ultimately, the court issued a bench warrant, and Monroe was arrested and appeared on June 3, 2013 for the Proceeding Supplemental hearing.
Gagan alleges that Monroe has failed to respond to the written discovery requests. Gagan further states that his counsel contacted Monroe's counsel on April 9, 2014 regarding the outstanding written discovery and that Monroe's counsel wrote on April 11, 2014 that he would respond to the discovery requests. However, Gagan contends that he has not received a discovery response from Monroe.
Monroe admits that the court ordered him to answer outstanding written discovery on June 3, 2013, but that he did not answer because settlement negotiations were ongoing and continued for several months following the hearing. Additionally, Monroe states that he received no requests for the outstanding discovery following the June 3, 2013 hearing until April 7, 2014.
In 1999, Gagan filed an action in an Arizona federal court, Gagan I, to collect this court's 1994 judgment. On May 31, 2013, Gagan filed a second action in an Arizona federal court, Gagan II, for fraudulent transfers of funds. On October 24, 2013, Monroe filed a motion to dismiss Gagan I for lack of jurisdiction. On December 9, 2013, Judge Robert Broomfield, who presides over Gagan I, transferred Gagan II to his court and stayed discovery in Gagan II pending the motion to dismiss in Gagan I. On December 30, 2013, Judge Broomfield stayed discovery in Gagan I, thus staying discovery in both Arizona matters while the motion to dismiss was pending. On March 18, 2014, Judge Broomfield dismissed Gagan I for lack of jurisdiction because Gagan failed to timely renew his judgment, but Gagan II is still pending.
On April 7, 2014, Monroe's counsel received a subpoena that was served on Monroe's accountant in Arizona. Gagan served the same subpoena on Monroe's accountant in Gagan I in November 2013, and the Arizona court quashed the subpoena on December 30, 2013. Under Federal Rule of Civil Procedure 45, Monroe's accountant needed to produce responsive documents in Phoenix, Arizona. Monroe filed a Motion for Sanctions in the Arizona federal court against Gagan for pursuing discovery through the Northern District of Indiana action. Additionally, Monroe moved to quash the Indiana subpoena because the Arizona federal court had stayed discovery in Gagan I & II while deciding a motion to dismiss for lack of jurisdiction.
On June 25, 2014, Gagan served Monroe with requests for production of documents. Gagan has not received a response to the requests for production of documents. Gagan's counsel discussed the requests for production with Monroe's counsel, but the parties did not reach an agreement to provide a response.
On September 10, 2012, Gagan filed an Emergency Motion to Enjoin Transfer of Assets or, Alternatively, Request for Temporary Injunction and Request for Expedited Hearing. In that motion, Gagan alleged that Monroe had assets located in multiple states. On September 21, 2012, this court issued an Order enjoining Monroe from "in any way transferring, encumbering, assigning, releasing, forgiving, and/or disposing of any or all of" his assets. [DE 660]. Gagan alleges that, on September 20, 2012, Monroe withdrew $115, 000 from his Oklahoma BancFirst account via $5, 000 in cash, three separate $30, 000 cashier checks, and one $20, 000 cashier check. Gagan further claims that, on October 16, 2012, Monroe filed a sworn, notarized Affidavit indicating that he had no assets of value, no prospects for obtaining assets, and no means to travel from Arizona to Indiana while possessing $110, 000 worth of BancFirst cashier checks. Gagan argues that Monroe then engaged in multiple transactions with Kimberly Sullivan and Lajunta Daniels, Monroe's daughters, to transfer and dissipate the entire $115, 000 to his daughters and to avoid Gagan's collection efforts.
Monroe alleges that he paid the $115, 000 in question as part of a $175, 000 payment deposited with the Clerk in this action after the proceeding supplemental hearing on June 3, 2013. Monroe claims he used some of the $115, 000 BancFirst funds for living expenses, but he retained the rest in a home personal safe in Arizona. Furthermore, Monroe indicates that any funds transferred or dissipated in transactions with his daughters were paid back before he submitted the $175, 000 payment deposited with the Clerk.
In addition to the $175, 000 payment, Monroe deposited $42, 503.73 from Massachusetts Mutual Life Insurance Company with the Clerk in June 2013. Furthermore, Gagan has gained a receivership, charging order, and order for levy/sale/or turnover of Monroe's interests in multiple business enterprises including Beta Tech Communications, Inc., Westcom Cable Vision, Gila River Cablevision, Inc., Salt River Cablevision, LLC, Comet Communications, LLC, SBC Cablevision East, LP, Crestmore Cablesvision, LLP, Monroe Consulting & Engineering, and Monroe-Perry Company. Gagan also obtained a turnover order for $120, 000 owed to Monroe by Central Arizona Communications and a Writ of Execution that allowed him to execute on Monroe's personal residence and ultimately led to the home's sale in November 2006. Monroe believes that Gagan has pursued and collected funds from the estate of Co-Defendant Victor Sharar and pursued collections against the defendants' real property in other jurisdictions.
Gagan alleges that Monroe has transferred or dissipated additional sums of money to avoid collection. Gagan claims that Monroe spent over $117, 000 on a home remodeling project in 2006 and paid Arizona attorney David Carmichael over $105, 000 in recent years. Additionally, Gagan alleges that Monroe transferred money to himself, withdrew $240, 447.91 from Ally Bank in January 2012, on April 27, 2012, wired $119, 000 to his daughter, Kimberly Sullivan, provided approximately $100, 000 to Sullivan to establish a Texas cable ...