Free Motion to Strike - District Court of Arizona - Arizona

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Law Office of James Burr Shields 382 East Palm Lane Phoenix, Arizona 85004-1531 (602) 307-0780 (Office) (602) 307-0784 (Facsimile)
James Burr Shields II, State Bar #011711 John A. Conley, State Bar #016429 Blake Simms, State Bar #021595 Attorneys for Plaintiff

IN THE UNITED STATES DISTRICT COURT IN AND FOR THE STATE OF ARIZONA

) ) ) ) ) Plaintiffs, ) ) vs. ) ) 5. Home Mortgage, Inc., an ) Arizona corporation conducting ) business in Arizona, ) 6. Carl Brown; ) 7. Molly Brown; ) 8. Greg Brown; ) 9. Jane Doe Brown; ) 10. Does 1-10; ) 11. XYZ Corporations; ) 12. Black Partnerships; ) ) Defendants. ) _________________________________)

1. 2. 3. 4.

Cathleen Channel, Theresa Wharry, Stacie Hanson, Monique Nichols,

Case No. CIV 2003-0100 PHX ROS PLAINTIFFS' MOTION TO STRIKE DEFENDANTS' MOTION TO DISMISS/ RESPONSE TO DEFENDANTS' MOTION TO DISMISS

Plaintiffs, Cathleen Channel, Theresa Wharry, Stacie Hanson, and Monique Nichols, by and through counsel undersigned, hereby file their Motion to Strike Defendants' Motion to Dismiss/Response to Defendants' Motion to Dismiss. Plaintiffs, as Defendants' motion does not comply with the Federal Rules of Civil Procedure, first requests the Court strike the motion. Plaintiffs also, in the event the Court wishes to address the merits, has also provided a substantive response. *** ***
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MOTION TO STRIKE Defendants have styled their motion a "Motion to Dismiss." Defendants appear to be proceeding under Rule 12(b)(6) of the Federal Rules of Civil Procedure, which governs claims in which a defendant argues the plaintiff has "fail[ed] to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). Rule 12 makes clear that a defendant must file any such motion to dismiss "before pleading if a further pleading is permitted." Fed.R.Civ P. 12(b). Defendants, on September 30, 2003, filed their Answer to Plaintiffs' Second Amended Complaint. Defendants' motion comes after the pleading closed and is untimely. Defendants' motion, then, is more in the nature of a Rule 12(c) motion for judgment on the pleadings. Fed.R.Civ.P. 12(c). The problem, however, is Defendant has presented in its motion matters outside the pleadings. For example, Defendants attached to their motion as exhibits documents neither party attached to the pleadings, including corporation commission records. Defendants' inclusion in its motion of matters outside the pleadings makes the motion more akin to a motion for summary judgment. Rule 56.1 of the United States District Court Local Rules of Civil Procedure requires a party filing a motion for summary judgment to "set forth separately from the memorandum of law, and in full, the specific facts on which that party relies in support of the motion." LRCiv 56.1. The statement of facts must also refer to the record. Id. Defendants' motion contains no separate statement of fact. Defendants do not, in order to support the facts it presents, make any reference to the record. As such, the motion is deficient. Plaintiffs believe Defendants' failure to comply with the applicable rules provides grounds for striking the motion. Even if the Court does not agree with Plaintiffs on that issue, the applicable law makes clear Plaintiffs' claims were timely. The legal authority supporting Plaintiffs' contention is below. ***
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MEMORANDUM OF POINTS AND AUTHORITIES I. Facts and Procedurally History Plaintiffs, Cathleen Channel, Theresa Wharry, Stacie Hanson, and Monique Nichols, are all former employees of HMI, the judgment debtor in this matter. HMI refused to pay Plaintiffs wages that were due at the time of the respective separation from the Company. On January 15, 2003, after several unsuccessful attempts by Plaintiffs to obtain their withheld wages through less formal means, Plaintiffs filed suit against HMI. HMI never responded. On April 21, 2003, Plaintiffs filed an application for default with the necessary supporting documents and also filed a motion for attorney's fees. On April 24, 2003 the clerk entered the default of HMI. On June 6, 2003, Plaintiffs' filed with the Court an Application for Default Judgment, a Proposed Form of Judgment, and a motion for an award of fees and costs. On June 20, 2003, the Court entered judgment for Plaintiffs against HMI. The judgment totaled $232,241.34, plus $285 in costs and $4,390.82 in attorney's fees. Plaintiffs, on August 26, 2003, filed a motion for leave to amend their complaint to include as defendants in this case, Carl and Molly Brown, husband and wife, and Greg and Jane Doe Brown, husband and wife. Plaintiff, on the same date, filed a motion to amend the judgment to reflect a prejudgment interest rate of 10% per annum. On August 29, 2003, the Court granted both Plaintiffs' motion to add Carl and Molly Brown and Greg and Jane Doe Brown as individual defendants and their motion to amend the judgment. On September 11, 2003, Plaintiffs' submitted their Second Amended Complaint in which they added as defendants the Carl Brown and Molly Brown. The Second Amended Complaint, which is the operative complaint in this matter, alleged Carl Brown, Molly Brown, and Greg Brown, as officers and shareholders of HMI, were individually liable to Plaintiffs. Plaintiffs, on October 23, 2003, filed a motion for summary judgment against Carl Brown and Molly Brown. Plaintiffs, in the motion, argued Defendants Carl Brown and Molly Brown were directly liable for wages under the Arizona Wage Payment Act and also that Defendants Carl Brown and Molly Brown and HMI were
