Free Motion to Stay - District Court of Arizona - Arizona

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Gerald H. Goldstein TX Bar No. 08101000 Cynthia E. Orr TX Bar No. 15313350 Goldstein, Goldstein & Hilley 310 S. St. Mary's St., 29 th Floor San Antonio, Texas 78205 210-226-1463

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA UNITED STATES OF AMERICA, Plaintiff, versus § § § § § § § § § § § § § § § §

CIV-04-363-PHX-JWS CLAIMANTS' MOTION FOR STAY OF ENTRY OF ORDER OF SALE OF RES AND FOR IMMEDIATE TRANSFER, INSPECTION, AND ACCOUNTING

10 11 12 13 14 15 16 1. Lear Jet, Model 31A, Serial Number 31A-244, U.S. Registration No.N224LJ; 2. Agusta Helicopter, Model A 109E, Serial Number 11116, Mexican Registration Number XA-TSR; 3. Cessna Caravan, Model 208B, Serial Number 208B-0941, Mexican Registration Number XA-TUF, Defendants.

NOW COME CLAIMANTS Alberto Abed and Uptongrove, Ltd., and move the Court 17 to stay his entry of order of public sale of the res, Defendant Lear Jet Model 31A, N224LJ, 18 and further moves the Court to order the named aircraft transferred to proper storage for full 19 and immediate inspection and accounting of the res. 20 SUMMARY OF CLAIMANTS' REQUESTS 21 1. Claimants request that the Court stay his order of sale so that an inspection of the 22 Defendant aircraft may be made by an independent third party. If the Court does not stay the 23 order and allow this inspection, Claimants will suffer irreparable harm. The res in the action 24 before the Court has been damaged and is in jeopardy of further harm. If the aircraft is sold 25 or its condition altered, Claimants will suffer irreparable harm by being deprived of a 26 complete and contemporary report of the plane's condition. Claimants further request that 27 28 1

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the Court order the Defendant Lear Jet transferred to the custody of a third party bailee who will properly hanger the aircraft and prevent further deterioration. ARGUMENT A. The Government's Bailee Has Been a Poor Steward of the Defendant Aircraft. 2. On September 24, 2002, the Government seized the Defendant Lear Jet, a brand new aircraft valued at approximately six million dollars, and placed it in the custody of the current bailee, in Fort Lauderdale, Florida. Over the course of the last three years the Government's bailee has shown an unbroken pattern of neglect and disdain for the condition of this very valuable asset. Aircraft, especially sophisticated jet aircraft, must be maintained and flown according to regular schedule of comprehensive maintenance. Before its seizure, the Defendant Lear Jet was kept according to the well-respected "Maintenance Service Plan" developed by Honeywell, Inc. Flight logs were meticulously recorded, and the aesthetic aspects of the aircraft were in excellent condition. After the Defendant Lear Jet was seized, counsel for Claimant wrote to Plaintiff's bailee, requesting that the aircraft be maintained and its engines be started on a regular basis to ensure their proper preservation. Unfortunately, the Government's bailee has failed to adhere to the most basic industry standards for the maintenance of jet aircraft. Essential regular maintenance has lapsed, engines have not been started, no inspections have been performed, and the aircraft was left on the tarmac, exposed to the corrosive Florida weather (including the recent hurricanes that have swept the region) for nearly three years. A recent evaluation of the aircraft by a professional aircraft appraiser revealed significant and debilitating damage to the jet's engines, instrumentation, interior, and protective paint. In fact, when the nose cone of the Lear Jet was removed, a viscous green sludge poured from the airframe ­ a condition Claimant is assured does not occur in properly maintained aircraft. Additionally, rust can be seen on the engine and there are indications of internal corrosion of the plane's essential flight instruments. See Exhibits 1

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and 2.1 Extensive repair will be needed to restore the aircraft to an airworthy and marketable condition, as admitted by Plaintiff and its proposed order. This process of evaluating the damage caused to the aircraft is one the Claimants, having a property interest in the res, have a right to participate in as well. The Government's bailee's neglect has worked a substantial diminution in the value of the aircraft, and the Government should not unilaterally determine the extent of the damage it has caused. 3. Professional appraisal estimates the current "as is" value of the jet at $2,100,000. See Exhibit 1. Had the aircraft been properly cared for, its value would be an estimated $4,100,000. See Exhibit 1. Claimants have filed a counter-claim for damages with this Court and are contemplating further civil action seeking compensation for this damage. By making some of the necessary repairs the aircraft could bring a price of $3,100,000 and after making all necessary repairs and bring the aircraft up to current service standards it may bring a price of $3,700,000. See Exhibit 1 B. Defendant Aircraft Should be Transferred to the Custody of a Responsible, Independent Third Party Custodian. 4. Claimants request that the Defendant Lear Jet be transferred to the custody of the

