Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_08-cv-01023/USCOURTS-casd-3_08-cv-01023-1/pdf.json

Nature of Suit Code: 120
Nature of Suit: Marine Contract Actions
Cause of Action: 46:1101 Violation of Maritime Regulations

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1 08cv1023

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

WACHOVIA BANK, N.A.,

Plaintiff,

v.

M/Y JUST A NOTION, Official Number

1089525, her engines, tackle, furniture and

appurtenances, in rem, and GREGORY A.

STRASBURG, as Trustor and Trustee of The

Gregory A. Strasburg Revocable Trust,

Defendants. 

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Case No.: 08cv1023 AJB (BLM)

ORDER DIRECTING THE CLERK TO

DISBURSE $540,000.00 TO PLAINTIFF

FROM THE PROCEEDS OF THE U.S.

MARSHAL’S SALE OF THE M/Y JUST A

NOTION AND RETAIN THE

REMAINDER OF THE FUNDS PENDING

RESOLUTION OF THE RELATED CASE,

08-CV-0021

Pending is the parties’ Joint Motion for Order to Clerk to Disburse Funds (Doc. No. 68) asking

the Court to direct the Clerk to disburse $540,000 to Wachovia Bank, N.A. (“Wachovia”) from the sale

proceeds of M/Y Just a Notion (the “Vessel”), filed March 29, 2011. 

On April 4, 2009, the Court entered a Stipulated Judgment drafted by Wachovia and Defendant

Gregory A. Strasburg. (Doc. No. 22). Pursuant to the Stipulated Judgment, the proceeds from the sale

of the Vessel would be applied first to the mortgage held by Wachovia. (Id. at ¶ 14). In the event that

the sale yielded proceeds in excess of the amount claimed by Wachovia, the Stipulated Judgment stated

that “any balance remaining shall be deposited in the registry of the Court pending further orders of the

Court.” (Id.). If further stated that “[a]ny such funds shall not be disbursed to any other claimants or

alleged lien holders until the validity of such liens has been adjudicated by this Court in the related

Case 3:08-cv-01023-AJB-BLM Document 70 Filed 04/18/11 Page 1 of 3
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K:\COMMON\BATTAGLI\DJ CASES\2 Orders to be filed\08-1023 Wachovia Order to disburse funds.wpd 2 08cv1023

case,” Strasburg v. M/Y Just a Notion et al., 08-cv-0021. The Stipulated Judgment relieved Wachovia

of its obligation to pay the substitute custodian fees and costs while the Vessel remained arrested and

transferred that obligation to Strasburg and the Strasburg Trust until further order of the Court. (Id. at ¶

11). 

On April 23, 2010, the U.S. Marshals Service notified the court that the Vessel had been sold for

$650,000. (Doc. No. 53). On February 4, 2011, the parties submitted a Joint Motion for Disbursement

of Funds (Doc. No. 63). The Funds Distribution Agreement was attached the motion as Exhibit A (Doc.

No. 63-1). The Funds Distribution Agreement provided that Plaintiff, as holder of the mortgage, would

be paid $540,000 from the sale proceeds of the Vessel. The Court granted the motion on February 8,

2011 (Doc. No. 64). The Court subsequently directed the parties to file supplemental briefing with

regard to disbursal of the remaining sale proceeds. 

In the supplemental briefing, Strasburg asks that the Court disburse the remaining proceeds from

the Vessel’s sale to him in order to reimburse him for the administrative costs he has paid to the

substitute custodian pursuant to the Stipulated Judgment. (Doc. No. 65 at 3). Strasburg contends that

federal courts sitting in admiralty have equitable powers to give priority claims arising out of the

administration of property within its jurisdiction. (Id. (citing New York Co. v. Poznan, 274 U.S. 117

(1927); Kingsgate Oil v. M/V Green Star, 815 F.2d 918 (3rd Cir. 1987))). Jim Singleton, a party in the

related case, filed an opposition to Strasburg’s supplemental briefing at the request of the Court. (Doc.

No. 66). Singleton relies upon the terms of the Stipulated Judgment previously entered by the Court and

argues that the Court should retain the remainder of the proceeds pending resolution of the related case. 

(Id.). 

The Court is inclined to agree with Singleton’s view. Strasburg participated in the drafting of

the Stipulated Judgment which clearly states that any proceeds exceeding the amount owed to Wachovia

would “not be disbursed to any other claimants or alleged lien holders until the validity of such liens has

been adjudicated by this Court in the related case.” (Doc. No. 22 at ¶ 14). Nevertheless, Strasburg

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K:\COMMON\BATTAGLI\DJ CASES\2 Orders to be filed\08-1023 Wachovia Order to disburse funds.wpd 3 08cv1023

entered into the Stipulated Judgment, knowingly incurring the obligation to pay the administrative costs

associated with the Vessel’s arrest. Accordingly, the Court is not inclined to depart from the terms of

the mutually agreed upon Stipulated Judgment on the basis of equity towards Strasburg. 

Based on the foregoing, the parties’ Joint Motion for Order to Clerk to Disburse Funds is

GRANTED. The Court directs the Court Clerk to disburse the amount of $540,000.00 from the interest

bearing account in the above-entitled case to “Wachovia Bank, N.A.”, whose mailing address is c/o

Russell & Associates, Attn: Thomas A. Russell, Esq., P.O. Box 11466, Newport Beach, CA 92658. It is

further ORDERED that the Clerk is authorized to deduct ten percent of any earned interest on this

amount, as authorized by the Judicial Conference of the United States. 

It is further ORDERED that the excess funds from the sale of the Vessel shall remain in the

Court’s registry pending resolution of the claims in the related case, Strasburg v. M/Y Just a Notion, 08-

cv-0021. 

IT IS SO ORDERED.

DATED: April 18, 2011

Hon. Anthony J. Battaglia

U.S. District Judge

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