No. 14-14826 

United States District Court 

Eastern District of Michigan 

Southern Division 

Honorable Sean F. Cox 

In Re: Salvatore Cipriano, 

Debtor, 

R.A.M. Produce Distributors, LLC, 

Plaintiff/Appellant 

v. 

Salvatore Cipriano a/k/a Sal Cipriano and Produce Buyers Co., 

Defendants/Appellee (Cipriano only Appellee). 

(Bankr. Adv. No. 140-04957) 

Appeal from the United States Bankruptcy Court 

Eastern District of Michigan, Southern Division 

Hon. Marci B. McIvor 

DEFENDANT/APPELLEE SALVATORE CIPRIANO’S BRIEF ON 

APPEAL

Submitted By: 

Erik C. Stein (P72172) 

Gallagher Sharp 

Attorneys for Defendant/Appellee 

211 W. Fort St., Ste 660 

Detroit, MI 48226 

Phone: (313) 962-9160 / Fax: (313) 962-9167 

Email: estein@gallaghersharp.com

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 1 of 24 Pg ID 399
TABLE OF CONTENTS

TABLE OF AUTHORITIES .................................................................................... ii

JURISDICTIONAL STATEMENT ........................................................................ iii

STATEMENT OF THE CASE .................................................................................. 1

A. Factual background of claims ........................................................................... 1

B. Procedural History ............................................................................................ 2

ARGUMENT ............................................................................................................. 6

A. The Bankruptcy Court did not error and/or deny Due Process to Appellant 

because it did not sua sponte raise the issue of Statute of Limitations. ................. 6

B. The Bankruptcy Court did not error and/or deny Due Process to Appellant by 

dismissing its claims against Appellee Cipriano, because the Bankruptcy Court 

did not raise the issue sua sponte, nor was it waived. .......................................... 10

C. The Bankruptcy Court did not error in concluding that the three year statute 

of limitations for breach of fiduciary duty lapsed because of partial payments 

made on the claim of Appellant. ........................................................................... 12

D. The Bankruptcy Court did not err in deciding Appellee’s Motion to Dismiss 

under FRCP 12(b)(6). ........................................................................................... 14

CONCLUSION AND RELIEF SOUGHT .............................................................. 16 

 

i 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 2 of 24 Pg ID 400
TABLE OF AUTHORITIES

Cases

Adams v. AutoRail Logistics, Inc., 2011 U.S. Dist. LEXIS 6896 (E.D. Mich 2011), unpublished.

................................................................................................................................................... 11 

Charbonenneau v. Mary Jane Elliott, P.C., 611 F.Supp.2d 736 (E.D. Mich 2009) ..................... 13 

Cortec Industries, Inc. v. Sum Holding L.P., 949 F.2d 42 (2nd Circ 1991) ................................... 15 

Grant v. Preferred Research, Inc., 885 F.2d 795 (11th Cir. 1989) .......................................... 10, 11 

Hassan v. U.S. Postal Service, 842 F.2d 260, 263(11th Cir. 1988) ............................................... 11 

Howard v. Grinage, 82 F.3d 1343, 1349 (6th Cir. 1996) ................................................................ 7 

Jefferson Fourteenth Associates v. Wometco De Puerto Rico, Inc., 695 F.2d 524 (11th Circ. 1983)

................................................................................................................................................. 8, 9 

Murphy v. Lazarev, 589 Fed.Appx. 757, 2014 U.S. App. LEXIS 19951 (6th Cir. 2014) ............. 11 

Sprewell v. Golden State Warriors, 266 F.3d 979 (9th Cir. 2001) .............................................. 16 

Tingler v. Marshall, 716 F.2d 1109 (6th Cir. 1983) .................................................................... 7, 9 

Yeiter v. Knights of St. Casimir Aid Society, 461 Mich. 493, 607 N.W.2d 68 (2000) .................. 13 

Statutes

11 U.S.C. § 523(a)(4) ............................................................................................... 12 

MCL § 600.5805(1) ................................................................................................. 12 

MCL § 600.5807 ...................................................................................................... 12 

Rules

Fed.R.Civ.P 15(a) ............................................................................................ 7, 8, 11 

Fed.R.Civ.P. 12(b)(6) .................................................................................. 11, 14, 15 

Fed.R.Civ.P. 56 .......................................................................................................... 9 

Fed.R.Civ.P. 8(c) ...................................................................................................... 10 

 

ii 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 3 of 24 Pg ID 401
JURISDICTIONAL STATEMENT

Appellee adopts to the jurisdictional statement of Appellant. 

