Baydoun Opinion

8/20/2019 Baydoun Opinion

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Case 1:13-cv-01817-WSD Document 150 Filed 02/11/16 Page 1 of 28


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I.

BACKGROUND

On November 22, 2013, the Court determined that the appointment of a

receiver was necessary to marshal and preserve the assets of DMP and entered an

order appointing Jason S. Alloy (the “Receiver”) to serve as receiver for the DMP

estate. (November 22, 2013, Order [51] (the “Receiver Order”) ¶ 2). The Receiver

Order provides that “the following proceedings . . . are stayed until further Order

of this Court:”

All civil legal proceedings of any nature, including, but not limited to, bankruptcy proceedings, arbitration proceedings, foreclosure actions, default proceedings, or other actions of any nature involving: (a) the Receiver, in hiscapacity as Receiver; (b) any Receivership Property, wherever located;(c) the Receivership Defendant; or, (d) any of the Receivership Defendant’s

past or present officers, directors, managers, agents, or general or limited partners sued for, or in connection with, any action taken by them whileacting in such capacity of any nature, whether as plaintiff, defendant,third-party plaintiff, third-party defendant, or otherwise (such proceedingsare hereinafter referred to as “Ancillary Proceedings”).

(Receiver Order ¶ 24). The Receiver Order also provides: “parties to any and all

Ancillary Proceedings are enjoined from commencing or continuing any such legal

proceeding, or from taking any action, in connection with any such proceeding,

including, but not limited to, the issuance or employment of process.” (Id. ¶ 25).

The Receiver Order also restrains and enjoins “all persons receiving notice

of this Order” from “directly or indirectly taking any action or causing any action

to be taken, without the express written agreement of the Receiver,” which would:



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B. Hinder, obstruct or otherwise interfere with the Receiver in the performance of his duties; such prohibited actions include but are not

limited to, concealing, destroying or altering records or information

C. Dissipate or otherwise diminish the value of any ReceivershipProperty; such prohibited actions include but are not limited to,releasing claims or disposing, transferring, exchanging, assigning orin any way conveying any Receivership Property, enforcing

judgments, assessments or claims against any Receivership Propertyor any Receivership Defendant, attempting to modify, cancel,terminate, call, extinguish, revoke or accelerate (the due date), of anylease, loan, mortgage, indebtedness, security agreement or other

agreement executed by any Receivership Defendant or whichotherwise affects any Receivership Property; or,

D. Interfere with or harass the Receiver, or interfere in any mannerwith the exclusive jurisdiction of this Court over the ReceivershipEstates.

(Id. at ¶ 21(B-D)).

On May 15, 2015, Mr. Baydoun sent a litigation hold letter to “Detroit

Memorial Partners, David Shipper, Mark Morrow, and Midwest Memorial Group,”

relating to a claim Mr. Baydoun was asserting on behalf of Mr. Abdul Charara and

Mr. Waad Charara (the “Chararas”). ([145.3] (the “May 15th Letter”)).4 The

claim related to the alleged wrongful burial of a person in a plot owned by the

Chararas (the “Claim”). (Id. at 1). The May 15th Letter was also sent to the

4 The May 15th Letter was admitted as an exhibit at the January 4, 2016,Contempt Hearing.



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Receiver. (Id.). In discussing the Claim in the May 15th Letter, Mr. Baydoun

stated to DMP and its principals:

Common sense tells me that the viability of your business is now atstake, and a quick resolution with both families was in your interest,more than anyone else. As of yet, we have not received anyassurances that you will do anything, let alone the right thing by thesefamilies and this community. I have assured everyone involved of myintent to shame the cemetery, its management and owners in a very

public way until they do right by my clients and assure them that thiscannot happen ever again.

(Id.). Mr. Baydoun stated in the letter that he had hired two investigators to

investigate the controversies and allegations pertaining to the cemetery, and had

provided the investigator’s findings to the media. (Id. at 2). Mr. Baydoun also told

the recipients, including the Receiver, “[y]ou all ought to be ashamed of

yourselves.” (Id.).

Attached to the May 15th Letter were some of the documents purportedly

obtained during Mr. Baydoun’s investigation. On the page that preceded these

documents Mr. Baydoun wrote, by hand in large letters, taking up half a page, the

underlined statement:



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(Id. at 3).

On May 19, 2015, after the Receiver received the May 15th Letter, the

Receiver wrote to Mr. Baydoun, including in the letter a copy of the Receiver

Order. ([126.1] (the “May 19th Letter”)). In his letter, the Receiver stated that the

Receiver Order barred the commencement of civil proceedings against DMP.

