1591.001-01160567; 1

MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 1

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

Lawrence A. Wagner, OSB #024770

lwagner@lawssl.com

STEWART SOKOL & LARKIN LLC

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

Telephone: (503) 221-0699

Facsimile: (503) 223-5706

Attorneys for Plaintiff Tower Insurance Company of New York

UNITED STATES DISTRICT COURT

DISTRICT OF OREGON

PORTLAND DIVISION

TOWER INSURANCE COMPANY OF NEW 

YORK, a New York corporation,

Plaintiff,

v.

ROSE CITY AUTO GROUP, LLC, an Oregon 

limited liability company; LEONARD M. 

SHILEY, an individual; TERESA BYLE, an 

individual; LOGAN DRIEDRIC, an individual; 

JOANNA STONER, an individual; STEPHEN 

STONER, an individual; LOVE MARTINO, an 

individual; ANAN SRIVILAI, an individual; 

CAMERON JOHNSON, an individual; 

JONATHAN GILBERT, an individual; TINA 

HARRAL, an individual; ROY WIEGAND, an 

individual; NATHAN LANGER, an individual; 

KAREN BERSINE, an individual; MELISSA 

STEVENS, an individual; TONY EDWARDS, 

an individual; DEBBIE RECKTANGLE, an 

individual; RODNEY JENKINS, an individual; 

STEPHEN SCHANTIN, an individual; 

BRITTANY LAWRENCE, an individual; MATT 

REED, an individual; SHERIAL REED, an 

individual; RACHEL SCHANTIN, an individual; 

EZEKIAL HUNT, an individual; BOBBY 

HEAGLE, an individual; LANEY 

BLANKENSHIP, an individual; LONNEY 

FRANCIS, an individual; OREGON 

COMMUNITY CREDIT UNION, an Oregon 

non-profit entity; TWINSTAR CREDIT UNION, 

a Washington nonprofit corporation; LOBEL

Case No. 14-cv-00975-MO

MOTION REGARDING RESOLUTION OF 

CLAIMS AND FINAL DISBURSEMENT 

OF FUNDS

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 1 of 8
1591.001-01160567; 1

MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 2

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

MOTION

Plaintiff Tower Insurance Company of New York (“Plaintiff”) moves the court for 

an order that resolves all claims filed against the Bond Proceeds filed with this Court 

and for an Order that provides for the disbursement of all the remaining Bond Proceeds 

held by the Court. 

MEMORANDUM IN SUPPORT OF MOTION

I. Introduction

Plaintiff filed this case due to the significant number of claims it received against 

the Bond at issue in this case, and the size of such claims. The Bond’s penal sum was 

$40,000. On or about December 15, 2014, this Court entered an Order to Deposit 

Funds (Docket # 35). In conformance with that Order, Plaintiff deposited the sum of 

$40,000 into the Court’s registry. 

On November 20, 2014, this Court entered an Order for Interpleader Discharging 

Plaintiff from Further Liability, and for an Award of Plaintiff’s Costs and Attorney Fees. 

(Docket # 32). In that order, the Court ruled that “Tower shall be allowed to recover 

from the Bond Proceeds the sum of $12,170.42 ... The clerk of the court is hereby 

directed to disburse from the registry of the court, the sums awarded to Tower.” In 

conformance with that order and a subsequent motion to disburse, the Court Clerk 

disbursed the sum of $12,170.42 to Plaintiff. There remains in the Court’s registry the 

FINANCIAL CORPORATION, a California

corporation; THE EQUITABLE FINANCE 

COMPANY, an Oregon corporation; UNITUS 

COMMUNITY CREDIT UNION, an Oregon 

non-profit entity; WESTLAKE FLOORING 

COMPANY LLC, DBA WESTLAKE 

FLOORING SERVICES, a California limited 

liability company; and DOES 1-30,

Defendants.

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1591.001-01160567; 1

MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 3

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

sum of $27,829.58 that should be disbursed to pay legitimate claims against the Bond 

Proceeds or returned to Plaintiff. 

II. Disposition of Parties Who Have Not Appeared

On March 2, 2015, the Court ordered that “All parties have been served or 

waived formal service, and the time to appear in this matter has passed.” Docket # 48. 

In Docket Item 49, the Court then “entered” the defaults referenced in Docket Item 49. 

