At an IAS Part 55 of the Supreme Court of the State of New York, held in and for the County of New York at the Courthouse thereof, 60 Centre Street, New York on the day of July, 2016. P R E S E N T: Justice COLFIN BULLS FUNDING B, LLC, Plaintiff, Index No. 151885/2015 IAS Part 55 Hon. Cynthia S. Kern -against- AMPTON INVESTMENTS, INC., LAURENCE N. STRENGER, A CORPORATION, LAURENCE N. STRENGER, P.C., and LAURENCE N. STRENGER, ORDER TO SHOW CAUSE Defendants. Upon reading and filing the annexed affidavit of Laurence N. Strenger, sworn to July 11, 2016, and the affirmation of Norman Solovay, Esq., dated July 11, 2016, the summons and verified complaint, the exhibits annexed hereto, and upon all papers and proceedings heretofore had herein, Let the Plaintiff or its counsel show cause before this Court at an IAS Part 55, Room 432, to be held in and for the County of New York, to be held at the Courthouse located at 60 Centre Street, New York, on the day of July, 2016, at a.m./p.m. or as soon thereafter as counsel can be heard, why an order should not be made and entered herein: a. pursuant to CPLR 2221(d)(2) that a traverse hearing be held on the issue of service of the information subpoena and subpoena duces tecum and rescinding the Order entered June 8, 2016; OSC to Reargue 2016-07-12 1 of 14
b. that pending the decision of the traverse hearing further proceedings directed by the aforesaid Order entered June 8, 2016 be stayed; c. together with such other, further and different relief this Court may deem just and proper. SUFFICIENT CAUSE THERFOR APPEARING, it is hereby ORDERED, that pending the hearing and determination of this motion, that: a. pursuant to CPLR 2221(d)(2) that a traverse hearing be held on the issue of service of the information subpoena and subpoena duces tecum and rescinding the Order entered June 8, 2016; b. that pending the decision of the traverse hearing further proceedings directed by the aforesaid Order entered June 8, 2016 be stayed; c. together with such other, further and different relief this Court may deem just and proper. and it is further ORDERED, that delivery of a copy of this order to show cause, together with the summons and complaint and all other papers upon which it is granted, by e-mail to the Plaintiff s attorney, Browne George Ross LLP, having an office at 5 Penn Plaza, 24 th Floor, New York, New York 10001, on or before July, 2016, be deemed good and sufficient service thereof; and it is further ORDERED, that, opposing papers, if any, shall be served by e-mail upon Defendant s counsel seven days in advance of the return date of the motion. E N T E R: J.S.C. 2 2 of 14
SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COLFIN BULLS FUNDING B, LLC, Index No. 151885/2015 Plaintiff, -against- AMPTON INVESTMENTS, INC., LAURENCE N. STRENGER, A CORPORATION, LAURENCE N. STRENGER, P.C., and LAURENCE N. STRENGER, AFFIDAVIT Defendants. COUNTY OF NEW YORK ) :ss.: STATE OF NEW YORK ) Laurence N. Strenger, being duly sworn, deposes and says: 1. I had previously discussed with my building doorman, Adrian Orlive, the need for an affidavit making it clear that he had not and would not have kept an affidavit which a process server claims he left with him for me and a copy of the affidavit that I read him and he agreed to sign is annexed. However, I spoke thereafter with our building manager, James Pinzel, who refused to allow Mr. Orlive to sign any such document. Mr. Pinzel said that this, too, is a building policy and it could not and would not be signed without prior (and quite timeconsuming) approval by the building s law firm. 2. Mr. Pinzel and another building manager made it clear that, without such approval, the only way they could be persuaded to confirm the existence of the building policy in question would be to subpoena one of them. 3. If necessary, my lawyers tell me that they can and will subpoena Mr. Pinzel and/or the building manager to confirm the foregoing. Affidavit Strenger 2016-07-11 3 of 14
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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COLFIN BULLS FUNDING B, LLC, Index No. 151885/2015 Plaintiff, -against- AMPTON INVESTMENTS, INC., LAURENCE N. STRENGER, A CORPORATION, LAURENCE N. STRENGER, P.C., and LAURENCE N. STRENGER, AFFIRMATION IN SUPPORT OF ORDER TO SHOW CAUSE Defendants. Norman Solovay, an attorney duly licensed to practice law in the State of New York, affirms the following to be true under penalties of perjury pursuant to CPLR 2106: 1. My firm has been retained as Co-Counsel with the Law Firm of Robert Straniere, Esq., to represent Laurence N. Strenger ( Strenger ) by, among other things, preparing and filing this motion for re-argument of the Court s Decision and Order (the Order ) entered June 8, 2016 and served upon Strenger on June 17, 2016. The Order held Strenger in contempt of Court for failing to honor an information subpoena and to appear for a deposition despite Strenger s having maintained that he was never properly served. The Court handed down that Order despite Strenger s claim without holding a traverse hearing on the issue of service. PRELIMINARY STATEMENT 2. The Court s Order was based on the affidavit of service of a process server which can be shown to be unreliable in a number of respects while apparently rejecting the affidavit of Strenger, an attorney, admitted to practice in the State of New York. While the process server s defects will be reviewed in some detail, in some detail, before doing so, it should be made clear that the basic and only request on this motion for re-argument is that the Court conduct a traverse hearing on Strenger s claim that he was never properly served. Affirmation in Support of OSC 2016-07-11 5 of 14