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alter egos and that the Browns were jointly responsible for HMI's debts. Another shareholder and former officer of HMI, Greg Brown, on December 15, 2003, filed a motion to dismiss Plaintiffs' claims.1 The Court, on March 28, 2005, issued an order denying Plaintiffs' motion for summary judgment and also denying Defendant Greg Brown's motion to dismiss. The Court, in its September 19, 2005, Order made it clear it would allow Plaintiffs to go forward with their alter ego claims against Carl Brown and Molly Brown. Plaintiffs have, through discovery, continued to accumulate evidence that will allow them to pierce HMI's corporate veil and hold responsible for HMI's failure to pay wages Defendants Carl Brown and Molly Brown. Defendants, on August 31, 2006, filed a Motion to Dismiss Plaintiffs' claims. Defendants, in the motion, argue Plaintiffs' claims against Carl Brown and Molly Brown were untimely. Defendants contend a one-year statute of limitations applies to Plaintiffs' wage claims.2 Defendants argue that, since Plaintiffs' collective employment with HMI ended in or about April of 2002, any claim they asserted after April of 2003, is time-barred under the statute of limitations. Plaintiffs acknowledge they first named as defendants Carl Brown and Molly Brown on September 11, 2003. September 11, 2003 is, as Defendants state, beyond one year from the dates Plaintiffs' employment with HMI ended. The case law, however, is universal in holding that the relevant statute of limitations in alter ego claims against shareholders/officers where the plaintiffs have already obtained against the corporation a money judgment is the statute of limitations governing actions on judgments. In Arizona, Plaintiffs subsequently entered into an arrangement with Greg Brown and Jane Doe Brown and voluntarily dismissed them from the case.
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Plaintiffs disagree that wage claims under the Arizona Wage Payment Act are subject to a one-year statute of limitations. As the case law clearly demonstrates Plaintiffs' claims against Carl Brown and Molly Brown are subject to the statute of limitations for actions on judgments, it is very likely the Court will not need to decide the statute of limitations for wage claims.
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the statute of limitations for actions on judgments is five years. As such, Plaintiffs' claims were clearly timely. The legal authority in support of Plaintiffs' position is below. II. Relevant Legal Authority A. Limitations Period for Actions on Judgments Governs Plaintiffs' Claims As stated above, Defendants' argument is that Plaintiffs claims against Carl Brown and Molly Brown are, as Plaintiffs named them as defendants more than one year from the date their wages became due, untimely. Courts, however, have consistently held, where there is already a judgment against a corporation, subsequent alter ego claims against shareholders/officers of that corporation are subject to the statute of limitations governing actions on judgments. See, e.g., WM. Passalacqua Builders, Inc., v. Resnick Developers South, Inc., 608 F. Supp. 1261, 1264 (D.C.N.Y. 1985); Turner Murphy Company v. Specialty Constructors, Inc., 659 So.2d 1242, 1245-46 (Fla. Ct. App. 1995); Peetoom v. Swanson, 778 N.E.2d 291, 295-96 (Ill. Ct. App. 2002); Belleville v. Hanby, 394 N.W.2d 412, 414 (Mich. Ct. App. 1986); Norwood Group, Inc. v. Phillips, 828 A.2d 300, 302-03 (N.H. 2003); Oceanics Schools, Inc. v. Barbour, 112 S.W.3d 135, 142-45 (Tenn. Ct. App. 2003). These cases hold the statute of limitations for enforcing a judgment, rather than the statute of limitations for the underlying claim, governs when a plaintiff seeks to pierce the corporate veil and hold a shareholder liable for an prior judgment against the corporation. In Norwood Group, Inc. v. Phillips, the plaintiffs originally brought against the corporation an action on a promissory note. Norwood Group, Inc. v. Phillips, 828 A.2d 300, 301 (N.H. 2003). The plaintiffs brought this original action in 1995 and obtained a judgment for the amount due on the note. Id. The plaintiffs, who were unable to collect from the corporation the amount of the judgment, eventually brought against the corporation's shareholders an alter ego claim and attempted to hold them liable for the judgment. Id. The plaintiffs filed the alter ego claim in April of 2002. Id. The defendants, arguing the plaintiffs had brought their claim several years beyond the three-year statute of limitations governing a personal action, contended the plaintiffs'
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claims were untimely. Id. at 302. The trial court agreed and granted the defendants' motion to dismiss. Id. The plaintiffs appealed. Id. On appeal, the defendants renewed their argument that the three-year statute of limitations applicable to the plaintiffs underlying claims (their claims under the promissory note) applied and that the plaintiffs' claims were, therefore, untimely. Id. The plaintiffs argued that they, in the current action against the individual defendants, were seeking to enforce the judgment they previously obtained against the corporation and that the statute of limitations governing actions on judgments should apply. Id. The Norwood court reviewed the applicable case law and found persuasive the fact that: Courts in other jurisdictions, however, have ruled that where, as here, a party first obtains a judgment against a corporation and later sues corporate stockholders to cast them in judgment under the doctrine of piercing the corporate veil, the suit against the stockholders is an action on a judgment. Id. at 302. The court held the plaintiffs' subsequent alter ego claim was merely an action on the existing