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United States v. Thomas

July 29, 2010


The opinion of the court was delivered by: Gary S. Austin United States Magistrate Judge



On or about December 16, 2002, the United States of America filed its complaint to enforce federal income tax liens. (Doc. 1.) Following several years of litigation, on April 19, 2006, United States District Court Judge Anthony W. Ishii issued an Amended Stipulation for Entry of Judgment, Amended Judgment in a Civil Case, and Order. (Doc. 79.) Paragraph two, subsection (d) of the judgment and order provides as follows:

All parties would cooperate in government efforts to obtain Clara Sharp[]'s payment of the outstanding balance of the Sharp[] Note, in the amount of $188,000; which proceeds would be deposited to the Court to be divided later between the California FTB, the County of Stanislaus, and the United States.

On April 20, 2006, judgment was entered in favor of the United States and against Defendants in accordance with the Court's April 19, 2006, order. (Doc. 80.)

On May 11, 2010, the United States filed a Request for Status Conference wherein all parties could "discuss final resolution of this matter," and in particular, the outstanding $188,000.00 at issue.*fn1 (Doc. 82.) On May 13, 2010, this Court set the matter for a Status Conference and ordered the parties to prepare and file a joint status report one week prior. (Doc. 85.)

On June 7, 2010, the United States filed its Status Conference Report, wherein the government advised that the property of Clara Sharp remains the outstanding parcel upon which the government seeks to collect. Apparently Ms. Sharp agreed to sell her parcel and pay the government the sum of $188,000 from the proceeds - her obligation originally owed to the Thomases. However, despite Ms. Sharp agreeing to such a sale and payment, the property has not yet been sold. The government understood there was a prospective buyer of the property, and that "Ms. Sharp and the Bykers [were] about to close the Sharp property transaction." In conclusion, the government asked this Court to "direct the United States to submit a motion for an order of judicial sale to sell the Sharp property if the agreed payment is not deposited to the Court within thirty days from the status conference." (Doc. 89.)

On June 14, 2010, the undersigned conducted a Status Conference in this matter. G. Patrick Jennings personally appeared on behalf of the United States. Lori Mersereau telephonically appeared on behalf of Defendants Lien C. Thomas, Jeffrey A. Thomas, Maria D. Anthony, and the Peabody, Homequity, Common Sense and Thomas/Pioneer Trusts, and Gemini Funding Group (hereafter "Thomas Defendants"). Michael L. Abbott telephonically appeared on behalf of Defendant Clara Sharp. Ultimately, because the sale of the Sharp property seemed imminent, the Court ordered a further status hearing be held July 28, 2010. All parties were to participate and a joint status report was to be filed one week prior to the hearing.

On July 26, 2010, this Court issued a minute order wherein it continued the further status hearing one week, to August 4, 2010, because the parties failed to file a status report as previously requested. The parties were ordered to file a joint status report no later than 4:00 p.m. on July 28, 2010. (Doc. 91.)

On July 28, 2010, a Joint Status Report was filed with the Court on behalf of Mr. Jennings for the government and Ms. Mersereau for the Thomas Defendants. Mr. Abbott, counsel for Defendant Sharp, did not participate in the preparation of the report, nor did he sign the document. (Doc. 92 at 1.) The report advises that despite Ms. Sharp's agreement to cooperate and "pay the United States $188,000 on her obligation to the Thomases," she has not yet done so. The government acknowledges the transaction is "extraordinarily complex," however, an attorney representing the prospective buyers of the Sharp property has indicated that "Ms. Sharp would not cooperate to complete the transaction." (Doc. 92 at 1-2.) Further, it is indicated that "James Sifers, counsel for Sharp in other cases, has offered to pay the Sharp obligation to the United States outside of escrow, but payment has not been received." (Doc. 92 at 2.) The government indicates that it intends to file a motion for order of judicial sale on August 13, 2010, in the event payment has not been received by that date. Counsel for the government requests that the further status hearing be continued to September 20, 2010, "the hearing date for the motion to enforce the judgment." (Doc. 92 at 2.)

Legal Representation of Clara Sharp

This Court has previously indicated that Michael L. Abbott is Defendant Clara Sharp's attorney of record for purposes of this litigation. Because Mr. Abbott did not participate in the joint status report filed July 28, 2010, and because Mr. Abbott has previously indicated to the Court that he believed Mr. Sifers*fn2 should be representing Ms. Sharp in these proceedings, this Court notes the following for the record:

Defendant Sharp filed an answer to the government's complaint on or about April 4, 2003. (Doc. 19.) Mr. Abbott, according to this Court's CM/ECF system, has been Defendant Sharp's attorney of record since April 4, 2003. Mr. Abbott's address and contact information, including email address of, apparently have remained unchanged.*fn3 At the time of the settlement of this action, in December 2005, Mr. Abbott was served with the Notice of Settlement as the legal representative of Defendant Clara Sharp. (See Doc. 73.) Further, Mr. Abbott's electronic signature*fn4 appears on the Amended Stipulation for Entry of Judgment and Amended Judgment in a Civil Case, a document that expressly indicates this Court "retains jurisdiction to enforce this agreement . . .." (See Doc. 79.)

Shortly after this Court issued its minute order setting this matter for a status conference (Doc. 85), on June 2, 2010, Mr. Abbott electronically filed a "Substitution of Attorney." On June 7, 2010, this Court ordered the substitution be stricken, as the docket now reflects. As the Court explained in its minute order, the substitution was stricken because it did "not comply with this Court's Local Rules."*fn5 Mr. Abbott was "directed to consult Local ...

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