United States District Court, E.D. Michigan, Southern Division
K. Majzoub, Mag. Judge.
ORDER GRANTING IN PART PLAINTIFF'S EMERGENCY
MOTION FOR RESTRAINING ORDER AGAINST STERLING RENTAL, INC.,
TRANSFER OF ASSETS, AND DEBTOR-CREDITOR EXAMINATION
E. LEVY, UNITED STATES DISTRICT JUDGE.
the Court is Plaintiff SeTara Tyson's unopposed emergency
motion for restraining order against Sterling Rental, Inc.,
transfer of assets, and debtor-creditor examination. (ECF No.
151.) Defendants were ordered to respond no later than Friday
December 6, 2019 and did not respond. (ECF No. 152.) Having
considered the unopposed motion and applicable law, the Court
grants in part and denies in part Plaintiff's motion for
the reasons set forth below.
Federal Rules of Civil Procedure expressly authorize
discovery “[i]n aid of the judgment or
execution.” Fed.R.Civ.P. 69(a)(2). The Sixth Circuit
has confirmed that “the scope of postjudgment discovery
is very broad.” United States v. Conces, 507
F.3d 1028, 1040 (6th Cir. 2007.) Rule 69 states: “[a]
money judgment is enforced by a writ of execution, unless the
court directs otherwise. The procedure on execution . . .
must accord with the procedure of the state where the court
is located[.]” Fed.R.Civ.P. 69(a)(1). Accordingly, the
procedures of Michigan law apply.
Plaintiff seeks a debtor-creditor examination of a Sterling
Rental corporate representative, Al Chami, and Rami Kamil in
order to discover the assets held by Defendants. Both Federal
Rule of Civil Procedure 69(a)(2) and Michigan law authorize
this type of post-judgment discovery. Michigan Compiled Laws
§ 600.6110(1) states:
[u]pon an affidavit, showing to the satisfaction of the judge
that any person has money or property of the judgment debtor,
or is indebted to him, the judge may issue a subpoena
requiring the judgment debtor or person or both to appear at
a specified time and place, and be examined on oath, and to
produce for examination any books, papers, or records in his
or its possession or control with have or may contain
information concerning the property or income of the debtor.
argues that Defendants have not satisfied payment of
Plaintiff's award of damages, attorney fees, and costs in
this case and has supported this argument with an affidavit
to this effect. (ECF No. 151-5, PageID.1931.) Accordingly,
Plaintiff is authorized to issue a subpoena requiring
Defendants Sterling Rental, Inc., Al Chami, and Rami Kamil to
attend a debtor-creditor examination as provided by Michigan
Plaintiff seeks an order enjoining Defendant Sterling Rental,
Inc. from transferring assets. Michigan Compiled Laws §
(1) An order for examination of a judgment debtor may contain
a provision restraining the judgment debtor from making or
suffering any transfer or other disposition of, or
interference with any of his property then held or thereafter
acquired by or becoming due to him not exempt by law from
application to the satisfaction of the judgment, until
further direction in the premises, and such other provisions
as the court may deem proper.
(2) Unless previously vacated by order of the court or by
stipulation of the parties in writing, a restraining
provision as herein provided shall remain in full force and
effect for a period of 2 years from the date thereof, at
which time it shall be deemed vacated for all purposes unless
extended by order of the court for good cause shown.
argues that she has no information regarding Sterling
Rental's assets. She argues that, as a used car lot,
Sterling Rental could transfer all of its assets to new
ownership “simply by signing the titles to a new
company.” (ECF No. 151, PageID.1891.) She also states
that since entry of judgment, Defendant's counsel
indicated that Sterling would “go bankrupt rather than
pay the judgment.” (Id.)
Court takes these allegations seriously and notes that
Defendant has not responded or otherwise offered another
explanation for why it has not paid Plaintiff's award in
full. Despite this concern, an order enjoining Defendant from
transferring any assets to a third party may effectively halt
Defendant's business operations of selling and leasing
used cars, which may make it more likely that Defendant will
not pay Plaintiff her award. Accordingly, Plaintiff's
motion to enjoin the transfer of assets is granted in part.
Sterling Rental may continue to sell and lease vehicles only
in the ordinary course of business. If, after conducting
postjudgment discovery as set forth in this order, Plaintiff
discovers that Defendant has transferred any of its assets in
bad faith or for the purpose of avoiding payment of
Plaintiff's award, Plaintiff may present this motion
reasons set forth above, Plaintiff's motion to conduct
postjudgment discovery is GRANTED and Plaintiff's motion
to enjoin transfer of ...