judgment against the corporation and that the proper statute of limitations to apply was the one governing actions on judgments. Id. The court noted the statute of limitations for actions on judgments in New Hampshire is ten years and, as such, the plaintiffs' claims were timely. Id. As the above authority clearly demonstrates the statute of limitations for actions on judgments will govern Plaintiffs' alter ego claims against Carl Brown and Molly Brown, HMI's primary shareholders. The statute of limitations for actions on judgments in Arizona is five years. A.R.S.. § 12-1551(A). Plaintiffs, then, had five years from the date of the entry of judgment within which to bring against Carl Brown and Molly Brown their alter ego claim. In the case at bar, Plaintiffs filed suit against the corporation, HMI, on January 15, 2003, which was well before the expiration of one year from Plaintiffs' respective separation dates. Plaintiffs obtained against HMI a money judgment on June 20, 2003. Plaintiffs, not even three months later, on September 11, 2003, filed alter ego claims against Carl Brown and Molly Brown, HMI's primary shareholders. Plaintiffs' claims, then,
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are unquestionably timely. B. Plaintiff's Second Amended Complaint Relates Back 1. Rule 15(c) Amendments Rule 15(c) of the Federal Rules of Civil Procedure allows, in certain sets of circumstances for an amendment to "relate back" to the date of the original complaint. Fed.R.Civ.P. 15(c). A court should hold that an amendment relates back when: The claim or defense asserted in the amended pleading arose out of the conduct, transaction or occurrence set forth or attempted to be set forth in the original pleading. Fed.R.Civ.P. 15(c)(2). An amendment adding a party is proper when: The amendment changes the party or the naming of the party against whom a claim is asserted if the foregoing provision (2) is satisfied and, within the period provided by Rule 4(m) for service of the summons and complaint, the party to be brought in by amendment (A) has received such notice of the institution of the action that the party will not be prejudiced in maintaining a defense on the merits, and (B) knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against the party. Fed.R.Civ.P. 15(c)(3). The requirements of Rule 15 are clearly met with respect to Plaintiffs' Second Amended Complaint. An amendment adding new parties relates back to the original complaint if the proposed new parties have an identity of interest with the originally named party. Brink v. First Credit Resources, 57 F. Supp.2d 848, 853 (D. Ariz. 1999). There exists between two parties an identity of interests where "the parties are so closely related in their business operations or other activities that the institution of an action against one serves to provide notice of the litigation to the other." G.F. Co. v. Pan Ocean Shipping Co., Ltd., 23 F.3d 1498, 1503 (9th Cir. 1994). The relevant facts in Brink v. First Credit Resources are nearly indistinguishable from the facts in the present case and will provide strong guidance for the Court's decision herein. 2. Brink v. First Credit Resources ­ Notice to Proposed Parties In Brink, the plaintiff filed a claim for an alleged violation of the Fair Debt Collection Practices Act ("FDCPA"). Brink v. First Credit Resources, 57 F. Supp.2d 848, 851 (D.
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Ariz. 1999). The plaintiff initially brought suit against only the corporation responsible for sending the notice the plaintiff alleged violated the FDCPA. Id. The statute of limitations for FDCPA claims is one year. 15 U.S.C. § 1692k(d). The plaintiff's initial complaint was filed within one year of the alleged FDCPA action. The plaintiff, at some point after filing the initial complaint, sought to amend his complaint to add as defendants two officers of the defendant corporation the plaintiff originally sued. Id. at 851. The plaintiff filed his proposed amendment after the one-year statute of limitations had expired. Id. at 852. The defendants, as Defendants herein have done, argued that the proposed amendment adding as defendants the corporation's officers was untimely since it came after the expiration of the statute of limitations. Id. at 853. The court disagreed, holding the proposed amendments to add as defendants the corporate officers related back to the date of the original complaint. The defendants argued that while they, within the 120 days specified by Rule 4(m), receive sufficient notice of the plaintiff's complaint, allowing the officers to be added as defendants would constitute undue prejudice. Id. at 855. First, the court noted that there is an identity of interest between a corporation and that corporation's officers. Id. at 854. The court went on to hold that notice is imputed to a corporation's officers on the same day the corporation receives notice of the suit. Id. at 855. The court justified its holding on several grounds. It indicated that since the corporation's officers had the same amount of time as the corporation to prepare a defense to the plaintiff's claims, the individual officers would suffer no prejudice by being added as defendants. Id. The court also reasoned that there was no prejudice, because the officers had access to the same records necessary to generate a defense as did the corporation. Id. In the case at bar, it is beyond dispute that Carl Brown, the dominant shareholder in and an officer of HMI, within the time period set forth in Rule 4(m) of the Rules of Civil Procedure, received notice of Plaintiffs' claims. Plaintiffs' filed their original complaint on January 15, 2003, which is well within one year of the date on which Plaintiffs ceased to be