3. Strenger s moving affidavit on the prior motion contained a sworn denial of service. Accordingly, the law on Strenger s entitlement to a traverse hearing is so clear and unequivocal that the Court may well decide it need read no further. See, e.g., Riverwalk Holding, Ltd. v. Fiallo, 2013 NY Slip Op 51151(U), holding: At a traverse hearing, plaintiff has the burden of proving, by a fair preponderance of the evidence, that service on Fiallo had been properly effectuated. (Frankel v. Schilling, 149 AD2d 657 [2nd Dept 1989].) [O]rdinarily, a proper affidavit of a process server attesting to personal delivery of a summons to a defendant is sufficient to support a finding of jurisdiction. (Skyline Agency, Inc. v. Ambrose Coppotelli, Inc., 117 AD2d 135 [2nd Dept 1986].) It is well settled, however, that where there is a sworn denial of service by the defendant, the affidavit of service is rebutted and the plaintiff must establish jurisdiction by a preponderance of the evidence at a hearing. (Frankel v. Schilling, 149 AD2d 657 [2nd Dept 1989]; citing Skyline Agency, Inc. v. Ambrose Coppotelli, Inc., supra.) 4. However, should the Court want further reasons for directing the traverse hearing there are additional equally clear ones in addition to Strenger s earlier sworn denial of having been served. They include the fact that the so-called process server purportedly left the subpoena with Strenger s doorman after allegedly being informed that Strenger was at home, which his earlier affidavit makes clear was not the case. Unfortunately, apart from Strenger s prior sworn statement, the only other such proof we are presently able to present in view of time constraints is the annexed affidavit of the building doorman (Exhibit 1) which the doorman was prepared to sign after discussions with Strenger. 5. However, what happened just before Exhibit 1 was going to be signed is that a building manager intervened and directed the doorman not to sign it. This would clearly be evidence/testimony not before the Court at the time the original motion was argued and could or should result in a finding that a traverse hearing is now warranted. 6. The manager s belated and surprising intervention made it clear that the rule against allowing building staff to sign affidavits in a pending litigation without a court order or subpoena 2 6 of 14
or without prior (and quite time-consuming) approval by the building s law firm was even more important as far as the building was concerned than the rule against accepting and keeping legal documents for tenants. Had we received earlier notice of this rule Strenger s counsel would have taken other steps to obtain or make the required evidence available in time for its consideration with the present motion. However, if the Court approves the proposed stay in the Order to Show Cause, counsel will take immediate steps to serve a subpoena or subpoenas on the necessary building personnel and/or other representatives to make sure the true facts are available at the traverse hearing. ADDITIONAL GROUNDS FOR SIGNING THE PROPOSED OSC 7. The plaintiff in these proceedings has apparently succeeded in portraying Strenger as something of an irresponsible financial deadbeat who habitually avoids paying just debts. In doing so they have submitted mounds of documents which Strenger s prior counsel ignored in favor of focusing on the specific reasons for not granting the stringent relief the plaintiff was seeking. However, the overlooked facts, which were never properly presented to the Court in defense of Strenger, make it clear that a lot worse things can be said about the party suing Strenger. 8. While these facts may not be the usual and typical ones presented on motions of this kind, we believe the Court s view of plaintiff s motion and Strenger s pending one for reargument will be drastically altered by learning of them. We therefore respectfully request the Court s permission to give the following brief summary pursuant to CPLR 2221(d)(2) of the facts which, based on the prior one-sided presentation, were overlooked and/or misapprehended by the Court: 9. In this regard, Strenger maintains that: a. Ampton Investments, Inc. ( Ampton ) is a corporate entity utilized by Strenger and it and its predecessors had a line of credit with Oak Brook Bank going back to 1975. 3 7 of 14