(Id.).5

5 The Claim related to certain plots at a cemetery owned by MidwestMemorial Group. DMP is a minority member of Midwest Memorial Group. It



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In e-mails between Mr. Baydoun and the Receiver on May 19, 2015 and

May 20, 2015, Mr. Baydoun acknowledged that he read the Receiver Order and

expressly stated to the Receiver that he would first seek leave of the Receiver

before any action was filed based on the Claim. ([126.2] (the “May 2015

E-mails”) at 5-6). Mr. Baydoun stated that he planned to name DMP, Mr. Morrow,

and Mr. Shipper as defendants in an action on the Claim, and he asked the

Receiver to provide information regarding whether Mr. Shipper had any role in

DMP. (Id.). The Receiver responded by telling Mr. Baydoun that the Receiver

would not consent to the filing of an action against DMP, Mr. Shipper, or

Mr. Morrow. (Id. at 4). The Receiver told Baydoun: “If you or anyone else

violates the Court order, we will move for contempt.” (Id.). In a follow-up e-mail,

the Receiver told Mr. Baydoun that the information he requested about

Mr. Shipper was not relevant to the Claim because DMP does not operate any

cemeteries and any individuals implicated in Mr. Baydoun’s planned litigation

were those employed by Midwest Memorial Group (“MMG”), and not DMP. (Id.

at 3). The Receiver stated that he “remain[ed] very concerned that the allegations

does not operate or control the Midwest Memorial Group business, including itscemeteries. (See May 19th Letter at 1). Actions against Midwest Memorial Groupare not barred by the Receiver Order. (Receiver Order ¶ 24).



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being made against DMP are way off base, frivolous, and being pursued for

illegitimate purposes.” (Id.). Mr. Baydoun replied:

You should be very concerned. I am concerned that you seem to berepresenting DMP as opposed to representing [the] court’s interest inthe receivership estate as it relates to a potential claimant. Yourconclusion and decision to “vigorously oppose any claims” againstDMP is both premature and prejudicial. It may instead be time foranother “capital call” to settle our claims before the [Michigan]attorney generally seizes all of the cemeteries again to protect theconsumers. Then your estate may be worthless.

(Id. at 2).

On August 6, 2015, Mr. Baydoun filed an action based on the Claim in the

Michigan State Court (the “Michigan Action”). (See [141.1] (the “Michigan

Complaint”)). The Michigan Complaint named DMP as an “Unidentified Owner

(Believed to be Detroit Memorial Partners, LLC).” (Michigan Compl. at 8). The

Michigan Complaint named Messrs. Shipper and Morrow as defendants. The

Michigan Complaint alleges that Mr. Shipper, as President and CEO of MMG and

an initial investor in DMP, caused the burials at issue in the Michigan Action. (Id.

¶¶ 50-54). The Michigan Complaint alleges that Mr. Morrow was an initial

investor in DMP, and DMP’s managing member until May 2013. (Id. ¶ 55). The

Michigan Complaint alleges that Mr. Morrow mismanaged trust funds meant for

the daily operation of MMG’s cemetery operations which was a direct cause of the

burials at issue in the Michigan Action. (Id. ¶ 56).



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On August 13, 2015, the Receiver filed his Contempt Motion against

Mr. Baydoun, Mr. Hicks, the Meridian Law Group (the “Respondents”), and the

Chararas.6 The Receiver alleged the Respondents knowingly violated the Receiver

Order by naming DMP, Mr. Shipper, and Mr. Morrow as defendants in the

Michigan Action, without first seeking leave of the Court. (Contempt Mot. at 3-4).

By doing so, the Receiver claimed the Respondents were in contempt of the

Receiver Order. The Receiver sought an award of attorneys’ fees for the cost of

pursing the Contempt Motion, an order requiring the Chararas to dismiss DMP,

Mr. Shipper, and Mr. Morrow from the Michigan Action, and any additional

penalties or sanctions the Court deemed appropriate. (Id. at 10).

On August 14, 2015, Mr. Baydoun wrote to the Receiver concerning the

filing of the Contempt Motion. ([145.2] at 57-63) (the “August 14th Letter”). In

this letter, Mr. Baydoun restated his intent to file a motion for leave to file a

complaint against DMP. (August 14th Letter at 1). Mr. Baydoun went on to

question the Receiver’s responsibilities to DMP and the receivership estate, and

questioned the Receiver’s authority and how the Receiver was performing his

responsibilities. (Id. at 2-7).

6 The Chararas did not respond to the Contempt Motion.



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On November 5, 2015, Mr. Baydoun dismissed Messrs. Shipper and

Morrow from the Michigan Action. ([141.4] at 1). Because DMP was never

served with the Michigan Complaint, DMP was dismissed from the Michigan

Action on November 6, 2015, by operation of the Michigan Court Rules. (Resp.

