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UNITED STATE DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

PALM BEACH DIVISION

IN RE: CASE NO.: 19-18585-MAM

Chapter 11

MERIDIAN MARINA & YACHT CLUB

OF PALM CITY, LLC 

Debtor.

___________________________________/

MOTION TO CONFIRM EXCLUSIVITY HAS EXPIRED 

OR TO TERMINATE EXCLUSIVITY, OR IN THE ALTERNATIVE, 

MOTION TO APPOINT A CHAPTER 11 TRUSTEE OR 

CONVERT TO A CASE UNDER CHAPTER 7

Pursuant to 11 U.S.C. §§ 1104, 1112 and 1121, Secured Creditor Martin County Marine 

Holdings, LLC (Marine Holdings) moves to confirm that exclusivity has expired or to terminate 

exclusivity, or in the alternative, to appoint a Chapter 11 Trustee or to convert this case to a case 

under Chapter 7, as follows:

INTRODUCTION

1. The Debtor has failed in its multiple attempts to sell its property that have spanned 

two bankruptcies and a gaggle of terminated sale agreements, despite significant interest over the 

years and presently by potential buyers. The proposed purchaser under that pending plan has 

abandoned the sale and the unauthorized purported assignee of the purchase and sale agreement 

has failed to provide assurances of its ability to perform and otherwise has no enforceable 

obligation to close. It is time for an open auction pursuant to an 11 U.S.C. § 363 sale. Marine 

Holdings intends to file a plan to allow for such a sale.

2. Alternatively, either a Chapter 11 Trustee should be appointed, or this case should 

be converted to a Chapter 7 case. In addition to the above, and upon information and belief, the 

Debtor has entered into an undisclosed contract to sell property of the estate, the Debtor has failed 

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to obtain necessary property insurance, and the Debtor has failed to adequately address concerns 

by Florida Department of Environmental Protection regarding possible hazardous contamination.

HISTORY

3. The Debtor is the owner and operator of a marina and yacht club located in Palm 

City, Florida, providing boat storage, sales, dockage, servicing and repairs. The facility houses 

approximately 280 dry storage marina and wet slips located on approximately 6.5 acres (Marina), 

plus 4.5 acres of unimproved land adjacent to the Marina (Land).

4. Although denied by the Debtor in its Petition [DE 1, ¶9], the Debtor was the subject 

of a prior voluntary Chapter 11 proceeding styled In re Martin County Marine Corp., Case No. 

12-11819 that pended in this jurisdiction and was filed on January 24, 2012.

5. At that time, Marine Holdings held a promissory note in the approximate total 

amount of $2,600,000 secured by a first lien on the debtor’s property. Pursuant to the confirmed 

plan, Marine Holdings was to be paid monthly interest for 36 months, with the principal due in 

full at the end of that period. 

6. As a result of a default under that plan, on December 18, 2018, Marine Holdings 

obtained a final judgment against this Debtor in the amount of $4,417,341.17 plus interest. Marine 

Holdings has not been paid any funds since May 19, 2017.

7. This Case was filed in order to preclude the foreclosure sale of the Debtor’s 

property to satisfy the final judgment in favor of Marine Holdings. It was initiated over a year ago 

by the filing of a voluntary petition under Chapter 11 on June 27, 2019. 

8. Although denied by the Debtor in the Petition [DE 1, ¶7], this is a single asset real 

estate case as defined by 11 U.S.C. § 101(51B).

9. Over the years, the Debtor has entered into contracts with at least five different 

purchasers for the sale of the Marina, each at a time when Marine Holdings’ was close to realizing 

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upon its collateral or when the prior contract had been abandoned. In each instance, Marine

Holdings has forborne from pursuing its legal remedies in reliance upon the representations of the 

Timothy Mullen, the managing member of the Debtor. Each and every time, the contract has fallen 

through. Upon information and belief, in some of those instances, Mr. Mullen repudiated or failed 

to complete the contract.

STATUS OF BANKRUPTCY CASE

10. Pursuant to the Third Amended Disclosure Statement [DE 115] and the Amended 

Plan [DE 111], the Debtor proposes to sell the Marina to Marina Development Partners, LLC. 

(Marina Development). The purchase price is $6.5 million. To date, Marina Development has 

deposited $30,000 in trust. A $100,000 additional deposit is due August 25, 2020, which coincides 

with the end of the due diligence period of August 15, 2020. Confirmation is scheduled for 

September 22, 2020 [DE 117] and the closing on the sale of the Marina is scheduled for October 

17, 2020. 

11. Since approval of the Third Amended Disclosure Statement on June 5, 2020 [DE

117], the Debtor has filed a Notice of Assignment of Purchase and Sale Agreement, purportedly 

assigning the Marina Development contract to Integra Real Estate, LLC (Integra). The Debtor has 

not sought to amend the Amended Plan nor otherwise obtained Court approval for this assignment.

12. Despite request, Integra has not provided any proof of ability to close and has no 

risk given that it did not put up the original deposits (which are a mere .46% of the total purchase 

price) and that the next deposit is not due until August 25, 2020 (such deposit being 1.5% of the 

total purchase price).

13. Furthermore, the Amended Plan makes no provisions should there be a default or 

other failure to proceed under the pending purchase and sale agreement. 

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14. Upon information and belief, the Debtor has entered into a purchase and sale 

agreement for the Land. This agreement has not been disclosed nor is it the subject of the Amended 

Plan. Debtor’s counsel has not responded to a request for a copy of this agreement.