It appears the Court did not default all defendants who have failed to appear. For 

instance, Defendants Teresa Byle, Logan Driedric, Anan Srivilai, Tina Harral, Nathan 

Langer, Karen Bersine, Lobel Financial Corporation, The Equitable Finance Company, 

Rose City Auto Group, LLC and Leonard Shiley are not mentioned in either Docket Item 

48 or Docket Item 49.1 Defendant Rachel Schantin was mentioned in Docket Item 48, 

but not in Docket Item 49. These parties have all failed to appear within the time 

allowed, and it seems appropriate for the Court to default these parties as well, so that 

this matter can be concluded.2

III. Resolution of Claims

Despite numerous contacts from various claimants indicating that they will file 

claims with the court, 3 and documents to indicate the potential of numerous additional 

claims, it seems that only seven claims have been filed against the Bond Proceeds and 

that there will be funds remaining after the resolution of claims to return to Plaintiff. 

 

1 Plaintiff already obtained a default order and judgment against Defendants Rose City Auto 

Group, LLC and Leonard Shiley on Plaintiff’s second claim for relief, but did not seek a default 

against these defendants in connection with the interpleader claim.

2 Plaintiff’s goal in this case was to make the funds available to these claimants and does not 

intend to actively seek the defaults against any party who wants to make a claim, but the time to 

appear and assert a claim has long expired. 

3 As recently as February 18, 2015, Claimant Nathan Langer indicated an intent to file a claim 

for approximately $8,000. As of March 2, 2015, Mr. Langer’s counsel (Ethan Chatov) informed 

the undersigned that Mr. Langer does not intend to file a claim.

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 3 of 8
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MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 4

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

Plaintiff hereby requests that the Court resolve all the pending claims and that the Court 

enter an order that provides for the disbursement of: (a) any awarded claims to the 

respective claimant(s) (in a pro-rata portion of the claims or in any other equitable 

amount, if necessary, due to a lack of sufficient funds to pay all valid claims); and (b)

any balance of the Bond Proceeds to Plaintiff. 

Plaintiff presents the following items that may be relevant for the Court in 

analyzing the pending claims:

A. The Standard for Claims Against the Bond

ORS 822.030(2) provides for the basis of a claim against a motor vehicle dealer 

bond such as the subject Bond.

Any person shall have a right of action against a 

vehicle dealer, against the surety on the vehicle 

dealer’s bond and against the letter of credit in the 

person’s own name if the person suffers any loss or 

damage by reason of the vehicle dealer’s fraud, 

fraudulent representations or violations of provisions 

of the vehicle code relating to:

 (a) Vehicle registration;

 (b) Vehicle permits;

 (c) The transfer or alteration of vehicles; or

 (d) The regulation of vehicle dealers.

B. All Claims by Persons “Other than Retail Customers” are Limited to 

a Total of $20,000. 

It appears that Joanna and Stephen Stoner are the only “retail customers” to 

have filed claims against the Bond Proceeds. All the remaining claimants are “other 

than retail customers.” This is important because all claims “by persons other than retail 

customers of the dealer” are limited to a total of $20,000 from the Bond Proceeds. ORS 

822.030(3).

Plaintiff will leave it to the Court and the other parties to ascertain whether the 

reduction in the Bond Proceeds by way of disbursement to Plaintiff should reduce the 

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 4 of 8
1591.001-01160567; 1

MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 5

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

$20,000 portion of the Bond Proceeds that is available to non-retail consumers and 

retail consumers equally, whether the payment to Plaintiff will reduce the two portions of 

the Bond proceeds in a pro-rata manner, or otherwise. 

C. Are the Non-Consumer Claims Valid?

Lenders, such as the non-consumer claimants in this case will often assert that a 

dealer’s failure to pay off a loan or clear title supports a claim under ORS 822.030(2). 

However, there are certainly limitations to such claims. For instance, see ORS 

822.045(2), which provides that “A dealer shall not be considered to have committed the 

offense described in subsection (1)(j) of this section if the dealer fails to satisfy an 

interest in a vehicle or camper that arises from an inventory financing security interest 

for which the dealer is the debtor.” There is also Oregon case law that explains the 

limitations of lenders’ claims against a motor vehicle dealer bond. See, e.g., Brasher’s 

Cascade Auto Auction, Inc. v. Leon, 247 Or App 535 (2011); and the summary 

judgment briefing and order in Oregon Circuit Court for Multnomah County, Case No. 

0005-04358 (Brasher’s Cascade Auto Auction v. McCarty). 

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Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 5 of 8
1591.001-01160567; 1

MOTION REGARDING RESOLUTION OF CLAIMS

AND FINAL DISBURSEMENT OF FUNDS - PAGE 6

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

IV. Final Distributions and Case Closure

Upon the Court’s final determination as to which claims are timely and valid, the 

Court should enter an order to disburse: (a) the amount of any awarded claims to the 

respective claimant(s) (in a pro-rata portion of the claims or in any other equitable 

amount, if necessary, due to a lack of sufficient funds to pay all valid claims); and (b) 

any balance of the Bond Proceeds to Plaintiff.4 

DATED this 5th day of March, 2015.

