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Franklin County Ohio Clerk of Courts of the Common Pleas- 2022 Sep 16 4:21 PM-20CV007082
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IN THE COURT OF COMMON PLEAS
OF FRANKLIN COUNTY, OHIO
APF -— CRE I, LLC & CASE NO. 20CV007082
APF - CPX I, LLC,
MAGISTRATE JENNIFER CORDLE
Plaintiffs,
v
TEHRAH HOSPITALITY, LLC,
ABHIJIT S. VASANI &
BHAVNA A. VASANI,
Defendants.
PLAINTIFFS’ MOTION (I) FOR PROTECTIVE ORDER, AND (II) IN LIMINE TO
EXCLUDE ARGUMENT OR EVIDENCE OF COLLATERAL DISPOSITION
Plaintiffs APF — CRE I, LLC (“APF — CRE”) and APF — CPX I, LLC (“APF — CPX”, and
together with APF — CRE, collectively, “Plaintiffs”), successors in interest to Access Point
Financial, LLC, f/k/a Access Point Financial, Inc. (“Access Point”), by and through undersigned
counsel, respectfully move (this “Motion”) for an Order (i) issuing a protective order, in
accordance with Rule 26(C) of the Ohio Rules of Civil Procedure (the “Civil Rules”), excluding
the discovery requests served by Defendants Abhijit S. Vasani and BhavnaA. Vasani (collectively,
“Defendants”) on Plaintiffs to the extent such requests seek any information in connection with
the disposition and release of that certain real property, along with all furniture, fixtures, and
equipment, commonly known as the Holiday Inn Express located at 5855 Hagman Road, Toledo,
Ohio 443612 (as more specifically described in the parties’ Loan Documents!, hereinafter
collectively the “Hotel”) by public auction (the “Sale”); and (ii) prohibiting Defendants from
' Capitalized but undefined terms herein shall have the meanings ascribed to them in Plaintiffs’ Complaint, filed in
this case on October 29, 2020.
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offering evidence or argument specifically related to the Sale of the Hotel at the Damages Hearing
(as defined below) that is scheduled in this matter.
As set forth below, in light of the express waivers that Defendants knowingly and
voluntarily agreed to in the Mortgage Guaranty and Equipment Guaranty (collectively, the
“Guaranties”)’, Defendants’ discovery is overly broad, unduly burdensome, harassing, and
exceeds the scope of what may be deemed necessary for the Damages Hearing. In support of this
Motion, Plaintiffs respectfully state as follows:
FACTUAL AND PROCEDURAL BACKGROUND
1 On July 22, 2022, this Court entered its Entry Granting in Part Plaintiffs’ Motion
for Partial Summary Judgment; Denying Defendants’ Motion to Amend; and Denying as Moot
Defendants’ Civ. R. 56(F) Motion (the “Entry”). In the Entry, this Courtruled, among other things,
thatthe Motion of Plaintiffs, APF —CRE I, LLC & APF —CPX, LLC for Partial Summary Judgment
as to Defendants Abhijit S. Vasani and Bhavna A. Vasani, as amended (the “Summary Judgment
Motion”), should be granted in part and that Defendants’ are liable for all damages under the Loan
Documents between Plaintiffs and Tehrah Hospitality, LLC (“Borrower”), pursuant to the terms
of the Guaranties. The Court also concluded that a separate evidentiary hearing should be held to
determine the amount of damages that Plaintiffs are entitled to under the Guaranties and other
Loan Documents, and accordingly referred the matter to a magistrate for a hearing (the “Damages
Hearing”).
2. On July 25, 2022, the Court issued an Order of Reference referring
the matter to
Magistrate Jennifer Cordle (the “Magistrate”) to adjudicate the Damages Hearing. This Motion is
? The Mortgage Guaranty and Equipment Guaranty are attached to Plaintiffs’ Complaint as Exhibits 5 and 8,
respectively.
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broughtbefore the Magistrate for an evidentiary and discovery -related determination in connection
with the Damages Hearing.
2 In the Entry, the Court also expressly limited the scope of Defendants’ discovery
to discovery that is “necessary to prepare for the damages hearing.” Entry at p. 17 (emphasis
added)
3 Following issuance of the Entry, Defendants filed a Notice of Substitution of
Counsel, by which Andrew Gerling, Esq. and Troy Doucet, Esq. of the law firm Doucet Gerling
Co., LPA were substituted as counsel for Defendants in this action.