15. Management of the Marina has also been compromised. Despite numerous 

communications with Debtor’s counsel spanning weeks of request, the Debtor has failed to provide 

a certificate of property insurance. Such insurance is necessary to protect the Debtor’s property 

from, among other things, an event such as a hurricane.

16. Similarly concerning is a Warning Letter by the Florida Department of 

Environmental Protection to the Debtor during the pendency of this case regarding possible 

hazardous contamination. That letter required corrective action be taken and advised that the 

failure to take such corrective action may result in liability for damages and civil penalties. Upon 

information and belief, the Debtor has not engaged in the required corrective action or otherwise 

sought to satisfy the concerns of the FL DEP. Debtor’s counsel has not responded to a request for 

information regarding the status of this Warning Letter.

EXCLUSIVITY

17. Pursuant to §1121(c), a creditor may file a plan if the debtor has not filed a plan 

that has been accepted before 180 days after the date of the order for relief by each class of claims 

or interests that is impaired under the plan. Pursuant to this Court’s Order Granting Debtor’s 

Expedited Motion to Extend Exclusive Period entered October 21, 2019, the exclusive period to 

obtain acceptances of a plan was extended through February 18, 2020. The Debtor did not obtain 

an extension of this exclusive period. Accordingly, the Debtor’s exclusivity period has expired.

18. Even if exclusivity has not lapsed, this Court should terminate the Debtor’s 

exclusive period to obtain acceptances and allow Marine Holdings to file a plan. Pursuant to 

§1121(d), this Court has discretion to reduce the exclusivity deadlines. As described above, the 

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Debtor has not modified the pending plan and disclosure statement to provide for a sale of the 

Marina to Integra, which sale does not appear likely given Integra’s failure to provide proof of 

funds sufficient to close and its lack of any present risk in failing to abide by the terms of the 

purchase and sale agreement. The pending plan and disclosure statement fail to address the 

apparent contract for the sale of the Land. And the plan’s failure to provide any alternatives to the 

pending purchase and sale agreement results in this estate being over a year into this Case with no 

viable plan.

19. Marine Holdings intends to file a plan that provides for a §363 sale of the Marina 

and the Land via auction, with a potential stalking horse. Marine Holdings is presently researching 

auctioneers and awaiting a proposal from at least one potential stalking horse. Marine Holdings 

suggests that the effectiveness of its plan may be tied to a default under the Debtor’s Amended 

Plan and the pending purchase and sale agreement, if adequate assurances are provided by Integra. 

Furthermore, Marine Holdings seeks authority from the Court to shorten any necessary time 

periods such that mailing and other time periods coincide with the Debtor’s scheduled mailing of 

the Third Amended Disclosure Statement, Amended Plan and Ballots on August 13, 2020 as 

provided in the Order Approving the Disclosure Statement [DE 117].

CHAPTER 11 TRUSTEE OR CONVERSION

20. Sections 1104(a) and 1112(b) require the Court to appoint a Chapter 11 Trustee or 

convert to a Chapter 7 for cause, including gross mismanagement of the affairs of the debtor by 

current management. Section 1112(b) further defines cause as including failure to maintain 

appropriate insurance. The allegations made herein establish cause to appoint a Chapter 11 Trustee 

or to convert this case to a case under Chapter 7.

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Wherefore, Marine Holdings hereby requests that this Court enter an Order confirming that 

exclusivity has expired or terminating exclusivity, or in the alternative, to appoint a Chapter 11 

Trustee or to convert this case to a case under Chapter 7.

Dated: July 21, 2020

I am admitted to the Bar of the United States District Court for the Southern District of Florida 

and I am in compliance with the additional qualifications to practice in this Court set forth in Local 

Rules 2090-1(A) and 9011-4(A)(1). 

SPECTOR RUBIN, P.A.

By: /s/ Amber Donner

Amber Donner

Florida Bar No. 600032

Continental Plaza

3250 Mary Street, Suite 405

Miami, Florida 33133

Tel: (305) 537-2009

Cell Phone: (303) 359-1314

Fax: (305) 537-2001

Attorney for Martin County Marine Holdings, 

LLC

CERTIFICATE OF SERVICE

I hereby certify that I electronically filed the foregoing with the Clerk of the Court using 

CM/ECF. I also certify that the foregoing document is being served this day on all counsel of 

record identified on the Service List via transmission of Notices of Electronic Filing generated by 

CM/ECF.

By: /s/ Amber Donner

Amber Donner

Florida Bar No. 600032

Notice will be electronically mailed to:

Alan B Rose, arose@mrachek-law.com

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John P Carrigan, jpc@reblawpa.com

Dana L Kaplan, dana@kelleylawoffice.com, tina@kelleylawoffice.com; 

craig@kelleylawoffice.com; cassandra@kelleylawoffice.com; 

kaplandr75945@notify.bestcase.com; Debbie@kelleylawoffice.com 

Craig I Kelley, craig@kelleylawoffice.com, dana@kelleylawoffice.com , 

kelleycr75945@notify.bestcase.com; tina@kelleylawoffice.com ; craig@kelleylawoffice.com; 

cassandra@kelleylawoffice.com; kaplandr75945@notify.bestcase.com; 

Office of the US Trustee USTPRegion21, Heidi.A.Feinman@usdoj.gov; 

USTPRegion21.MM.ECF@usdoj.gov

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