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Albert v. Site Managment, Inc.

United States District Court, D. Maryland

February 28, 2014

MARC E. ALBERT
v.
SITE MANAGEMENT, INC., et al

For Marc E. Albert, Plaintiff: Janet M Nesse, LEAD ATTORNEY, Washington, DC.

For Site Management, Inc., Site Leasing, Inc., Defendants: Alan M Grochal, Lee Bryan Rauch, LEAD ATTORNEYS, Tydings and Rosenberg LLP, Baltimore, MD.

OPINION

Page 454

MEMORANDUM OPINION

DEBORAH K. CHASANOW, United States District Judge.

Presently pending and ready for review in this breach of contract case is a motion by Defendants Site Management, Inc. t/a Site Realty Group, and Site Leasing, Inc. to modify, or partially withdraw, the reference. (ECF No. 1). The issues have been briefed, and the court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, the motion will be denied.

I. Background

This case traces its lineage to the bankruptcy case Jin Suk Kim Trust d/b/a La Union Mall, No. 11-14033, in the United States Bankruptcy Court for the District of Maryland. In that bankruptcy case, Plaintiff was appointed as the disbursing agent to assist Debtor Jin Suk Kim Trust in carrying out the duties and responsibilities set forth in the Amended Plan of Reorganization (" Plan" ) approved by the Bankruptcy Court on July 27, 2012. (Civil Action No. 13-1853, ECF No. 1, ¶ 5). Debtor owned and operated the shopping center known as La Union Mall in Langley Park, Maryland (" Shopping Mall" ). ( Id. ¶ 10). Since 2009, Defendant Site Management had managed the Shopping Mall and Defendant Site Leasing leased space in the Shopping Mall. ( Id. ¶ ¶ 11, 15). Debtor applied to retain Defendants as its property manager and leasing agents which the Bankruptcy Court approved. ( Id. ¶ ¶ 12-13). Pursuant to this application, " the terms and conditions of any lease agreement were to be subject to the Debtor's final approval, were to be made in the Debtor's name, and were to be executed by the Debtor." ( Id. ¶ 18).

Plaintiff alleges that on the eve of the July 27, 2012 Plan confirmation, the Defendants negotiated a long-term lease, took substantial commissions, and disposed of assets, all while being instructed not to do so and without informing the Plaintiff or the Bankruptcy Court. ( Id. ¶ ¶ 21-23). It is further alleged that Defendants did not provide accurate receivables information to the Debtor, the Bankruptcy Court, and creditors. The bankruptcy plan was proposed and then approved by the court based upon this inaccurate information. ( Id. ¶ ¶ 24-25). Plaintiff alleges that Defendants failed to keep complete records; negotiated lease extensions to maximize their returns without full disclosure; failed to close accounts at the direction of Plaintiff; and prepared inaccurate monthly operating reports for submission to the Bankruptcy Court. ( Id. ¶ ¶ 26-29).

On June 25, 2013, Plaintiff filed a complaint in this court. (Civil Action No. 13-1853, ECF No. 1). Plaintiff claims that Defendants' actions constituted negligence, breach of contract and fiduciary duty, and fraud. Defendants moved to dismiss the complaint for (1) failure to join a necessary party pursuant to Federal Rule of Civil Procedure 12(b)(7);

Page 455

(2) lack of standing; and (3) failure to comply with an order of the Bankruptcy Court. (ECF No. 8). Plaintiff opposed the motion (ECF No. 10), and Defendants replied. (ECF No. 12). On September 25, 2013, the undersigned referred this case to Bankruptcy Judge Thomas Catliota pursuant to 28 U.S.C. § 157(a) and Local Rule 402. (ECF No. 13). Civil Action number 13-1853 was administratively closed on October 17, 2013.

Defendants filed a motion to modify, or partially withdraw, the reference pursuant to 28 U.S.C. § 157(d) on October 28, 2013. (Civil Action No. 14-360, ECF No. 1). Plaintiff opposed on November 7, 2013. (ECF No. 2). On December 12, 2013, Judge Catliota ruled that the bankruptcy court had subject matter jurisdiction of the referred case under 28 U.S.C. § 1334(b). (Adversary No. 13-554, Dkt. No. 29).[1] On December 17, 2013, Judge Catilota denied Defendants' motion to dismiss to the extent it was based on grounds two (2) and three (3). He denied the motion to dismiss on the remaining ground on January 28, 2014, after La Union Center, LLC filed a ...


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