Lightsway Litigation Services, LLC as Trustee of T v. Yung, III

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re: ) Chapter 11

)

TROPICANA ENTERTAINMENT, LLC, )

et al., )

) Case No. 08-10856 (MFW)

Debtors. ) Jointly Administered

__________________________________ )

)

LIGHTSWAY LITIGATION SERVICES, LLC )

as TRUSTEE OF TROPICANA LITIGATION )

TRUST, )

)

Plaintiff, )

)

v. )

) Adv. No. 10-50289

WIMAR TAHOE CORPORATION f/k/a )

TROPICANA CASINOS AND RESORTS, INC.)

and COLUMBIA SUSSEX CORPORATION ) Rel. Docs. 223, 224, 225,

) 226, 227, 233, 234, 235,

Defendants. ) 236, 237

MEMORANDUM OPINION1

Before the Court are the Defendants’ Motions in Limine,

which are opposed by the Plaintiff. For the reasons set forth

below, the Court will grant in part and deny in part the Motions.

I. BACKGROUND

On May 5, 2008, Tropicana Entertainment, LLC, and its

affiliates (the “Debtors”) filed voluntary bankruptcy petitions

under chapter 11 of the Bankruptcy Code. (D.I. 1.) Pursuant to

1 The Court is not required to state findings of fact or

conclusions of law on these procedural motions pursuant to Rule

7052 of the Federal Rules of Bankruptcy Procedure. To the extent

there are material disputes of fact, the Court is reserving

decision until the trial. See, e.g., III.B infra.

the First Amended Joint Plan of Reorganization (the “Plan”), the

Debtors assigned certain claims against its insiders to the

Tropicana Litigation Trust (the “Plaintiff”).

The Plaintiff filed this adversary action in 2010. On

November 25, 2014, the Court granted in part and denied in part

the Defendants’ motion to dismiss. (Adv. Proc. D.I. 91.) As a

result, two claims remain against Defendants Wimar Tahoe

Corporation (“Wimar”) and Columbia Sussex Corporation (“Sussex”):

(1) breach of contract and (2) breach of the covenant of good

faith and fair dealing. Those claims relate to contracts between

Wimar and the Debtors for casino management services and

contracts between Columbia and the Debtors for hotel management

and back-office services.

On May 29, 2019, the Court denied the Defendants’ motion for

summary judgment, finding a material issue of disputed fact as to

whether the Defendants breached those contracts by, inter alia,

failing to supervise operations and understaffing the casinos and

hotels. (Adv. Proc. D.I. 211.)

The parties have completed both fact and expert discovery.

On November 22, 2019, the Defendants filed five motions in limine

to preclude the introduction of certain testimony and documents

at trial. The Plaintiff responded to the motions and on March

31, 2020, a notice of completion of briefing was filed. Although

the parties have not yet filed their lists of witnesses or

2

documents that they intend to present at the trial, the Plaintiff

has stated that it does intend to use certain documents and to

call certain witnesses (or rely on prior testimony of those

witnesses). Therefore, the issues raised by the Motions are ripe

for decision.

II. JURISDICTION

The Court has jurisdiction over the Motions. In ruling on

the motion to dismiss, the Court found that it had jurisdiction

over this adversary proceeding because there was a close nexus

between the claims and the confirmed Plan. Lightsway Litig.

Servs. LLC v. Yung (In re Tropicana Entm’t, LLC), 520 B.R. 455,

462-63 (Bankr. D. Del. 2014), citing Binder v. Pricewaterhouse &

Co., LLP (In re Resorts Int’l, Inc.), 372 F.3d 154, 168-69 (3d

Cir. 2004). Further, in its Opinion ruling on the motion for

summary judgment, the Court found that the parties have

stipulated to the Court’s authority to enter a final order.

