In re Mervyn's Holdings, LLC | Chapter 11 Cases

426 B.R. 488 (2010)

In re MERVYN?S HOLDINGS, LLC, et al., Debtors.

Mervyn?s LLC, Plaintiff,

v.

Lubert-Adler Group IV, LLC, et al., Defendants.

Bankruptcy No. 08-11586(KG). Adversary No. 08-51402(KG).

United States Bankruptcy Court, D. Delaware.

March 17, 2010.

491 *491 Ashley B. Stitzer, Daniel A. O?Brien, Justin R. Alberto, Neil B. Glassman, Bayard, P.A., Christopher M. Samis, Richards, Layton & Finger, P.A., Mary E. Augustine, Ciardi Ciardi & Astin, Wilmington, DE, Jennifer L. Stewart, Cooley Godward Kronish LLP, Boston, MA, Nicholas Smithberg, Ronald R. Sussman, Cooley Godward Kronish LLP, New York, NY, for Plaintiff.

492 *492 Adam G. Landis, Matthew B. McGuire, Landis Rath & Cobb LLP, Kimberly Ellen Connolly Lawson, Reed Smith LLP, Sharon M. Zieg, Young, Conaway, Stargatt & Taylor, Domenic E. Pacitti, Klehr Harrison Harvey Branzburg LLP, Gabriel R. MacConaill, Laurie Selber Silverstein, Potter Anderson & Corroon LLP, Francis A. Monaco Jr., Womble Carlyle Sandridge & Rice, John H. Strock, III, Fox Rothschild LLP, Natalie D. Ramsey, Montgomery, McCracken, Walker & Rhoads, Stuart M. Brown, Edwards Angell Palmer & Dodge LLP, Wilmington, DE, Aaron Rubinstein, Lee M. Cortes, Jr., Jr., Phillip A. Geraci, Kaye Scholer LLP, Richard G. Haddad, Otterbourg Steindler Houston Rosen, P.C., New York, NY, Dennis M. Ryan, Michael F. Doty, Wendy J. Wildung, Faegre & Benson LLP, Minneapolis, MN, Laurie A. Krepto, Montgomery, McCracken, Walker & Rhoads, Philadelphia, PA, for Defendants.

Bank of America Corporation, pro se.

MEMORANDUM OPINION [1]

KEVIN GROSS, Bankruptcy Judge.

INTRODUCTION

The matter before the Court is Defendant Target Corporation?s Motion to Dismiss (the ?Motion?) the adversary proceeding brought against it by Mervyn?s LLC (?Debtor?) acting through the Official Committee of Unsecured Creditors (the ?Committee?). [2]

STATEMENT OF FACTS [3]

I. Background

Debtor, a California limited liability company, was a nationwide retailer of affordable fashion and home d?cor products which at one time operated 177 retail stores in the Midwest, South and Pacific Northwest. (Am.Compl.? 42). In 1978, the Dayton Hudson Corporation (?DHC?) acquired Mervyn?s which became a wholly-owned subsidiary of DHC. DHC also owned several ?higher end? department stores, including Target Stores which became such a successful chain of discount retail stores that DHC changed its corporate name to ?Target Corporation? (?Target?). By 2003, Target owned and operated three department store chains: Marshall Field?s, Mervyn?s and Target Stores. Target?s board of directors had decided to focus solely upon the Target chain and therefore decided to sell both Marshall Field?s and Mervyn?s.

II. Private Equity Sale

After a competitive auction process, Target entered into an Equity Purchase Agreement (the ?Agreement?) on July 29, 2004, with a group of private equity firms that formed one of the Debtor entities 493 *493 ?Mervyn?s Holdings LLC,? (?Mervyn?s Holdings?). Mervyn?s Holdings is a Delaware limited liability company that was formed by three private equity groups (collectively, ?PE Sponsors.?) In order to spin-off Debtor?s valuable real estate assets from Debtor, the PE Sponsors formed defendant ?MDS Companies,? bankruptcy remote entities. (Am.Compl.?? 62-63). The Agreement itself called for Target to convey 100% of its ownership interest in Debtor to Mervyn?s Holdings for $1.175 billion. (Agreement, ? 1). Mervyn?s Holdings represented to Target that it had equity and debt commitment letters from external funding sources indicating that it had arranged loans and letters of credit from outside sources. Id., ? 6(d). The Agreement did not require the sale of Debtor?s real estate either by Target or anyone else. Id., ? 5(b). Instead, the Agreement expressly prohibited Target from selling or transferring any of Debtor?s real estate and also required Target to convert Debtor from a corporation to a limited liability company (?LLC?). Id.

III. The Sale Transaction

On September 2, 2004 the sale closed (the ?2004 Sale?). Am Compl. ?? 56-57. The parties satisfied or waived the Agreement?s conditions. Mervyn?s Holdings and PE Sponsors borrowed using Debtor?s real estate as collateral and incurred substantial obligations in order to fund the 2004 Sale. (Am.Compl.? 46). Debtor received no residual interest in its own real estate and ?all or substantially all of the loan proceeds were paid over to Target.? (Am. Compl.?? 46, 59). [4] Mervyn?s Holdings also leased the real estate back to Debtor at a ?substantially increased rate to both service the acquisition debt and to continue to extract over time the significant excess value of the real estate assets over the debt piled onto those assets.? (Am. Compl.? 49). Debtor claims that Mervyn?s Holdings? actions destroyed the Debtor?s value and led to filing of the Chapter 11 petition with the Court on July 29, 2008.

CAUSES OF ACTION

On September 2, 2008, Mervyn?s brought this adversary proceeding against Target and 38 other defendants by filing a complaint alleging that Target and the other defendants engaged in a fraudulent transaction and that Target, among others, breached their fiduciary duty to Debtor and its creditors. Thereafter, Debtor filed its Amended Complaint on December 22, 494 *494 2008, containing the following claims against Target:

Count I: Mervyn?s Holdings caused Debtor?s real estate assets to be transferred with the actual intent to hinder, delay, or defraud creditors or without adequate consideration, in violation of the applicable provisions of the Uniform Fraudulent Transfer Act (UFTA) or Uniform Fraudulent Conveyance Act (UFCA), and Bankruptcy Code Sections 544(b) and 550. Target is liable as a transferee of the proceeds.

Count II: Mervyn?s Holdings caused Debtor?s to pledge its real estate assets with the actual intent to hinder, delay, or defraud creditors or without adequate consideration, in violation of the applicable provisions of the UFTA or the UFCA, and Sections 544(b) and 550. Target is liable as a transferee of the proceeds.

Count V: That the owners of Debtor (which changed over time), including Target, each breached the fiduciary duties that they owed to Debtor and its creditors at the respective times that they owned it.

Target responded to the Amended Complaint by filing the Motion on April 3, 2009. On May 20, 2009, the adversary proceeding was stayed pending the resolution of a motion to disqualify Kirkland & Ellis LLP, as counsel to Sun Capital Defendants, which the Court denied. (Adv.Dkt.125).

Target now seeks an order from this Court dismissing the claims against it in the Amended Complaint, with prejudice, pursuant to Rules 8, 9(b), and 12(b)(6) of the Federal Rules of Civil Procedure, made applicable by Rules 7008, 7009, and 7012 of the Federal Rules of Bankruptcy Procedure.

STANDARD OF REVIEW

Rule 12(b)(6) of the Federal Rules of Civil Procedure, made applicable here by Federal Rule of Bankruptcy Procedure 7012(b), governs a motion to dismiss for failure to state a claim upon which relief can be granted. ?The purpose of a motion to dismiss is to test the sufficiency of a complaint, not to resolve disputed facts or decide the merits of the case.? Paul v. Intel Corp. (In re Intel Corp. Microprocessor Antitrust Litig.), 496 F.Supp.2d 404, 407 (D.Del.2007) (citing Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir.1993) ). The complaint ?must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory.? Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1969, 167 L.Ed.2d 929 (2007) (quoting Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7th Cir. 1984) ) (emphasis in original).

In considering a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the court must accept as true all factual allegations in the complaint and draw all inferences from the facts alleged in the light most favorable to the plaintiff. Worldcom, Inc. v. Graphnet, Inc., 343 F.3d 651, 653 (3d Cir.2003) . The court may not consider matters outside of the pleadings unless the court is willing to treat the matter as a motion for summary judgment. Fed.R.Civ.P. Rule 12(d). A complaint need not contain detailed factual allegations, but ?a plaintiff?s obligation to provide the `grounds? of his `entitle[ment] to relief? requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do . . . . Factual allegations must be enough to raise a right to relief above the speculative level.? Twombly, 127 S.Ct. at 1964-65 (internal citations omitted).