 

iii 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 4 of 24 Pg ID 402
iv 

STATEMENT OF ISSUES PRESENTED AND APPLICABLE STANDARDS 

OF REVIEW

Appellee adopts the Statement of Issues Presented and Applicable Standards 

of Review as stated by Appellant. 

 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 5 of 24 Pg ID 403
STATEMENT OF THE CASE

A. Factual background of claims 

Defendant Salvatore Cipriano (“Defendant”) is an individual residing in the 

County of Wayne, State of Michigan. (R1: R.A.M. Produce Distributors, L.L.C.’s 

Complaint to Establish Liability and Non-Dischargeability of Debt, ¶7). Plaintiff 

R.A.M. Produce Distributors, L.L.C. (“Plaintiff”) is a Michigan limited liability 

company with its principal place of business located in the City of Detroit. (R1: 

R.A.M. Produce Distributors, L.L.C.’s Complaint to Establish Liability and NonDischargeability of Debt, ¶6). 

In 2010, Defendant was employed as President of Produce Buyers Co. Inc., 

a closely held corporation engaged in produce dealing. (R7: Salvatore Cipirano’s 

Motion and Brief to Dismiss Claims Under FRCP 12(b)(6), p. 7). At this time, 

Defendant Produce Buyers Company, Inc. (hereinafter “Produce Buyers”) was 

licensed under the Perishable Agricultural Commodities Act of 1930, as amended, 

7 U.S.C. §499(a) et seq. (“PACA”). (R1: R.A.M. Produce Distributors, L.L.C.’s 

Complaint to Establish Liability and Non-Dischargeability, ¶13). 

From about June 10, 2010 to November 12, 2010, Plaintiff sold to Defendant 

perishable agricultural commodities, pursuant to PACA. (R1: R.A.M. Produce 

Distributors, L.L.C.’s Complaint to Establish Liability and Non-Dischargeability, 

¶14). Timely with and/or shortly after each sale and delivery of produce, Plaintiff 

1 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 6 of 24 Pg ID 404
delivered an itemized bill for said produce sold to Produce Buyers. (R1: R.A.M. 

Produce Distributors, L.L.C.’s Complaint to Establish Liability and NonDischargeability, Exhibit C1: Customer Ledger). The total principal amount due 

Plaintiff from Produce Buyers for the produce sold during this period was 

$37,921.10. (R1: R.A.M. Produce Distributors, L.L.C.’s Complaint to Establish 

Liability and Non-Dischargeability, Exhibit C1: Customer Ledger). 

 Produce Buyers offered no payment to Plaintiff until May 18, 2012, when it 

made a partial payment of $560.90. (R1: R.A.M. Produce Distributors, L.L.C.’s 

Complaint to Establish Liability and Non-Dischargeability, ¶16). On June 20, 

2012, another payment in the amount of $875.00 was made by Produce Buyers. 

(R1: R.A.M. Produce Distributors, L.L.C.’s Complaint to Establish Liability and 

Non-Dischargeability, ¶16). 

Subsequently, around the end of June or early July of 2012, Defendant 

Produce Buyers ceased operations. (R7: Salvatore Cipriano’s Motion and Brief to 

Dismiss Claims Under FRCP 12(b)(6), Exhibit C: § 341 Tr. p. 11, lines 19-21). 

