The opinion of the court was delivered by: David O. Carter United States District Judge
ORDER GRANTING SUMMARY JUDGMENT
Before the Court is a Motion for Partial Summary Judgment filed by Plaintiff Thomas A. Seaman ("Plaintiff") in the above-captioned case ("Motion for Summary Judgment") (Docket 33). After considering the moving and opposing papers*fn1 , as well as oral argument*fn2 , the Court GRANTS the Motion for Summary Judgment.
The following facts are those found in Plaintiff's Statement of Uncontroverted Facts (Docket 33-2) that were not later disputed in Defendants' Statement of Genuine Disputes (Docket 35). The facts that Defendants allege to be disputed will be discussed and evaluated further in the Discussion section.
Plaintiff is the duly appointed and acting Federal Equity Receiver for Medical Capital Holdings, Inc., Medical Capital Corporation, Medical Provider Funding Corporation VI and their subsidiaries and affiliates as identified in the orders appointing the Receiver (the "Receivership Entities"). Complaint, ¶ 3; Joint Answer of Pyramid Technologies, Inc., Tony Mavusi and Silva Mavusi to Plaintiff's Complaint (Docket 4) ("Answer"), ¶ 3. Medical Provider Financial Corporation IV, Series II ("Lender"), a Receivership Entity,entered into a loan agreement with Pyramid Technologies, Inc. ("Pyramid") ("Loan Agreement"), whereby Lender agreed to lend Pyramid up to $14 million (the "Loan"). Complaint, ¶ 10; Answer,¶ 10. Pyramid entered a written Note dated March 17, 2008 relating to the Loan Agreement. Complaint, ¶ 10; Answer,¶ 10.Pyramid disputes that it has defaulted under the Loan Agreement and the Note. Defendants' Statement of Genuine Disputes, 1.
Tony Mavusi ("T. Mavusi") and Silva Mavusi ("S. Mavusi") (collectively, "the Mavusis") entered into a written Guaranty Agreement in which they guaranteed repayment of the Loan. Complaint, ¶ 17; Answer,¶ 17. Under the Guaranty Agreement, the Mavusis expressly waived their right to require Lender to proceed first against the borrower, or against any property or assets of the borrower or against any collateral or security regarding the Loan. Complaint, ¶ 17; Answer,¶ 17. The Mavusis admit that they have not paid the indebtedness under the Loan Agreement and Note, Complaint, ¶ 19; Answer,¶ 19, but they dispute both that they are in breach of the Guaranty Agreement and that they are obligated to pay the indebtedness. Defendants' Statement of Genuine Disputes, 1-2. Defendants also dispute that the Loan Agreement and Note are in excess of $14 million. Id. at 2-3.
To further secure the obligations under the Loan Agreement, Pyramid and Lender entered a written Security Agreement dated March 17, 2008, under which Lender was granted a security interest in certain "Collateral," including accounts receivable, contract rights and other forms of right to payment, deposit accounts, goods, instruments, documents, equipment and the proceeds of any such collateral. Complaint, ¶ 16; Answer,¶ 16. In connection with the Security Agreement, a UCC financing statement was filed with the California Secretary of State on or about May 22, 2008. Id. Plaintiff is entitled to possession of the pledged Collateral under the Security Agreement, and none of this Collateral has yet been turned over to Plaintiff. Complaint, ¶¶ 38, 45-46; Answer,¶ 38, 45-46.
Defendants dispute that the Loan has an outstanding principal balanceof $14 million and that there is $5,190,644.85 in outstanding accrued interest on the Note and Loan Agreement. Defendants' Statement of Genuine Disputes, 3-4. Defendants also dispute that the last receipt of funds applied to the principal loan balance was in November 2000 and that the Receivership has not received any payment of principal or interest on the Loan from the Mavusis under the Guaranty Agreement. Id.
Summary judgment is proper if "the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). The Court must view the facts and draw inferences in the manner most favorable to the non-moving party. United States v. Diebold, Inc., 369 U.S. 654, 655 (1962); Chevron Corp. v. Pennzoil Co., 974 F.2d 1156, 1161 (9th Cir. 1992). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact for trial, but it need not disprove the other party's case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986). When the non-moving party bears the burden of proving the claim or defense at trial, the moving party can meet its burden for summary judgment by pointing out that the non-moving party has failed to present any genuine issue of material fact. Musick v. Burke, 913 F.2d 1390, 1394 (9th Cir. 1990). A party cannot create a genuine issue of material fact simply by making assertions in its legal papers. There must be specific, admissible evidence identifying the basis for the dispute. S.A. Empresa de Viacao Aerea Rio Grandense v. Walter Kidde & Co., Inc., 690 F.2d 1235, 1238 (9th Cir. 1980).
Plaintiff moves for summary judgment on his first, sixth, and eighth claims for breach of guaranty agreement and the turnover of all collateral and cash proceeds. The Court will address the first claim and then the sixth and eighth claims together.
A. First Claim: Breach of Guaranty Agreement
Plaintiff seeks summary judgment on his first claim for relief, alleging that the Mavusis are obligated to pay their outstanding debt under the Guaranty Agreement. Plaintiff alleges that the Mavusis owe $19,190,644.85, comprised of a $14 million principal balance and $5,190,644.85 of interest, as of August 31, 2011. Motion for Summary Judgment, 5. It is undisputed, as described above, that the Mavusis entered into the Guaranty Agreement under which they ...