IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

MERITAGE HOMEOWNERS' 

ASSOCIATION, 

Plaintiff, 

v. 

BANK OF NEW YORK MELLON, 

Defendant. 

BANK OF NEW YORK MELLON, 

Third-Pmiy Plaintiff, 

v. 

KURT FREITAG, 

EUGENE DIVISION 

Third-Pmiy Defendant. 

Page 1 - OPINION AND ORDER 

Case No. 6:16-cv-00300-AA 

OPINION AND ORDER 
AIKEN, Judge: 

This dispute centers on a planned community on the Oregon Coast, Meritage at Little 

Creek, in which defendant Bank of New York Mellon ("BNYM") owns a unit. Plaintiff 

Meritage Homeowners' Association ("Meritage") filed this action, alleging that defendant had 

failed to pay dues, assessments, fees, and interest associated with that unit. Defendant responded 

with counterclaims against Meritage and claims against third-party defendant Kurt Freitag 

("Freitag"), alleging that Meritage failed in its duty to maintain common property and that 

Freitag breached his fiduciary duty to Meritage's members in his management of the 

homeowners' association ("HOA"). BNYM now seeks a preliminary injunction preventing 

Freitag from taking any actions on behalf of Meritage during the pendency of this lawsuit. 

Meritage's attorneys also seek a stay of all proceedings in this case pending the appointment of a 

receiver or election of a new Board of Directors to administer Meritage. I heard oral argument 

on the motions on April 30, 2018. For the reasons set forth below, both motions are granted. 

BACKGROUND 

The facts in this case have been recounted at length in my previous opinions and I will 

not repeat them here. 1 On April 13, 2018, I issued an opinion and order ruling on the patties' 

cross-motions for summary judgment. In that order, I held that "Freitag . . . lacked legal 

authority to act on behalf of Meritage after June 5, 2004," the date on which the HOA's 

governing documents required turnover from Freitag (the developer and declarant under those 

documents) to Meritage's owner-members. lYJeritage Homeowners' Ass'n v. Bank of N.Y. 

lYJellon, 2018 WL 1787183 at *21. Due to that absence of authority, I denied Meritage's motion 

1 For a thorough summary of the factual background relevant to this case, see 1vferitage 

Homeowners' Ass'n v. Bank of New York Mellon, 2018 WL 1787183, *1-4 (D. Or. Apr. 13, 

2018), 1vferitage Homeowners' Ass'n v. Watt, 2017 WL 5615165, *1- 3 (D. Or. Nov. 20, 2017), 

and Bank of New York Mellon v. Watt, 2015 WL 1879680, *1-3 (D. Or. Apr. 22, 2015). 

Page 2 - OPINION AND ORDER 
for summary judgment regarding BNYM' s liability for dues, assessments, and attorney's fees. 

Id. at *15-16. 

The day the summary judgment opinion issued, Freitag sent the first of a series of emails2 to a subgroup3 of Meritage owner-members. In that e-mail, titled "TROUBLING 

NEWS," Freitag summarized the summary judgment order as holding that "Big Fish Patiners 

and I as designate have not had any authority to rnn the HOA since 2004" and "[a]s such, 

[BNYM] is not obliged to pay any dues, fix its windows, etc., unless and until it is legitimately 

directed to by an appropriate authority[.]" Gary Fisher Deel. Ex A at 2-3. The next day, April 

14, Freitag sent an e-mail to the same group asking them to give him their proxies in order to 

"maintain the status quo" by voting Freitag into a position managing the HOA. Id. at 1. Freitag 

followed up with another e-mail on April 15 advocating for the "status quo plan" and opining 

that "us[ing] the occasion to simply organize at long last the HOA and take over the litigation-it 

is theoretically possible ... just not a practical option." Gary Fisher Deel. Ex. B at I. Thatemail also explained that "[ o ]ver the next few weeks, at least, you can expect to see no change in 

the administration of the HOA" and stated that "the pending cou1i ruling is no inhibition to 

call'ying on the ordinary business of the HOA exactly as it has been conducted for the past, oh, 

15 years or so." Id. Freitag fmiher opined that the summary judgment ruling "is not an 

enforceable order or judgment" and that, until certain "ministerial steps" were taken to make the 

2 The e-mails were initially submitted as exhibits to the declaration of Brendan Herbert, 

one ofBNYM's attorneys; Herbert stated that the e-mails had been forwarded to him by "one of 

the other unit owners at Meritage." Herbert Deel. iii! 2-4. Mr. Herbert's declaration also 

included statements from an unnamed unit owner. After Freitag challenged those statements as 

inadmissible hearsay, BNYM submitted declarations from four of Meritage's owner-members 

(Gary Fisher, Cheryl Fisher, Gary Dhaemers, and Bahram Adrangi) with the e-mails as exhibits. 