Lightsway Litig. Servs. LLC v. Yung (In re Tropicana Entm’t,

LLC),Case No. 08-10856, Adversary. Procedure. No. 10-50289, 2019

WL 2320810, *2 n. 10 (Bankr. D. Del. May 29, 2019), citing

Wellness Int’l Network, Ltd. v. Sharif, 135 S. Ct. 1932 (2015).

3

III. DISCUSSION

A. First Motion in Limine

In its first motion, the Defendants seek to preclude the

Plaintiff from introducing a report issued by the New Jersey

Division of Gaming Enforcement (the “DGE”) and an Opinion by the

New Jersey Casino Control Commission (the “CCC”) relating to the

denial of a license to Wimar to operate a casino at the Debtors’

property located in Atlantic City, New Jersey.

The Plaintiff contends that the report and the opinion are

admissible under Rule 803 of the Federal Rules of Evidence

because it is a public record that contains factual findings from

a legally authorized investigation. Fed. R. Evid.

803(8)(A)(iii). The Plaintiff notes that the DGE and CCC are

part of the executive branch in New Jersey and were acting within

their authority.

The Defendants do not dispute this but argue that the

documents are not admissible because (1) they contain hearsay

within hearsay, (2) the CCC opinion was the result of a judicial

(rather than an investigative) proceeding, (3) both were the

result of union and political pressure, (4) Columbia was not a

party to the investigation or proceeding, and (5) they contain no

indicia of trustworthiness.

The Court must reject the Defendants’ first contention -

that the report and opinion contain multiple instances of hearsay

4

- because Rule 803 is an exception to the general rule that

hearsay is inadmissible. Specifically, Rule 803(8) (A) (i111)

provides an exception to the admissibility of hearsay for “a

record or statement of a public office if... it sets out...

in a civil case .. . factual findings from a legally authorized

investigation.”

The Court also rejects the Defendants’ second contention

that Rule 803(8) is not applicable because the CCC proceeding was

a judicial (not an investigative) proceeding. In support of

their argument, the Defendants argue that only if a proceeding is

investigative - as opposed to judicial in nature — does the Rule

(8) (A) (111) exception apply. See, e.g., Hynix Semiconductor

Inc. v. Rambus, Inc., Case No. CV-00-20905, 2008 WL 282376, at *3

(N.D. Cal. Jan. 28, 2008) (denying admission of FTC decision

because it was “more like ‘judging’ than ‘investigating.’”).°

The Court is not persuaded by the analysis in Hynix and

rather, is persuaded by the numerous decisions - some binding on

The Defendants actually cite Rambus, Inc. v. Infineon

Techs. AG, 222 F.R.D. 101 (E.D. Va. 2004) for that proposition.

However, the Rambus Court excluded the administrative ruling not

because it was the result of a judicial-like proceeding but

because it was only a preliminary decision that had to be

presented to the full Commission which would make the ultimate

findings of fact. Id. at 108. In doing so, the Rambus Court

acknowledged binding authority that facts found by executive

department tribunals are admissible (even though issued in

“jJudicial-like” proceedings). Id. at 107 (citing Zeus Enters.,

Inc. v. Alphin Aircraft, Inc., 190 F.3d 238, 242 (Ath Cir. 1999)

(holding that NTSB decision adopting ALJ’s finding that aircraft

was not airworthy was admissible under Rule 803(8)).

this Court - that conclude that findings of fact from executive

department decisions, even though conducted in judicial-like

proceedings, are admissible under Rule 803(8). See, e.g.,

Chandler v. Roudebush, 425 U.S. 840, 863 n. 39 (1976) (noting

that “[p]rior administrative findings” made by a Veteran’s

Administration examiner in a hearing on an employment

discrimination claim are admissible in federal court); Henry v.

Daytop Village, Inc., 42 F.3d 89, 96 (2d Cir. 1994) (findings of

state department of labor ALJ in unemployment benefits hearing

were admissible); In re Paducah Towing Co., 692 F.2d 412, 420

(6th Cir. 1982) (findings of ALJ in Coast Guard proceeding to

revoke license of ship’s captain admissible); Lloyd v. American

Export Lines, Inc., 580 F.2d 1179, 1183 (3d Cir. 1978) (findings

of hearing examiner in Coast Guard proceeding that included oral

testimony and admission of documents relating to assault and

battery charges were admissible under Rule 803(8)).

