Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-03569/USCOURTS-cand-3_05-cv-03569-0/pdf.json

Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 28:1332 Diversity-Property Damage

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 Applica’s failure to provide a memorandum of points and authorities, and its failure

to provide the Court with a proposed order, have unnecessarily hampered the Court’s

resolution of the instant motion. The Court further notes that this case has been

designated for electronic filing; all papers in this case must be filed electronically.

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

APPLICA CONSUMER PRODUCTS, INC.,

Plaintiff,

 v.

PUBLISHERS GROUP WEST

INCORPORATED,

Defendant.

 /

No. C-05-3569 MMC

ORDER DENYING WITHOUT

PREJUDICE PLAINTIFF’S EX PARTE

APPLICATION FOR WRIT OF

POSSESSION AND TEMPORARY

RESTRAINING ORDER

Before the Court is the application for an ex parte writ of possession and ex parte

temporary restraining order, filed September 15, 2005 by plaintiff Applica Consumer

Products, Inc. (“Applica”). For the reasons set forth below, the application is DENIED,

without prejudice.1

BACKGROUND

The instant action was filed September 6, 2005. Jurisdiction is based on diversity. 

Applica asserts causes of action against defendant Publishers Group West Incorporated

(“PGW”) for “specific recovery of personal property and damages for its detention,”

conversion, and an accounting.

Case 3:05-cv-03569-MMC Document 3 Filed 09/16/05 Page 1 of 7
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LEGAL STANDARD

A. Writ of Possession

Under California law, a plaintiff may obtain a writ of possession if it has (1)

“established the probable validity of the plaintiff’s claim to possession of the property” and

(2) filed an undertaking in the requisite amount. See Cal. Code Civ. Proc. § 512.060. 

Under the circumstances presented in the instant case, a writ of possession may be issued

ex parte only if the plaintiff demonstrates that (1) the defendant “acquired possession of the

property in the ordinary course of his trade or business for commercial purposes”; (2) the

“property is not necessary for the support of the defendant or his family”; (3) there is “an

immediate danger that the property will become unavailable to levy by reason of being

transferred, concealed, or removed from the state or will become substantially impaired in

value by acts of destruction or by failure to take care of the property in a reasonable

manner”; and (4) the “ex parte issuance of a writ of possession is necessary to protect the

property.” See Cal. Code Civ. Proc. § 512.020(b)(3).

An application for a writ of possession must be executed under oath and contain all

of the following:

(1) A showing of the basis of the plaintiff's claim and that the plaintiff is 

entitled to possession of the property claimed. If the basis of the plaintiff's

claim is a written instrument, a copy of the instrument shall be attached.

(2) A showing that the property is wrongfully detained by the

defendant, of the manner in which the defendant came into possession of the

property, and, according to the best knowledge, information, and belief of the

plaintiff, of the reason for the detention.

(3) A particular description of the property and a statement of its value.

(4) A statement, according to the best knowledge, information, and

belief of the plaintiff, of the location of the property and, if the property, or

some part of it, is within a private place which may have to be entered to take

possession, a showing that there is probable cause to believe that such

property is located there.

(5) A statement that the property has not been taken for a tax,

assessment, or fine, pursuant to a statute; or seized under an execution

against the property of the plaintiff; or, if so seized, that it is by statute exempt

from such seizure.

See Cal. Code Civ. Proc. § 512.010(b).

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“No writ directing the levying officer to enter a private place to take possession of

any property shall be issued unless the plaintiff has established that there is probable

cause to believe that such property is located there.” See Cal. Code Civ. Proc.

§ 512.060(b). Additionally, the Court may not issue a writ of possession until the plaintiff

has filed with the Court an undertaking “in an amount not less than twice the value of the

defendant’s interest in the property or in a greater amount.” See Cal. Code Civ. Proc.

§ 515.010(a).

