Opinion
8:21-CV-00107-JVS-JDE
02-14-2022
CENTERLINE HOUSING PARTNERSHIP I, L.P. - SERIES 2, f/k/a RELATED CAPITAL HOUSING PARTNERSHIP I, L.P. - SERIES 2, a Delaware limited partnership; and RCHP SLP I L.P. - SERIES 2, a Delaware limited partnership, Plaintiffs/Counter-Defendants, v. PALM COMMUNITIES, f/k/a PALM DESERT DEVELOPMENT COMPANY, a California corporation; and HOUSING CORPORATION OF AMERICA, a Utah non-profit corporation, Defendants/Counterclaimants, v. ALDEN TORCH FINANCIAL, LLC, a Delaware limited liability company, Counter-Defendant.
Eric S. Pettit, KING & SPALDING LLP Attorneys for Plaintiffs/Counter-Defendants CENTERLINE HOUSING PARTNERSHIP I, L.P. - SERIES 2 and RCHP SLP I L.P. - SERIES 2, and Counter-Defendant ALDEN TORCH FINANCIAL LLC.
Eric S. Pettit, KING & SPALDING LLP Attorneys for Plaintiffs/Counter-Defendants CENTERLINE HOUSING PARTNERSHIP I, L.P. - SERIES 2 and RCHP SLP I L.P. - SERIES 2, and Counter-Defendant ALDEN TORCH FINANCIAL LLC.
JUDGMENT
HONORABLE JAMES V. SELNA, UNITED STATES DISTRICT JUDGE.
Pursuant to the Court's orders dated November 1, 2021 (ECF No. 107), January 12, 2022 (ECF No. 127), and January 25, 2022 (ECF No. 131), it is hereby ORDERED, ADJUDGED, AND DECREED that:
1) As to Count One of the Amended Complaint for declaratory judgment filed by Plaintiffs/Counter-Defendants Centerline Housing Partnership I, L.P. - Series 2, f/k/a Related Capital Housing Partnership I, L.P. - Series 2 (“Centerline”) and RCHP SLP I L.P. - Series 2 (“RCHP” and, collectively with Centerline, the “Limited Partners”) and Count I of the Counterclaim for declaratory judgment filed by Defendants/Counterclaimants Palm Communities, f/k/a Palm Desert Development Company (“Palm”) and Housing Corporation of America (“HCA” and, collectively with Palm, the “General Partners”), the Court enters a declaratory judgment that:
a. Palm has the power under the partnership agreement to express, on behalf of the Frederick and 52 II Limited Partnership (the “Partnership”), a desire to sell the apartment complex owned by the Partnership, whereby RCHP's consent is only necessary for a sale transaction to become binding on the Partnership; and b. the below-market Right of First Refusal that HCA holds pursuant to Section 42(i)(7) of the Internal Revenue Code has not been triggered;
2) As to Count Two of the Limited Partners' Amended Complaint for declaratory judgment, the Court enters a declaratory judgment that the General Partners may not refinance the Partnership's debt without RCHP's prior written consent;
3) As to Count Three of the Limited Partners' Amended Complaint for breach of fiduciary duty, the Court enters judgment against Palm and in favor of the Limited Partners, and awards nominal damages to the Limited Partners in the sum of one dollar ($1.00);
4) As to Count I of the General Partners' Counterclaim for a declaratory judgment that RCHP is unreasonably withholding and delaying consent to refinance the Partnership's debt, the Court enters judgment against the General Partners and in favor of RCHP;
5) As to Count II of the General Partners' Counterclaim for breach of contract, breach of the implied covenant of good faith and fair dealing, and specific performance, the Court enters judgment against the General Partners and in favor of the Limited Partners; and
6) As to Count III of the General Partners' Counterclaim for tortious interference with contract, the Court enters judgment against the General Partners and in favor of Counter-Defendant Alden Torch Financial LLC.
IT IS SO ORDERED.