3 Freitag appears to have e-mailed all individuals who own units. He did not include 

BNYM or other financial institutions who own units on the messages. 

Page 3 - OPINION AND ORDER 
ruling "actionable, ... we are not obliged to act in accordance with the ruling." Id. at 2. Freitag 

sent two more e-mails, on April 16 and 17, info1ming the subgroup of owner-members that 

Meritage's attorneys could be required to withdraw from this case for ethical reasons arising 

from the summary judgment ruling. 

On April 18, BNYM filed a motion for a temporary restraining order and preliminary 

injunction against Freitag. BNYM sought to stop Freitag from taking any actions in the capacity 

of administrator of Meritage or on Meritage's behalf. BNYM provided this Court with copies of 

the e-mails described above and argued that an injunction was necessary to prevent Freitag from 

continuing to operate the HOA. On April 19, Mark Hoyt, counsel for Meritage, filed a motion 

for a stay of proceedings until legal authority to operate Meritage is established through the 

appointment of a receiver or election of a Board of Directors. Hoyt argued that, in view of the 

ruling that Freitag lacks authority to make decisions for Meritage, his client is currently unable to 

provide direction regarding how to proceed. Also on April 19, I entered a temporary restraining 

order, enjoining Freitag from: 

1. Taking any action on behalf of Meritage; 

2. Retaining counsel to represent Meritage; 

3. Soliciting, negotiating, or entering into any agreement with any pmiy that 

would bind Meritage to any legal obligations, create a new business relationship, 

or incur any fmiher costs for which Meritage would be responsible; 

4. Accessing or liquidating any bank accounts, reserve funds, or other property 

owned by Meritage or in which Meritage has a beneficial interest; 

5. Attempting to collect or enforce any debts alleged to be owed by Meritage or 

its members; 

6. Imposing fines or fees, or engaging in any collection or enforcement actions 

against members of Meritage; 

7. Placing any liens on propeiiy owned by Meritage or members of Meritage; 

Page 4 - OPINION AND ORDER 
8. Communicating with members of Meritage in the capacity of one in control of 

Meritage; and 

9. Destroying or failing to preserve any documentation (electronic or otherwise) 

concerning Meritage's operations, business relationships, financial affairs, 

maintenance, and legal affairs. 

Temporary Restraining Order (doc. 123) at 2-3. 

Freitag continued to send e-mails advocating for the status quo plan (i.e., taking action to 

formally make him administrative head of Meritage) to the subgroup of owner-members even 

after the temporary restraining order issued. On April 26, Freitag forwarded to the subgroup of 

owner-members a report prepared for Meritage by an economist in connection with this 

litigation. The purpose of that report was to quantify damages to other unit owners caused by 

"the failure of [BNYM] to replace windows on its unit and pay dues[.]" Gary Fisher Deel. Ex. F 

at 1. Also on April 26, Freitag sent a second e-mail regarding a judgment Meritage had against a 

realtor and lamenting that he was "hamstrung in now in pursuing, as we have been doing 

diligently over the past many years, everything that is owed us, no exceptions, no excuses, 

everyone obligated just the same." Gary Fisher Deel. Ex. G at 2. 

On April 27, Freitag sent an e-mail that began with the disclaimer that he was e-mailing 

in his capacity as "[a] lot and unit owner in the development;" "[t]he declarant/developer[;]" and 

"[t]rustee of the PSRG Profit Sharing Plan, the lender to the HOA." Gary Fisher Deel Ex. H at 

1. Freitag provided an explanation about the definition of a receiver and how receivership 

works; a statement regarding his belief that he has an ongoing fiduciary duty to Meritage's 

owner-members; a summary of his "substantial rights under Oregon law" as the declarant 

(including a reference to "super votes"), asserting that "out of a total of 15 votes, the declarant 

controls AT LEAST 6 already, where 8 total votes is a majority and has effectively complete 

Page 5 - OPINION AND ORDER 
authority over HOA operations"; and some "[b ]asic financial information" about the HOA 

including that its "accounts payable are cmTently about $500,000[,]" which in Freitag's 

estimation meant that if BNYM prevails in this lawsuit, it "would make your units unsaleable for 

any foreseeable time." Id at 2-3. Freitag also referred to a $1 million "demand loan" to the 