The relevant record under consideration consists of the complaint and any ?document 495 *495 integral or explicitly relied upon in the complaint.? U.S. Express Lines, Ltd. v. Higgins, 281 F.3d 383, 388 (3d Cir.2002) (citing In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir.1997) ). When considering a motion to dismiss, ?[i]t is axiomatic that the complaint may not be amended by the briefs in opposition to a motion to dismiss.? Pennsylvania ex rel. Zimmerman v. PepsiCo, Inc., 836 F.2d 173, 181 (3d Cir.1988) (citing Car Carriers, 745 F.2d at 1107 ). The movant carries the burden of demonstrating that dismissal is appropriate. Intel Corp., 496 F.Supp.2d at 408 .

However, Bankruptcy Rule 7009 further provides that Fed.R.Civ.P. 9 applies in adversary proceedings. While Fed.R.Civ.P. 9(b) provides that: ?all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity,? Rule 9(b) only applies to allegations of actual fraud. Furthermore, this Court takes the view that claims of constructive fraud, i.e. fraudulent transfers, are evaluated using Rule 8(a)(2). [5] A fraudulent transfer complaint ?need only set forth the facts with sufficient particularity to apprise the defendant fairly of the charges made against him.? In re AstroPower Liquidating Trust, 335 B.R. 309, 333 (Bankr.D.Del.2005) (holding that a constructive fraud count need not comply with Rule 9?s heightened pleading standard). Fed.R.Civ.P. 8(a), made applicable to this proceeding by Fed. R. Bankr.P. 7008, requires only ?a short and plain statement of the claim showing that the pleader is entitled to relief.? A plaintiff need not set out in detail the facts upon which he bases his claim, so long as he gives the defendant(s) fair notice of what the claim is and the grounds upon which it rests. Leatherman v. Tarrant County Narcotics Intelligence & Coordination Unit, 507 U.S. 163, 167, 113 S.Ct. 1160, 122 L.Ed.2d 517 (1993) (quoting Conley, 355 U.S. at 47, 78 S.Ct. 99, 2 L.Ed.2d 80). In reference to a constructive fraud claim, the Court has stated: ?[a]ll that is needed at this stage is an allegation that there was a transfer for less than reasonably equivalent value at a time when the Debtors were insolvent.? In re DVI, 2008 WL 4239120, at *9 (Bankr.D.Del. Sept.16, 2008) (finding complaint sufficient because ?the Trustee has identified the transfer by date and face amount and has alleged that it was for no consideration?).

DISCUSSION

The claims against Target in Counts I and II of the Amended Complaint are for fraudulent transfer, and Count V of the Amended Complaint alleges a breach of 496 *496 fiduciary duty. In reference to the fraudulent transfer issue, Debtor alleges actual fraud and constructive fraud through a series of transactions that occurred in September 2004.

The Court Will Not Consider Some Documents in Target?s Appendix

As a preliminary matter, Target attached an Appendix with exhibits in support of the Motion, including press releases, affidavits, wire transfer documents, Debtor?s operating agreement and a cash flow statement. Target claims that these exhibits fall under the Third Circuit?s ?integral exception? doctrine because they are all a part of the Agreement. In In re Burlington Coat Factory Securities Litigation, 114 F.3d 1410 (3d. Cir.1997), the Third Circuit formulated a narrow exception to Fed.R.Civ.P. 12(d). The court held that ?a document integral to or explicitly relied upon in the complaint may be considered without converting the motion into one for summary judgment.? Id. at 1426. Additionally, another exception to Rule 12(b) exists and that is the public record exception. In the Third Circuit, courts may take judicial notice of public records to acknowledge that the facts contained in the records existed in the public realm at that time. Benak v. Alliance Capital Mgmt. L.P., 435 F.3d 396, 401 (3d Cir. 2006) . The court may not, however, consider the truth of the information in the records. Id.

The Court will take judicial notice of the press releases and will further consider the commitment letters and the Agreement; however, the affidavit, operating agreement, cash flow statement and wire transfer documents will be excluded in considering the Motion. The Court is taking judicial notice of the press releases because they are public documents. However, the documents will not be considered for truth or veracity. Benak, 435 F.3d at 401 ; see also In re Nuvelo, Inc., Sec. Litig., 2008 WL 5114325, at *2 (N.D.Cal. Dec.4, 2008)(the court took judicial notice of SEC filings and press releases but not for the purposes of truth or veracity.).

The Court will also consider the Agreement and commitment letters because these documents fall within the ?integral? exception. As the Third Circuit stated in Burlington Coat, ?the rationale underlying this exception is that the primary problem raised by looking to documents outside the complaint-lack of notice to the plaintiff-is dissipated.? Burlington Coat, 114 F.3d at 1426 . Here, both parties are on notice as to the Agreement and commitment letters. Not only has Target relied upon them in the Motion, but Debtor heavily relies on these documents in its Amended Complaint. If these documents did not give Debtor notice or were in any way inaccurate, Debtor would not have relied on them in the Amended Complaint. Debtor did not rely upon the affidavit, wire transfers, operating agreement and cash flow statements in the Amended Complaint.

Counts I & II

The Amended Complaint Alleges Sufficient Facts to Find the 2004 Sale was a Fraudulent Transfer

In the Motion, Target argues that the 2004 Sale is not governed by either the Uniform Fraudulent Transfer Act (?UFTA?) or Delaware?s codified statute, 6 Del. C. ? 1304, based on five assertions. [6]

497 *497 Target contends that the 2004 Sale fails to fall within the confines of the UFTA and state law because: 1) Target sold its membership interest in Debtor, not Debtor?s property; 2) Target was not a transferee or subsequent transferee of Debtor?s property; and 3) was not a guarantor or an initial transferee for whose benefit the transfers were made. According to Section 17300 of the California Corporations Code, ?a membership interest and an economic interest in a limited liability company constitute personal property of the member or assignee.? Because Debtor was a California limited liability company, Target claims it only possessed a membership interest and not a direct stake. Furthermore, Target claims that Mervyn?s Holdings (instead of Debtor) paid the purchase price to Target through various loan obligations (Am.Compl.? 58, 59) and therefore Target was neither a guarantor nor an obligee of any initial transferee when the Agreement was executed.

Target?s fourth argument for why Debtor?s claims do not come within the purview of the UFTA is that the transaction did not render Debtor insolvent. In the Motion, Target asserts that the 2004 Sale was merely a change in ownership and that Mervyn?s Holdings represented to Target that it had adequate capital for the purchase price.

Lastly, Target asserts that the 2004 Sale was not made to ?hinder, delay, or defraud? creditors. Instead, Target?s aim was to promote the ?Target? brand.

The Court is satisfied that in deciding the Motion, it must collapse the events integral to the 2004 Sale, including the execution of the Agreement, the stripping of the real estate assets, and the leases, into a single conveyance. The Court will take the totality of the circumstances approach by looking at the overall economic consequences of the 2004 Sale.

In the Third Circuit, the leading authority on the propriety of collapsing multiple individual transactions when determining whether a transaction constitutes a fraudulent transfer is United States v. Tabor Court Realty Corp., 803 F.2d 1288, 1302 (3d Cir.1986) . The court in Tabor Court Realty held that when a series of transactions were ?part of one integrated transaction,? courts may look ?beyond the exchange of funds? and ?collapse? the individual transactions of a leveraged buyout. Id. Instead of focusing on one of several transactions, a court should consider the overall financial consequences these transactions have on the creditors. In re Hechinger Inv. Co., 327 B.R. 537, 546-47 (D.Del. July 19, 2005) . To make this determination, courts consider three factors in their analysis. First, whether all of the parties involved had knowledge of the multiple transactions. Id. Second, whether each transaction would have occurred on its own. Id. And third, whether each transaction was dependent or conditioned on other transactions. Id.

While the Court will not rule on the merits as to whether the 2004 Sale was a fraudulent transaction, the Court does find after considering the factors listed in Tabor and Hechinger, that the Amended Complaint states facts to support a finding that Target is liable as a transferee in the 498 *498 alleged fraudulent conveyance. As to the first requirement, knowledge of the multiple transactions, Debtor?s facts establish the ability to show that Target had constructive knowledge of the transactions that were going to take place subsequent to the conveyance of their membership interest in Debtor. Target was aware of the identity of Mervyn?s Holdings and acknowledged in the Motion that it was comprised of a group of private investment firms. The Agreement refers to the commitment letters. In fact, in the Motion, Target admits to receiving the actual commitment letters from Mervyn?s Holdings addressed from the various banks. The clauses requiring Debtor?s conversion to a limited liability company and prohibiting the sale of real estate assets also evidence Target?s knowledge. Certainly, all of the transactions comprising the 2004 Sale required the execution of the Agreement. Of particular concern is the clause requiring Target to convert Debtor into an LLC. Without this conversion, Target would not have been able to transfer its membership interest, a major factor in the fraudulent transfer claim. The actions of the parties (including converting Debtor into an LLC, the clause prohibiting the sale of Mervyn?s real estate assets, the letters of credit from the banks, the execution of the sale and the substantial increase in the rents) were each dependent on the others.