B. Procedural History 

On or about May 16, 2014, Defendant filed a voluntary petition under 

Chapter 13 of the United States Bankruptcy Code. (R1: R.A.M. Produce 

Distributors, L.L.C.’s Complaint to Establish Liability and Non-Dischargeability, 

¶10). On June 12, 2014, Defendant filed a Notice to Convert Case from Chapter 13 

2 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 7 of 24 Pg ID 405
On September 5th, 2014, Plaintiff filed suit against Defendant, alleging 

breach of fiduciary duty as trustee of PACA assets, and arguing that Plaintiff’s 

debt is accordingly non-dischargeable 11 U.S.C §523 (a)(4). (R1: R.A.M. Produce 

Distributors, L.L.C.’s Complaint to Establish Liability and Non-Dischargeability). 

Defendant/Appellee Cipriano filed a Motion to Dismiss Adversary Proceeding Re: 

Failure to State a Claim on October 8, 2014. (R7: Salvatore Cipriano’s Motion and 

Brief to Dismiss Claims Under FRCP 12(b)(6)). Defendant/Appellee Cipriano also 

filed an Answer to Plaintiff/Appellant’s Complaint on October 8, 2014. (R8: 

Defendant Sal Cipriano’s Answer to the Class Action [sic] Complaint and 

Affirmative Defenses). Plaintiff/Appellant filed a Response to 

Defendant/Appellee’s Motion on October 23, 2014. (R11: Plaintiff R.A.M. 

Produce Distributors, L.L.C.’s Response to Salvatore Cipriano’s Motion to 

Dismiss Claims Under FRCP 12(b)(6)). The matter was heard before the Hon. 

Marci B. McIvor of The United States Bankruptcy Court for the Eastern District of 

Michigan on November 25, 2014. (R49: Transcript Regarding Hearing Held 11-

25-14 Re: Cipriano’s Motion to Dismiss). 

Defendant/Appellee Cipriano raised two arguments in its Motion to Dismiss: 

(1) Plaintiff/Appellant was not entitled to trust protection under PACA at the time 

3 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 8 of 24 Pg ID 406
of the Defendant’s alleged breach under the same; and (2) Plaintiff/Appellant could 

not assert a viable claim excepted from the bankruptcy discharge against 

Defendant/Appellee. (R7: Salvatore Cipriano’s Motion and Brief to Dismiss 

Claims Under FRCP 12(b)(6)). Generally speaking, Defendant/Appellee asserted 

that PACA did not apply to the transaction at hand because of the delay by R.A.M. 

Produce in asserting any cause of action against Defendant/Appellee. (R7: 

Salvatore Cipriano’s Motion and Brief to Dismiss Claims Under FRCP 12(b)(6)). 

Defendant/Appellee further argued that Plaintiff/Appellant could not assert a valid 

PACA action, there existed no other basis for a breach of fiduciary duty actionable 

under 11 U.S.C. § 523(a)(4). (R7: Salvatore Cipriano’s Motion and Brief to 

Dismiss Claims Under FRCP 12(b)(6)). 

Plaintiff/Appellant, in its response spent nearly an entire page discussing the 

statute of limitations in a single spaced footnote. (R15: Brief in Support of 

Plaintiff R.A.M. Produce Distributors, L.L.C.’s Response to Defendant Cipriano’s 

Motion to Dismiss Claims Under Fed.R.Civ.P. 12(b)(6), pp. 9-10). 

Plaintiff/Appellant also attached as exhibits to its Response an email exchange 

between counsel for Plaintiff/Appellant and counsel for Defendant/Appellee in 

which the statute of limitations issue discussed. (R15: Brief in Support of Plaintiff 

R.A.M. Produce Distributors, L.L.C.’s Response to Defendant Cipriano’s Motion 

to Dismiss Claims Under Fed.R.Civ.P. 12(b)(6), Exhibit G). 

