Citibank, N.A. v. Aralpa Holdings Limited Partnership
- Rochon
- 1:22-cv-08842
- U.S. District Court · Southern District of New York
- 8
In Citibank v. Aralpa Holdings, Judge Rochon partly granted and partly denied a request to pause enforcement and discovery while an appeal proceeded.
The stay affects Citibank, N.A., Aralpa Holdings Limited Partnership, Rodrigo Lebois Mateos, One57 36B, LLC, and Aralpa Miami Investments LLC. It pauses enforcement against One57’s and Aralpa Miami’s assets, including their bank accounts, while requiring the nonmoving parties to follow the existing temporary restrictions. The parties must continue with post-judgment discovery.
What happened
Citibank, N.A. sued Aralpa Holdings Limited Partnership and Rodrigo Lebois Mateos over a loan and personal guaranty. After earlier rulings, Citibank obtained orders involving assets of One57 36B, LLC and Aralpa Miami Investments LLC and post-judgment discovery.
The entities and Lebois asked the court to pause those orders while they appealed. The court found that losing One57’s condominium could cause harm that money could not fully repair, while Citibank’s interests could be protected by existing restrictions on the assets and post-judgment interest.
Judge Jennifer L. Rochon granted the request to pause the asset execution and turnover orders, including orders concerning the entities’ bank accounts, as long as the nonmoving parties followed the existing restrictions. She denied the request to pause the parties’ meeting and discovery obligations and required them to proceed with discovery.
The detailed version
- Citibank, N.A. v. Aralpa Holdings Limited Partnership · No. 1:22-cv-08842
- Rochon
- Feb. 16, 2024
Background
Citibank sued Aralpa Holdings Limited Partnership and Rodrigo Lebois Mateos for breaching a loan agreement and personal guaranty. In an earlier ruling, the court granted Citibank judgment on the pleadings. The defendants appealed that ruling but later voluntarily dismissed the appeal.
Citibank then sought post-judgment relief involving assets held by One57 36B, LLC and Aralpa Miami Investments LLC. The court entered temporary asset restrictions and later, in the ruling at issue on appeal, granted a writ of execution and turnover order concerning One57’s assets and a turnover order concerning Aralpa Miami’s assets. The court denied Citibank’s attachment request as moot, denied its motion to compel without prejudice, and ordered the parties to meet and confer about post-judgment discovery.
Aralpa Holdings, Lebois, One57, and Aralpa Miami moved to stay—that is, pause—the relevant portions of that ruling while they appealed. They alternatively sought a short interim stay to ask the Second Circuit for relief. They agreed to follow the existing temporary restraining order during any stay. The court had temporarily stayed the ruling to preserve the status quo while Citibank responded.
Stay standard and analysis
The court applied the traditional four-factor test for a stay pending appeal: whether the applicants showed a strong likelihood of success, whether they would suffer irreparable harm without a stay, whether a stay would substantially harm the other parties, and where the public interest lay. The party requesting the stay carried the burden of showing that the circumstances justified one.
On likelihood of success, the court disagreed with the nonmoving parties’ argument that Citibank could not disregard the separate legal status of One57 and Aralpa Miami. The court also noted that the nonmoving parties had not previously raised their procedural and evidentiary objections during the post-judgment proceedings, creating issue-preservation problems on appeal. The court therefore did not find a strong likelihood of success, although it recognized that significant and complicated legal issues were involved.
On irreparable harm, the court focused on the possibility that One57’s condominium could be sold during the appeal. Based on Lebois’s declaration, the court found that he and family members had used the condominium as a home during stays in New York City, that it contained personal belongings, and that the family planned to use it again if One57 retained ownership. The court concluded that losing this unique property could cause harm that would be difficult or impossible to repair by returning the same property later.
The court found that a stay would cause Citibank relatively minor harm. The existing temporary restraining order would reduce the risk that the assets would be dissipated, and post-judgment interest would address delay in Citibank’s recovery. The court also found that the public interest favored maintaining the status quo while the Second Circuit considered the issues, particularly because non-parties were involved in the post-judgment proceedings.
Ruling
Judge Jennifer L. Rochon granted the motion in part by staying pending appeal the portion of the earlier ruling that granted Citibank’s request for a writ of execution and turnover order concerning One57’s assets and the turnover order concerning Aralpa Miami’s assets. The stay also covered the bank accounts of One57 and Aralpa Miami. The stay was conditioned on the nonmoving parties’ continued compliance with the temporary restraining order entered in the earlier proceeding.
The court denied the request to stay the portion of the earlier ruling ordering the parties to meet and confer about post-judgment discovery. The court explained that those discovery obligations arose from the earlier final judgment, which was no longer on appeal, rather than from the ruling being appealed. The court extended the meet-and-confer deadline to February 23, 2024, and directed the parties to proceed with discovery.
Read the full 8-page opinion on CourtListener, the free public archive maintained by the Free Law Project.