4 Since their retention, Defendants’ new counsel have served on Plaintiffs and
various third parties a plethora of harassing discovery that far exceeds the limited scope of
discovery permitted by the Court in the Entry. Specifically, Defendants served a combined set of
extremely broad requests for admissions, interrogatories, and requests for production of documents
on August 29, 2022, along with a Civil Subpoenaon Access Point, on September 12, 2022 seeking
various categories of documents and correspondence by September 30, 2022 3 This discovery and
the Access Point subpoena inappropriately include multiple requests relating to disposition of the
lenders’ collateral
5 These topics are expressly barred from being raised or challenged by Defendants
under their Guaranties. Specifically, under Section 3 of the Mortgage Guaranty and Equipment
Guaranty, respectively, Defendants expressly agreed that “the validity of this Guaranty and the
obligations of [Defendants] hereunder shall in no way be terminated, affected or impaired by
reason of the release or exchange of any collateral covered by the [Mortgage and Equipment
Agreement, respectively] or other collateral of the Debt” (emphasis added). See Mortgage
5 Copies of the referenced discovery requests and Access Point subpoena are attached hereto as Exhibits | and 2,
respectively.
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Guaranty at J 3(c) and Equipment Guaranty at { 3(c). In addition, Defendants agreed that their
obligations under the Guaranties “shall in no way be terminated, affected orimpaired ... by reason
of Lender’s failure to exercise, or delay in exercising, any such right or remedy or any right or
remedy Lender may have hereunder or in respect to [the Guaranties].” See Mortgage Guaranty at
at § 3(d) and Equipment Guaranty at § 3(d).
6 As indicated on the Court’s docket, Defendants also served subpoenas on several
other third-party entities, including CW Financial Services, CWFS Insight LLC, Alfons Beshi,
Berkadia Commercial Mortgage LLC, Berkadia Real Estate Advisors LLC, Hagman Hospitality
LLC, InterContinental Hotels Group, and Trimont Real Estate Advisors LLC (collectively, the
“Third Parties”).*
7 Upon review of both the discovery requests issued to Plaintiffs, as well as the Civil
Subpoenasissuedto Access Pointand the Third Parties, Defendants seek a broad array of irrelevant
documents and correspondence from the inception of the lending relationship between Plaintiffs
and Defendants to current date
8 As discussed more fully below, the vast majority of this discovery is overly broad,
harassing, and irrelevant given Defendants are limited to seeking information necessary for the
Damages Hearing. Since Defendants waived any challenge to disposition of collateral long ago in
the Guaranties that they signed, the Court should grant this Motion and curtail the discovery
accordingly.>
* Copies of the referenced third-party subpoenas are attached heretocollectively at Exhibit3
* By separate expedited motion filed contemporancously herewith, Plaintiffs have also sought continuance of
discovery deadlines and various depositions, and the quashing of a certain subpoena served on third party Access
Point, for the reasons set forth herein.
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LAW AND ANALYSIS
9 Civil Rule 26(C) provides that, for good cause shown, a court may also “make any
order thatjustice requires to protecta party or person from annoyance, embarrassment, oppression,
or undue burden or expense, including . that the discovery not be had [and] that certain matters
not be inquired into[.]” Ohio Civ. R. 26(C).® In addition, the filing a motion in limine “is to avoid
injection into [the] trial of matters which are irrelevant, inadmissible and prejudicial[.J’
Huntington Nat'l Bank v. Slodov, 202 1-Ohio-2932 (Ct. App.) (citing State v. French, 1995-Ohio-
32, 72 Ohio St. 3d 446, 449, 640 N.E.2d 887 (1995).
10 In the Entry, the Court permitted Defendants to conduct discovery “necessaryto
prepare for the damages hearing.” See Entry at p.17. Defendants have apparently taken this
statement by the Court to mean that they may effectively reopen and redo discovery in this case,
and accordingly have issued a flurry of discovery requests on Plaintiffs and eight other third-party
entities that seek a broad array of documents and correspondence from the entirety of the lending
relationship between Plaintiffs and Defendants. However, Defendants’ ability to seek any
discovery from Plaintiffs, introduce any evidence obtained by such discovery, or raise additional
argument or evidence at the Damages Hearing challenging Plaintiffs’ disposition and release its
collateral—specifically, the Sale of the Hotel—was expressly waived by Defendants under the
terms of the Guaranties.