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employees of HMI.3 Plaintiffs' process server served upon Carl Brown the initial complaint on February 24, 2003. As such, Carl Brown, the individual at the center of Plaintiffs' claims, had timely notice of Plaintiff's claims against HMI. Carl Brown received actual notice of Plaintiffs' complaint on the day HMI received notice. As such, Carl Brown, as an officer and shareholder of HMI, has suffered no prejudice since he had the same amount of time to prepare a defense to Plaintiffs' claims as did HMI and had access to the same records as did HMI. 3. Mistake As stated above, Rule 15(c) requires, in order for an amendment adding a party to relate back to the date of the original complaint, that the party sough to be added "knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against the party." Fed.R.Civ.P. 15(c)(3)(B). In Brink, the corporate officers argued plaintiffs had not satisfied the "mistake" element of Rule 15(c)(3). Id. at 856-58. First, the court noted that the Ninth Circuit interpreted the mistake element of Rule 15(c)(3) more broadly than did other circuits. Id. at 856. The court went on to reject the defendants' argument on this point and held that when a plaintiff, at the outset of the litigation, is unaware of the identity of the parties it seeks to add pursuant to Rule 15(c), the plaintiff has satisfied the mistake requirement of 15(c)(3). The court, in Brink, noted that the plaintiff attempted, within the limitations period, to discover the identity of individuals within the corporation who might be liable for the alleged violations of the FDCPA. Id. at 857. Instead of providing adequate responses to the plaintiff's inquiries, the defendant corporation objected and sought from the court a protective order. Id. at 857. The plaintiff was not able to discover the names of the officers against whom he sought to assert claims until the court ordered it to provide that

