United States District Court, E.D. Michigan, Southern Division
ORDER GRANTING PLAINTIFF'S MOTION FOR APPOINTMENT
OF RECEIVER [#7] and MOTION FOR EXPEDITED HEARING
Page Hood Chief Judge, United States District Court.
filed this mortgage foreclosure action on September 19, 2017,
when it was assigned to the Honorable Avern Cohn. On
September 25, 2017, Plaintiff filed a Motion for Appointment
of Receiver (“Receiver Motion”) [#7] and Motion
to Expedite Hearing on the Receiver Motion. [#8] The Receiver
Motion has been fully briefed. On October 16, 2017, this
action was reassigned to the undersigned as a companion case
to criminal case 17-20465 (the “Criminal Case”).
A hearing was set for and held on October 27, 2017. By virtue
of the hearing held on October 27, 2017, the Court
GRANTED the Motion to Expedite Hearing. For
the reasons set forth below, the Court grants the Receiver
M Rashid Holdings LLC (“Rashid Holdings”) is the
owner of property commonly known as 2990 W Grand Boulevard,
Detroit, Michigan (the “Property”). Plaintiff
issued a loan of approximately $2 million to Rashid Holdings
dated January 30, 2017 (the “Loan Agreement”),
with a mortgage on the Property securing the loan. Defendant
Mashiyat Rashid is a guarantor of the mortgage on the
6, 2017, Defendant Rashid was indicted for alleged attempt
and conspiracy to commit healthcare fraud and related claims
(the Criminal Case), and the Criminal Case remains pending.
On October 6, 2017, the Court entered an Order regarding the
Property in the Criminal Case. That Order provided for, among
other things, the appointment of a receiver for the Property
with the power and authority to maintain and sell the
Property. Until a receiver is appointed, all expenses related
to the Property require approval of Pretrial Services.
APPLICABLE LAW & ANALYSIS
appointment of a receiver is a matter of judicial discretion,
and the Court has inherent authority to appoint one. U.S.
v. Prod. Plated Plastics, Inc., 61 F.3d 904, at *7 (6th
Cir. 1995) (recognizing inherent power of courts to appoint
receiver); Federal Nat. Mortg. Ass'n v. Mapletree
Investors Ltd. Partnership, 2010 WL 1753112, at *3 (E.D.
Mich. 2010); Liberte Capital Group, LLC v. Capwill,
462 F.3d 543, 551 (6th Cir. 2006). “A district court
enjoys broad equitable powers to appoint a receiver over
assets disputed in litigation before the court. The
receiver's role, and the district court's purpose in
the appointment, is to safeguard the disputed assets,
administer the property as suitable, and to assist the
district court in achieving a final, equitable distribution
of the assets if necessary.” Liberte Capital,
462 F.3d at 551.
parties agree that the appointment of a receiver for the
Property is appropriate, and the parties acknowledge that the
Court ordered the appointment of a receiver in its October 6,
2017 Order in the Criminal Case. Accordingly, the Receiver
Motion is granted.
parties disagree on who should be appointed as receiver, and
each party has proposed a person for the Court to appoint as
receiver for the Property. Plaintiff seeks the appointment of
Michael A. Stevenson, and in their brief, Defendants sought
the appointment of Michael Kalil. At the hearing,
Defendants' argument focused more on having Michael Kalil
retained as the manager of the Property than as receiver for
the Property. The parties acknowledged that Plaintiff and its
proposed receiver have offered to retain Michael Kalil and
his company (NIA Farbman) as the manager of the Property.
Court notes that Defendants cannot control the terms of the
order of receivership. The terms of bond for Defendant Mayishat
Rashid (prior to his bond being revoked) provided that he was
not to have any involvement in the control of the Property,
and it appears to the Court that he likely violated those
conditions in a number of ways.
Court appoints Michael A. Stevenson as receiver for the
Property. The Court declines Defendants' request to
appoint Michael Kalil as receiver for the Property and leaves
the appointment of any Property ...