Accordingly, the Court rejects the Defendants’ second

contention that the findings of fact in the CCC decision are not

admissible because they were issued in a judicial-like

proceeding. The Court agrees with the Defendants, however, that

any conclusions of law in that decision are not admissible

because the hearsay exception in Rule 803(8) is limited to

“factual findings” from an investigation.

6

The Court also rejects the Defendants’ fourth contention

that the CCC decision is not admissible as to Columbia because it

was not a party to the proceeding. Rule 803(8) does not require

that the party against whom the report is admitted actually be a

party to or the subject of that investigative report. Rule

803(8) makes investigative reports admissible on the assumption

“that a public official will perform his duty properly.” Zeus,

190 F.3d at 241. It is not predicated on the fact that a party

had an opportunity to participate in the investigation. Cf. Fed.

R. Evid. 804(b)(1) (prior testimony exception to hearsay rule

requires that party against whom testimony is offered had an

opportunity to test that testimony at the prior hearing or

deposition). The Court will not read such a requirement into

Rule 803(8).

The Defendants’ third and fifth contentions are related:

they assert that there is no indicia of trustworthiness in the

DGE report or the CCC opinion because they contain hearsay within

hearsay and they were the result of union and political pressure.

The Plaintiff disputes these contentions.

The Court starts with the burden of proof. Rule 803(8)

makes public records of investigations admissible if “the

opponent [of admissibility] does not show that the source of

information or other circumstances indicate a lack of

trustworthiness.” Fed. R. Evid. 803(8)(B). Thus, the burden of

7

showing untrustworthiness is on the party opposing the admission

of the investigative report, i.e., the Defendants in this case.

Baker v. Elcona Homes, 588 F.2d 551, 558 (6th Cir. 1978). It is

not sufficient to meet this burden by showing that some of the

evidence on which the report relied was hearsay. Paducah, 692

F.2d at 421 (concluding that opposing party failed to show that

report was untrustworthy by showing that one witness’s testimony

was hearsay without admitting the entire transcript to show the

other evidence on which the tribunal relied). Rule 803 is an

exception to the hearsay rule, thereby permitting the admission

of hearsay.

The Defendants cite the Third Circuit for the proposition

that a report may be excluded if it includes hearsay within

hearsay. Bernard v. East Stroudsburg Univ., 700 Fed. App’x 159

(3d Cir. 2017). The Bernard case is distinguishable. First, the

Circuit was reviewing the District Court ruling on exclusion

under an abuse of discretion standard. Id. at 167. Second, the

report at issue contained only preliminary findings. Id. Third,

the party seeking admission of the report admitted that it

contained only hearsay. Id. The Defendants in this case do not

contend that the entire record before the CCC was hearsay. In

fact, several representatives of the Defendants testified before

8

the CCC.3 The Defendants fail to identify specifically what

evidence considered by the CCC was hearsay and what weight the

CCC gave that evidence.

The Defendants also argue that the CCC decision is

untrustworthy because the CCC was subject to pressure by the

local union and politicians to deny the Defendants a casino

license. The Defendants present the deposition testimony of a

union representative who testified that he did oppose the license

and that he caused articles critical of the Defendants to be

published. However, that evidence is insufficient to show that

the CCC tribunal itself was biased or prejudiced against the

Defendants. While the union may have been biased against the

Defendants, there is no evidence that bias was held by the DGE or

the CCC. Rather, it appears that the CCC rendered its opinion

based on the record before the CCC, which was not limited to the

position of the Union but also included testimony from

representatives of the Defendants.