B. Temporary Restraining Order

The California Code of Civil Procedure provides that when a party seeks a writ of

possession, that party may also seek a temporary restraining order, which may issue

ex parte if the party demonstrates the probable validity of its claim to possession of the

property, has provided an adequate undertaking, and has “established the probability that

there is an immediate danger that the property claimed may become unavailable to levy by

reason of being transferred, concealed, or removed or may become substantially impaired

in value.” See Cal. Code Civ. Proc. § 513.010(b).

In addition, under the Federal Rules of Civil Procedure, an ex parte temporary

restraining order may issue “only if (1) it appears from specific facts shown by affidavit or

the verified complaint that immediate and irreparable injury, loss, or damage will result to

the applicant before the adverse party or that party’s attorney can be heard in opposition,

and (2) the applicant’s attorney certifies to the court in writing the efforts, if any, which have

been made to give the notice and the reasons supporting the claim that notice should not

be required.” See Fed. R. Civ. P. 65(b).

DISCUSSION

Lisa R. Castarphen, Applica’s Vice President, General Counsel and Secretary

(“Castarphen”), attests to the following facts:

In connection with a loan Applica made to non-party Bay/SOMA Publishing, Inc.

(“Bay/SOMA”), Bay/SOMA executed a document titled “Secured Promissory Note,” dated

June 30, 2001, in the amount of $500,000, in favor of Applica. (See Castarphen Decl. ¶ 3

Case 3:05-cv-03569-MMC Document 3 Filed 09/16/05 Page 3 of 7
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and Ex. 1.) By its terms, the note was payable in full on June 30, 2003. (See id. Ex. 1

¶ 2(b).)

On the same date, Bay/SOMA entered into an agreement titled “Security

Agreement,” whereby Bay/SOMA granted Applica a security interest in certain of its assets,

including, but not limited to, all current and future inventory owned or acquired by

Bay/SOMA (“Collateral”). (See id. ¶ 4 and Ex. 2 ¶ 1.1(c).) The Security Agreement further

provides that in the event of default, Applica is entitled to, inter alia, “[e]nter upon and into

and take possession of all or such part or parts of the asserts and properties of Borrower

as may be necessary or appropriate in the judgment of the Lender, to permit or enable the

Lender to manage the Borrower’s Business, and to store, lease, sell or otherwise dispose

of or collect all or any part of the Collateral, and use and operate said properties for such

purposes and for such length of time as the Lender may deem necessary or appropriate for

said purposes.” (See id. Ex. 2 §§ 5.1, 6.1(c) (emphasis added).)

On January 20, 2001 and on January 13, 2005, Applica filed UCC financing

statements with the California Secretary of State, giving notice of its security interest in the

Collateral. (See id. ¶ 4 and Ex. 3.)

Castarphen further declares that on December 6, 2004, due to an unspecified

“occurrence of an Event of Default under the Security Agreement,” Applica sent Bay/SOMA

a “Notice of Default and Acceleration under the Security Agreement Dated June 30, 2001.” 

(See id. ¶ 5 and Ex. 4.) Applica, however, does not submit any evidence as to what

Bay/SOMA did that constituted an Event of Default, and does not attest to Bay/SOMA’s

response, if any, to the Notice of Default.

Additionally, according to Castarphen, on June 1, 2005, “Applica conducted a

foreclosure sale of the Collateral,” at which Applica “was the successful and prevailing

bidder . . . and is now the owner of the Collateral.” (See id. ¶ 6.) By purchasing the

Collateral at the foreclosure sale, Applica “did not assume any liabilities of Bay/SOMA to

any parties.” (See id.) Applica, however, has submitted no evidence as to precisely what it

purchased at the foreclosure sale, and has submitted no documentation showing Applica’s

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current ownership of the Collateral.