[141] at 2 n. 2).

On December 2, 2015, the Court ordered a hearing on the Contempt Motion

to be held on January 4, 2016. ([134]). On December 8, 2015, the Receiver told

Mr. Baydoun that he would withdraw the Contempt Motion if he: (i) dismissed

DMP from the Michigan Action; (ii) amended the Michigan Complaint to remove

references to Messrs. Shipper’s and Morrow’s roles with DMP; and (iii) paid all of

DMP’s attorneys’ fees in relation to the Contempt Motion. (December 8, 2015,

E-mails [137.1] at 4). Mr. Baydoun responded by stating: “I hope and trust the

Georgia weather will be more kind than you have been.” (Id. at 3). Mr. Baydoun

alleged the Receiver was acting improperly, stating:

I trust you are preparing to be sued personally and publically. Pleaseconsider this email notice that we intend to intervene in your case, filea motion to disqualify the receiver, a motion for leave to sue the

defendants, and a motion for leave to sue you personally for abuse of process if we are forced to travel to Georgia for an unnecessaryhearing on this Motion.. . .Please also take this as notice that my client may be filing a complaintwith the bar regarding your retaliatory conduct and the clear conflict



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of interest you have engaged in by acting both as attorney for thedefendant AND receiver for the court in the same matter.

. . .I urge you, for the sake of all involved, and your professionalstanding, to reconsider this approach.

(Id.). Mr. Baydoun still later asked the Receiver if he was “engaging in

impermissible ex parte communication with the Court regarding this matter or do

those rules of conduct not apply to party DMP’s attorney because he happens to

also be the Receiver.” (Id. at 1).7

On December 21, 2015, the Respondents filed their Motion for Leave to File

a Response [139] to the Contempt Motion. On December 23, 2015, the Court

granted the Motion for Leave, and the Respondents filed their Response [141].

The Respondents argue that under Michigan Court Rules:

naming of a defendant “unidentified owner” is essentially a placeholder for a defendant to be named later. (See MCR 2.201(D))However, it does not actually name any person or any entity as adefendant, and a motion to amend to add a defendant is still requiredunder [the Michigan Court Rules]. Therefore, even if the“unidentified owner” relates to a specific individual or entity, they arenot placed in legal jeopardy, no summons has been created by thecourt against that specific individual or entity, and no litigation has

been instituted against them.

7 Mr. Baydoun admitted at the hearing that he did not have any information

that ex parte communications had been held. (Tr. of Contempt Hearing at84:21-23).



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(Resp. at 2 n.2). The Respondents argue that by identifying DMP only as an

“unidentified owner,” DMP was not a named defendant in the Michigan Action.

(Id.). The Respondents also argue that any violation of the Receiver Order was

cured by dismissing DMP, Mr. Shipper, and Mr. Morrow from the Michigan

Action.

The Respondents argue further that the Receiver Order bars only the

commencement of civil proceeding against DMP’s past and present officers and

directors who are sued for, or in connection with, any action taken by them while

acting in such capacity. (Id. at 7-8). They assert that they named Mr. Shipper as a

defendant based on his involvement with MMG, and in his individual capacity, and

not based on his involvement with DMP. (Id. at 8). The Respondents argue that

Mr. Morrow was named as a defendant in his individual capacity and as an agent

and officer of MMG. The Respondents thus contend they did not violate the

Receiver Order. (Id. at 8-9).

On January 4, 2016, the Court held a hearing on the Contempt Motion (the

“Contempt Hearing”). Mr. Baydoun attended the hearing and Mr. Hicks, at his

request, participated by telephone. The Chararas, who live in Lebanon, did not

attend or otherwise participate in the hearing. The Receiver argued at the hearing

that the Respondents violated the injunction against filing suit against DMP and its



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former officers and directors, and violated the provisions of the Receiver Order

preventing anyone from hindering, obstructing, interfering, or harassing the

Receiver. (Tr. of Contempt Hearing at 5:5-20). The Receiver argued further that

Mr. Baydoun’s May 15th Letter was extortionate, that his other communications

with the Receiver were harassing, and that Mr. Baydoun, despite repeatedly stating

he was going to file a motion for leave in this Court in order to sue DMP,

Mr. Shipper, and Mr. Morrow, filed the Michigan Action without seeking leave.

The Receiver represented that the fees he incurred in connection with the

Contempt Motion were in excess of $28,000. (Id. at 29:8-10); ([145.2] at 136-54).