11 Simply put, Defendants’ attempts to conduct such expansive discovery upon
Plaintiffs is wholly wnnecessary for the Damages Hearing, given the express terms of the
Guaranties that Defendants signed. By serving
the harassing discovery, Defendants place an undue
and unreasonable burden on Plaintiffs that requires issuance of a protective order. Furthermore,
° In accordancewith the requirements of Civil Rule 26(C), Plaintiffs submit that prior to filing this Motion, they made
a reasonable effort to resolve this discovery dispute with Defendants’ counsel, but suchefforts were not fruitful.
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in light of the aforementioned language contained in the Guaranties that bars Defendants from any
challenge to disposition of the collateral, Plaintiffs are entitled to an Order that prohibits
Defendants from introducing any argument or evidence related to same at the Damages Hearing.
12. As noted above, Defendants agreed in advance to never challenge and waived all
defenses associated with Plaintiffs’ disposition of its collateral, including the Hotel. Specifically,
in Section 3 of the Mortgage Guaranty and Equipment Guaranty, respectively, Defendants
expressly agreed that “the validity of this Guaranty and the obligations of [Defendants] hereunder
shall in no way be terminated, affected or impaired . by reason of the release or exchange of
any collateral covered by the [Mortgage and Equipment Agreement, respectively] or other
collateral of the Debt” (emphasis added). See Mortgage Guaranty at § 3(c) and Equipment
Guaranty at § 3(c). In addition, Defendants agreed that their obligations under the Guaranties
“shall in no way be terminated, affected or impaired . by reason of Lender’s failure to exercise,
or delay in exercising, any such rightor remedy or any right orremedy Lender may have hereunder
or in respect to [the Guaranties].” See Mortgage Guaranty at at | 3(d) and Equipment Guaranty at
3(d). In other words, Defendants agreed that their obligations under the Guaranties would remain
valid and absolute, notwithstanding any disposition of collateral conducted by Plaintiffs in
connection with their rights and remedies under the Loan Documents, or the manner or timing in
which such disposition was undertaken and completed by Plaintiffs.
13 In addition, pursuant to Section 1 of the Guaranties, Defendants indicated their
express understanding and agreement that their obligations under the Guaranties “are and shall be
absolute under any and all circumstances, without regard to the validity, regularity or
enforceability of the Loan Documents[.]” See Mortgage Guaranty at 4 1(a) and Equipment
Guaranty at J 1(a). Together with Section 3, these provisions operate as a complete waiver of
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Defendants’ rights to challenge the Sale of the Hotel, which wasthe primary collateral covered by
the Mortgage Loan Documents, as well as Plaintiffs’ subsequent application of sale proceeds to
the amounts due under the Loan Documents
14, Such waivers by Defendants are enforceable under applicable Georgia law.’ See,
e.g., HWA Properties, Inc. v. Cmty. & S. Bank, 322 Ga. App. 877, 887, 746 S.E.2d 609, 617(2013),
cert. denied (Nov. 18, 2013) (“A guarantor may consent in advance to a course of conduct which
would otherwise result in his discharge, and this includes the waiver of defenses otherwise
available to a guarantor.”) (quoting Baby Days v. Bank of Adairsville, 218 Ga. App. 752, 755(3),
463 S.E.2d 171 (1995)). In HWA, the Georgia Court of Appeals affirmed the trial court’s grant of
summary judgment in favor of a lender and against a guarantor, notwithstanding a failure by the
lender to confirm a foreclosure sale for the collateral that secured the underlying
note that gave
rise to the guarantor’s obligations (which would otherwise be a requirement to maintain a
deficiency suit against the guarantor under the applicable Georgia statutes). Like the Guaranties
signed by Defendants, the applicable guaranty in HWA contained a broad waiver of any defenses,
“except the defense of discharge by paymentin full.” See HWA, 322 Ga. App. At 886. Although
confirmation of a foreclosure sale would have normally served as a defense, and a prerequisite to
the lender seekinga deficiency judgment against a guarantor under Georgia’s confirmation statute,
O.C.G.A. § 44-14-161, the Court of Appeals ruled that the guarantor’s broad waiver of defenses
in the applicable guaranty barred such a defense. HWA, 322 Ga. App. at 887-88 (“[G]iven these
[waiver] provisions, we conclude that [the lender’s] failure to obtain a valid confirmation of the
foreclosure sale, pursuant to OCGA § 44-14-161, does not impair its authority to collect the
7 Pursuantto Section 12(c) of the Mortgage Guaranty and Section 14(c) of the Equipment Guamanty, the Parties agreed
that the Guaranties “shall be deemed to be [contracts] entered into pursuant to the laws of the State of Georgia and
shall in all respects be governed, construed, applied and enforced in accordance with applicable federal law and the
laws of the State of Georgia , without giving effect to any conflict of laws principles.”