Thus, the Court concludes that the Defendants have not met

their burden of showing that the CCC decision is untrustworthy

pursuant to Rule 803(8)(A)(3). Accordingly, the Court will deny

the First Motion in Limine.

3 As noted below, the testimony of representatives of the

Defendants is not hearsay under Rule 801(d)(2). See III.D infra.

9

B. Second Motion in Limine

In their Second Motion in Limine, the Defendants seek to

preclude the Plaintiff from offering the expert opinions of their

damages expert, Jaime D’Almeida. In support they argue that (1)

the D’Almeida report is based on the report of the Plaintiff’s

liability expert, William Friedman, whom the Plaintiff is not

going to present at trial and (2) the “debt pricing model”

portion of the opinion is excludable under Daubert because it is

not founded on any scholarly method or other expert’s opinion; in

fact, the Defendants contend that Mr. D’Almeida admitted it has

never been used by any other expert, including himself.

The Plaintiff disagrees with the Defendants’ assertion that

D’Almeida’s report is based only on Mr. Friedman’s expert

opinion. The Plaintiff asserts that it will prove liability at

trial and that it does not need Mr. Friedman to do so. Once it

has established liability, the Plaintiff contends that

D’Almeida’s opinion as to the damages arising from that liability

will be admissible.

The Court agrees with the Plaintiff on this point. “Unlike

an ordinary witness . . . an expert is permitted wide latitude to

offer opinions, including those that are not based on firsthand

knowledge or observation. See Rules 702 and 703.” Daubert v.

Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 592 (1993). Mr.

D’Almeida’s expert report is based on facts upon which he relied

10

in forming his damages opinion. In the event that the Plaintiff

establishes those facts, then Mr. D’Almeida’s opinion based on

that evidence is admissible.

Further, the Plaintiff contends that the debt pricing model

portion of Mr. D’Almeida’s expert report is not a novel theory

but is widely used to calculate the change in value of debt. It

notes that Mr. D’Almeida explained at his deposition that he used

that model as a check on his calculation of the change in value

of equity, because both change in tandem. At any rate, the

Plaintiff argues that Mr. D’Almeida’s theory can be tested at

trial.

The Court agrees with the Plaintiff’s last point. The trial

is a bench trial, not before a jury, and therefore exclusion of

testimony on Daubert grounds now, before the Court has had the

chance to evaluate the direct (and cross) examination of the

expert witness, is not the best way to assess the reliability of

the expert’s opinion.

The court believes that these issues [the reliability

of the expert’s methodologies and their fit with the

facts of the case] will best be resolved at trial

rather than now in writing or following a Daubert

hearing sometime prior to trial. As this case will be

a bench trial, the court’s ‘role as a gatekeeper

pursuant to Daubert is arguably less essential’ . . . .

Indeed, ‘vigorous cross-examination [and] presentation

of contrary evidence’ will provide the best means of

attacking [the expert’s] report, as opposed to the

court’s conducting a line-by-line analysis of the

report now. If the court examined the report now as

plaintiffs urge, the court’s determinations regarding

the veracity, reliability, or weight of isolated

11

statements in the report would be without the benefit

of the context to be provided by other evidence, the

context in which the report as a whole must be

considered.

Clark v. Richman, 339 F. Supp. 2d 631, 648-49 (M.D. Pa. 2004)

(citations omitted).

Accordingly, the Court will deny the Second Motion in

Limine, with the caveat that the Defendants may move at trial to

exclude the expert’s testimony after cross-examination.

C. Third Motion in Limine

Related to the First Motion, the Third Motion in Limine

seeks to exclude the admission of the New Jersey Court opinions

upholding the CCC decision denying a casino license to Wimar.

The Defendants argue that the judicial decisions are not

admissible under res judicata or collateral estoppel grounds

because the action in New Jersey did not involve the same parties

or same factual or legal issues. Columbia, in particular, argues

that it was not a party to the appeals. The Defendants also

argue that the issues relevant to the appeals are different from

the issues in the adversary. The appeals dealt with whether the

denial of the casino license was justified not whether Wimar or

Columbia breached their contracts with the Debtors. The

Defendants further contend that the opinions are hearsay and not

admissible under Rule 803(8) because they are clearly judicial

decisions and not investigative reports.