Mr. Baydoun testified at the Contempt Hearing. He admitted he did not file

a motion for leave to file the Michigan Action, but explained he identified DMP

only as an “unidentified owner,” which, under Michigan Court Rules, meant that

DMP was not technically a defendant in the Michigan Action. (E.g., id. at

64:14-17). Mr. Baydoun explained that his correspondence with the Receiver was

not meant to undermine the Receiver’s authority. (Id. at 65:23-67:1).

Mr. Baydoun testified he was not going to defend himself, and apologized for his

conduct, noting that it may have been “brash and perhaps even a little . . . offensive

to Your Honor, and I apologize for that.” (Id. at 68:12-18). Baydoun testified that



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everything he did was, to him, “zealous advocacy and all [he] was trying to do was

advance [his] client’s best interests.” (Id. at 68:16-18).

Mr. Baydoun acknowledged that the Chararas were not provided with

copies of his correspondence with the Receiver. (Id. at 90:3-91:6). He also

acknowledged that Mr. Hicks did not draft any of the correspondence or

communications with the Receiver relevant to this case, except “perhaps one

e-mail.” (Id. at 35:3-6). Mr. Baydoun acknowledged that Mr. Hicks drafted the

Michigan Complaint, but under Mr. Baydoun’s authority and supervision. (Id. at

36:12-25). Mr. Baydoun approved and signed the pleading. (Id.). Mr. Baydoun

testified that neither Mr. Hicks nor the Chararas are responsible for any contempt

in which Mr. Baydoun may have engaged. (Id. at 82:9-12).

II.

DISCUSSION

A. Legal Standard

To establish civil contempt, a movant must show by clear and convincing

evidence that: (1) the order allegedly violated was valid and lawful; (2) the order

was clear and unambiguous; and (3) the alleged violator had the ability to comply

with the order. Ga. Power Co. v. NLRB, 484 F.3d 1288, 1291 (11th Cir. 2007);

Riccard v. Prudential Ins. Co., 307 F.3d 1277, 1296 (11th Cir. 2002). The movant

bears the initial burden of producing evidence that establishes “by clear and



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convincing evidence that the alleged contemnor violated the court’s earlier order.”

United States v. Roberts, 858 F.2d 698, 700-01 (11th Cir. 1988). If the movant

meets its required showing, the burden “shifts to the alleged contemnor to produce

detailed evidence specifically explaining why he cannot comply” with the order.

Id. at 701. A contemnor cannot merely assert an inability to comply with the

order, but must show that he has made “‘in good faith all reasonable efforts to

comply.’” Id. (quoting United States v. Rizzo, 539 F.2d 458, 465 (5th Cir. 1976)).

An order of civil contempt may be issued to coerce the contemnor into

compliance and compensate the complainant for losses suffered. Mercer

v. Mitchell, 908 F.2d 763, 768 n.8 (11th Cir. 1990) (citing United States v. United

Mine Workers, 330 U.S. 258, 303-04 (1947)). “District courts have broad

discretion in fashioning civil contempt sanctions.” Howard Johnson

Co. v. Khimani, 892 F.2d 1512, 1519 (11th Cir. 1990). In cases of receivership, it

is well established that district courts have the authority to require that leave of

court be obtained before an action may be brought in which the principal of the

receiver property is involved or that involve the receivership property itself. See,

e.g., Liberte Capital Grp., LLC v. Capwill, 462 F.3d 543, 552 (6th Cir. 2006)

(citing In re Tyler, 149 U.S. 164, 182 (1893)); see also Wright, Miller & Marcus,

Federal Practice and Procedure: Civil 3d § 2984, at 30.



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B. Analysis

The Court first finds that the Chararas are not responsible for Mr. Baydoun’s

conduct in this case. The Chararas are not attorneys and they relied on

Mr. Baydoun who recommended that the Michigan Action be filed. They did not

know about the communications between Mr. Baydoun and the Receiver, and were

not aware of the Receiver Order. (Tr. of Contempt Hearing 90:3-91:6). The

Chararas did not willfully violate the Receiver Order, or hinder, obstruct, interfere,

or harass the Receiver. They cannot be held in contempt, and the contempt action

against them is dismissed.

The Court also finds that Mr. Hicks did not violate the Receiver Order and

did not participate in the communications between Mr. Baydoun and the Receiver.

Although he drafted the Michigan Complaint, he did so under Mr. Baydoun’s

supervision and direction. He did not sign the Michigan Complaint or cause it to

be filed. Mr. Hicks may have at some point suggested to Mr. Baydoun that his

correspondence with the Receiver went too far. (Tr. of Contempt Hearing at

83:2-13). Mr. Baydoun overruled any of the objections Mr. Hicks may have

expressed. (Id.). The only conduct at issue here is Mr. Baydoun’s filing of the

Michigan Action and his communications with the Receiver, conduct for which

Mr. Hicks is not responsible. Mr. Hicks is dismissed from this contempt action.