Pursuant to Tabor Court Realty the Court must also examine the overall financial consequences the transactions have had on creditors. Here, they were devastating, including the stripping of Debtor?s real estate assets, the increasing of rent from the leases to enable Mervyn?s Holdings to meet its acquisition debt, and the creation of a conflict of economic interest for Mervyn?s Holdings as the owner and managing member of Debtor because the ultimate owners of Mervyn?s Holdings and the owners of MDS Companies were one and the same?the PE owners acting through the PE Sponsors. Debtor was subsequently left with working capital as little as $22 million and acquired additional debt totaling over $800 million. (Am. Compl., passim).

For the above-mentioned reasons, Debtor has successfully established a valid claim under Tabor Realty and Hechinger for collapsing the transactions surrounding the 2004 Sale such that the Court can find a fraudulent transfer upon proof.

The Amended Complaint Satisfies Rules 8(a) and 9(b)

In the Amended Complaint, Debtor asserts fraudulent transfer claims based on both actual and constructive fraud that are respectively subject to Fed.R.Civ.P. 8(a) and 9(b). The basic notice pleading standard applies to the constructive fraudulent transfer claim because ?[a]ll that is needed at this stage is an allegation that there was a transfer for less than reasonably equivalent value at a time when the Debtors were insolvent.? In re DVI, 2008 WL 4239120, at *9 (Bankr.D.Del., Sept.16, 2008) .

Debtor specified facts to describe the 2004 Sale, the property and dates involved in the transaction, the value of the transfers made, the amount of money transferred to Target, the source of the funds and the negative implications of the 2004 Sale. (Am.Compl.?? 17, 62-71, 76, 100-102, 129-137, 139-147).

Similar to the constructive fraud argument, the Amended Complaint also satisfies the heightened Rule 9(a) requirement for the actual fraud claim. Rule 9(a) is satisfied on the basis that there is an opinion letter quoted in the Amended Complaint describing in definitive terms the Debtor?s allegations that the leases demonstrate Target?s knowledge and fraudulent intentions of separating Debtor 499 *499 from its real estate assets. (Am. Compl. ? 92). The Court therefore finds that both Rules 8(a) and 9(b) are satisfied.

The ?Settlement Payment? Exception of Section 546(e) is not Applicable

Target asserts that even if the 2004 Sale was considered a fraudulent transfer, the Debtor is barred from avoiding the transaction because the transaction falls within the safe harbor of section 546(e). Target contends it satisfied all of the requirements of 546(e): 1) properly received a settlement payment from a financial institution via wire transfer; and 2) the ?settlement payment? fits the definition of section 741(8). Target further argues that the fact that the transaction did not involve a publicly traded entity is irrelevant because the Court in In re Plassein Int?l Corp., 366 B.R. 318 (Bankr.D.Del. 2007) found that the ?broad application of what constitutes a settlement payment mandated in Resorts covers . . . purchases of non-public securities.? Id. at 325.

Section 544(b) of the Bankruptcy Code authorizes the Trustee to ?avoid any transfer of interest of the debtor in property or any obligation incurred by the debtor that is voidable under applicable law.? 11 U.S.C. ? 544(b). Section 546(e), however, provides that, notwithstanding section 544, ?the Trustee may not avoid a transfer that is a . . . settlement payment, as defined by section 101 or 741 of [the Bankruptcy Code], made by or to a . . . financial institution.? 11 U.S.C. ? 546(e). . . . ?settlement payment? is defined under section 741(8) to include ?a preliminary settlement payment, a partial settlement payment, an interim settlement payment, a settlement payment on account, a final settlement payment, or any other similar payment commonly used in the securities trade.? 11 U.S.C. ? 741(8). Put simply, ?a settlement payment is generally the transfer of cash or securities made to complete a securities transaction.? Lowenschuss v. Resorts International, Inc. (In re Resorts International, Inc.), 181 F.3d 505, 515 (3d Cir.1999) . The Court of Appeals for the Third Circuit has repeatedly held that this definition is ?extremely broad? and encompasses almost all securities transactions. In re Resorts International, 181 F.3d at 515 (quoting Bevill, Bresler & Schulman Asset Management Corporation v. Spencer Savings & Loan Association, 878 F.2d 742, 751 (3d Cir.1989) ). In Resorts, the Third Circuit held that a payment to a shareholder for his shares as part of a leveraged buyout was ?obviously a common securities transaction? and, therefore, a settlement payment under section 546(e). In re Resorts International, 181 F.3d at 516 ; see also Hechinger, 274 B.R. at 87 (applying Resorts and holding that payment for shares of stock was an unavoidable settlement payment).

The second prong of section 546(e) requires that payment for the securities must be made by or to a financial institution. ?So long as a financial institution is involved, the payment is an unavoidable `settlement payment.?? Hechinger, 274 B.R. at 87. The term ?financial institution? is defined under the Bankruptcy Code as ?a Federal Reserve bank or an entity that is a commercial or savings bank. . . when any such Federal Reserve bank. . . or entity is acting as agent or custodian for a customer . . . in connection with a securities contract.? 11 U.S.C. ? 101(22)(A). This requirement is satisfied when a leveraged buyout payment is made by wire transfer. In re Resorts International, 181 F.3d. at 515 . Indeed, federal regulations require that a wire transfer must be performed by a bank; thus, a wire transfer must be made through a financial institution. See In re 500 *500 Loranger Mfg. Corp., 324 B.R. 575 (Bankr. W.D.Pa.2005) (taking judicial notice of federal regulation requiring that a wire transfer must be accomplished by a bank, rejecting plaintiff?s arguments that bank?s involvement was ?mere facilitation? and holding that debtor?s leveraged buyout of defendant?s shares was a ?settlement payment? under ? 546(e) because payment was made by wire transfer).

The Court previously held that a ?settlement payment? includes privately held securities in In re Plassein Int?l Corp., 366 B.R. 318, 326 (Bankr.D.Del.2007), aff?d, 590 F.3d 252 (3d Cir.2009) . Therefore, the only issue within Target?s 546(e) claim that the Court must address is whether section 546(e) even applies to the 2004 Sale. The Court believes that section 546(e) does not apply.

First, as a general rule, section 546(e) does not apply to ?collapsed? transactions. The conveyance in In re Plassein Int?l Corp., was not collapsed because ?the complaint [did] not allege fraud or bad faith . . . and the Trustee conceded he [was] not claiming actual fraud. The complaint also [did] not allege any relationship whatsoever among the transactions or the [s]hareholders. Moreover, there [were] no allegations calling into question the good faith of the [s]hareholders.? 366 B.R. at 326 . Debtor?s case could not be more different. The Amended Complaint contains pointed allegations of actual fraud and how the events surrounding the 2004 Sale were interdependent.

Second, although ?settlement payments? include non-publicly traded securities, section 546(e) does not apply to the other transactions surrounding the sale because they do not fall within the section 741 definition of ?settlement payment.? The Court firmly believes that because of the multiple conveyances made surrounding the 2004 Sale, section 546(e) does not apply. Target?s attempt to have this Court apply section 546(e) to a single conveyance within the entire transaction is not persuasive. In the Motion, Target represents to the Court that the 2004 Sale involved only transferring the loan proceeds from MDS to Target. Target fails to recognize that this was only one part of the 2004 Sale. The other transactions to this sale do not fall within the parameters of section 546(e). For instance, when Debtor transferred its real estate assets to MDS for virtually no consideration, this was not a conveyance of a ?preliminary settlement payment, a partial settlement payment, an interim settlement payment, a settlement payment on account, a final settlement payment or any other similar payment commonly used in the securities trade.? The conveyance was conditioned on the subsequent transaction of MDS securitizing the real estate assets to obtain financing.

Count V?Breach of Fiduciary Duty Claim

a. California law imposes a fiduciary duty upon a member of a Limited Liability Company

Target contends that because there is ?zero? case law addressing whether a sole member of a California LLC owes fiduciary duties to the LLC or to its creditors, that no such duties exist. In a majority shareholder context, Target also argues, in relying on Trenwick America Litigation Trust v. Ernst & Young, LLP, 906 A.2d 168, 173 (Del.Ch.2006), aff?d, 931 A.2d 438 (Del.2007), that wholly owned subsidiaries (such as Debtor in this case) are expected to act for the benefit of the parent corporation and for this reason parent corporations do not owe fiduciary duties to subsidiaries. See also, Official Committee of Unsecured Creditors v. Nat?l Amusements, Inc., 2010 WL 399295 (Bankr. D.Del. Jan.29, 2010).