4 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 9 of 24 Pg ID 407
In a bench opinion, the Bankruptcy Court dismissed Plaintiff/Appellant’s 

Complaint. (R49: Transcript Regarding Hearing Held 11-25-14 RE Cipriano’s 

Motion to Dismiss). “This Court finds that waiting four years to assert a lien 

against Produce Buyers cannot be considered “prompt action” under any definition 

of the word.” (R49: Transcript Regarding Hearing Held 11-25-14 RE Cipriano’s 

Motion to Dismiss, p. 42, line 25, p. 43, lines 1-2). The Bankruptcy Court went on 

to state that Plaintiff/Appellant’s “failure to promptly pursue its PACA claim 

against Produce Buyers is fatal to is argument that it has any lien rights against 

Produce Buyers principle [sic] Defendant Cipriano.” (R49: Transcript Regarding 

Hearing Held 11-25-14 RE Cipriano’s Motion to Dismiss, p. 43, lines 9-12). 

In a Supplemental Opinion to Bench Opinion Issued on November 25, 2014, 

the Bankruptcy Court further discussed its basis for dismissal of Plaintiff’s 

Complaint. (R33: Supplemental Opinion to Bench Opinion Issued on November 

25, 2014). Taking note of the argument in Plaintiff/Appellant’s Response to the 

Motion to Dismiss, the Court further concluded that Plaintiff/Appellant’s 

complaint was filed beyond the applicable statute of limitations. (R33: 

Supplemental Opinion to Bench Opinion Issued on November 25, 2014, p. 8). The 

Bankruptcy Court held that the three year statute of limitations applied to breach of 

fiduciary duty under a PACA trust and that said statute of limitations was not 

5 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 10 of 24 Pg ID 408
renewed by partial payments. (R33: Supplemental Opinion to Bench Opinion 

Issued on November 25, 2014, pp. 6, 7). 

Plaintiff /Appellant then brought the instant appeal. 

SUMMARY OF THE ARGUMENT 

The Bankruptcy Court did not err in dismissing Appellant’s Complaint 

pursuant to Fed.R.Civ.P 12(b)(6). First, the Bankruptcy Court did not sue sponge

dismiss the Appellant’s Complaint as Appellant had notice of statute of limitations 

argument and briefed a response to the argument in its Response to Appellee’s 

Motion to Dismiss. Second, Appellant had enough notice, despite the absence of 

the statute of limitations in Appellee’s Affirmative Defenses, to satisfy the 

requirements of Fed.R.Civ.P 8(c). Third, Appellant has failed to provide any 

authority that applies the “partial payment rule” to statute of limitations issues 

regarding a breach of fiduciary duties. Finally, the Bankruptcy Court did not err 

when it failed to consider the extrinsic evidence provided by Appellant in support 

of its Response to Appellee’s Motion to Dismiss. 

ARGUMENT 

A. The Bankruptcy Court did not error and/or deny Due Process to 

Appellant because it did not sua sponte raise the issue of Statute of 

Limitations. 

Due process is the requirement that a party be given adequate notice and an 

opportunity to be heard. Howard v. Grinage, 82 F.3d 1343, 1349 (6th Cir. 1996). In 

addressing sua sponte dismissals before District Courts, the Sixth Circuit 

6 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 11 of 24 Pg ID 409
enunciated the applicable standard in Tingler v. Marshall, 716 F.2d 1109, 1112 (6th

Cir. 1983), superseded on statutory grounds related to 28 U.S.C. § 1915(e)(2)(B). 

At issue in Tingler was a prison inmate’s suit relating to an alleged infringement of 

his constitutional rights by the prison he was held at in Ohio. Id. at 1109. The day 

that the plaintiff filed suit, the District Court dismissed the action sua sponte: the 

complaint had not been serviced and nobody was notified of the court’s intention 

to dismiss the complaint. Id.

Tingler held that a court faced with a complaint that it believes is subject to 

dismiss must: (1) allow service of the complaint on the Defendant; (2) notify all 

parties of its intention to dismiss the complaint; (3) give the plaintiff a chance to 

either amend its complaint or respond to the reasons stated by the court regarding 

its notice of dismissal; (4) give the defendant a chance to respond or file an answer 

or motions; and (5) if the claim is dismissed, stat its reasons for the dismiss. 