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To prove civil contempt, the Receiver must show, by clear and convincing

evidence, that: (1) the Receiver Order was valid and lawful; (2) it was clear and

unambiguous; and (3) that Mr. Baydoun had the ability to comply. See Ga. Power

Co., 484 F.3d at 1291. The Receiver also must show that Mr. Baydoun violated

the Receiver Order. Mr. Baydoun concedes that the Receiver Order is valid and

lawful and that he had the ability to comply with it. (Resp. at 5). Mr. Baydoun

disputes that the Receiver Order was clear and unambiguous. (Id. at 5-9). He also

disputes that he violated it and argues that, even if he did, he took sufficient

corrective steps to cure any alleged violation. (Id. at 5-11).

Paragraphs 24 and 25 of the Receiver Order are not ambiguous. Paragraph

24 plainly states that all civil legal proceedings of any nature involving DMP or its

past or present officers and directors are stayed. (Receiver Order ¶ 24). Paragraph

25 plainly provides that parties to Ancillary Proceedings are enjoined “from

commencing or continuing any such legal proceeding, or from taking any action, in

connection with any such proceeding, including, but not limited to, the issuance or

employment of process.” (Id. ¶ 25). “Ancillary Proceedings” are defined in the

Receiver Order as “civil legal proceedings of any nature” including those

“involving . . . (c) the Receivership Defendant; or, (d) any of the Receivership

Defendant’s past or present officers, directors, managers, agents, or general or



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limited partners sued for, or in connection with, any action taken by them while

acting in such capacity of any nature . . . .” (Receiver Order ¶ 24).

The Michigan Complaint named in its caption an “Unidentified Owner,”

Mr. Shipper, and Mr. Morrow as defendants. (Michigan Compl. at 1). The

Michigan Complaint later elaborated on the owner defendant by stating:

“Unidentified Owner (Believed to be Detroit Memorial Partners, LLC).” (Id. at 8).

The Michigan Complaint asserted specific allegations against DMP. (Id.

¶¶ 37-45). The complaint also alleged that DMP was an “unidentified owner”

“until such point in time that Plaintiffs may name DMP as a Defendant directly.”

(Id. ¶ 45). Mr. Baydoun argues that Michigan Court Rule 2.201(D) allows him to

name DMP as an “unknown owner” without placing DMP in legal jeopardy and

without actually “commencing” suit against DMP. (Resp. at 2 n.2).

Michigan Court Rule 2.201(D), entitled “Unknown Parties; Procedure,”

provides:

(1) Persons who are or may be interested in the subject matter of anaction, but whose names cannot be ascertained on diligent inquiry,may be made parties by being described as: (a) unknown claimants;

(b) unknown owners; or (c) unknown heirs, devisees, or assignees of adeceased person who may have been interested in the subject matterof the action.

Mich. Ct. R. 2.201(D)(1) (emphasis added). Rule 2.201(D) allows for “John Doe”

pleadings when a plaintiff genuinely does not know the identity of the putative



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defendant. It allows a plaintiff to describe a party as an “unknown owner” only if

the party’s “name[] cannot be ascertained on diligent inquiry . . . .” See id.8

DMP

was not unknown to Mr. Baydoun. Mr. Baydoun was well aware of DMP’s name,

and its relationship to the Claim and its interest in the Michigan Action. Indeed, he

specifically identified, and made allegations against, DMP in the Michigan

Complaint.

By its plain terms, Rule 2.201(D) does not apply where, as here, the

“unnamed owner” was specifically known to Mr. Baydoun and he specifically

named DMP in the Michigan Complaint. All of the Michigan cases that discuss

Rule 2.201(D) involve true “John Doe” pleadings, where the identity of a putative

defendant is truly unknown at the time the complaint is filed. See, e.g., Thomas

v. Process Equip. Corp., 397 N.W.2d 224, 226 (Mich. Ct. App. 1986) (“Plaintiffs

attempted to avoid the limitations bar by filing a ‘John Doe’ complaint, i.e.,

naming no specific defendants, but instead referring to them as ‘XYZ Corp.’, etc.

This type of complaint is authorized by [Rule 2.201(D)].”).

8 Rule 2.201(D) provides further that a plaintiff that names an unidentified

owner as a defendant must state in the complaint “the efforts made to identify andlocate [the unidentified party].” Mich. Ct. R. 2.201(D)(2). Mr. Baydoun did notadd this required information to the Michigan Complaint because he knew DMP’sidentity. The requirement of Rule 2.201(D)(2) undercuts the concocted argumentsMr. Baydoun offered at the Contempt Hearing.