501 *501 At the outset, the Court recognizes that California, not Delaware, corporation law applies to this matter. The internal affairs doctrine directs federal courts sitting in Delaware to apply the law of the state of organization to claims that implicate an organization?s internal affairs. In re PHP Healthcare Corp., 128 Fed. Appx. 839, 843 (3d Cir.2005) . In this case, because a breach of fiduciary duty is alleged, this matter directly relates to Debtor?s internal affairs. Therefore, the Court will apply California law.

While no California court has directly and explicitly stated that a sole member of an LLC owes the company fiduciary duties, the Court believes that were the California Supreme Court to decide that issue, that court is more likely to find that such duties are owed to the LLC. According to First American Real Estate Information Services, Incorporated, v. Consumer Benefit Services, Incorporated, 2004 WL 5203206, at *6 (S.D.Cal. Apr.23, 2004), although the California Code is silent, a court is likely to find that a member of a California LLC does owe the LLC fiduciary duties:

While California law does permit the members of the LLC to specifically vest managers with the duties of managing the LLC, see Cal. Corp.Code ? 17151(b), that act does not extinguish the members? fiduciary duties to each other and to the LLC. See Cal. Corp.Code ? 17150 (stating that where members manage a LLC, the members shall have the same rights and be subject to all duties and obligations of managers as set forth in this title; but silent on whether members otherwise have fiduciary duties).

Id. at *6.

Although no case directly addresses this issue, the First American Real Estate decision sufficiently indicates that a member of a California LLC owes fiduciary duties to the entity and its other members. Secondly, the Court rejects Target?s reliance upon Trenwick because Trenwick is a Delaware Court of Chancery opinion interpreting Delaware corporation law and is thus inapplicable. Target also argues that fiduciary duties are not owed to creditors when the company is insolvent. However, California law takes the opposite view. There are two cases, In re Jacks, 243 B.R. 385, 390 (Bankr.C.D.Cal.1999) and CarrAmerica Realty Corp., 2006 WL 2868979, at *5 (Bankr.N.D.Cal., Sept. 29, 2006) that definitively recognize a member?s duty to a company?s creditors when the company is insolvent. According to In re Jacks:

A corporation?s directors and officers owe no fiduciary duty to creditors under California law until the corporation becomes insolvent. In re Jacks, 243 B.R. 385, 390 (Bankr.C.D.Cal.1999), aff?d in part, rev?d in part, 266 B.R. 728 (9th Cir. BAP 2001) . ?Because a director?s fiduciary duties to creditors do not arise until the corporation is insolvent, the timing of the insolvency is critical.? In re Jacks, 266 B.R. at 738 . The time of insolvency as determined under California law is the point at which the corporation is unlikely to be able ?to meet its liabilities . . . as they mature.? Id. (quoting Cal. Corp.Code ? 501).

California law appears to be clear that Target, as a member of Debtor, owed a fiduciary duty to Debtor?s creditors. The Amended Complaint sufficiently pleads that at the time the Agreement was executed, Debtor was or became insolvent due to the stripping of the real estate assets. Consequently, Target, which was in control of Debtor at the time of the closing, owed fiduciary duties to Debtor?s creditors. (Am.Compl. ? 43).

b. The exculpatory clause is not a proper defense

Target argues in the Motion that even if it owed a fiduciary duty, an exculpation 502 *502 clause in Debtor?s operating agreement provides that Target cannot be held liable to Debtor for conduct that is ?at worst, negligent, or grossly negligent.?

The Third Circuit has been clear that ?protection of an exculpatory charter provision appears to be in the nature of an affirmative defense. As we have said, affirmative defenses generally will not form the basis for dismissal under Rule 12(b)(6).? In re Tower Air, Inc., 416 F.3d 229, 242 (3d Cir.2005) . The Delaware District Court has taken an even more rigid approach by refusing to even consider the defense on a motion to dismiss. Ad Hoc. Comm. of Equity Holders of Tectonic Network, Inc. v. Wolford, 554 F.Supp.2d 538, 561 (D.Del.2008) . This Court arrived at the same conclusion: ?The [c]ourt agrees. . . [t]he exculpation clause is an affirmative defense and the determination of the viability of that defense is not proper at this stage.? In re The Brown Schools, 368 B.R. 394 (Bankr.D.Del.2007) . [7]

c. Debtor timely filed the breach of fiduciary claim

Target contends that Delaware?s statute of limitations applies and that the that Mervyn?s breach of fiduciary duty claim is barred. In the alternative, Target argues that Delaware?s ?borrowing? statute impedes the breach of fiduciary duty claim pursuant to 10 Del. C. ? 8121. In Delaware, the limitation period for breach of fiduciary duty claims is three years. 10 Del. C. ? 8106. In California, there is a four year period for such claims. Cal. Code Civ. Proc. ? 343. Debtor commenced this adversary proceeding more than three years but less than four years after the 2004 Sale.

The Court must apply Delaware?s choice of law rules to determine which statute of limitations applies. See, e.g., In re PHP Healthcare Corp., 128 Fed.Appx. 839, 843 (3d Cir.2005) (applying the choice of law rules of the state in which the bankruptcy court sits); In re Garden Ridge Corp., 338 B.R. 627, 632 (Bankr.D.Del.2006) (?To determine which state?s law to apply, the Court turns to Delaware choice of law rules.?). Delaware?s choice of law rules require application of ?the law of the state of incorporation to issues involving corporate internal affairs.? VantagePoint Venture Partners 1996 v. Examen, Inc., 871 A.2d 1108, 1115 (Del.2005) . A breach of fiduciary duty involves the internal affairs of the corporation. Coleman v. Taub, 638 F.2d 628, 629 n. 1 (3d Cir.1981) . Delaware has a borrowing statute that in pertinent part states:

[w]here a cause of action arises outside of this State, an action cannot be brought in a court of this State to enforce such cause of action after the expiration of whichever is shorter, the time limited by the law of this State, or the time limited by the law of the state or country where the cause of action arose, for bringing an action upon such cause of action.

10 Del. C. ? 8121.

However, the Delaware Supreme Court in Saudi Basic Industries Corp. v. Mobil 503 *503 Yanbu Petrochemical Company, Incorporated, 866 A.2d 1, 16 (Del.2005), cert. denied, 546 U.S. 936, 126 S.Ct. 422, 163 L.Ed.2d 322 (2005) (emphasis added), explained that the rationale of the Delaware borrowing statute is to help prevent forum shopping:

Borrowing statutes are typically designed to address a specific kind of forum shopping scenario-cases where a plaintiff brings a claim in a Delaware court that (i) arises under the law of a jurisdiction other than Delaware and (ii) is barred by that jurisdiction?s statute of limitations but would not be time-barred in Delaware, which has a longer statute of limitations.

Id.

In another Delaware Bankruptcy Court case where this issue arose, Judge Walrath reasoned that because the internal affairs doctrine applied, the statute of limitations of the state law in the state of incorporation applied to the breach of fiduciary claims. In re Circle Y of Yoakum, Texas, 354 B.R. 349, 359 (Bankr.D.Del.2006) The Debtor was a Texas corporation, with a mailing address in Yoakum, Texas. Therefore, despite the trustee?s contention that Delaware law applied, the court ruled that Texas law governed the applicable limitations period. Id.

The breach of fiduciary duty claim is not barred by the Delaware statute of limitations because California law applies. As in In re Circle Y of Yoakum, Texas, the Court will apply the internal affairs doctrine and concludes that the Delaware statute does not apply. This is not a case where forum shopping might even remotely be an issue. Debtor, the plaintiff in this adversary proceeding, came to Delaware with a shorter (instead of longer) statute of limitations period and chose Delaware for the Chapter 11 case and not for the adversary proceeding which the Committee brought. There is absolutely no threat of forum shopping and the Delaware ?borrowing? statute is inapplicable.

CONCLUSION

The Amended Complaint contains detailed facts which, if proven true, make a troubling case of wrongdoing. Although Target points at others to blame, it is at the center of the 2004 Sale. The Motion is denied in all respects.

ORDER DENYING MOTION TO DISMISS

The Court has carefully considered Defendant Target Corporation?s Motion to Dismiss (the ?Motion?), and the briefs and respective arguments of the parties in support of and against the Motion. For the reasons stated in the Memorandum Opinion of even date,

IT IS ORDERED.

[1] This Opinion constitutes the findings of fact and conclusions of law pursuant to Federal Rule of Bankruptcy Procedure 7052. To the extent any of the following findings of fact are determined to be conclusions of law, they are adopted, and shall be construed and deemed, conclusions of law. To the extent any of the following conclusions of law are determined to be findings of fact, they are adopted, and shall be construed and deemed, as findings of fact.

[2] The Committee has brought this adversary proceeding on behalf of the Debtor pursuant to an Order which the Court entered on December 30, 2008 (D.I. 1330), granting it standing.