HOA that the lender (PSRG Trust, for which Freitag is trustee) could call "due at any time" and 

noting that if PSRG Trust were to foreclose on certain units, it (by which he meant he) would 

gain seven additional votes. Id. Finally, Freitag referenced the lawsuit the unit owners filed 

seven years ago attempting to gain control of Meritage. He stated that he "warn[ ed]" those unit 

owners at the time that "they were embarking on a long and very, very costly trip from which 

some would not be returning." Id. at 3. Freitag reported that the "outcome" of the prior 

litigation was "at LEAST $2-million essentially down the drain, ... eight owners losing their 

homes, four bankruptcies, at least one divorce, many other personal relationships shattered 

beyond repair." Id He ended by urging the recipients of the e-mail to "consider ... carefully" 

whether they wanted to repeat that experience and to give his "plan your diligent consideration." 

Id. at 3-4. 

In a declaration submitted in support of his response to BNYM's motion for a 

preliminary injunction, Freitag states that he owns several units with Meritage at Little Creek and 

that he remains the declarant under Meritage's bylaws. He expresses his "understanding that, as 

the declarant and Director 'in fact,' I have fiduciary obligations to see to the day-to-day 

management of the HOA including paying any bills for services, utilities and the like." Freitag 

Deel. if 6, Apr. 24, 2018. He further asserts that he "understand[s] the court's order" that he 

lacks authority "to bind the HOA to any contracts, negotiations, deals or lawsuits." Freitag Deel. 

if 5, April 24, 2018. 

Page 6 - OPINION AND ORDER 
In a reply in support of its motion for a preliminaiy injunction, BNYM submitted 

declarations from four Meritage owner-members. In those declarations, owner-members Gary 

Fisher, Cheryl Fisher, and Gary Dhaemers state they "have long been very WOIT'ied about Mr. 

Freitag's mismanagement of the HOA[,]" including "his relentless pursuit of litigation, 

accumulation of large attorney fee bills, and his aggressive tactics of assessing dues and penalties 

against unit owners." Gary Fisher Deel.~ 10; Cheryl Fisher Deel.~ 10; Dhaemers Deel.~ 10. 

They further asse1t that although they "have long hoped that control of the HOA could be taken 

away from Mr. Freitag[,]" they have been "reluctant to speak out ... for fear of retaliation, since 

we have seen how he has treated other owners who have tried to stand up to him." Gary Fisher 

Deel. ~ 11; Cheryl Fisher Deel. ~ 11; Dhaemers Deel. ~ 11. They express concern that Freitag 

"will res011 to a financial scorched earth policy as a reaction to his removal from the future of 

Meritage" including demanding immediate payment of the '"supposed' million dollar loan he 

has provided Meritage[.]" Gary Fisher Deel. ~ 12; Cheryl Fisher Deel. ~ 12; Dhaemers Deel. ~ 

12. The Fishers also report that on April 25, Che1yl, who is 73, had to go to the emergency room 

for high blood pressure, a health problem she usually does not have and which the Fishers 

attribute to stress from Freitag's "continued threats in his recent e-mails[.]" Gary Fisher Deel.~ 

13; Cheryl Fisher Deel. ~ 13. Member-owner Bahram Adrangi states that the previous attempt 

"to form a properly elected HOA board ended in litigation and resulted in financial catastrophe 

for homeowners causing many to go bankrupt and/or lose their homes." Adrangi Deel. ~ 4. He 

fuither states that he is concerned about "potential financial burdens" such as the loan Freitag 

refened to, which Adrangi reports was not referenced in Meritage's most recent annual budget. 

Adrangi Deel. ~ 5. All four member-owners express their strong support for appointment of a 

neutral receiver as a transitional step to the election of a pe1manent Board of Directors. 

Page 7 - OPINION AND ORDER 
STANDARDS 

To obtain a preliminary injunction in federal court, the pmiy seeking the injunction 

generally must establish that (1) it is likely to succeed on the merits; (2) it will suffer irreparable 

hmm in the absence of injunctive relief; (3) the balance of equities tips in its favor; and ( 4) an 

injunction is in the public interest. Winter v. Nat'l Resources Def Council, 555 U.S. 7, 21 

(2008). The Ninth Circuit also employs a "sliding scale" variant of that test. All. for the Wild 

Rockies v. Pena, 865 F.3d 1211, 1217 (9th Cir. 2017). Under the sliding scale variant, "if a 

plaintiff can only show that there are serious questions going to the merits-a lesser showing that 

likelihood of success on the merits-then a preliminary injunction may still issue if the balance 

of hardships tips sharply in the plaintiffs favor, and the other two Winter factors are satisfied." 