Castarphen further declares that, since the time Applica became owner of the

collateral on June 1, 2005, Applica “has been entitled to the immediate and exclusive

possession of the Collateral, including all of the inventory of the products published by

Bay/SOMA located at the warehouses” of defendant Publishers Group West Incorporated

(“PGW”) “in Indiana, Canada and outside of North America.” (See id. ¶ 7.) Castarphen

attaches to her declaration a document she states is a “table listing the Inventory as of the

date of the Foreclosure Sale.” (See id. ¶ 7 and Ex. 5.) Applica, however, fails to provide

any foundation for the admissibility of this document, which purports to show an inventory

consisting of approximately 145,000 books. (See id. Ex. 5.) Additionally, Applica provides

no foundation for Castarphen’s conclusion that any such inventory consists of property

formerly owned by Bay/SOMA and purchased by Applica at the foreclosure sale.

Castarphen next attests that PGW “acquired possession of the Inventory in the

ordinary course of business for commercial purposes as the United States Distributor for

Bay/SOMA and was in possession of Inventory on the date of the Foreclosure Sale and

continues to hold possession as of this date”; that, on information and belief, “the Inventory

is not necessary for the support of the Defendant which is a corporation”; and that she

“believe[s] that there is an immediate danger that the Inventory will become unavailable to

levy by reason of being transferred . . . [because] Defendant continues to sell the

Inventory.” (See id. ¶¶ 8, 10, 11.) Again, Applica submits no evidence as to the basis for

Castarphen’s belief that PGW acted as Bay/SOMA’s distributor, and no evidence as to why

it believes the inventory itemized in Exhibit 5 consists of inventory formerly owned by

Bay/SOMA.

According to Castarphen, Applica’s counsel sent letters to PGW’s counsel on July 6,

2005 and July 11, 2005, demanding the return of the Inventory, and that PGW has not

responded to said letters. (See id. ¶ 9 and Ex. 6.)

Finally, Castarphen attests that the value of the Inventory at the time of the

foreclosure sale was “not less than $3,289,962.85.” (See id. ¶ 13.) Applica submits no

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evidence as to the basis for this estimate.

Having read and considered the above submission, the Court finds Applica has not

demonstrated its entitlement to an ex parte writ of possession or temporary restraining

order, for the following reasons. First, Applica has presented no evidence as to the nature

of Bay/SOMA’s asserted default under the Note. Castarphen’s declaration that Applica

sent a Notice of Default to Bay/SOMA does not suffice as evidence that a default actually

occurred. 

Second, even assuming Bay/SOMA defaulted on the Note, Applica has presented

no evidence as to precisely what Applica purchased at the foreclosure sale.

Third, Applica has failed to set forth in adequate detail the basis for its belief that

PGW has possession of former Bay/SOMA inventory. Although Castarphen attaches to

her declaration a document that purports to list various titles in PGW’s warehouses in

Indiana, Canada, and outside of North America, (see id. Ex. 5), there is no evidence as to

how Applica learned of the existence of this inventory, or the basis for Applica’s belief that it

was formerly owned by Bay/SOMA. Consequently, there is no “showing” as to how PGW

came into possession of the inventory, as required by § 512.010(b)(2) of the California

Code of Civil Procedure.

Fourth, Applica has failed to submit evidence of “the location of the property” and,

consequently, has not made a “showing that there is probable cause to believe that such

property is located there,” as required by § 512.010(b)(4) of the California Code of Civil

Procedure.

Accordingly, Applica has not demonstrated “the probable validity of the plaintiff’s

claim to possession of the property” currently in possession of PGW, as required by

§ 512.060 of the California Code of Civil Procedure and, thus, has not demonstrated its

entitlement to a writ of attachment or temporary restraining order. 

Finally, Applica has not complied with Rule 65(b) of the Federal Rules of Civil

Procedure, which requires a certification as to the efforts made to notify the opposing party

or the reasons why such notice should not be required. (See Fed. R. Civ. P. 65(b).)

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CONCLUSION

Accordingly, for the reasons set forth above, Applica’s request for an ex parte writ of

possession and ex parte temporary restraining order is hereby DENIED, without prejudice.

IT IS SO ORDERED.

Dated: September 16, 2005 MAXINE M. CHESNEY

United States District Judge

Case 3:05-cv-03569-MMC Document 3 Filed 09/16/05 Page 7 of 7