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Mr. Baydoun testified at the Contempt Hearing that under the Michigan

Court Rules, one can refer to a “John Doe” or “unidentified” party with

“particularity.” (See Tr. of Contempt Hearing at 77:15-24). Mr. Baydoun

acknowledged that he had never seen it done as specifically has he had done, but

his understanding was that it was proper under Rule 2.201(D). (See id. at

77:25-78:4). The Court finds Mr. Baydoun’s stated belief that he was in

compliance with Rule 2.201(D) to be incredible, and unsupported by the plain

terms and clear purpose of Rule 2.201(D) to allow for true “John Doe” pleadings.

Mr. Baydoun violated the Receiver Order when he identified DMP and made

specific allegations against DMP, despite calling DMP an “unidentified owner.”9

9 The Court notes also that, even if an action was not “commenced” againstDMP, the Receiver Order prohibits more than just the commencement of a lawsuitnaming DMP as a party. It also stays any civil legal proceeding “involving” DMP.(Receiver Order ¶ 24). The Michigan Complaint, which refers specifically toDMP, was an action “involving” DMP. This involvement required DMP toactively respond. Naming DMP as an “unidentified owner,” asserting specificallegations against DMP in the Michigan Complaint, and providing the Receiverwith a copy of the Michigan Complaint, required the Receiver to respond to a

pleading in which DMP was specifically named and in which it was forecast that

DMP would eventually be required to respond as a party to the action. NamingDMP as an “unidentified” defendant in the Michigan Complaint and stating thatDMP would be an “Unidentified Owner, until such point in time that Plaintiffsmay name DMP as a Defendant directly,” violated the Receiver Order and its

purpose. The Court concludes that identifying DMP in the Michigan Complaintand making specific allegations against it violated the anti-commencement

provision of Paragraph 25.



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Even if the Receiver Order was not violated when DMP was named as an

“unidentified owner,”—which the Court finds that it was—naming Mr. Morrow as

a defendant also violated the Receiver Order.10 Mr. Baydoun identified

Mr. Morrow as an initial investor in DMP, and as DMP’s managing member until

May 2013. (Michigan Compl. ¶ 55). Mr. Baydoun alleged that Mr. Morrow, as a

DMP principal, was able to unlawfully and fraudulently funneled funds away from

MMG, contributing to the misburial. (Id. ¶ 56). Mr. Baydoun alleged further that

Mr. Morrow is part of the SEC’s suit against DMP in this case. (Id. ¶ 57). The

Michigan Action was brought against Mr. Morrow in his capacity as an officer of

DMP. Naming Mr. Morrow in the Michigan Action based on actions taken as a

managing member of DMP violated Paragraph 25 of the Receiver Order.

Mr. Baydoun also violated Paragraph 21(B), and (D) of the Receiver Order.

Paragraph 21(B) restrains and enjoins “all persons receiving notice of this Order”

from “directly or indirectly taking any action or causing any action to be taken,

without the express written agreement of the Receiver,” which would “[h]inder,

10 Regarding Mr. Shipper, Mr. Baydoun alleged that he, as President and CEOof MMG, caused the misburials at issue in the Michigan Action. WhileMr. Baydoun also identified Mr. Shipper as an initial investor in DMP, it is clearthat the allegations in the Michigan Complaint are directed at his conduct asPresident and CEO of MMG. (Michigan Compl. ¶¶ 50-54). Mr. Baydoun, thus,did not name Mr. Shipper as a defendant in the Michigan Action because of hisassociation with DMP, but rather on account of his involvement with MMG.



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obstruct or otherwise interfere with the Receiver in the performance of his

duties . . . .” (Receiver Order ¶ 21(B)). Paragraph 21(D) restrains and enjoins

people from interfering “with or harass[ing] the Receiver, or interfer[ing] in any

manner with the exclusive jurisdiction of this Court over the Receivership Estates.”

(Id. ¶ 21(D)).