Appellant cites to the Eleventh Circuit decision in Jefferson Fourteenth 

Associates v. Wometco De Puerto Rico, Inc., 695 F.2d 524 (11th Circ. 1983) to 

support its assertion that its due process rights were violated by the dismissal of its 

case. In Jefferson, the issue was money damages related to physical damage to 

theaters owned by a third party plaintiff. Id. at 525. While the first party suit was 

pending, the third party suit was stayed. Id. Third party plaintiff filed a motion to 

lift the stay and in response to that motion, defendant “suggested” in response that 

7 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 12 of 24 Pg ID 410
the court should sua sponte dismiss the action. Id. The court then dismissed the 

action. Id.

In remanding Jefferson to the district court, the Eleventh Circuit based its 

opinion on the fact that the parties did not have any notice that a “dismissal” was 

before the court. Id. at 527. The 11th Circuit also noted that Fed.R.Civ.P 15(a) 

provided the plaintiff the opportunity to amend its pleadings – especially in light of 

the fact that neither Jefferson defendant filed an answer. Id. 

Here, it is overly simplistic to label the dismissal of Appellant’s action as 

sua sponte – the Court was presented with a Motion by Appellee for dismissal. 

Nonetheless, the facts demonstrate that the Tingler standard has been met and that 

Jefferson is simply not applicable. First, Appellant knew, unlike the plaintiff in 

Jefferson, that the matter before the court was the dismissal of its complaint. 

Second, in Appellant’s Response to the Motion to Dismiss, Appellant argued in a 

lengthy footnote as to why the statute of limitations was not a proper basis for 

dismissing its complaint. Third, Appellant, did not, pursuant to Fed.R.Civ.P. 

15(a), amend its Complaint in light of Apellee’s Motion to Dismiss. Fourth, 

Appellant filed a Response to Plaintiff’s Motion – with an argument regarding the 

statute of limitations and attended a hearing held by the Bankruptcy Court 

regarding the same. Fifth, the Bankruptcy Court offered a lengthy bench and 

written supplemental reasons providing a detailed explanation regarding the 

8 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 13 of 24 Pg ID 411
dismissal. For Appellant to now argue that it did not have notice that (1) its case 

was being analyzed for dismissal and (2) that it was unaware of the basis upon 

which dismissal was being sought is disingenuous. 

Assuming however, that the Tingler elements have not been met, there were 

not any additional facts that were subject to development in this matter. In 

Jefferson and Tingler the courts noted that the denial of the plaintiff’s ability to 

develop facts in support of its allegations were a major concern regarding the 

dismissals in each case. Here, however, as stated on the record by the parties and 

the Court, only issues of law remained between the parties – further factual 

development was not deemed to be necessary by Appellant as evidenced by the 

notice that Appellant intended to file a Motion pursuant to Fed.R.Civ.P. 56 as soon 

as the Bankruptcy Court rendered its decision on Appellee’s Motion. (R49: 

Transcript Regarding Hearing Held 11-25-14 RE: Cipriano’s Motion to Dismiss, p. 

23, lines 2-9). As a result, Appellant’s cries of foul ring hollow when, if Appellant 

is hypothetically successful in having this action remanded to the Bankruptcy 

Court, an amendment to the pleadings by Appellee to correct any deficiencies to its 

Answer will once again prove fatal to Appellant’s case. 

9 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 14 of 24 Pg ID 412
B. The Bankruptcy Court did not error and/or deny Due Process to 

Appellant by dismissing its claims against Appellee Cipriano, because 

the Bankruptcy Court did not raise the issue sua sponte, nor was it 

waived. 