[3] The operative complaint is the First Amended Complaint which the Committee filed on December 22, 2008 (Adv.Dkt.7). The Court denied leave to the Committee to file a Second Amended Complaint (Adv. Dkt. 178 and 179), which does not impact the Motion. The well-pleaded facts are deemed true for purposes of the Motion. See Standard of Review, infra.

[4] According to Mervyn?s Amended Complaint, the 2004 Sale was funded by three sources:

1. Pursuant to that certain Loan Agreement dated September 2, 2004, Greenwich and Archon, as lenders (the ?Senior Real Estate Secured Lenders?), advanced $675,000,000 to Realty I, Realty II, Texas Realty I and Texas Realty II. Repayment of these loans was secured by the Unitary Leases held by the listed borrowers, mortgages, liens, assignments of rents and deeds of trust with respect to the real estate assets that had been transferred to the borrowers by Debtor. Mervyn?s Holdings used all or substantially all of the loan proceeds to pay the purchase price of the 2004 Sale.

2. Pursuant to the Mezzazine Loan Agreement dated September 2, 2004, Greenwich and GS Mortgage (the ?Mezzanine Real Estate Secured Lenders?), advanced $125,000,000 to Holdings I, Holdings II, Texas Properties I and Texas Properties II. Repayment of these loans was secured by certain pledges and security interests provided by such borrowers. Mervyn?s Holdings used all or substantially all of the loan proceeds to pay the purchase price.

3. Pursuant to the Securities Purchase Agreement, dated September 2, 2004, Mervyn?s Holdings purchased 100% of the interests in Holdings I and Holdings II for $429,746,414,84. At the closing, Mervyn?s Holdings used these funds to pay the purchase price.

(Am.Compl.? 58).

[5] Brandt v. Trivest II, Inc. (In re Plassein Int?l Corp.), 352 B.R. 36, (Bankr.D.Del.2006) (?Accordingly, the Court joins with those decisions that have (either implicitly or explicitly) evaluated fraudulent transfer complaints using Rule 8(a)(2)?s notice pleading standard?) Id. at 40-41. See. e.g., Giuliano v. U.S. Nursing Corp. (In re Lexington Healthcare Group, Inc.), 339 B.R. 570, 574-75 (Bankr.D.Del.2006) (applying ?liberal notice pleading standard?); AstroPower, 335 B.R. at 333 (holding that a fraudulent transfer complaint ?need only set forth the facts with sufficient particularity to apprise the defendant fairly of the charges made against him?); Official Comm. of Unsecured Creditors v. DVI Bus. Credit, Inc. (In re DVI, Inc.), 326 B.R. 301, 305-306 (Bankr. D.Del.2005) (applying Rule 8(a)(2)); Tese-Milner v. TPAC, LLC (In re Ticketplanet.com), 313 B.R. 46, 68 (Bankr.S.D.N.Y.2004) (?While there is authority to the contrary, the better and majority rule is that a claim for constructive fraud. . need not be pleaded with particularity. . . .?); Nisselson v. Drew Indus. (In re White Metal Rolling & Stamping Corp.), 222 B.R. 417, 429 (Bankr.S.D.N.Y.1998) (?[T]he sole consideration should be whether, consistent with the requirements of Rule 8(a), the complaint gives the defendant sufficient notice to prepare an answer, frame discovery and defend against the charges.?).

[6] Since the Delaware bankruptcy court has jurisdiction over this matter, the Court should apply the ?most significant relationship? choice of law standard to determine which state law applies to the fraudulent transfer claim. Travelers Indemn. Co. v. Lake, 594 A.2d 38, 47 (Del. 1991) . There are three possible state?s laws that can apply: 1) Delaware, the state of reorganization and incorporation for Mervyn?s Holdings; or 2) California, where the Agreement was executed and is Debtor?s state of incorporation and headquarters; or 3) Minnesota, the state of incorporation and headquarters for Target. All three states have similarly adopted the UFTA, and therefore the result is the same regardless of the choice of law issue.

[7] In In re Fedders North America, Inc., 405 B.R. 527, 543 (Bankr.D.Del.2009), Judge Shannon dismissed a duty of care claim and applied the exculpation clause. However, unlike Fedders, the breach of fiduciary claims here are ?inextricably intertwined? with other claims. The Amended Complaint pleads with particularity that the 2004 Sale resulted in a fraudulent transfer which triggered a breach of the fiduciary duties of care, loyalty, and good faith. All of these alleged breaches, as cited in the Amended Complaint, arise from the same transaction and therefore are ?inextricably intertwined? which each other. (Am. Compl.?? 172, 175, 176, 178-180). Moreover, the Court is not considering the operating agreement per its earlier ruling.

Source: http://chapter11cases.com/in-re-mervyns-holdings-llc/

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ServiceNow Has Cured The Post-Facebook IPO Market (NOW)

ServiceNow had a phenomenal IPO today, soaring nearly 37 percent in its New York Stock Exchange stock debut.

ServiceNow planned to price shares between $15 to $17 but it opened at $23.16 and that was after raising its opening price to $18. Shares were selling for over $26 in after-hours trading. It sold 11.65 million shares, reports Reuters.

ServiceNow is the first technology company taken public by Morgan Stanley since Facebook and some are calling it the company that revived the IPO market.?

But as sunny as all this is, this IPO is one more signal that we're in a bubble?or near to one. Its?valuation is well over $2 billion, which is pretty amazing for a company that hasn't reached $100 million in revenue yet. In fiscal year 2011, ServiceNow reported $92.6 million in revenue, with a profit of $9.8 million. That compares to a loss of $29.7 million in 2010.

ServiceNow offers cloud apps that serve enterprise IT departments. Its claim to fame is a self-service app.? When an employee has a problem with their PC, apps or the network, they can fire up ServiceNow and find the answer on their own. If that doesn't work, they can use the app to get IT on the line through a chat session.

ServiceNow is yet another successful enterprise IPO in 2012. Splunk and Infoblox had hot debuts before Facebook, too.

Source: http://www.businessinsider.com/enterprise-ipo-service-now-puts-facebook-ipo-to-shame-2012-6

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Florida State extends Martin's contract through 2015

Sorry, Readability was unable to parse this page for content.

Source: http://www.tallahassee.com/article/20120629/FSU06/120629013

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U2 bassist's aide found guilty of stealing from him

[ [ [['Connery is an experienced stuntman', 2]], 'http://yhoo.it/KeQd0p', '[Slideshow: See photos taken on the way down]', ' ', '630', ' ', ' ', ], [ [['Connery is an experienced stuntman', 7]], ' http://yhoo.it/KpUoHO', '[Slideshow: Death-defying daredevils]', ' ', '630', ' ', ' ', ], [ [['know that we have confidence in', 3]], 'http://yhoo.it/LqYjAX ', '[Related: The Secret Service guide to Cartagena]', ' ', '630', ' ', ' ', ], [ [['We picked up this other dog and', 5]], 'http://yhoo.it/JUSxvi', '[Related: 8 common dog fears, how to calm them]', ' ', '630', ' ', ' ', ], [ [['accused of running a fake hepatitis B', 5]], 'http://bit.ly/JnoJYN', '[Related: Did WH share raid details with filmmakers?]', ' ', '630', ' ', ' ', ], [ [['accused of running a fake hepatitis B', 3]], 'http://bit.ly/KoKiqJ', '[Factbox: AQAP, al-Qaeda in Yemen]', ' ', '630', ' ', ' ', ], [ [['have my contacts on or glasses', 3]], 'http://abcn.ws/KTE5AZ', '[Related: Should the murder charge be dropped?]', ' ', '630', ' ', ' ', ], [ [['have made this nation great as Sarah Palin', 5]], 'http://yhoo.it/JD7nlD', '[Related: Bristol Palin reality show debuts June 19]', ' ', '630', ' ', ' ', ], [ [['have made this nation great as Sarah Palin', 1]], 'http://bit.ly/JRPFRO', '[Related: McCain adviser who vetted Palin weighs in on VP race]', ' ', '630', ' ', ' ', ], [ [['A JetBlue flight from New York to Las Vegas', 3]], 'http://yhoo.it/GV9zpj', '[Related: View photos of the JetBlue plane in Amarillo]', ' ', '630', ' ', ' ', ], [ [['the 28-year-old neighborhood watchman who shot and killed', 15]], 'http://news.yahoo.com/photos/white-house-stays-out-of-teen-s-killing-slideshow/', 'Click image to see more photos', 'http://l.yimg.com/cv/ip/ap/default/120411/martinzimmermen.jpg', '630', ' ', 'AP', ], [ [['He was in shock and still strapped to his seat', 6]], 'http://news.yahoo.com/photos/navy-jet-crashes-in-virginia-slideshow/', 'Click image to see more photos', 'http://l.yimg.com/cv/ip/ap/default/120406/jet_ap.jpg', '630', ' ', 'AP', ], [ [['xxxxxxxxxxxx', 11]], 'http://news.yahoo.com/photos/russian-grannies-win-bid-to-sing-at-eurovision-1331223625-slideshow/', 'Click image to see more photos', 'http://l.yimg.com/a/p/us/news/editorial/1/56/156d92f2760dcd3e75bcd649a8b85fcf.jpeg', '500', ' ', 'AP', ] ]

