Gary Guseinov v. Synergy Ventures, Inc

467 S.W.3d 920, 2014 Tenn. App. LEXIS 675, 2014 WL 5390567
CourtCourt of Appeals of Tennessee
DecidedOctober 21, 2014
DocketM2014-00213-COA-R3-CV
StatusPublished
Cited by13 cases

This text of 467 S.W.3d 920 (Gary Guseinov v. Synergy Ventures, Inc) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gary Guseinov v. Synergy Ventures, Inc, 467 S.W.3d 920, 2014 Tenn. App. LEXIS 675, 2014 WL 5390567 (Tenn. Ct. App. 2014).

Opinion

OPINION

J. STEVEN STAFFORD, P.J., W.S.,

delivered the opinion of the Court,

in which JOHN W. McCLARTY, J. and BRANDON 0. GIBSON, J., joined.

This case involves the enrollment of a foreign judgment in Tennessee. The trial court granted summary judgment in favor of plaintiff, effectively enrolling the foreign judgment pursuant to the Full Faith and Credit Clause of the United States Constitution and Tennessee’s Uniform Foreign Judgment Enforcement Act. On appeal, the defendant argues that the grant of summary judgment was improper because he allegedly satisfied the foreign judgment. He further argues that the trial court denied him due process when it declined to conduct an evidentiary hearing. We hold that satisfaction is not a defense to the enrollment of a foreign judgment pursuant to the Full Faith and Credit Clause of the United States Constitution or Tennessee’s Uniform Foreign Judgment Enforcement Act. Further, we discern no due process violation from the trial court’s decision not to conduct an evidentiary hearing. The judgment of the trial court is affirmed.

California Proceedings

In 2005, Gary Guseinov (“Appellee”) obtained an arbitration award against Synergy Ventures, Inc. (“Synergy - Ventures”) and Stan Burns (“Appellant”). 1 On De *922 cember 7, 2005, the Superior Court of California in Los Angeles entered a judgment jointly and severally against Synergy and Mr. Burns, enforcing the arbitration award (“the California judgment”). The amount of the judgment against Synergy Ventures and Mr. Burns was $5,223,980.09. Since September 16, 2005, the California judgment has been accruing interest at the rate of ten percent per year and will continue to accrue interest until satisfied in full. Mr. Burns appealed the arbitration award in the California Court of Appeals. The California Court of Appeals affirmed the judgment on December 15, 2006. See Guseinov v. Bums, 145 Cal.App.4th 944, 51 Cal.Rptr.3d 903 (2006). On April 13, 2006, the California court entered an amended judgment reflecting the accrued prejudgment interest of $299,126.53 in favor of Mr. Guseinov. 2

Tennessee Proceedings

On October 24, 2006, Plaintiff/Appellee Mr. Guseinov filed an action in Tennessee to enroll the California judgment against Synergy Ventures 3 and Mr. Burns. On November 27, 2006, Mr. Burns filed an answer and several counterclaims. His counterclaims allege that he had satisfied the judgment by the transfer of shares in Synergy Ventures to Mr. Guseinov, providing that:

Defendant Burns conveyed to Plaintiff Guseinov all of Mr. Burns’s stock ownership in Synergy Ventures, Inc. Additionally, in satisfaction of the Judgments which are the subject of this action, Plaintiff Guseinov claimed a lien on Synergy Ventures, Inc.’s software, data and computer hardware which Guseinov has repossessed and appropriated to his own use.

The record on appeal indicates that, after arbitration, Mr. Burns allegedly continued to work for Synergy Ventures and “actually built the company up.” Further, in August 2006, Mr. Burns alleges that he transferred 2,975,579 shares of Synergy Ventures stock, which included 100 percent of his interest in Synergy Ventures, to Mr. Guseinov. According to Mr. Burns, the parties agreed that the shares were valued at $2.00 per share. Thus, according to Mr. Burns, he has actually over-satisfied the $5,223,980.09 judgment because the value of the shares he transferred was $5,951,158.00. In his pleadings, Mr. Burns further alleges that Mr. Gusei-' nov committed waste by failing to marshal the assets of Synergy Ventures in a commercially reasonable manner as required by Article 9 of the Uniform Commercial Codes in both California and Tennessee. Mr. Guseinov’s alleged waste of Synergy Ventures’ assets is not an issue in this appeal.

Over six years later, 4 on July 26, 2013, Mr. Guseinov filed a motion for summary *923 judgment seeking enrollment of his California judgment in Tennessee on the basis that no material facts were in dispute. Mr. Guseinov argued that, although Mr. Burns claims to have satisfied the California judgment, the record from the California court indicates that the judgment is outstanding. According to Mr. Guseinov, “In the eyes of the California judgment, the judgment has not been satisfied ... Moreover, it was undisputed that the judgment was outstanding in California and that Mr. Burns did not raise one of the proper defenses to the [F]ull [Fjaith and [Cjredit [Cjlause of the [United States] Constitution.” In his response, Mr. Burns argued that a dispute of material fact— namely, whether he had satisfied the California judgment — precluded summary judgment. He also requested that the trial court conduct an evidentiary hearing on the issue of satisfaction.

The trial court granted Mr. Guseinov’s motion for summary judgment, effectively enrolling the judgment in Tennessee. The trial court found that it could only decline to afford full faith and credit to foreign judgments in three circumstances: (i) when there was a lack of jurisdiction, (ii) where there was fraud, (iii) where it would otherwise violate public policy. The trial court stated:

[Mr. Burns] has provided no authority to the Court that demonstrates that the issues [Mr. Burns] raises, in response to the Motion for Summary Judgment, are appropriately before and should be considered by Tennessee courts. Absent any such authority that this Court has jurisdiction to grant the relief [Mr. Burns] seeks merely because he raises an affirmative defense, the Court finds the Motion for Summary Judgment is well taken and should be granted.

Mr. Burns filed a Motion to Alter or Amend on November 15, 2018 asking the trial court to reconsider its ruling in favor of Mr. Guseinov on his motion for summary judgment. In Mr. Burns’s motion, he argued that there are at least three-and not only three-ways a court can decline to afford a foreign judgment full faith and credit, as discussed above. According to Mr. Burns, in addition to those three circumstances, post-judgment satisfaction can also be raised as a defense or counterclaim in Tennessee to the enrollment of a foreign judgment. The trial court disagreed and denied Mr. Burns’s Motion to Alter or Amend, stating that it was “not persuaded that ... [Rule 60.02(4) ] may also prevent the enforcement of a foreign judgment.” 5 The trial court also found that it did not have the jurisdiction to hear Appellant’s affirmative defense of satisfaction, and that the defense must be heard by the California court. 6 Mr. Burns timely filed this appeal.

*924 Issues 7

Mr. Burns presents two issues for review by this Court:

1.

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Cite This Page — Counsel Stack

Bluebook (online)
467 S.W.3d 920, 2014 Tenn. App. LEXIS 675, 2014 WL 5390567, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gary-guseinov-v-synergy-ventures-inc-tennctapp-2014.