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difference between the amount due on the note and the foreclosure sale proceeds from [guarantor]
based upon his personal guaranty.”); see also Cmty. & S. Bank vy. DCB Investments, LLC, 760 SE.
2d 210 (2014), reconsideration denied (July 29, 2014) (guarantors’ broad waiver of any and all
defenses to their respective liabilities enforceable) (citing HWA).
15 Although HWA addressed waiver of Georgia’s confirmation statute, the Georgia
Court of Appeals’ consistent holdings that broad guarantor waivers are enforceable under Georgia
law apply with equal force to Defendants’ waiver to challenge Plaintiffs’ release of its collateral
in accordance with its rights under the Loan Documents. Thus, under HWA and its progeny,
Defendants have expressly waived the ability to raise any defenses or challenges with respect to
the Sale of the Hotel.
16 While these waiver arguments were previously raised by Plaintiffs in the context of
Plaintiffs’ Motion for Summary Judgment, the Court deferred adjudication on this issue by
referring the matter of damages to the Magistrate and permitting only necessary discovery under
its Entry, i.e., discovery directly related to the determination of the calculation of damages under
the Loan Documents. Thus, under the terms of the Entry, and considering the express waivers that
they signed in the Guaranties, Defendants may conduct very limited discovery related to current
amounts outstanding under the Loan Documents and nothing else.
17. In connection with the filing of this Motion, Plaintiffs therefore intend to provide
documentation to Defendants in connection with and responsive to their discovery that is targeted
at this limited and permissible topic. Defendants should
not be permitted to issue overly broad,
burdensome, and harassing discovery requests against Plaintiffs or any other party in an attempt
to challenge Plaintiffs’ disposition and release of the Hotel. As any evidence or argument by
Defendants regarding the circumstances of this release must be excluded from the Damages
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Hearing, such discovery is useless, costly, and unnecessarily burdensome. Given the express terms
of the Guaranties, Defendants’ outstanding discovery exceeds the Court’s instructions in the Entry
WHEREFORE, for the reasons stated above, Plaintiffs respectfully request that the Court
enter an Order (i) issuing a protective order excluding the discovery requests served by the
Defendants on Plaintiffs, other than requests specifically limited to information on calculation of
amounts outstanding; (ii) prohibiting all evidence and argument by Defendants related to the Sale
of the Hotel at the Damages Hearing; and (iii) granting Plaintiffs such other and further relief as
the Court deems just and appropriate.
Dated: September 16, 2022 Respectfully submitted,
/s/ Sean A. Gordon
Sean A. Gordon (OH Bar No. 0074243)
Matthew J. Kerschner (OH Bar No. 0096902)
THOMPSON HINE LLP
3900 Key Center
127 Public Square
Cleveland, Ohio 44114-1291
(216) 566-5500 (P)/ (216) 566-5800
(F)
Sean. Gordon @ ThompsonHine.com
Matthew. Kerschner@’ Thompson Hine.com
Counsel for Plaintiffs
Franklin County Ohio Clerk of Courts of the Common Pleas- 2022 Sep 16 4:21 PM-20CV007082
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CERTIFICATE OF SERVICE
The undersigned hereby certifies that a copy of the foregoing Plaintiffs’ Motion (I) For
Protective Order and (Il) In Limine to Exclude Argument or Evidence of Collateral Disposition
was electronically filed with the Clerk of the Court by using the e-Filing system, which will send
a notice of electronic filing to all counsel registered to receive notice thereby, including:
Andrew J. Gerling andrew@doucet Jaw
Troy J. Doucet troy@doucet law
Dated: September 16, 2022. Respectfully submitted,
/s/ Sean A. Gordon
Sean A. Gordon (Ohio Bar No. 0074243)
Matthew J. Kerschner (Ohio Bar No. 0096902)
THOMPSON HINE LLP
3900 Key Center
127 Public Square
Cleveland, Ohio 44114-1291
(216) 566-5500 (P)/ (216) 566-5800
(F)
Sean Gordon @ThompsonHine.com
Matthew Kerschner(aThompsonHine com
Counsel for Plaintiffs
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