[ [ [['did not go as far his colleague', 8]], '29438204', '0' ], [ [[' the 28-year-old neighborhood watchman who shot and killed', 4]], '28924649', '0' ], [ [['because I know God protects me', 14], ['Brian Snow was at a nearby credit union', 5]], '28811216', '0' ], [ [['The state news agency RIA-Novosti quoted Rosaviatsiya', 6]], '28805461', '0' ], [ [['measure all but certain to fail in the face of bipartisan', 4]], '28771014', '0' ], [ [['matter what you do in this case', 5]], '28759848', '0' ], [ [['presume laws are constitutional', 7]], '28747556', '0' ], [ [['has destroyed 15 to 25 houses', 7]], '28744868', '0' ], [ [['short answer is yes', 7]], '28746030', '0' ], [ [['opportunity to tell the real story', 7]], '28731764', '0' ], [ [['entirely respectable way to put off the searing constitutional controversy', 7]], '28723797', '0' ], [ [['point of my campaign is that big ideas matter', 9]], '28712293', '0' ], [ [['As the standoff dragged into a second day', 7]], '28687424', '0' ], [ [['French police stepped up the search', 17]], '28667224', '0' ], [ [['Seeking to elevate his candidacy back to a general', 8]], '28660934', '0' ], [ [['The tragic story of Trayvon Martin', 4]], '28647343', '0' ], [ [['Karzai will get a chance soon to express', 8]], '28630306', '0' ], [ [['powerful storms stretching', 8]], '28493546', '0' ], [ [['basic norm that death is private', 6]], '28413590', '0' ], [ [['songwriter also saw a surge in sales for her debut album', 6]], '28413590', '1', 'Watch music videos from Whitney Houston ', 'on Yahoo! Music', 'http://music.yahoo.com' ], [ [['keyword', 99999999999999999999999]], 'videoID', '1', 'overwrite-pre-description', 'overwrite-link-string', 'overwrite-link-url' ] ]

Source: http://news.yahoo.com/u2-bassists-aide-found-guilty-stealing-him-192706695.html

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Mayor Ed Lee Considering Stop-And-Frisk Policy For SF

Here we go. San Francisco Mayor Ed Lee is considering a rather controversial (for San Francisco) tactic in order to reduce crime. It's the stop-and-frisk method already used by police in other cities like Los Angeles and New York City. And it works like this: police stop anyone they deem suspect and search them for illegal weaponry. It would also be used as a(n ineffective) tool in the war on drugs. The random selecting would be at the discretion of law enforcement. This is where it gets racist-y.

The Chronicle reports [emphasis ours]:

"Civil rights groups and others have denounced stop-and-frisk policies in various cities as a racist approach that disproportionately affects Latino and African American residents. Several thousand demonstrators marched through New York's streets this month to protest the policy.

"A recent report by the New York Civil Liberties Union found that the vast majority of people stopped by police there were black or Latino, and that of 686,000 people stopped in 2011, 88 percent of them had done nothing wrong."

Those who supports stop-and-frisk, however, say that it will help to get guns off the streets and thus stop killings/shootings. It's a preventative measure, see. Ideally. "This is under consideration as a way to make sure that we keep homicides and some of these other violent crime(s) down," Mayor Lee a former civil rights attorney, told The Chronicle's editorial board. "I think we have to get to the guns. I know we have to find a different way to get to these weapons, and I'm very willing to consider what other cities are doing."

Lee even went so far as to meet with Rev. Amos Brown, the president of the San Francisco chapter of the NAACP, who is onboard with the idea provided that "police officers will enforce it without using racial profiling and in a calm, compassionate way." Which: what?! That's really rich. Perhaps the fuzz can frisk unwitting suspects on soft pink clouds of lollipops and warm fuzzies while they're at it.

Meanwhile, controversial Chronicle columnist opined C.W. Nevius opines, "Stopping and frisking parolees and subjects on probation makes much more sense than randomly searching people walking down the street."

But how does Supervisor Malia Cohen, who represents District 10, the most crime-ridden parts of San Francisco, feel about it? She's not pleased. "Wow...That's shocking and alarming," she exclaims to the Chronicle.

What say you? Take our poll below and let your voice be heard.

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BBC Says 'I'm Sorry' for Lack of Coverage of ... - Yeshiva World News

The massacre of the Fogel family HY?D in Yishuv Itamar took place in March 2011? but it took the BBC a bit of time to come to the realization that its lack of coverage of this horrific massacre, an Arab terror attack, required an explanation. While the BBC covered the event on its website, it was omitted from broadcast news.

Conservative MP Louise Mensch complained, demanding an explanation, and he received an apology. Amazingly, when he asked the BBC?s outgoing director, Mark Thompson to explain the decision, the latter brazenly told him that it was a ?very busy? time period and therefore, the massacre was not covered. He explained they were reporting on events in Libya and the tsunami in Japan.

Thompson insists the decision was not one of bias, simply poor judgment at the time. He went as far as to say they cover events in Gaza as well as showing the effects of rocket attacks in Sderot. Thompson added in his defense that he did not air a humanitarian appeal during Operation Cast Lead that was aimed at showing the pain and suffering in Gaza.

MP Mensch accepted the apology and was comfortable with the reasoning that accompanied it, persuaded the decision was not a biased one as Thompson stated.

Settlement Council spokesman Roni Arazi was less comforted by Thompson?s explanation, citing the media coverage of events in Gaza are definitely biased against Israel, simply confirming the lack of media objectivity that exists today.

(YWN ? Israel Desk, Jerusalem)

?

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Record numbers of sockeye salmon return to Northwest

Record numbers of a once-waning population of sockeye salmon have been returning to the Northwest's Columbia Basin this summer, with thousands more crossing the river's dams in a single day than the total numbers seen in some previous years.

Since Bonneville Dam outside Portland was built in 1938, there have been plenty of times there weren't 38,000 sockeye salmon swimming over the fish ladders in a whole year.

But on Monday that many passed the Columbia River dam, and another 41,000 swam over the dam on Wednesday ? a rate of nearly 30 a minute. That bought the total so far to 290,000.

More than 400,000 of the Columbia Basin's farthest-swimming salmon ? a record number -- are expected to return this year, almost all of them wild fish bred in rivers, instead of the hatcheries that produce most Northwest salmon.

Sockeye cross nine dams to reach spawning grounds in northern Washington and Canada.

500-mile journey
Biologists credit habitat improvements in the Okanagan Basin of northern Washington and Canada, improved dam operations, and favorable ocean conditions for the numbers. Okanagan sockeye swim more than 500 miles to spawn.

The bulk of the record returns are going back to the Okanagan River Basin, which drains a series of lakes straddling the Canadian border and flows into the Columbia.

"I have been telling people if they get the opportunity, to go up and visit the Okanagan," said Bill Tweit, special assistant to the director of the Washington Department of Fish and Wildlife. "It's going to be an incredible natural spectacle."

Judge clears way for killing of salmon-gulping sea lions

Smaller than most salmon at three to five pounds, sockeye are also the brightest in color. They are popularly known as bluebacks for their silvery blue hue as they pass Bonneville Dam, but as they get closer to laying their eggs in the gravels of rivers and lakes in the fall, their bodies turn bright red and their heads green.

Though the Okanagan sockeye were never listed as an Endangered Species, as Snake River sockeye in Idaho were, the future was not looking bright for Okanagan sockeye in the late 1980s and early 1990s, said Joe Peone, fish and wildlife director for the Confederated Tribes of the Colville Indian Reservation, which is in the Okanagan Basin.

Less than 9,000 returned in '95
Fewer than 9,000 sockeye returned to the Columbia Basin in 1995.

The operation of hydroelectric dams regularly washed out the eggs after the fish laid them in the river, or left them high and dry before they hatched.

Sockeye proved difficult to rear in hatcheries, so tribes on both sides of the border teamed up with local utilities that owned the dams to work out rules for maintaining flows that the fish could live with. Natural meanders were restored to rivers that had been straightened to reduce flooding.

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"Right now those fish are utilizing maybe a quarter of their historic habitat," Peone said. If more habitat is restored, "You could see 1 million fish coming back here."

Ritchie Graves, a NOAA Fisheries Service biologist who makes sure federally owned dams are living up to their Endangered Species Act obligations not to kill too many salmon, said the survival rate for young salmon swimming downstream to the ocean has been higher than ever the past three years, hitting about 50 percent for sockeye.

