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United States v. Cochran

United States District Court, E.D. North Carolina, Eastern Division

January 14, 2015

UNITED STATES OF AMERICA, Plaintiff,
v.
WILLIAM I. COCHRAN, III; WRC, LLC; EKP, LLC; EMLAN PROPERTIES, LLC; and RICHARD A. COCHRAN, Defendants

Page 579

For United States of America, Plaintiff: Michael James, LEAD ATTORNEY, Raleigh, NC; Mazen M. Basrawi, U.S. Department of Justice, Washington, DC; Tamica Daniel, U.S. Department of Justice, Civil Rights Division, Washington, DC.

For William I. Cochran, III, WRC, LLC, EKP, LLC, Emlan Properties, LLC, Defendants: Charles L. McLawhorn, Jr., Serenity Shea Rasmussen, LEAD ATTORNEYS, McLawhorn & Associates, Greenville, NC.

For Richard A. Cochran, Defendant: Serenity Shea Rasmussen, LEAD ATTORNEY, McLawhorn & Associates, Greenville, NC.

For City of Greenville, Greenville Police Department, Interested Party: William J. Little, III, Office of the City Attorney, Greenville, NC.

For Della Boyd, and other parties similarly situated as aggrieved persons or witnesses, Interested Party: Jack Holtzman, LEAD ATTORNEY, N.C. Justice Center, Raleigh, NC; Kelly Anne Clarke, LEAD ATTORNEY, Legal Aid of North Carolina, Raleigh, NC.

For Tammy Grimes, Vanessa Bailey, Interested Parties: Jack Holtzman, LEAD ATTORNEY, N.C. Justice Center, Raleigh, NC.

Page 580

ORDER

LOUISE W. FLANAGAN, United States District Judge.

This matter comes before the court on defendants' motion in limine to exclude certain arguments and contentions relating to defendants' asserted joint and several liability and liability of Richard Cochran (DE 177). Plaintiff responded to the motion, and in this posture the issues raised are ripe for ruling. For the following reasons, the court grants the motion.

BACKGROUND

In September 2012, plaintiff filed complaint asserting a claim under the Fair Housing Act (" FHA" ), 42 U.S.C. § § 3601-3619, against individual defendant William I. Cochran, III (" William Cochran" ) and the various entities for which he has managed residential rental properties, namely defendants WRC, LLC (" WRC" ); EKP, LLC (" EKP" ); and EmLan Properties, LLC (" EmLan" ). Plaintiff seeks damages on behalf of certain tenants and associated

Page 581

persons asserted to be " aggrieved persons" allegedly injured by defendants' discriminatory conduct. On September 19, 2013, plaintiff filed, with leave of court, an amended complaint, adding Richard A. Cochran (" Richard Cochran" ), William Cochran's brother, as a defendant.

As pertinent here, the amended complaint includes the following allegations regarding the parties and their conduct. " In his establishment of policies and procedures and his management activities relating to the rental properties, William Cochran acted as the agent of Defendant [WRC], [EmLan], [EKP], and [Richard Cochran]." (Am. Compl. ¶ 5). " WRC rented its properties to tenants through the actions of its agent, William Cochran." (Id. ¶ 6). " EKP rented its properties to tenants through the actions of its agent, William Cochran." (Id. ¶ 7). " Emlan rented its properties to tenants through the actions of its agent, William Cochran." (Id. ¶ 8). " Richard Cochran and William Cochran rented their property(-ies) to tenants through the actions of William Cochran." (Id. ¶ 9).

" Since at least 2003, William Cochran has maintained unlawful discriminatory policies and engaged in unlawful discriminatory practices at the residential properties owned by the Defendants, because of race or color." (Id. ¶ 11). " The Defendants are liable for the discriminatory conduct of their agent and manager, William Cochran, described above." (Id. ¶ 13). Plaintiff seeks relief including an award of " monetary damages to each person injured by the Defendants' discriminatory conduct." (Id. p. 6).

In its brief in opposition to summary judgment, plaintiff summarized its theory of liability for defendants in this case. In particular, it stated, " [William] Cochran, acting as an agent of the LLCs, primarily handles the daily management of residential rental properties that are or were owned by Defendants." (DE 121 at 2). " Defendants [WRC], [EKP], [EmLan] and [Richard Cochran] are each vicariously liable for the actions of William Cochran as manager of the properties each owns." Id. It confirmed, further, " [i]ndeed, Defendants do not raise any arguments to the contrary in their motion, nor could they -- there is no factual dispute that William Cochran had primary responsibility for all aspects of the day-to-day rental and maintenance of the Defendants' properties." (Id. at 3).

At pretrial conference, held December 23, 2014, defendants voiced objection to inclusion of plaintiff's contentions in proposed joint pre-trial order that William Cochran and Richard Cochran commingled funds between and amongst the LLC defendants, their personal funds, and additional businesses, Cochran Builders and Build Tech, Inc. (Pretrial Conf. Tr. at 71). Defendants objected to the inclusion of the contention that all of the LLC defendants could be held jointly and severally liable, premised on alter ego or piercing the corporate veil, for all of the actions taken by William Cochran, where that theory of liability was not pleaded. (Id. at 66-68, 70-71). Defendants also objected to the contention that Richard Cochran could be held liable for acts of William Cochran directed at properties other than the one he owns. (Id. at 68-70).

The court directed defendants to file an appropriate motion by January 5, 2015, and plaintiff to file a response in opposition by January 9, 2015, a matter of days before the scheduled commencement of trial on January 13, 2015, now underway. Defendants filed their motion on January 5, supported by memorandum filed January 6, which motion specifically seeks exclusion ...


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