16 Honeywell International, Inc. facilities at the Fort Lauderdale Airport where the aircraft is 17 currently located, or another adequately equipped facility, for proper storage and immediate 18 inspection and accounting. This will ensure no further damage is done to the jet, preserving 19 the res in the action before the Court and allowing Claimants and other interested parties a 20 complete and independent evaluation of the condition of the asset. It is imperative that this 21 be done before any sale of the aircraft. 22 PRAYER 23 In conclusion, in order to properly protect the res in the present forfeiture action and 24 25 26 27 28 Exhibit 2 are photographs of the aircraft which could not be uploaded on the Court's website, therefore, they will be submitted in paper format to the Court for filing and served on all parties. 3
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preserve its value, Claimants pray the Court stay the entry of his order for sale of Defendant 1 and order the Lear Jet Model 31A, N224LJ, immediately transferred to the custody of an independent third party custodian for proper storage and immediate inspection and accounting. Respectfully submitted, GERALD H. GOLDSTEIN Bar No. 08101000 CYNTHIA EVA HUJAR ORR Bar No. 15313350 GOLDSTEIN, GOLDSTEIN & HILLEY 310 S. St. Mary's St. 29 th Floor Tower Life Bldg. San Antonio, Texas 78205 210-226-1463 210-226-8367 facsimile BY: ____/s/________________________ Cynthia E. Orr CERTIFICATE OF SERVICE

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I HEREBY CERTIFY that on September 12 th , 2005, I electronically transmitted 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: Reid Pixler Assistant United States Attorney 2 Renaissance Sq. 40 N. Central, Ste. 1200 Phoenix, Arizona 85004-4408 [email protected] Allen B. Bickart 6508 N. 10 th Place Phoenix, Arizona 85014 [email protected] Douglas F. Behm Jennings Strouss & Salmon P.L.C. Collier Cntr. 201 E. Washington St., Ste. 1100 Phoenix, AZ 85004-2385 [email protected] Lawson Pedigo Miller, Keffer & Pedigo 4

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8401 N. Central Expressway, Ste. 630 Dallas, Texas 75225 [email protected] and via U.S. Mail, first class, to the following who are not registered participants of the CM/ECF: Jennifer Collins Mark Hopson Sidley, Austin, Brown & Wood 1501 "K" Street, N.W. Washington, D.C. 20005 Geoffrey Young Ruden McClosky 150 2 nd Ave., Suite 1700 St. Petersburg, FL 33701 Marc S. Nurik, Esq. Ruden, McClosky, Smith, Schuster & Russell, P.A. 200 East Broward Blvd., Ste. 1500 P.O. Box 1900 Ft. Lauderdale, FL 33302 and Leonard J. McDonald, Jr. Tiffany & Bosco, P.A. 2525 E. Camelback Rd. Phoenix, AZ 86015-4237. __/s/_______________________________ Cynthia E. Orr

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

UNITED STATES OF AMERICA, Plaintiff, versus 1. Lear Jet, Model 31A, Serial Number 31A-244, U.S. Registration No.N224LJ; 2. Agusta Helicopter, Model A 109E, Serial Number 11116, Mexican Registration Number XA-TSR; 3. Cessna Caravan, Model 208B, Serial Number 208B-0941, Mexican Registration Number XA-TUF, Defendants.

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CIV-04-363-PHX-JWS ORDER

CAME ON TO BE HEARD the Claimants' Motion for Stay of Entry of Order of Sale of Res and for Immediate Transfer, Inspection, and Accounting. The Court, after considering same, is of the opinion that the Motion should be GRANTED. It is therefore ­ ORDERED, ADJUDGED, and DECREED that no sale of Defendant 1 be had, and said aircraft to be transferred to the custody of an independent third party custodian for proper storage, inspection and accounting.

DATED: __________________

___________________________________ UNITED STATES DISTRICT JUDGE

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