12

The Plaintiff argues that the Motion is premature because it

currently does not intend to offer the Opinions into evidence.

However, it reserves the right to offer them if the Defendants

seek to collaterally attack the CCC decision which was affirmed

by the New Jersey Courts.

The Court agrees with the Defendants that the New Jersey

Court Opinions are not admissible under Rule 803(8) because they

are judicial decisions and not investigative reports. See, e.g.,

Int’l Land Acqs., Inc. v. Fausto, 39 Fed. App’x 751, 756 (3d Cir.

2002); Nipper v. Snipes, 7 F.3d 415, 417 (4th Cir. 1993).

However, the Court concludes that they are admissible (not for

the truth of what they say) but for notice of the fact that they

were entered. Michael v. Quaker Valley School Dist., Civ. A. No.

2:16-cv-00473, 2019 WL 1349556, at *2, n.4 (W.D. Pa. March 26,

2019) (statements offered in support of summary judgment were not

hearsay because they were offered, not for the truth of what was

stated, but to show that plaintiff had notice of them). Cf. Fed.

R. Evid. 801(c)(2). The Court need not address whether they are

admissible for any other purpose, until and unless a party seeks

to admit them.

Accordingly, the Court will grant in part and deny in part

the Third Motion in Limine.

13

D. Fourth Motion in Limine

In the Fourth Motion in Limine, the Defendants seek to

exclude the CCC hearing transcripts and testimony elicited in

that proceeding. The Defendants argue that the prior testimony

before the CCC is not admissible under Rule 804 because (1) there

is no evidence that the declarants are unavailable and (2)

neither Columbia (who wasn’t even a party to the CCC proceeding)

nor Wimar had a “similar motive to develop [that testimony] by

direct, cross, or redirect examination.” Fed. R. Evid.

804(b)(1)(B).

The Plaintiff responds that the transcript is admissible

under Rules 801 and 804. The Plaintiff notes that many of the

witnesses who testified at the CCC proceeding, and particularly

Mr. Yung, are representatives of the Defendants. Consequently,

it argues that the prior testimony is not even hearsay under Rule

801. Further, the Plaintiff asserts that it has not determined

what parts of the transcript, if any, it intends to offer at the

trial. Therefore, it argues that the Defendants’ Motion is

premature.

The Plaintiff does ask the Court to decide, nonetheless,

that the transcript would be admissible under Rule 804 as to

declarants who are not representatives of the Defendants to the

extent they are not available to testify at trial because the

issues extant at the CCC were the same issues that are relevant

14

here: namely, whether the Defendants mismanaged the hotel and

casino properties.

The Court agrees with the parties that a ruling on the issue

of admissibility of any part of the CCC transcript is ripe and

will facilitate the parties’ preparation for, and presentations

at, the trial.

With respect to any witness who testified at the CCC hearing

who is a representative of the Defendants, the Court agrees with

the Plaintiff that the testimony (at the CCC hearing or

otherwise) is not hearsay and is admissible under Rule 801

regardless of availability. Fed. R. Evid. 801(d)(2). Further,

if any witness who testified at the CCC hearing is called to

testify at the trial in this matter, his prior testimony may be

used to impeach him or for any other reason set forth in Rule

801(d)(1).

With respect to witnesses who do not fall into either of

those categories, the Court addresses the two arguments presented

by the Defendants to exclude that testimony as follows.

1. Unavailability

The Defendants argue that the Plaintiff has not met the

standard under Rule 804 to show the declarants are now

unavailable. They contend that “unavailable” under Rule 804

requires a showing that the Plaintiff “has not been able, by

process or other reasonable means to procure” their attendance at

15

trial. Fed. R. Evid. 804(a) (5) (emphasis added). The Defendants

contend that the Plaintiff has made no such showing.