Id. (internal quotation marks omitted) (emphasis in original). 

Courts considering whether to stay a final judgment apply a four-factor test that 

"substantial[ly] overlaps" with the four-factor preliminary injunction test. Nken v. Holder, 556 

U.S. 418, 434 (2009). Before final judgment, however, federal courts have broad inherent 

authority to stay proceedings in cases before them. Landis v. North American Co., 299 U.S. 248, 

254-55 (1936). 

DISCUSSION 

I. 1Vfotion for Preliminwy Injunction 

Having carefully reviewed the record, I find that all four factors weigh in favor of 

extending the temporary restraining order into a preliminary injunction in this case. 

Success in the merits is, in this particular case, the easiest factor to evaluate. In the 

summary judgment order, I ruled that BNYM is entitled to summary judgment on the issue of 

whether Freitag had legal authority to make decisions on behalf of Meritage when he levied dues 

Page 8 - OPINION AND ORDER 
and assessments against BNYM and incurred litigation expenses contending that he contends 

BNYM is liable to pay. BNYM has on the relevant point-Freitag's authority---done more than 

show likely success on the merits: it has already won on the merits. Essentially, BNYM seeks a 

preliminary injunction to give force to the point on which it won summmy judgment. The 

balance of hardships and public interest factors also weigh in favor of a preliminary injunction. 

It is unclear how Freitag will be harmed if he is prevented from exercising legal authority he 

does not possess, whereas it would plainly be inequitable to permit Freitag to continue running 

Meritage-in his own words, "exactly as it has been conducted for the past, oh, 15 years or 

so"-when he lacks legal authority to do so. Gary Fisher Deel. Ex. B at 1. Finally, given the 

scarcely believable amount of money already expended on this lawsuit and other litigation 

related to this dispute, it is clearly in the public interest to hit "pause" to give Meritage's ownermembers the opportunity to determine who should be in charge of making decisions for the HOA 

going forward. 

The remaining factor, i11'eparable harm, is the factor that requires the closest examination. 

Indeed, irreparable harm is the only one of the four Winter factors Freitag addressed in his 

response in opposition to the preliminary injunction. Freitag contends that the available evidence 

is insufficient to show it is likely that he will fail to comply with this Court's directives, will 

expose Meritage to new financial obligations, or will otherwise take actions that expose BNYM 

and its fellow member-owners to i11'eparable harm. 

Having carefully reviewed the available evidence, I find that BNYM has made the 

requisite showing of irreparable hmm here. Freitag's statements that he is not obliged to act in 

accordance with the rulings of this Court and characterization of the summary judgment order as 

"pending" are more than sufficient evidence that he is likely at best to comply with the letter of 

Page 9 - OPINION AND ORDER 
my rulings in a hype1iechnical manner and at to worst flout the rulings altogether, while in either 

case continuing to exercise continuing administrative control over Meritage. That conclusion is 

underscored by his e-mails to member-owners after the temporary restraining order was in place. 

Freitag is correct, of course, that he is pennitted to contact his fellow unit owners in his capacity 

as a unit owner. But that is not the substance of his messages; read as a whole, the messages 

plainly violate my directive that Freitag refrain from communicating with Meritage members in 

the capacity of one in control of Meritage. They imply that the summary judgment ruling is a 

technicality and that, for all practical purposes, Freitag remains in charge. 

Freitag also violated the temporary restraining order's prohibition on attempting to 

collect or enforce debts alleged to be owed by Meritage or its members. He carefully worded his 

discussion of the $1 million loan in hypothetical terms, but to any reasonable person, the 

message reads as a threat. That threat is in direct contravention of the terms of the temporary 

restraining order. 