Plaintiffs, in section II.A, infra, set forth their disagreement with Defendants as to the statute of limitations applicable to claims advanced pursuant to Section 355 of Title 23 of the Arizona Revised Statutes. However, a ruling on that issue is not necessary since it is clear that the amendment at issue herein related back to the date of the original complaint.
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information. Id. This occurred after the statute of limitations expired. Id. As such, the plaintiff was not able to obtain the information he sought until after the expiration of the statute of limitations. Id. The court held, "it is inappropriate for a defendant to withhold information that the plaintiff is seeking and then use the statute of limitations as a defense when the plaintiff finally gains the information and attempts to use it." Id. In the present case, HMI did not appear to defend. As such, Plaintiffs were unable to, prior to obtaining against the company a sizeable default judgment, obtain any information on the company's management structure. Plaintiffs would have, had HMI appeared in the underlying action, sought to obtain through proper discovery requests information such as, whether any individual within HMI possessed sufficient authority and control over company to justify holding individuals liable for unpaid wages, the financial condition of the company, the names of the corporation's shareholders, the percentage of ownership of each shareholder, the names and respective titles of the corporation's officers, the individual(s) with the greatest control over the corporation's operations, etc. Again, Defendant HMI's strategic decision to not respond to Plaintiffs' complaint prevented Plaintiffs from obtaining, within the limitations period, the information it would have needed to add as defendants Carl Brown and Molly Brown. Plaintiffs were able to obtain the information they needed to determine who else might be liable to them for their unpaid wages only after they conducted a debtor's examination of HMI. Carl Brown attended HMI's debtor's examination on August 4, 2003. During that examination, which was recorded by a court reporter, Plaintiffs' gained information about HMI's management structure, its shareholders, its officers, its financial condition, etc. On August 26, 2003, just a few weeks after discovering the above information, Plaintiffs filed their motion for leave to amend the complaint. On September 11, 2003, Plaintiffs, after receiving from the Court authorization to do so, filed their Second Amended Complaint. That is, Plaintiffs' within almost one month of discovering the information it needed to add the Browns as defendants, amended their complaint adding them as defendants. Had HMI not, by deliberately failing to appear in the action, withheld
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that information, Plaintiffs would have moved to add as defendants the Browns much sooner. Importantly, courts have held piercing the corporate veil claims should relate back to timely claims against an alter ego. See, e.g., Ex Parte Empire Gas Corp., 559 So. 2d 1072 (Ala. 1990) (holding Amendment to add party defendant related back to date of filing original petition where amendment only added parent corporation because parent corporation had notice of claims made from time action was filed); Williams v. Avery Dev. Co.-Boca Raton, 910 So.2d 851 (Fl.Ct.App. 2005) (holding alter ego claim related back to date of the original complaint). Other courts have issued rulings supporting Plaintiffs' positions. See, e.g., Itel Capital Corp v. Cups Coal Co., Inc., 707 F.2d 1253 (11th Cir. 1983) (holding, for purposes of relating back to the original complaint an amendment adding a corporation's officer and sole shareholder, that a corporation and its officers and shareholders shared an identity of interest); Spiker v. Hoogeboom, 628 P.2d 177 (Colo. Ct. App. 1981) (holding, for purposes of relating back to the original complaint an amendment adding as a defendant a corporation's officer, that a corporation and its officers shared an identity of interest); Berlin v. Boedecker, 887 P.2d 1180 (Mont. 1994) (holding, for purposes of relating back to the original complaint an amendment adding as a defendant a corporation's officer, that a corporation and its officers shared an identity of interest); White v. Lordell, 678 P.2d 637 (Mont. 1984) (holding, for purposes of relating back to the original complaint an amendment adding as a defendant a corporation's officer, that a corporation and its officers shared an identity of interest). See also, e.g., Galion v. Conmaco Intern., Inc., 658 P.2d 1130 (N.M. 1983) (holding, for purposes of relating back to the original complaint an amendment adding as a party parent corporation, that a parent corporation and its subsidiary corporation shared an identity of interest). Courts have also held that there is, for purposes of relating back to the date of the original complaint, an identity of interest when the original defendant and the defendant the plaintiff seeks to add to the complaint are represented by the same attorney. See, e.g., Jacobsen v. Osborne, 133 F.3d 315, 320 (5th Cir. 1998). The same attorney who represented HMI in this matter has also represented Carl
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Brown throughout these proceedings. This is further evidence that there exists between the Browns and HMI an identity of interest. C. Statute of Limitations for Ariz. Rev. Stat. § 23-355 Claims Additionally, Plaintiffs take issue with Defendants' claim that the applicable statute of limitations for wage claims under A.R.S. § 23-355 is one year. The Arizona Wage Payment Act, itself, provides no statute of limitations for private causes of action to recover wages. See A.R.S. § 23-350, et seq. As such, the Court must, in order to determine the appropriate statute of limitations for such claims, look to the statute of limitations provisions found in Title 12 of the Arizona Revised Statutes. Defendants argue that the statute of limitations contained in Section 541(5) of Title 12 of the Arizona Revised Statutes applies to Section 355 wage claims. Section 541(5) of Title 12 indicates that a party who seeks to hold a defendant civilly liable for violating a state statute must bring an action within one year after the cause of action accrues. A.R.S. § 12-541(5).4 That section states that a cause of action "[u]pon a liability created by statute, other than a penalty or forfeiture," must be "commenced and prosecuted within one year after the cause of action accrues." Id. (emphasis added). However, as the clear language of the provision demonstrates, the one year statute of limitations applies only to statutory causes of action that do not constitute a penalty or a forfeiture.