The Plaintiff responds that unavailability under Rule 804 is

the same as that under Rule 32 of the Federal Rules of Civil

Procedure: namely, that the witness is beyond the subpoena power

of the Court. Wilson v. Seven Seventeen HB Philadelphia Corp.

No. 2, Civ. A. No. 99-CV-1729, 2003 WL 22709073 (E.D. Pa. Nov.

14, 2003).

The Court agrees with the Plaintiff. As noted by the Wilson

Court:

“In civil cases, it has long been the rule that

inability to procure attendance by ‘process or other

reasonable means’ is satisfied by demonstration of

inability to serve a subpoena.” Zenith Radio Corp. v.

Matsushita Elec. Indus. Co., 505 F. Supp. 1190, 1249

(E.D. Pa.1980), aff’d in part and rev’d in part on

other grounds, 723 F.2d 238 (3d Cir. 1983); AEL Indus.,

Inc. v. Alvarez, No. 88-0391, 1989 WL 97394, at *2

(E.D. Pa. Aug. 17, 1989) (“A witness who is beyond the

subpoena power of the court is unavailable.”). See

also Aubrey Rogers Agency, Inc. v. AIG Life Ins. Co.,

No. 97-529, 2000 WL 135129, at *2 (D. Del. Jan. 13,

2000) (noting that courts distinguish between the

unavailability of fact witnesses and expert witnesses

and find fact witnesses unavailable solely because the

witnesses are beyond the subpoena power of the court).

Accordingly, we conclude that any witness outside the

subpoena power of this Court (within 100 miles of this

District) is unavailable under Rule 804(a)(5) and their

testimony may be admissible under the “former

testimony” exception to the hearsay rule.

Wilson, 2003 WL 22709073, at *4.

Thus, to the extent any of the witnesses who testified at

the CCC hearing are beyond the subpoena power of the Court, the

16

Court concludes that they are unavailable under Rule 804.

2. Similar Action

The Defendants argue, however, that the CCC transcript is

not admissible because the Defendants did not have a similar

motive or opportunity to elicit testimony in the CCC proceeding

that is relevant to the issues in this case because it was before

the adversary complaint was filed and the issues were

significantly different. See, e.g., United States v. DiNapoli, 8

F.3d 909, 913 (2d Cir. 1993); Complaint of Bankers Trust Co., 752

F.2d 874, 887–88 (3d Cir. 1984). The Defendants also argue that

the transcript is not admissible as to Columbia because it was

not a party to the CCC proceeding.

The Plaintiff responds that the CCC proceeding addressed the

very facts that are at issue in this proceeding: namely, whether

the Defendants mismanaged the hotel and casino operations. It

also argues that Columbia was a party because it was an “entity

qualifier” in those proceedings.

Rule 804(b)(1) provides an exception to the hearsay rule if

the declarant is unavailable as a witness and:

(A) the testimony was given as a witness at a trial,

hearing, or lawful deposition, whether given during the

current proceeding or a different one; and

(B) the testimony is now offered against a party who

had – or, in a civil case, whose predecessor in

interest had – an opportunity and similar motive to

develop it by direct, cross-, or redirect examination.

Fed. R. Evid. 804(b)(1) (emphasis added).

17

The Court agrees with the Plaintiff that Columbia, though

not the applicant for the casino license, was a party to the

proceeding because it was an entity qualifier. As an entity

qualifier, it too was investigated by the DGE to see if it

qualified to operate the casino’s hotel.4 Further,

representatives of Columbia participated in the CCC proceeding

by, inter alia, testifying at length.5

The Court also concludes that both Defendants had an

opportunity and a similar motive in the CCC proceeding as they

have in this adversary proceeding to develop relevant testimony.