Those messages-that Freitag is still really the person in charge, and that he is in a 

position to call for immediate repayment of a $1 million loan-creates a likelihood of irreparable 

harm to BNYM. By writing to the owner-members in this capacity, he is-by vhiue of a 

combination of threats to call in large debts, reference to past acrimonious conduct, and dire 

predictions about what will happen if the owner-members do not suppmi his plan--exerting 

impe1missible influence over the process of selecting the person or persons who will be in 

administrative control of Meritage going forward. The declarations submitted by BNYM clearly 

suppmi the conclusion that Freitag has been willing to take extraordinary steps in the past to 

maintain control over Meritage. It is therefore critical that Freitag be bmTed from holding 

himself out as possessing more authority than he has--even by implication. As a unit owner, he 

Page 10- OPINION AND ORDER 
remains a voting member of Meritage. He may even, as he suggests, have access to "super 

votes" under the terms of the Declaration and Bylaws. But he cannot, without violating Comt 

orders and exposing himself to sanctions, continue to communicate with member-owners in a 

way that implies he is still really the one in control of the HOA. Freitag has an ongoing fiduciary 

duty to act in the best interests of Meritage when he takes any action within the scope of his 

authority. But that fiduciary duty cannot and does not ovenide the requirement that he comply 

with the terms of this Court's orders, which substantially limit his power to act on Meritage's 

behalf. 

I am also mindful of the fact that no person has authority to speak on behalf of Meritage 

and so Meritage has taken no position on BNYM's motion. There is substantial evidence in the 

record that Meritage is likely to suffer ineparable harm in the absence of an iajunction. Freitag's 

e-mails include a not-so-veiled threat that PSRG Trust could foreclose on several units in an 

attempt to collect the $1 million loan; foreclosure, which causes not only monetary harm but loss 

of unique real prope1ty, would constitute irreparable harm. The unit-owners' declarations also 

suppo1t the conclusion that Freitag has aggressively depleted HOA resources in the past when he 

has felt threatened; if he continues to incur obligations on Meritage's behalf, he could render the 

HOA insolvent, another ineparable haim. As explained above, BNYM has met the ineparable 

harm standard on its own. But the likelihood of irreparable haim to Meritage in combination 

with Meritage's present inability to take a position on the preliminary injunction further 

underscore the need for injunctive relief. 

The temporary restraining order will be extended into a preliminary injunction. 

However, its te1ms must be modified somewhat to account for some practical issues raised by the 

patties at oral argument. Specifically, until a receiver or some other authority is duly appointed 

Page 11 - OPINION AND ORDER 
to run Meritage, Freitag remains the de facto administrator under Oregon law. He therefore 

needs to be able to pay bills in the normal course, collect and deposit rent checks on the units 

Meritage owns, conduct repairs and deal with run-of-the-mill tenancy issues. Under the terms of 

the preliminary injunction, Freitag retains the limited authority to conduct the day-to-day 

business of Meritage in the nan-ow categories outlined above, pending appointment of other 

administrative authority over Meritage. However, Freitag is directed to notify BNYM by e-mail 

before paying any bills, making repairs, or dealing with tenant issues and promptly after he 

cashes rent checks. The e-mail communications should include copies of bills, copies of checks, 

and any other relevant documentation. BNYM is then directed to promptly circulate Freitag's 

messages to all other member-owners of Meritage. When the matter is trnly routine, BNYM is 

directed to promptly give Freitag consent to perform the necessary action. If the pmties cannot 

agree on a particular issue, they should immediately seek the Court's assistance in resolving the 

matter. Every effmt is to be made to ensure that there is no substantial change in or interference 

with the experience of the rental tenants at Meritage at Little Creek as a result of this lawsuit. 

Finally, if Freitag sends any fmiher communications to member-owners that state or 

imply that he retains administrative control over Meritage for any purpose other than the day-today operations outlined above, BNYM is directed to bring the communication to my attention 

immediately. 

II. Motion for Stay 

Meritage is the plaintiff in this action. As Mr. Hoyt con-ectly pointed out in his motion 

for a stay and at oral argument, there is presently no person who is able to give Meritage' s 

lawyers guidance about how to proceed in any matter related to this lawsuit. Accordingly, this 

matter is stayed until a person or group of persons is lawfolly vested with the authority to 

Page 12 - OPINION AND ORDER 
manage Meritage's affairs and make legal decisions on its behalf through the appointment of a 

receiver, the election of a Board of Directors, or some other lawful transfer of administrative 

power. The stay shall remain in place for a reasonable time after the establishment of said legal 

authority so that Sheiman Sherman Johnnie & Hoyt, LLP, can evaluate its ethical obligations and 

dete1mine the appropriate course for proceeding in this case. 