Those improved dam operations have also benefited chinook, coho, chums, pinks and steelhead, said Graves. The six species combined accounted for 1.8 million salmon over Bonneville in 2010, compared to 471,144 in 1938.

Once young salmon get to the ocean, scientists have only a vague idea where they go, and an incomplete understanding of why some years they thrive and some years they starve.

Generally, years when climate and weather cause the ocean waters to well up, salting the water column with food, fish do better. But unlike most salmon, which eat other fish, sockeye eat plankton, tiny shrimplike animals.

Though poor ocean conditions have been blamed for a nosedive in chinook salmon in Alaska this year, sockeye have done well, not only in the Columbia, but in Canadian and Alaskan rivers as well.

"Whatever is going on in the ocean is basically being good to sockeye," said Tweit.

? 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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CCNY, UC Berkeley develop lasers that could rewrite quantum chips, spin those atoms right round

Computers are normally limited by the fixed nature of their chipsets: once the silicon is out of the factory, its capabilities are forever locked in. The City College of New York and University of California Berkeley have jointly developed a technique that could break chips free of these prisons and speed along quantum computing. They found that hitting gallium arsenide with a laser light pattern aligns the spins of the atoms under the rays, creating a spintronic circuit that can re-map at a moment's notice. The laser could be vital to quantum computers, which can depend heavily or exclusively on spintronics to work: a simple shine could get electrons storing a much wider range of numbers and consequently handling many more calculations at once. Research is only just now becoming public, however; even though gallium arsenide is common in modern technology, we'll need to be patient before we find quantum PCs at the local big-box retail chain. Despite this, we could still be looking at an early step in a shift from computers with many single-purpose components to the abstracted, all-powerful quantum machines we've held in our science fiction dreams.

CCNY, UC Berkeley develop lasers that could rewrite quantum chips, spin those atoms right round originally appeared on Engadget on Wed, 27 Jun 2012 04:26:00 EDT. Please see our terms for use of feeds.

Permalink   |  CCNY, Nature  | Email this | Comments

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Cardio Exercise Equipment Improves Your Overall Health

Cardio Exercise Equipment Improves Your Overall Health

In addition to healthy food consumption, exercising is another necessary component to having a healthy body. Of the many ways to exercise, cardio workouts have apparently become necessary routines for many individuals. If you are beginner and wondering about this type of exercise, cardio workouts are exercises which specifically focus on different large muscles of the human body that will help increase the efficiency of our heart and lungs. There are many types of cardio workouts you can follow. They can be walking, jogging, rowing, cycling, and so on.

Cardiovascular workouts have been shown to have numerous physical health benefits when carried out routinely that include strengthen your heart, lowering hypertension, boosting your metabolic process, as well as very helpful when it comes to dropping extra pounds. In short, doing regularly cardio workouts will not only strengthen your heart, but will also significantly improve your overall health.

Although these forms of exercises can be performed without needing special fitness equipment however, it never hurts to buy cardio exercise equipment for your home gym. Doing cardiovascular workouts with the aid of particular piece of training equipment won?t only allow you to achieve optimum fitness objectives within a shorter period of time, it will also help you stay motivated to exercise in the long run. Not to mention, the average cardiovascular machine that you can buy today comes with a wide range of innovative features which have been proven to encourage many lazy people to break a sweat on a regular basis. It may be built-in Television, audio jacks for music player, different workout options, and many more. In other words, cardio exercise equipments offer you a convenient way to routinely workout in the comfort of your home.

When considering purchasing cardio exercise equipment, there are numerous options you can choose from, and of course, deciding which one to buy is indeed a matter of your personal preference. In the next few paragraphs, we will take a look at the two most best-selling cardiovascular workout equipments available today. They?re the treadmill and elliptical trainer.

Walking or jogging is still considered to be one of the most comfortable physical exercises for many, regardless of age and fitness level. So it?s not surprising that the two most in-demand cardio exercise equipments will be the treadmill and elliptical machine. Due to the fact both of these machines are typically straightforward to operate yet extremely helpful in improving the quality of health, treadmills and elliptical machines are highly recommended by many health and fitness experts. Both of these cardio workout machines offer you beneficial cardiovascular exercises, but in a different way. A treadmill is a fantastic fitness machine which enables you to walk or jog in place as it has a rotating belt which is driven by a treadmill motor. When compared if you?re walking or running on concrete and asphalt surface, exercising with a treadmill is far safer for your knees since it is usually designed with a cushioned material that can significantly lessen the possibility of leg injury. Within today?s technological innovations, it?s easy for you to acquire a treadmill which is packed full of the latest features. With the use of a treadmill, you can execute a number of different workouts depending on your fitness level. You can easily change your speed, level of resistance, including simulate running up or down a hill.

On the other hand, elliptical workout is a little bit more challenging. Unlike a treadmill that basically designed to target your lower body, elliptical machine helps you to get a full body exercise because it has dual handle bars to get your hands involved during the exercise. It can be said that elliptical workout is a combination of rowing, cycling and cross-country skiing. In this way, working out on an elliptical machine feels like you are being engaged in a couple of physical activities at the same time. And the result is that this type of machine provides complete workout to your entire body, both lower and upper, which helps you to get a toned body. Also, like a motor-driven treadmill machine, elliptical trainer also usually comes with a number of preset programs besides entertainment features.

As you can see, working out with the help of a home treadmill or elliptical machine won?t only enable you to get a good cardio workout, but can also motivate you to regularly exercise in the comfort of your home.

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Johnsonville Rental Property Management ... - Scottsdale real estate

When you have properties to rent you?re juggling this responsibility together with other responsibilities in your day to day life. Property management needs coping with finances, opportunities, tenants, and damaged property, to name one or two things. It can be quite stressful, regardless of whether you live nearby. What if you live at the other side of the country or the other side of the planet?

For a few of the people the simple fact is that they just are not good at managing all the things that goes with a rental property ? tenants, rental prices, advertising vacancies and tenancy contracts. If you have an investment house, and think you either can?t or don?t want to look after your property, then look for a professional in property management lettings to take care of the everyday administration for you.

Property managers may work independently, or be part of bigger groups. Ideally you?ll want a good chief with plenty of experience and good references. Don?t forget to ask about references because previous performance is crucial.

A brief search for property management on Google, Bing, or one of the other search websites will produce some names. Don?t forget to look in Google Places, an in-depth resource for finding local companies. And don?t forget to ask around. Talk to other investment property owners. Personal recommendation is frequently the best advertisement for property management rentals. Any names that come up frequently are likely to be folk and companies you can trust.

After you?ve discussed your needs with two different property management companies, see who will offer you the best price. Some charge the standard rate ( generally a percentage rate ) with extra fees for evictions or maintenance, while others will work for a fixed rate that covers everything. There?s regularly room for negotiation too.

Once you?ve got an executive for your rental property they?re going to do all the difficult work from the start. they?ll publicize the property, take potential renters through. Then once the contract is signed, they will take care of the agreements, collecting the rent, any ongoing maintenance and any disputes that surface with the renters. The property manager you select should be conversant with the residential tenancy contracts and other any applicable tenancy laws. Ensure you ask all about this as part of your vetting process.

Remember too, you are the property owner, and how your property executive manages relations with potential and current tenants, trades folk, realtors and any person else in the bizz can impact on you. So do the research and do it competently before you sign the contract.

Hire a professional, relax and relax, knowing your property is in safe hands. Where can you find a good property boss? Look out for a trusted name in property management Johnsonville.

Related posts:

1. Getting Great Tenants ? Residential Property Management Company Checklist
2. Property Investment Strategies For Retirees
3. Property Rental

Tags: property management rentals, property management johnsonville, property management

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roof replacement - Roofing Contractor | Roofing Company | Roof ...

Roofing contractors provide a very important service to homes and businesses throughout Florida. Suncoast Roofing Solutions (SRS) addresses the very needs that the challenges of Florida weather bring.

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More Details about roof replacement here.

Roofing contractors provide a very important service to homes and businesses throughout Florida. Suncoast Roofing Solutions (SRS) addresses the very needs that the challenges of Florida weather bring. Different roof materials allow the roofing contractor and roofing company that understand this to aid homeowners and businesses to save money and protect their roofing investment for a longer duration of time. Tile, metal, shingle, flat, and tile roof coating for residential and commercial uses are important different approaches that the professional roofing contractor and roofing company must address. With over 40 years of experience under their belt, SRS has been servicing roof replacement as a premier roof contractor in Pasco, Hillsborough, and Pinellas county and Central Florida for this time. Having worked for over 30 companies within the Tampa Bay area, SRS spends the time to educate its clients as to the various and salient features of roofing and roof contractor approaches to installations and materials.