The subject of the CCC proceeding focused largely on whether the

hotel and casino operations were mismanaged. The predicate of

the Plaintiff’s complaint in this adversary proceeding is that

those operations were mismanaged and, as a result, the Defendants

breached their management agreements with the Debtors. Thus, in

seeking the casino license which would allow Wimar to run the

casino (and the approval of Columbia as an “entity qualifier”

allowing it to run the hotel), both Defendants had a motive in

the CCC proceedings that is similar to their motive in defending

this adversary proceeding: to establish that they did not

mismanage the hotel or casino properties.

4 See D.I. 233, Ex. A at 78-79.

5 See D.I. 236, Ex. A at 5, 30 et seq.

18

Consequently, the Court concludes that the CCC transcript is

admissible under Rule 804. Accordingly, the Court will deny the

Fourth Motion in Limine.

E. Fifth Motion in Limine

In the Fifth Motion in Limine, the Defendants seek to

exclude the admission of transcripts of certain depositions taken

in another proceeding (the main bankruptcy case).6 As in the

Fourth Motion, the Defendants argue that they are not admissible

under Rule 804 because (1) there is no evidence that the

declarants are unavailable and (2) neither Columbia nor Wimar had

a “similar motive to develop [that testimony] by direct, cross,

or redirect examination.” Fed. R. Evid. 804(b)(1)(B). The

Defendants also argue that the depositions are not admissible

under Rule 32 of the Federal Rules of Civil Procedure because the

prior action did not involve the same parties or same subject

matter. Maxus Liquidating Trust v. YPF (In re Maxus Energy

Corp.), Bankr. No. 16-11501, Adv. No. 18-50489, 2019 WL 2581609,

*2-3 (Bankr. D. Del. June 24, 2019). Specifically, they argue

that the main bankruptcy case involved many matters and not the

express issues raised in this adversary proceeding.

6 By agreement of the parties, the transcripts of the

depositions of Donna More (June 19, 2008), William Yung III

(June 16 and 17, 2008), and Theodore Mitchel (June 20 and

September 25, 2008) may be used at trial in the adversary subject

to specific objections with respect to individual testimony. The

Plaintiff seeks the admission of additional deposition

transcripts.

19

The Plaintiff responds that currently it intends to use only

two depositions taken in the main bankruptcy case, those of

Richard Fitzpatrick, a former employee of Defendant Columbia, and

Howard Reinhardt, a former employee of Defendant Wimar. The

Plaintiff asserts that those depositions are admissible under

both Rule 32 and Rule 804. It presented evidence that both live

beyond the subpoena power of the Court and, therefore, are

unavailable under either Rule.7

Further, the Plaintiff notes that the depositions were taken

in the main bankruptcy case by the Creditors’ Committee and a

special committee of the Debtors’ Board for the express purpose

of ascertaining whether there were any claims that the estate had

against the Defendants for their mismanagement of the Debtors’

casino and hotel properties - exactly the contentions in this

adversary proceeding.

The Court agrees with the Plaintiff that the depositions

taken in the main bankruptcy case did involve “the same subject

matter between the same parties, or their representatives or

successors in interest, to the same extent as if taken” in this

adversary proceeding. Fed. R. Civ. P. 32(a)(8).

With respect to whether the parties to the depositions were

the same (or predecessors in interest to the current parties),

the Court concludes they were. The Third Circuit has held that

7 D.I. 237, Ex. B.

20

While we do not endorse an extravagant interpretation

of who or what constitutes a “predecessor in interest,”

we prefer one that is realistically generous over one

that is formalistically grudging. We believe that what

has been described as “the practical and expedient

view” expresses the congressional intention: “if it

appears that in the former suit a party having a like

motive to cross-examine about the same matters as the

present party would have, was accorded an adequate

opportunity for such examination, the testimony may be

received against the present party.” Under these

circumstances, the previous party having like motive to

develop the testimony about the same material facts is,

in the final analysis, a predecessor in interest to the

present party.

Lloyd v. Am. Export Lines, Inc., 580 F.2d 1179, 81 (3d Cir.