In Grant v. Preferred Research, Inc., 885 F.2d 795 (11th Cir. 1989), plaintiff 

filed suit alleging a number of civil allegations. Id. The District Court rejected all 

of the plaintiff’s claims on the basis that the applicable statute of limitations had 

run. Id. Plaintiff then argued on appeal that the defendant did not assert the statute 

of limitations as an affirmative defense and thus waived it. Id. at 796. The court 

noted that Fed.R.Civ.P. 8(c) is intended to give the opposing party notice of the 

affirmative defense and a chance to rebut it. Id. at 797. The court went further to 

reason that if a plaintiff receives notice of an affirmative defense by means other 

than the pleadings, “the defendant’s failure to comply with Rule 8(c) does not 

cause the plaintiff any prejudice.” Id., citing Hassan v. U.S. Postal Service, 842 

F.2d 260, 263(11th Cir. 1988); see also Murphy v. Lazarev, 589 Fed.Appx. 757, 

2014 U.S. App. LEXIS 19951 (6th Cir. 2014), unpublished; Adams v. AutoRail 

Logistics, Inc., 2011 U.S. Dist. LEXIS 6896 (E.D. Mich 2011), unpublished. 

Here, Appellant states in his response to Appellee’s Motion to Dismiss that 

“through an email sent by Defendant Cipriano’s counsel on October 1, 2014, 

Defendant Cipriano requested concurrence on dismissal of the pending claims of 

RAM produce based on a lapse of the applicable statute of limitations.” (R19: 

Brief in Support of Plaintiff R.A.M. Produce Distributors, L.L.C.’s Response to 

10 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 15 of 24 Pg ID 413
Defendant Cipriano’s Motion to Dismiss Claims Under Fed.R.Civ.P. 12(b)(6), pp. 

9-10; Exhibit G). The record demonstrates that Appellant was on notice of a statute 

of limitations argument – so much so that Appellant devoted nearly half a page in 

its Response to Plaintiff’s Motion arguing the same. (R19: Brief in Support of 

Plaintiff R.A.M. Produce Distributors, L.L.C.’s Response to Defendant Cipriano’s 

Motion to Dismiss Claims Under Fed.R.Civ.P. 12(b)(6), pp. 9-10). The court also 

noted Appellant’s footnote in its Supplemental Opinion, stated: 

While the parties did not brief the issue, a footnote in Plaintiff’s 

brief suggests that Defendants, at one point, asserted a three 

year statute of limitations period, presumably the limitations 

period for bring tort actions seeking damages for breach of 

fiduciary duty. 

(R33: Supplemental Opinion to Bench Opinion Issued on November 25, 2014, p 

5). Again, for Appellant to assert that this issue was raised by the court sua sponte

is simply not true. 

 If, however, the Court believes that the statute of limitations was not 

properly asserted before the Bankruptcy Court, as stated in Section A of this Brief, 

upon remand Appellee will have the ability to apply for leave from the Bankruptcy 

Court to amend its affirmative defenses pursuant to Fed.R.Civ.P. 15(a)(2), 

rendering the subject matter of Appellant’s appeal moot. 

11 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 16 of 24 Pg ID 414
C. The Bankruptcy Court did not error in concluding that the three 

year statute of limitations for breach of fiduciary duty lapsed 

because of partial payments made on the claim of Appellant. 

There is not a dispute between the parties regarding the applicable statute of 

limitations period for PACA claims. Likewise, there is also not a dispute between 

the parties that Michigan law provides that a partial payment on a debt serves to 

revive the statute of limitations. The dispute, rather, lies at whether a partial 

payment serves to restart the statute of limitations on claims alleging a breach of 

fiduciary duty. 

Michigan law does provide that a partial payment serves to re-start the 

statute of limitations period of for a nonpayment of debt. In Yeiter v. Knights of St. 

Casimir Aid Society, 461 Mich. 493, 607 N.W.2d 68 (2000) a partial payment 

served to restart the six year statute of limitations found in MCL § 600.5807. The 

court reasoned that a partial payment serves as an acknowledgement of the full 

debt, absent any indication otherwise by the debtor. Yietier, 461 Mich at 497. In 

Charbonneau v. Mary Jane Elliott, P.C., 611 F.Supp.2d 736 (E.D. Mich 2009), the 

court again held that the six year statute of limitations was revived based upon a 

partial payment on a debt. 

