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Ward v. Coleman-Ward

United States District Court, W.D. Tennessee, Eastern Division

October 16, 2019

MAVIS WARD, Plaintiff,
v.
RONALD COLEMAN-WARD, FIRSTBANK, TROY BUTTREY, JONATHAN BELL, ROBERT NEWCOMB, and JOHN DOE, Defendants.

          ORDER DISSOLVING TEMPORARY RESTRAINING ORDER AND DENYING PRELIMINARY INJUNCTION

          S. THOMAS ANDERSON, CHIEF UNITED STATES DISTRICT JUDGE.

         On October 4, 2019, the Court granted Plaintiff Mavis Ward's motion for temporary restraining order.[1] The Court enjoined a foreclosure sale noticed for 10:00 a.m. and 10:30 a.m. on Monday, October 7, 2019, in Henry County, Tennessee. The Court held a hearing with the parties on Friday, October 11, 2019, to consider whether Plaintiff was entitled to a preliminary injunction. Plaintiff, who is representing herself in this matter, appeared by telephone, and counsel for Defendants FirstBank, Troy Buttrey, and Jonathan Bell appeared in court.[2] For the reasons set forth below, the Court hereby dissolves the October 4th temporary restraining order and denies a preliminary injunction to halt the foreclosure.

         BACKGROUND

         Plaintiff filed suit June 10, 2019, alleging a number of claims related to the affairs of her 55-acre family farm in Cottage Grove, Tennessee. According to the Complaint, Plaintiff has joint ownership with her son Ronald Coleman-Ward of the acreage, which Coleman-Ward operated as a cattle farm. Plaintiff alleges that she invested $193, 000 in the business and had an oral contract with her son for the repayment of her investment, presumably from the farm's profits. It is not clear from the pleadings whether Plaintiff funded her investment in the farm from her own assets or whether she borrowed the money from FirstBank with the farm property pledged as collateral. In any case, Plaintiff alleges that in May 2014 she refinanced the farm property with FirstBank in her name only for the amount of $189, 736.00. Plaintiff further alleges that she had an additional loan in her name only with FirstBank in the amount of $9, 883.63 to finance the purchase of cattle chutes and bush hog equipment.[3] At some point, the farm experienced the misfortune of losing one-third of the cattle herd to disease.

         The Complaint names Plaintiff's son and business partner Ronald Coleman-Ward, FirstBank, Troy Buttrey, Jonathan Bell, Robert Newcomb, and John Doe as Defendants. Plaintiff alleges causes of action for breach of implied contract, breach of contract, breach of fiduciary duty, violations of 42 U.S.C. § 1981, violations of the Equal Credit Opportunity Act, 15 U.S.C. § 1691, and tortious interference with a contract.[4] While all of the particulars of Plaintiff's allegations are not entirely clear, the gravamen of Plaintiff's Complaint is that her son entered into a loan modification or reorganization with FirstBank and that the bank and its employees somehow allowed him to do so without Plaintiff's informed consent or by means of some fraud on Plaintiff. Plaintiff specifically alleges that her son improperly obtained loans from FirstBank and pledged the 55 acres as collateral with the help of First Bank employees Troy Buttrey and Jonathan Bell and former FirstBank employee Robert Newcomb without proper notarization of Coleman-Ward's signature. Plaintiff alleges that by doing so, Buttrey, Bell, and Newcomb breached their fiduciary duty to Plaintiff and fraudulently induced her to sign a loan modification, because of her race in violation of 42 U.S.C. § 1981 and the Equal Credit Opportunity Act, 15 U.S.C. § 1691.[5] The Complaint seeks $850, 000.00 in compensatory, treble, punitive, and actual damages.

         In her motion for a TRO, Plaintiff sought relief in response to a notice of foreclosure she had received from counsel for FirstBank dated September 13, 2019. The letter stated that Plaintiff's note was delinquent and that the full amount of principal and interest was due and owing to the bank. Plaintiff argued that a TRO was justified based on the allegations of her Complaint as well as the fact that Robert Newcomb, a vice-president at the bank and one of the named Defendants in this action, was recently convicted of bank fraud in this Court. Plaintiff alleged that she was one of the victims of Newcomb's fraud, a scheme by which Newcomb defrauded her out of $30, 000 in connection with the sale of a tractor and overall in the amount of $100, 000 over a period of five years. The Court granted the motion and entered a temporary restraining order to enjoin the foreclosure sale until the parties could be heard further on the issue.[6]

         At the injunction hearing, Plaintiff addressed the Court first and reported on her recent health issues, the treatment she was receiving for the issues, and the medication she was currently taking. Plaintiff explained that her bouts with pain and vertigo had required her to see a doctor and begin taking medicine for pain. Plaintiff found that the medication caused dizziness and made her feel incoherent. Plaintiff argued that her current health condition justified extending the temporary restraining order. Plaintiff also expressed her desire to find an attorney to assist her in prosecuting her claims. Plaintiff stated that she cannot afford representation and that a retired lawyer in her church has referred her to a lawyer, apparently in Indiana where Plaintiff resides. Counsel for Defendants FirstBank, Buttrey, and Bell argued that the Court should lift the temporary restraining order since Plaintiff had not demonstrated irreparable harm. Plaintiff's ability to recover money damages will make her whole in the event she can prevail on her claims. FirstBank asserted that an injunction would continue to deprive the bank of its right to foreclose on the collateral. Counsel represented to the Court that there was currently no farming activity taking place at Plaintiff's property. The bank was therefore ready to proceed with the foreclosure.