Mr. Baydoun’s correspondence with the Receiver was harassing and

extortionate in nature, and hindered and interfered with the Receiver’s ability to

administer the receivership estate by forcing the Receiver to address

Mr. Baydoun’s baseless, inappropriate, and extortionate threats. Mr. Baydoun’s

first communication with the Receiver included the threat that Mr. Baydoun

intended to “shame the cemetery, its management and owners in a very public way

until they do right by my clients and assure them that this cannot happen ever

again.” (May 15th Letter at 1). The threat made to extract payment on the Claim

was extraordinary, and disturbing, conduct by a lawyer. After the Receiver

responded to this letter, Mr. Baydoun made even more direct and personal attacks

on the Receiver’s administration of the receivership estate. Mr. Baydoun attacked

the Receiver’s conduct as unethical, stating that Mr. Baydoun was:

concerned that you seem to be representing DMP as opposed torepresenting [the] court’s interest in the receivership estate as it relatesto a potential claimant. Your conclusion and decision to “vigorouslyoppose any claims” against DMP is both premature and prejudicial. It



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may instead be time for another “capital call” to settle our claims before the [Michigan] attorney generally seizes all of the cemeteries

again to protect the consumers. Then your estate may be worthless.

(May 2015 E-mails at 2). The Court has specifically approved the payment of

estate funds to make capital calls for DMP to preserve its ownership interest in

MMG. Mr. Baydoun’s demand that the Receiver make a “capital call” to pay the

Claim so the Receiver can avoid the depletion of DMP assets that Mr. Baydoun

would cause to occur is unquestionably harassing, intimidating, and improper

conduct engaged in to extract payment of the Claim.

After the Contempt Motion was filed, Mr. Baydoun continued to ratchet up

his improper and contemptuous conduct, including by writing to the Receiver,

stating: “I trust you are preparing to be sued personally and publically.”

(December 8, 2015, E-mails at 3). Mr. Baydoun stated that his client “may be

filing a complaint with the bar regarding your retaliatory conduct and the clear

conflict of interest you have engaged in . . . .” (Id.).11 Mr. Baydoun urged the

Receiver “for the sake of all involved, and your professional standing, to

reconsider this approach.” (Id.).

Mr. Baydoun’s conduct in this case caused the Receiver to spend time and

resources to respond to the filing of the Michigan Complaint and to address

11 It is doubtful Mr. Baydoun ever discussed the filing of a bar complaint withthe Chararas.



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Mr. Baydoun’s conduct aimed to hinder, obstruct, interfere and harass the

Receiver, all motivated to extract payment on the Claim asserted by Mr. Baydoun.

The time and effort required by the Receiver to address threats to “shame” DMP

into compliance with Mr. Baydoun’s demands, and his suggestion that DMP have

another “capital call” to address his clients’ claims is, quite simply, extortionate in

nature and adversely impacted the administration of the receivership estate.

The Receiver Order was unambiguous that harassing the Receiver or

otherwise hindering or interfering with his performance of his duties violates the

Receiver Order. Mr. Baydoun’s conduct was harassing in nature, and hindered and

interfered with the Receiver’s performance of his duties and responsibilities to the

receivership estate. Mr. Baydoun’s conduct practically, effectively, and

intentionally violated Paragraphs 21(B) and (D) of the Receiver Order.

Mr. Baydoun’s testimony at the Contempt Hearing that everything he did

was, to him, “zealous advocacy and all [he] was trying to do was advance [his]

client’s best interests,”12 is not credible. The nature and content of his

communications with the Receiver, both before and after the Contempt Motion

was filed, when read in isolation and the aggregate, show that his purpose was to

exert leverage to extract payment from the Receiver to resolve the Claim.

12 (Tr. of Contempt Hearing at 68:16-18).



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Mr. Baydoun’s testimony at the Contempt Hearing was calculated to disguise the

purpose behind filing the Michigan Action and harassing and interfering the

Receiver in the performance of his duties under the Receiver Order. As the Court

noted at the Contempt Hearing, the tone and rhetoric of Mr. Baydoun’s

communications, and the dispersions that he cast on another attorney and his client

were extraordinary, and disappointing. Mr. Baydoun’s conduct went far beyond

zealous advocacy, and became contemptuous when Mr. Baydoun personally

attacked and harassed the Receiver in an attempt to extract payment on the Claim.

Having found that Mr. Baydoun’s conduct violated the terms of the Receiver

Order, which Mr. Baydoun conceded was valid and lawful, the Court further finds

that the Receiver proved by clear and convincing evidence that Mr. Baydoun

engaged in civil contempt of the Receiver Order. See, e.g., Ga. Power Co.,

484 F.3d at 1291; Roberts, 858 F.2d at 700-01. The Court finds further, based on

the evidence presented at the January 4, 2016, hearing, that Mr. Baydoun did not

prove that he made a “good faith” effort to comply with the Receiver Order. See

Roberts, 858 F.2d at 701.13 To the contrary, the Court finds that Mr. Baydoun

13 Mr. Baydoun argues that he has cured any violation of the Receiver Order by dismissing DMP and Messrs. Shipper and Morrow from the Michigan Action.The cure of this violation does not address his conduct that violated the ReceiverOrder and the claimed “corrective action” did not “cure” the evasive, harassing,and interfering conduct in which he also engaged. The later conduct caused the



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engaged in his contemptuous conduct to seek to coerce the Receiver to pay to settle

the Claim.