III. Remaining Matters 

In his response in opposition to the temporary restraining order, Freitag asks me to take 

this opportunity to explain the effect of the ruling that mandatory turnover was triggered in 2004 

and Freitag lacked authority to retain control of Meritage after that point. I agree with Freitag 

that there is much to be sorted out with respect to the effect of the failure to turn over control of 

Meritage to its members in 2004. Bearing in mind that we must walk before we run, at this point 

I will say only that my ruling does not automatically invalidate every legal decision Freitag made 

on behalf of Meritage from 2004 onward, that the § 363 sale to BNYM remains valid, and that 

BNYM is a titled unit owner and member of Meritage. All other issues, including BNYM's 

liability for the windows assessment and fees Freitag levied against BNYM on Meritage's 

behalf, will have to be resolved on a case-by-case basis as the need to make that inquiry arises. 

CONCLUSION 

The motion of Sherman Sherman Jolmnie & Hoyt, LLP to stay proceedings (doc. 122) is 

GRANTED. All proceedings except those related to the preliminary injunction and process of 

appointing a receiver are ST A YED in this case until a receiver is appointed or some other 

individual or group is lawfully vested with the authority to make decisions on Meritage's behalf 

and She1man Sherman Johnnie & Hoyt, LLP has had a reasonable time to evaluate its ethical 

obligations and determine how to proceed. 

Page 13 - OPINION AND ORDER 
BNYM's motion for a preliminary injunction (doc. 120) is GRANTED. Kutt Freitag is 

hereby enjoined, during the pendency of this action or until granted leave of the Coutt, from: 

1. Taking any action on behalf of Meritage except those actions specifically 

enumerated below in the section addressing day-to-day operations of Meritage; 

2. Retaining counsel to represent Meritage; 

3. Soliciting, negotiating, or entering into any agreement with any patty that 

would bind Meritage to any legal obligations, create a new business relationship, 

or incur any further costs for which Meritage would be responsible; 

4. Accessing or liquidating any bank accounts, reserve funds, or other prope1ty 

owned by Meritage or in which Meritage has a beneficial interest, except as 

necessary for him to can-y out the functions described below in the section 

addressing day-to-day operations of Meritage; 

5. Attempting to collect or enforce any debts alleged to be owed by Meritage or 

its members; 

6. Imposing fines or fees, or engaging in any collection or enforcement actions 

against members of Meritage; 

7. Placing any liens on property owned by Meritage or members of Meritage; 

8. Communicating with members of Meritage in the capacity of one in control of 

Meritage; and 

9. Destroying or failing to preserve any documentation (electronic or otherwise) 

concerning Meritage's operations, business relationships, financial affairs, 

maintenance, and legal affairs. 

Until a receiver is appointed or some other individual or group is lawfully vested with 

authority to make decisions on behalf of Meritage, however, Freitag retains the authority to 

conduct the following activities necessary to the day-to-day operation of Meritage. 

1. Freitag may pay bills in the n01mal course. Before making payment, Freitag 

shall electronically send a copy of any such bill to BNYM, which in turn will 

circulate the bill to all other owner-members. If the bill is a routine obligation, 

BNYM shall promptly grant consent for Freitag to make payment. 

2. Freitag may collect rent from tenants in units owned by Meritage in the normal 

course. After depositing each rent payment, Freitag shall electronically send a 

Page 14 - OPINION AND ORDER 
copy of any rent check or other record of payment to BNYM, which shall in tum 

circulate the payment record to the other owner-members. 

3. Freitag may make ordinary repairs and deal with other routine issues of tenancy 

as the need arises. Freitag shall promptly notify BNYM of any expenses 

associated with such duties before making payment, and BNYM shall in turn 

circulate the infonnation to the other owner-members. If the matter is routine, 

BNYM shall promptly grant consent for Freitag to take the necessary action. 

Every eff01i is to be made to ensure that there is no substantial change in or interference 

with the experience of the tenants at Meritage at Little Creek as a result of this lawsuit. If 

additional issues with tenants arise that cannot be resolved and are not governed by the tenns of 

this order, the patiies shall promptly seek the assistance of the Couti to resolve them. BNYM is 

hereby ordered to inform the Court promptly ifFreitag sends any communications to unit-owners 

that state or imply that he retains administrative control of Meritage except to the limited extent 

enumerated above. Freitag is hereby info1med that if he sends any such communications to 

member-owners, he places himself at risk of civil contempt sanctions. 

IT IS SO ORDERED. 

5/-

Dated this_}__ day of May 2018. 

Ann Aiken 

United States District Judge 

Page 15 - OPINION AND ORDER