         STANDARD OF REVIEW

         Federal Rule of Civil Procedure 65 governs the issuance of injunctions and restraining orders. “The only type of injunctive relief that a district court may issue ex parte [without notice] is a temporary restraining order.” First Tech. Safety Sys., Inc. v. Depinet, 11 F.3d 641, 650 (6th Cir. 1993). By its own terms, a TRO is of limited duration and simply preserves the status quo until both parties to a dispute have the opportunity to be heard. Once a temporary restraining order issues without notice, a district court must set a hearing on preliminary injunctive relief “at the earliest possible time, taking precedence over all other matters . . . .” Fed.R.Civ.P. 65(a)(3). “The purpose of a preliminary injunction is merely to preserve the relative positions of the parties until a trial on the merits can be held.” Univ. of Tex. v. Camenisch, 451 U.S. 390, 395 (1981).

         Just as with a TRO, a district court balances the following factors when deciding whether to grant a preliminary injunction: (1) the moving party's likelihood of succeeding on the merits; (2) the permanent harm to the moving party if the court does not grant an injunction; (3) the substantial harm the injunction would cause third parties; and (4) whether the injunction would serve the public interest. McGirr v. Rehme, 891 F.3d 603, 610 (6th Cir. 2018) (citing S. Glazer's Distribs. of Ohio, LLC v. Great Lakes Brewing Co., 860 F.3d 844, 849 (6th Cir. 2017)). Courts weigh the facts “against each other;” they do not serve as prerequisites. Overstreet v. Lexington-Fayette Urban Cnty. Gov't, 305 F.3d 566, 573 (6th Cir. 2002). No single factor is determinative except that “a finding that there is simply no likelihood of success on the merits is usually fatal.” Gonzales v. Nat'l Bd. of Med. Examiners, 225 F.3d 620, 625 (6th Cir. 2000).

         A party seeking the preliminary injunction has the burden of justifying injunctive relief, Handel's Enters., Inc. v. Schulenburg, 765 Fed.Appx. 117, 121 (6th Cir. 2019). Although a moving party need not prove the merits of her case at a preliminary injunction hearing, Certified Restoration Dry Cleaning Network, L.L.C. v. Tenke Corp., 511 F.3d 535, 542 (6th Cir. 2007) (quoting Camenisch, 451 U.S. at 395), the United States Court of Appeals for the Sixth Circuit has held that “the proof required for the plaintiff to obtain a preliminary injunction is much more stringent than the proof required to survive a summary judgment motion.” Leary v. Daeschner, 228 F.3d 729, 739 (6th Cir. 2000) (collecting cases).

         ANALYSIS

         The Court holds that Plaintiff has not shown why the Court should convert its temporary restraining order into a preliminary injunction to stop the foreclosure sale of her property pending a full trial on the merits. First and foremost, Plaintiff has not demonstrated a likelihood of success on her claims. “In order to establish a likelihood of success on the merits of a claim, a plaintiff must show more than a mere possibility of success.” Six Clinics Holding Corp., II v. Cafcomp Sys., Inc., 119 F.3d 393, 402 (6th Cir. 1997). The plaintiff must actually “raise[] questions going to the merits so serious, substantial, difficult, and doubtful as to make them a fair ground for litigation and thus for more deliberate investigation.” Id. Plaintiff has not carried her burden to make such a showing here.

         Plaintiff's Complaint alleges serious claims of fraud and the violation of her civil rights. Stripped of its legal labels and conclusions, however, Plaintiff's pleadings do not suggest anything more than the possibility of success on those claims. Plaintiff does not seriously dispute that she had significant loans with FirstBank and that her account is in default. The Complaint alleges that in May 2014 she refinanced her property with FirstBank and obtained a loan of approximately $190, 000. While the Complaint does not allege what the outstanding balance on Plaintiff's loan is, [7] Plaintiff does not deny that her loan is now overdue or that the bank lacks the right to foreclose on her property. The Complaint actually alleges that her son's cattle operation suffered losses and that her son is now in breach of an oral contract to repay her for her investments in their farming enterprise. The reasonable inference from these facts, is that without farm income or payments from her son, Plaintiff has not repaid her loan. Plaintiff does make a number of vague allegations about how her son perhaps used their jointly owned property as collateral to obtain loan modifications and/or additional loans from the bank. Plaintiff also makes allegations about how FirstBank and its employees fraudulently extended loans to her son, which were secured by their property only, without her full and knowing consent. The Court expresses no view on the merits or plausibility of the pleadings or whether Plaintiff has given ...


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