b. Oak Brook Bank was acquired by MB Financial Bank ( MB ), though Oak Brook Bank s personnel went to work for MB and continued to administer the line of credit. The line of credit was documented by a contract of some 20 pages. c. During a more than 30-year period, the line of credit, which began at $35,000, was raised from time to time to more than $1.5 million, and was never called in by MB. d. Colony Capital ( Colony ), a California hedge fund, doing business in New York through its purported subsidiary ColFin Bulls Funding B, LLC ( ColFin ), claimed to have acquired MB s rights under the line of credit contract, but not its obligations. It immediately called the entire principal due, and refused to supply a line of credit for Strenger as it was required to do if it was substituting for MB. e. The foregoing facts have caused millions in damages to Ampton and its shareholder. f. In addition, Strenger has pointed out that Colony is obviously not an exempt lender for purposes of the New York usury laws, since it is attempting to claim interest on its investment well in excess of usury law limits in New York. The Second Circuit has ruled that the usury exemption of a bank cannot be passed on to the purchaser of an obligation not so exempt, and the U.S. Supreme Court declined to review the decision this term. Therefore, Colony and ColFin are in violation of New York usury laws. g. Further, Strenger believes and submits that it is also a matter of public record that Colony Capital and its subsidiaries have been predatory purchasers of huge hosts of various obligations during and since the financial crisis, and that they have violated innumerable federal and state laws in strong armed attempts to collect them, many of which they have no right to hold, and a very large class of the American public has been seriously harmed by these actions. 4 8 of 14
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Exhibit 1 10 of 14
SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COLFIN BULLS FUNDING B, LLC, Index No. 151885/2015 Plaintiff, -against- AMPTON INVESTMENTS, INC., LAURENCE N. STRENGER, A CORPORATION, LAURENCE N. STRENGER, P.C., and LAURENCE N. STRENGER, AFFIDAVIT Defendants. COUNTY OF NEW YORK ) :ss.: STATE OF NEW YORK ) Building ). Adrian Orlive, being duly sworn, deposes and says: 1. I am a doorman on the front door of 45 East 89 th Street, New York, New York (the 2. The Building has a strict policy against accepting legal papers on behalf of any resident, whether at the door or in the mail room. Accordingly I have never accepted legal papers on behalf of Laurence Strenger or any other tenant who was unavailable to receive them. 3. I vaguely recall being handed some papers a good while back for Laurence Strenger, but he wasn t in at the time and, consistent with Building policy, I handed them back to the one who gave them to me. Sworn to before me this day of July, 2016. Adrian Orlive Notary Public Affidavit Orlive 2016-07-08 11 of 14
Exhibit 2 12 of 14
Laurence Strenger J.D.: Executive Profile & Biography - Businessweek Page 1 of 1 Executive Profile Laurence Strenger J.D. Chief Executive Officer, Managing Director, and General Counsel, Ampton Investments, Inc. Age Total Calculated Compensation This person is connected to 0 Board Members in 0 different -- -- organizations across 1 different industries. Background Mr. Laurence N. Strenger is the Chief Executive Officer, Managing Director, General Counsel, Founder, and a principal shareholder at Ampton Investments, Inc. Prior to 1989, he was a major shareholder of the BKS Company, involved in real estate and corporate investment, primarily for its principals. Prior to the formation of BKS Company, Mr. Strenger was an attorney in California and New York. During his legal practice, which concentrated on business representation of high net worth individuals, he was a Director of, or counsel to, a variety of largely special purpose private investment companies whose assets included real property, operating companies, and securities investment activities. Prior to the formation of Ampton and its predecessor companies, Mr. Strenger resided in Los Angeles, California, where he was a Partner at Rosenfeld, Meyer & Susman specializing in real property and corporate finance law, with diverse clients ranging from the Howard Hughes interests, the late A.N. Pritzker, the late Dr. Jules Stein (founder of MCA), Washington Mutual Savings Bank, the English Astor Family to the Los Angeles Rams. After his graduation from law school, Mr. Strenger went to work for Debevoise, Plimpton, Lyons & Gates in New York. He has also held numerous directorships of private companies and major executorships and trusteeships. Mr. Strenger is also a Director of North American Insurance Leaders, Inc. He is a member of the Visiting Committee of the University of Chicago Law School and the Los Angeles Committee on Foreign Relations. Mr. Strenger was also a representative Director of two closely held public companies, one engaged in financial services and asset management (Aitken-Hume, Plc, LSE), and the other in the refinery and mining business (Arabian Shield, Inc., NASDAQ). He is a graduate of Columbia University and received a J.D. from the University of Chicago Law School, where Mr. Strenger was a member of its law and economics program. Collapse Detail Corporate Headquarters -- --, -- -- United States Phone: -- Fax: -- Board Members Memberships There is no Board Members Memberships data available. Education BA Columbia University JD University of Chicago Law School Other Affiliations Columbia University University of Chicago Law School North American Insurance Leaders Inc. 13 of 14 http://www.bloomberg.com/research/stocks/private/person.asp?personid=76886&privcapi... 6/15/2016
Index No. 151885 Year 2015 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COLFIN BULLS FUNDING B, LLC, Plaintiff, -against- AMPTON INVESTMENTS, INC., LAURENCE N. STRENGER, A CORPORATION, LAURENCE N. STRENGER, P.C., and LAURENCE N. STRENGER, Defendants. ORDER TO SHOW CAUSE THE STRANIERE LAW FIRM Attorneys for Defendant Laurence N. Strenger 300 EAST 57 TH STREET SUITE #3F NEW YORK, NEW YORK 10022 (917) 880-7303 14 of 14