An order of civil contempt may be issued to force the defendant into

compliance and compensate the complainant for losses suffered. E.g., Mercer,

908 F.2d at 768 n.8. DMP and Mr. Morrow were dismissed from the Michigan

Action, and action is not necessary to require Mr. Baydoun to comply with the

anti-commencement provision of Paragraph 25. The Receiver, however, also

suffered loss in the form of attorneys’ fees and expenses required to address

Mr. Baydoun’s interfering and harassing conduct and to prepare and file the

Contempt Motion. At the Contempt Hearing, the Court noted that Mr. Baydoun

had not had a chance to review the attorneys’ fees request made by the Receiver at

the Contempt Hearing. The Court stated that it would allow Mr. Baydoun to

respond to the request for fees and would decide later whether the Court needed

further evidence regarding the fees. (Tr. of Contempt Hearing at 96:10-18).

Receiver to incur attorneys’ fees, including by having to file the Contempt Motion.Simply put, curing the violation after the fact does not negate the harmMr. Baydoun’s contemptuous conduct caused. That Mr. Baydoun waited untilthree months after the Contempt Motion was filed to dismiss Mr. Morrow andDMP from the Michigan Action forced the Receiver to continue to spend time andresources on this matter even after filing the Contempt Motion, negating anycurative value his dismissal of DMP and Mr. Morrow may have caused.



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An award to the Receiver of his reasonable attorneys’ fees is appropriate in

this case. Attorneys’ fees will be awarded for any legal fees incurred to respond to

Mr. Baydoun’s interfering and harassing communications during the period

May 15, 2015, to December 8, 2015, and to file and prosecute the Receiver’s

Contempt Motion, including the fees incurred to prepare for and attend the

Contempt Hearing. The Court requires the Receiver to detail the attorneys’ fees he

incurred to respond to Mr. Baydoun’s communications and to prosecute his

Contempt Motion. The submission shall include a description of each service

performed by each time keeper, the time required to perform each service, and the

billing rate of the person who performed the service. This submission shall be

filed on or before March 4, 2016. Mr. Baydoun should file, on or before

March 18, 2016, his objections to the attorneys’ fees claimed.14

14 The Court notes that the parties, in seeking to resolve this matter amicably,had submitted proposed orders that required the payment of a reduced amount ofattorneys’ fees, though the parties did not come to a complete agreement on thespecific amount. In lieu of further briefing on this matter, the parties are welcometo negotiate an agreed upon amount of attorneys’ fees which Mr. Baydounshould be required to pay to the Receiver. If the parties reach such an agreement,they should notify the Court and submit a proposed consent order.



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III.

CONCLUSION

For the foregoing reasons,

IT IS HEREBY ORDERED that Detroit Memorial Partner, LLC’s Motion

for Contempt Against Non-Parties Tarek M. Baydoun, Jeffrey R. Hicks, the

Meridian Law Group, Abdul K. Charara, and Waad Charara [126] is GRANTED

IN PART and DENIED IN PART. It is GRANTED with respect to Mr. Tarek

Baydoun. It is DENIED with respect to Mr. Jeffrey Hicks, Mr. Abdul Charara,

Mr. Waad Charara, and the Meridian Law Group.15

IT IS FURTHER ORDERED that the Receiver is entitled to an award of

attorneys’ fees that he would not otherwise have incurred in this action but for

Mr. Baydoun’s contempt. The Court requires the Receiver to detail the attorneys’

fees he incurred to respond to Mr. Baydoun’s communications and to prosecute his

Contempt Motion. The submission shall include a description of each service

performed by each time keeper, the time required to perform each service, and the

billing rate of the person who performed the service. This submission shall be

filed on or before March 4, 2016. Mr. Baydoun should file, on or before

March 18, 2016, his objections to the attorneys’ fees claimed.

15 Because there was no testimony or evidence submitted regarding why the

Meridian Law Group, as an entity, is liable to the Receiver, the Court concludesthat only Mr. Baydoun should be held personally responsible for his conduct.



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IT IS FURTHER ORDERED that the Non-Parties’ Motion for Extension

of Time to Respond [129] is DENIED AS MOOT.

SO ORDERED this 11th day of February, 2016.

_______________________________

WILLIAM S. DUFFEY, JR.

UNITED STATES DISTRICT JUDGE


Documents

Baydoun Opinion