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Section 541, in its entirety, reads:

There shall be commenced and prosecuted within one year after the cause of action accrues, and not afterward, the following actions: 1. For malicious prosecution, or for false imprisonment, or for injuries done to the character or reputation of another by libel or slander. 2. For damages for seduction or breach of promise of marriage. 3. For breach of an oral or written employment contract including contract actions based on employee handbooks or policy manuals that do not specify a time period in which to bring an action. 4. For damages for wrongful termination. 5. Upon a liability created by statute, other than a penalty or forfeiture.
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If, on the other hand, a statutory claim amounts to a penalty or forfeiture, courts should not apply thereto the one-year statute of limitations of that section. See Gulf Homes, Inc. v. Gonzales, 676 P.2d 635, 640 (Ariz. Ct. App. 1983) (analyzing a state statute detailing with the proper procedures for disposing of collateral and holding that the statutory cause of action for wrongful disposal of collateral constituted a penalty and was not subject to the one-year statute of limitations contained in Section 541(5) of Title 12). Section 355 of Title 23 of the Arizona Revised Statutes clearly constitutes a penalty. See, e.g., Apache East, Inc. v. Wiegand, 580 P.2d 769, 773 (Ariz. Ct. App. 1978) (discussing the "treble damages penalty" of Section 355). As the cause of action created by Section 355 constitutes a penalty, the one-year statute of limitation of Section 541(5) does not apply. It is likely that an Arizona court, confronted with the issue, would hold that the three-year statute of limitations for oral contracts applies to Section 355 claims. See Ariz. Rev. Stat. § 12-543(1). Plaintiffs, in the present case, amended their complaint to include the Browns on September 11, 2003. This was less than two years following Plaintiffs' last day of work at HMI. As such, the amendment adding as defendants the Browns, in their individual capacities, came before the expiration of any possible statute of limitations, except the inapplicable limitations period set forth in Section 541(5). However, since it is crystal clear, based on Section II.A, supra, that the proper statute of limitations is the five-year statute of limitations on actions on judgments and based on Section II.B., supra, that said amendment will relate back to the date of the original complaint, the Court need not reach this more difficult question of law. III. Conclusion Plaintiffs' alter ego claims against Defendants Carl Brown and Molly Brown are subject to the five-year statute of limitations governing actions on judgments. Plaintiffs filed their complaint within five years of obtaining judgment against HMI, the Browns' alter ego. Further, Plaintiffs' claims against Carl Brown and Molly Brown relate back to the complaint they filed against HMI. Finally, the Arizona Wage Payment Act is not subject to a one-year statute of limitations.
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Plaintiffs, based on the foregoing, respectfully request that the Court deny Defendants' Motion to Dismiss. RESPECTFULLY SUBMITTED this 22nd day of September, 2006. LAW OFFICE OF JAMES BURR SHIELDS

____s/ W. Blake Simms__________________ James Burr Shields Blake Simms Attorneys for Plaintiffs CERTIFICATE OF SERVICE I hereby certify that on the 22nd day of September, 2006, I electronically submitted the attached document to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: John E. Karow, Esq. 11350 North 104th Place Scottsdale, Arizona 85259 Attorney for Defendants Dennis Hall, Esq. 14614 North Kierland Boulevard, Suite 300 Scottsdale, Arizona 85254 Attorneys for Defendant Greg Brown ____s/ Gail Ivey___________________

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