STEWART SOKOL & LARKIN LLC

By: s/ Lawrence A. Wagner

Lawrence A. Wagner, OSB #024770

lwagner@lawssl.com

Attorneys for Plaintiff Tower Insurance 

Company of New York

 

4 Even if all filed claims are granted, there should be funds to return to Plaintiff given the limit on 

non-retail customer claims ($20,000 total), and the limited sum of the sole retail customer claim 

(which the undersigned understands is approximately $900-$1,000 based on communications 

with the claimant as of March 5, 2015 and previous communications).

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 6 of 8
1591.001-01160567; 1

CERTIFICATE OF SERVICE - 1

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

CERTIFICATE OF SERVICE

I hereby certify that I served the foregoing MOTION REGARDING RESOLUTION 

OF CLAIMS AND FINAL DISBURSEMENT OF FUNDS on:

Michelle M. Bertolino

Farleigh Wada Witt

121 SW Morrison Street, Suite 600

Portland, Oregon 97204

 Attorneys for Defendant Unitus 

 Community Credit Union

James P. Laurick

Kilmer Voorhees & Laurick PC

732 NW 19th Avenue

Portland, Oregon 97209

 Attorneys for Defendant Twinstar 

 Credit Union

 

Daniel L. Duyck

Whipple & Duyck PC

1500 SW 1st Avenue, Suite 1170

Portland, Oregon 97201

 Attorneys for Defendant Westlake Flooring

 Company LLC dba Westlake Flooring

 Services

Thomas M. Orr

Hutchinson Cox Coons Orr & Sherlock

Post Office Box 10886

Eugene, Oregon 97440

 Attorneys for Defendant Oregon 

 Community Credit Union

by the following indicated method or methods:

 ✓ by E-filing a full, true and correct copy thereof to the attorney at the electronic 

mail address reflected on the court’s CM/ECF system, on the date set forth below; 

and on

Teresa L. Byle

3101 Colony Mountain Lane

Bow, Washington 98232

Karen Bersine

1256 Avenue A, Apartment A

Seaside, Oregon 97138

Logan Driedric

1325 SE 85th Avenue

Portland, Oregon 97216

The Equitable Finance Company

Attention: Karin Spruance

4124 SE 82nd Avenue, Suite 650

Portland, Oregon 97266

Jonathan Gilbert

2778 Cambridge Street

West Linn, Oregon 97068

Tina Harral

7995 SE Otty Street

Portland, Oregon 97222

Cameron Johnson

8906 SE Market Street

Portland, Oregon 97216

Nathan Langer

625 NE Country Club Avenue

Gresham, Oregon 97030

Love Martino

2308 SE 110th Avenue

Portland, Oregon 97216

Love Martino

1161 SE Boise Street

Portland, Oregon 97266

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 7 of 8
1591.001-01160567; 1

CERTIFICATE OF SERVICE - 2

2300 SW First Avenue, Suite 200

Portland, OR 97201-5047

(503) 221-0699

FAX (503) 223-5706

Rose City Auto Group, LLC

c/o Leonard M. Shiley, Member and 

Registered Agent

7717 SW Greenwood Drive

Portland, Oregon 97223

Ethan Chatov

Chatov Law LLC

1220 NW Eastman Pkwy

Gresham, Oregon 97030

Attorneys for Defendant Nathan Langer

Lobel Financial Corporation

Attention: Gary Dean Lobel

1150 North Magnolia Avenue

Anaheim, California 92801

Rachel Schantin

10180 SW Nez Perce Drive

Culver, Oregon 97734

Leonard M. Shiley

7717 SW Greenwood Drive

Portland, Oregon 97223

Joanna Stoner

Post Office Box 381

Onalaska, Washington 98570

Stephen Stoner

Post Office Box 381

Onalaska, Washington 98570

Anan Srivilai

8509 NE Thompson Street

Portland, Oregon 97220

by the following indicated method or methods:

 ✓ by mailing a full, true and correct copy thereof in a sealed, first-class postagepaid envelope, and addressed to the attorney as shown above, the last-known 

office address of the attorney, and deposited with the United States Postal 

Service at Portland, Oregon on the date set forth below.

DATED this 5th day of March, 2015.

s/ Lawrence A. Wagner 

Lawrence A. Wagner, OSB #024770

lwagner@lawssl.com

Attorneys for Plaintiff Tower Insurance 

Company of New York

Case 3:14-cv-00975-MO Document 53 Filed 03/05/15 Page 8 of 8