A claim under PACA presents a factual distinction to the cases cited by 

Appellant in its brief – especially in light of Appellant’s claim for the nondischargeability of its debts pursuant to 11 U.S.C. § 523(a)(4). Specifically, 

12 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 17 of 24 Pg ID 415
Appellant has alleged an underlying debt along with a claim for breach of fiduciary 

duty for violation of the PACA trust. (R1: R.A.M. Produce Distributors, L.L.C.’s 

Complaint to Establish Liability and Non-Dischargeability of Debt). Two separate

statutes of limitations are applicable to Appellant’s Complaint: the three year 

statute of limitations for breach of fiduciary found in MCL § 600.5805(1) and the 

six year statute of limitations found in MCL § 600.5807. Despite Appellant’s 

assertions, it has failed to provide any authority that demonstrates that a partial 

payment revives the statute of limitations for breach of fiduciary duty. 

Here, the Bankruptcy Court was correct in finding that the three year statute 

of limitations found in MCL § 600.5805(1) has run. (R33: Supplemental Opinion 

to Bench Opinion Issued on November 25, 2014, p. 6). The 2012 partial payments 

served only to revive the six year statute of limitations applicable to Appellant’s 

breach of contract claims. This assertion is consistent with Yeiter and the other 

cases cited by Appellant. To that extent, Appellee does not contest that Appellant 

has an unsecured claim against him that is not immediately subject to the statute of 

limitations. Appellant, however, is foreclosed from bringing any action pursuant 

for breach of the PACA trust as the statute of limitations has expired. 

13 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 18 of 24 Pg ID 416
D. The Bankruptcy Court did not err in deciding Appellee’s Motion 

to Dismiss under FRCP 12(b)(6). 

Appellant contends in its brief that the Bankruptcy Court erred in that it 

failed to consider all of the submissions of the parties in its decision to dismiss 

Appellant’s complaint. Appellant contends that Appellee filed, in support of its 

Motion, several additional items constituting extrinsic evidence beyond the scope 

of the pleadings. Appellant then filed several items of extrinsic evidence in support 

of its Response. 

Fed.R.Civ.P. 12(d) states in relevant part that: 

If, on a motion under Rule 12(b)(6) or 12(c), matters outside of 

the pleadings are presented to and not excluded by the court, the 

motion must be treated as one for summary judgment under 

Rule 56. 

It is well settled that in deciding a Motion to Dismiss filed pursuant to 

Fed.R.Civ.P. 12(b)(6), the court may examine and rely upon documents which the 

plaintiff was aware of and relied upon in framing its complaint, even though the 

plaintiff did not attach those documents to its complaint or incorporate them be 

reference. Cortec Industries, Inc. v. Sum Holding L.P., 949 F.2d 42 (2nd Circ 1991), 

cert denied, 503 U.S. 960 (1992). This is true, especially if the authenticity of the 

document in question was not in dispute by any party. Sprewell v. Golden State 

Warriors, 266 F.3d 979 (9th Cir. 2001). 

14 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 19 of 24 Pg ID 417
 Here, Appellant attached the following documents as exhibits to its 

Complaint: 

• Appellee’s Schedule F 

• Excerpts from the Transcript of Appellee’s 341 Hearing 

• An Affidavit signed by Michael Bommarito 

• R.A.M. Produce Distributor’s Customer Ledger dated 06/27/2014 

(R1: R.A.M. Produce Distributors, L.L.C.’s Complaint to Establish Liability and 

Non-Dischargeability of Debt with Exhibits A-C and C1). As attachments to his 

Motion to Dismiss, Appellee attached the following exhibits: 

• Appellant’s Complaint 

• All invoices referred to in R.A.M. Produce Distributor’s Customer Ledger 

dated 6/27/2014 

• Excerpts from the Transcript of Appellee’s 341 Hearing 

(R7: Salvatore Cipriano’s Motion and Brief to Dismiss Claims Under FRCP 

12(b)(6) with exhibits). Appellee contends that all of the documents it submitted as 

exhibits to his Motion to Dismiss were proper under Fed.R.Civ.P 12(b)(6) and 

12(d) as all of the documents were either referred to or attached to Appellant’s 

complaint. Furthermore, the record does not contain any objection by Appellant 

regarding the authenticity of the documents provided with Appellee’s Motion to 

Dismiss. 