SRS has studied their competitors in the roof contracting and roof replacement marketplace. They have proprietary methods that they use in order to offer as a premier roofing company, roof replacement materials and tools that set their company apart. Tile roofing, which most people do not know, is really decorative and not functional as a protection for the home. It is the roofing contractor's shingles and roofing undercoating that provides a home with the roofing protection that is most important.

For more information as to what a roofing company and a genuine roofing contractor should offer in roof replacement or roof installations and a free estimate, please contact Suncoast Roofing Solutions at 813-283-2544 or visit http://suncoastroofingsolutions.com

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Palmer Park Yoga | Detroit Food & Fitness Collaborative

Yoga. It?s consistently amazing to me how one word, one activity can capture such a variety of experiences for those who give it a chance! There are many reasons why one would try yoga, including strength training for athletic goals, improving overall health and fitness, reducing stress, and learning meditation techniques. The great thing about yoga is that it does all of those things and more. So, regardless of why someone starts, they reap the benefits of all of the other things that yoga can do.

When I heard about People for Palmer Park?s free summer yoga program on Saturdays, I was delighted. What a great way to engage the community: with an activity that seeks to connect the body, mind, and soul, while also creating awareness of one?s connection to others and the natural world. And did I mention free? The cost of a single yoga class ranges, but it is typically $10-$12. So the economics are easy! It is a perfect opportunity to try out something new or, like me, to continue learning about the benefits of this activity.

?Namaste? is a Sanskrit term and it is often heard at the start and conclusion of a yoga class. Namaste as a gesture consists of placing your hands together in front of your heart and offering a slight bow. It is a symbol of gratitude and respect and, to (greatly) simplify it, sends the message, ?I honor you? to the recipient. Palmer Park is an urban oasis and a great setting for residents and friends to connect through yoga. The physical and spiritual work transitions into a peaceful mental state as class concludes in the Detroit sunshine.

Namaste indeed.

Yoga at Palmer Park takes place on Saturdays, 9:00-10:00 a.m. in the clearing next to the pool parking lot. Details, dates, and more can be seen here. The Palmer Park summer yoga classes are supported by an Active Living Detroit Mini-Grant, jointly sponsored by the Healthy Environments Partnership and the Detroit Food & Fitness Collaborative.

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How You Can Make Your Home An Oasis With Some Improvements

Handy items you need to have are ladders, the right belt of bag for working, a good metric ratchet set, chisels and also reliable rubber mallet. There are things that you do not necessarily need but are very useful around the house.

A floor lamp can be a great addition to the room and free up valuable space on a nightstand or dresser. Floor versions are great because they can be easily moved to different locations. There are literally thousands of attractive floor lamps for sale.

When buying a home, always set up a home inspection by a professional. That way you need not rely on the seller and your eyes about what has to be replaced or fixed if you buy the house. A professional can also act as a mediator, allowing the transaction to stay civil.

Searching for information is helpful when making home improvements. You could also check out some books at the library or purchase some. Visit paint and carpet stores and pick up color samples and fabric swatches. The more you know about your project, the better prepared you will be to complete it successfully.

Give your home?s exterior a scrub down with a pressure washer using soap made specifically for home siding. It does not cost much to rent pressure washers, and they can go a long way toward removing the dirt and grime from your home?s exterior. Be careful, though, around windows and your roof line. You want to avoid knocking things loose.

Don?t just believe your contractor when she says she is insured. Give the insurance company a call to verify the contractor?s insurance status. Contractors will sometimes attempt to fool others by carrying around a card to appear insured but in reality they aren?t.

Home improvement projects allow you to stamp your own style on your home, and they can be simple to do if you plan projects out. This allows you to concentrate on the task itself instead of leaving you distracted by details relating to cost and design. Figure out what you want to do by visiting neighbors? homes and checking out media that deals with home improvement.

When you get together with your contractor to arrange the payment terms for your home improvement project, tie payments to the percentage of work completed, not the amount of time elapsed. This allows you to fire a contractor if his or her work is incomplete or shoddy or if the contractor starts asking for more money.

It?s helpful to determine your priorities for your wish list when it comes to home improvements. Know why you wish to make the improvements and think about whether it will improve the quality of life in the home. You need to be committed to making home improvements, and it?s important you are putting your time to good use.

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Fitness Tips For A Long And Healthy Life | Health Massage Chair ...

Being physically fit can dramatically impact your life. It can boost your mood, your stamina and your self esteem. You will feel more confident and be better equipped to handle day to day life. This article will give you some tips on how you can make that a reality.

To improve how fast you can swim, work on making your ankles more flexible. Use short exercises like alternately pointing your toes and then flexing your feet for a minute or so to increase flexibility. This will make your feet better at moving you quickly through the water just as water creatures? flippers propel them.

Make sure to work out all the muscle groups, one after another, in your arms to get better results. Try working out the different groups in succession in your workouts. For example, work out your biceps and then immediately work out your triceps afterwords. This will cause one set of muscles to rest while working the other and you won?t require long breaks for all of them between sets.

A great way to keep your kids active is to take them on hikes. Find a state park near you and take them on a hike through the woods. You can make a miniature adventure out of it and have fun along the way. Your kids probably won?t even realize they?re exercising!

If you are traveling in a car, use rest stops as an opportunity to get a little exercise. They can be the perfect place to get rejuvenated for the next leg of your trip; take a brief jog or go on a short walk. These activities will help you feel less stiff and more alert so that you can continue your drive.

The colder weather that comes with autumn makes it a great time to move your fitness routine outdoors. See what exercises you are already doing that can be done in the brisk, cool air outside. Consider picking up new workouts or sports that will let you take advantage of the exercise-friendly weather.

Eat protein! If you have started to work out then you may not know the importance of protein. For people who are doing any kind of muscle building protein is the nutrient that actually helps the muscles to build mass. This means that after any workout you do you need to ingest some type of protein.

A good tip for overweight people looking to become more fit is to look at examples of other bigger people who have successfully slimmed down. This is an excellent motivation tool that will give you the confidence and strength to achieve and and all of your weight loss goals.

Make exercise a priority in your life. Write it on your calendar or include it in your scheduling program. If you wait to do it until you have time, or when you think of it, you will not get it done. You have to be consistent in order see significant results.

To run faster, look to quicker, rather than bigger, strides. Having a big stride is actually inefficient for your body to develop optimal propulsion. Always try to have your foot come down in line with your body instead of in front of it. Then, use your rear toes to propel yourself forward.

Pay up front for the gym and your trainer! Sometimes money is the best commitment we can make that will insure we will exercise regularly. If we have already paid the fees for the gym and for our trainer we will be much more likely to take advantage of the services we?ve paid for!

If you are looking to lose body fat while maintaining your strength you should strongly consider the Spartacus workout. This is a circuit workout that uses very few weights so it is easy to do at home. This is great if you are to busy to go to the gym.

To protect your body and also your weight, do not be afraid to drink milk. Milk is as critical to the health of our bodies as adults as it was when we were babies. Plus, while milk may have more calories or fat than water or sports drinks studies have consistently shown that people that drink milk regularly are leaner and stronger than those who do not.

Build muscles and strength for stronger bones. All types of exercise, from mild to intense, can help reduce your risk of disease and keep your heart healthy. Milder exercise, though, may not be enough to strengthen your bones. Research has indicated that greater strength is associated with stronger bones.

To have a healthy body it is important to have a good amount of sleep. The body needs to sleep to rejuvenate, this should not be taken for granted. Sleeping for eight hours maintains the body?s healthy immune system, helps the individual manage stress better. So be sure to get a good amount of sleep daily.

When choosing a gym, make a ?shopping list?. Make a list of the things that are most important to you. Consider the various equipment that they offer, location, price, hours, trainers, classes, child care etc. Also, find out if you can sign up on a month to month basis, so you aren?t locked in to a long term contract if you discover that the gym doesn?t live up to your expectations.

In order to get the most out of your weightlifting sessions and gain as much muscle as possible, it is important to eat plenty of meat. Eating 4 to 8 ounces of meat every single day is a great way to get all of the protein that your body needs and will also help to boost testosterone levels. Studies have proven that meat eaters gain muscle more easily than vegetarians.

Choose the ideal time of day for your body to exercise. A morning person will find it quite easy to fit in their workout routine early in the day, whereas someone who feels at their best later on in the day should wait until the afternoon or evening to exercise. If you work out when your body and mind is feeling in tip-top condition, you will get the best results possible.

Hopefully after reading this article you are feeling like you can form beneficial strategies of success towards your fitness goals. Remember that the more information you know the more you have to apply towards getting into shape. When you have a lot of information and apply all of it to the best of your ability, then you should see some serious changes in your body.

If you are look for ways to lose weight faster, then check out vegan meal plan. Alternatively, you can also discover here.

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