1978). In this case, the Creditors’ Committee and special

Committee of the Debtors are clearly predecessors in interest to

the Plaintiff. Under the Plan, the claims investigated by the

Debtor and the Creditors’ Committee were assigned by the Debtors

to the Liquidating Trust. Further, both Defendants were given an

adequate opportunity to participate in the depositions.8

In addition, the Court concludes that the subject of the

depositions was the same as this adversary proceeding. In the

main case, the Debtor and Creditors’ Committee were investigating

whether the estate had claims against the Defendants for, inter

alia, mismanaging the casino and hotel properties of the Debtors.

This adversary proceeding resulted from that investigation and

alleges that, in fact the Defendants mismanaged the casino and

hotel properties, thereby breaching their contracts.

8 D.I. 237 at Exs. C & D.

21

Thus, the Court concludes that the depositions of Mr.

Fitzpatrick and Mr. Reinhardt taken in the main bankruptcy case

are admissible in this adversary proceeding under Rule 32 and

Rule 804. Accordingly, the Court will deny the Fifth Motion in

Limine.

IV. CONCLUSION

For the foregoing reasons, the Court will deny the First,

Fourth, and Fifth Motions in Limine. The Court will grant in

part and deny in part the Second and Third Motions in Limine.

An appropriate Order is attached.

Dated: April 20, 2020 BY THE COURT:

Mary F. Walrath

United States Bankruptcy Judge

22

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re: ) Chapter 11

)

TROPICANA ENTERTAINMENT, LLC, )

et al., )

) Case No. 08-10856 (MFW)

Debtors. ) Jointly Administered

__________________________________ )

)

LIGHTSWAY LITIGATION SERVICES, LLC )

as TRUSTEE OF TROPICANA LITIGATION )

TRUST, )

)

Plaintiff, )

)

v. )

) Adv. No. 10-50289

WIMAR TAHOE CORPORATION f/k/a )

TROPICANA CASINOS AND RESORTS, INC.)

and COLUMBIA SUSSEX CORPORATION ) Rel. Docs. 223, 224, 225,

) 226, 227, 233, 234, 235,

Defendants. ) 236, 237

ORDER

AND NOW this 20th day of APRIL, 2020, upon consideration of

the Motions in Limine filed by the Defendants and the Responses

of the Plaintiff thereto, it is hereby

ORDERED that the First Motion in Limine is DENIED; and it is

further

ORDERED that the Second Motion in Limine is DENIED without

prejudice to the right of the Defendants to move to exclude the

expert’s opinion after cross-examination at trial; and it is

further

ORDERED that the Third Motion in Limine is GRANTED IN PART

AND DENIED IN PART; and it is further

ORDERED that the Fourth Motion in Limine is DENIED; and it

is further

ORDERED that the Fifth Motion in Limine is DENIED.

BY THE COURT:

Mary F. Walrath

United States Bankruptcy Judge

cc: Joseph Grey, Esquire’

t Counsel shall distribute a copy of this Order and the

accompanying Memorandum Opinion to all interested parties and

file a Certificate of Service with the Court.

SERVICE LIST

Herbert Beigel, Esquire

Herbert Beigel & Associates, LLC

38327 S. Arroyo Way

Tucson, AZ 85739

Counsel for the Plaintiff

Joseph Grey, Esquire

Cross & Simon LLC

1105 North Market Street, Suite 901

Wilmington, DE 19801

Counsel for the Plaintiff

Dennis A. Meloro, Esquire

Nancy A. Peterman, Esquire

Greenberg Traurig, LLP

77 West Wacker Drive

Suite 3100

Chicago, IL 60601

Counsel for the Defendants

George M. Vinci, Jr., Esquire

Neal R. Troum, Esquire

Spector Gadon Rosen Vinci P.C.

1635 Market Street, 7th Floor

Philadelphia, PA 19103

Counsel for the Defendants