 Appellant, however, in its Response to Appellee’s Motion stepped outside of 

the boundaries of exhibits submitted with its Complaint – notably a different 

affidavit signed by M. Bommarito after the filing of Appellee’s Motion. (R15: 

15 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 20 of 24 Pg ID 418
16 

Brief in Support of Plaintiff R.A.M. Produce Distributors, L.L.C.’s Response to 

Defendant Cipriano’s Motion to Dismiss Claims Under FRCP 12(b)(6), Exhibit C). 

As this new affidavit was not previously incorporated, the Court was not in error 

by failing to consider it. 

CONCLUSION AND RELIEF SOUGHT 

For the reasons noted above, Appellee Salvatore Cipriano respectfully 

requests that this Honorable Court uphold the Bankruptcy Court’s Order of 

Dismiss on all of the claims asserted by R.A.M. Produce Distributors, LLC against 

Appellee Salvatore Cipriano. 

 Respectfully Submitted, 

 GALLAGHER SHARP 

March 20, 2015 By: /s/ ERIK C. STEIN 

 ERIK C. STEIN (P72172) 

 Attorneys for Defendant/Appellee 

 Salvatore Cipriano 

 211 W. Fort St., Ste 660 

 Detroit, MI 48226 

 (313) 962-9160 

 estein@gallaghersharp.com

 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 21 of 24 Pg ID 419
UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

In Re: 

SALVATORE CIPRIANO CASE No. 14-14826 

 Debtor Hon. Sean F. Cox 

R.A.M. PRODUCE DISTRIBUTORS, L.L.C., 

 Plaintiff/Appellant, 

v. 

SALVATORE CIPRIANO a/k/a SAL CIPRIANO 

And PRODUCE BUYERS CO., 

 Defendants/Appellee 

(Bankr. Adv. No. 14-04957) 

CERTIFICATE OF COMPLIANCE 

 I hereby certify that the foregoing Defendant/Appellee Salvatore Cipirano’s 

Brief on Appeal was produced in Microsoft Word, 14 point, Times New Roman 

font, and contains 4,008 words, thereby complying with the limitations set forth in 

Fed.R.App.P. 32(a)(7)(c). 

 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 22 of 24 Pg ID 420
2 

Respectfully Submitted, 

 GALLAGHER SHARP 

March 20, 2015 By: /s/ ERIK C. STEIN 

 ERIK C. STEIN (P72172) 

 Attorneys for Defendant/Appellee 

 Salvatore Cipriano 

 211 W. Fort St., Ste 660 

 Detroit, MI 48226 

 (313) 962-9160 

 estein@gallaghersharp.com

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 23 of 24 Pg ID 421
UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

In Re: 

SALVATORE CIPRIANO CASE No. 14-14826 

 Debtor Hon. Sean F. Cox 

R.A.M. PRODUCE DISTRIBUTORS, L.L.C., 

 Plaintiff/Appellant, 

v. 

SALVATORE CIPRIANO a/k/a SAL CIPRIANO 

And PRODUCE BUYERS CO., 

 Defendants/Appellee 

(Bankr. Adv. No. 14-04957) 

CERTIFICATE OF SERVICE

 I hereby certify that on the 20th day of March, 2015 a copy of the foregoing 

was filed electronically. Notice of this filing will be sent to all parties by operation 

of the Court’s electronic filing system. Parties may access this filing through the 

Court’s system. 

/s/ERIK C. STEIN (P72172) 

Attorney for Defendant/Appellee 

Salvatore Cipriano 

2:14-cv-14826-SFC-DRG Doc # 13 Filed 03/20/15 Pg 24 of 24 Pg ID 422