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1
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LETTER OPINION
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EXTRACTED KEY WORDS
DEFENDANTS SUPREME COURT OPINION BOND PLAINTIFF MOTION PATRIOT PARTNERSHIP AGREEMENT PROVISION LISTS LIMITED PARTNERSHIPS PARTNERS PURSUANT REASON IMPROPER PURPOSE DEFENSE INTERPRETATION INVESTORS SECURITIES LAW DENY DEFENDANTS LIKELIHOOD IMPLIED IMPROPER PURPOSE FAIR GROUND DELIBERATIVE INVESTIGATION DELAWARE LIMITED PARTNERSHIPS FIRST IMPRESSION SUFFER IRREPARABLE HARM LITIGATION MINI-TENDER PARTNERSHIP INFORMATION |
C OURT OF C H A N C E R Y
OF THE
S TATE OF D E L A W A R E
M Y R O N T. ST E E L E
vlcECH*NC&rLLLOR
Craig B. Smith Gregory V. Varallo
Robert J. Katzenstein Kelly A. Herring
Smith, Katzenstein & Furlow Richards, Layton & Finger
800 Delaware Avenue One Rodney Square
P.O. Box 410 P.O. Box 551
Wilmington, DE 19899 Wilmington, DE
Re: Bond Purchase, L.L.C. v. Patriot Tax
Credit Properties, L.P., et al.
C.A. No. I6643-NC
Submitted: August 12, 1999
Decided: August 16, 1999
Counsel:
I have reviewed Defendants'(referred to as "Defendants" or the "Partnership")
Motion for a Stay of my July 23, 1999 Opinion in this case (the "Opinion")' pending
Defendants' appeal. Defendants make their motion pursuant to Court of Chancery
Rule 62. Supreme Court Rule 32(a) mandates that this Court consider the motion in
the first instance even after appeal. Plaintiff (referred to as "Plaintiff' or "Bond")
objects to Defendants' Motion. I deny Defendants' Motion for the following reasons.
' D e l . C h
S t e e l e , V . C . ( J u l y 2 3 , 1 9 9 9 ) .
Bond v. Patriot (C.A. #16643-NC) CORRECTED PAGE
August 16, 1999
Page 2
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2
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DEFENDANTS REPLY IN SUPPORT OF MOTION FOR STAY PENDING APPEAL
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EXTRACTED KEY WORDS
DEFENDANTS PARTNERSHIP COURT OPINION TENDER LAW BUC TAX CREDITS SUPREME COURT INVESTOR LISTS SECURITIES LAWS DEL MOTION FIRST IMPRESSION LITIGATION COUNSEL PURCHASE FAIR GROUND LIMITED PARTNERSHIPS VIOLATIONS HARM PLAINTIFF PROVISIONS PARTNERSHIP AGREEMENT HOLDINGS PRECLUDES FEDERAL SECURITIES DKT |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
BOND PURCHASE, L.L.C. >>
Plaintiff, )>
V. > C.A. No. 16643
>
PATRIOT TAX CREDIT PROPERTIES, >
L.P. and RCC PARTNERS 96, L.L.C. >>
Defendants. >
DEFENDANTS' REPLY IN SUPPORT OF
MOTION FOR STAY PENDING APPEAL
Defendants Patriot Tax Credit Properties, L.P. (the "Partnership") and RCC Partners 96,
L.L.C. (the "General Partner") (together "Defendants"), hereby .reply to the response of plaintiff
Bond Purchase, L.L.C. ("Bond") dated August 9, 1999, to Defendants' motion for a stay pending
appeal.
The Appeal Presents Legitimate Issues Of First
Impression And Presents "Fair Ground" For Further Litigation
1. Bond unconvincingly argues that this case presents no legal issues of first
for the Supreme Court and is not likely to succeed. As this Court's July 23, 1999 opinion (the
"Opinion") reveals, Defendants' appeal presents novel issues of law involving the interplay between
various provisions of limited partnership agreements and 6 Del. C. 5 17-305 ("Section 17-305").
We respectfully submit that there would have been no need for the Court to write a 5 1 page opinion
analyzing the issues presented by these case if they were governed by settled law. Likewise,
Defendants need not show that they are likely to succeed on appeal but instead that their appeal
WI-l-2042435-2
presents "fair ground" for further litigation. Kirkpatrick v. Deluwure Alcoholic Beverage Control
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3
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OPINION
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EXTRACTED KEY WORDS
PARTNER LISTS INVESTOR AGREEMENT BUC MINI-TENDER BOND PURSUANT PURPOSE OUTSTANDING PLAINTIFF DEFENDANT GENERAL PARTNER DELAWARE RIGHTS SAFE HARBOR ASSIGNOR LIMITED PARTNER REQUESTING LIMITED PARTNERS IMPROPER PURPOSE DEFENSE SECONDARY MARKET BENEFICIAL UNIT CERTIFICATES PROPER PURPOSE PUBLICLY TRADED PARTNERSHIP SECURITIES LAWS FEDERAL SECURITIES LAWS PAINE WEBBER PARTNERSHIP ARGUES INTERPRETATION SCHWARTZBERG |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE : :
p'.` li f *
IN AND FOR NEW CASTLE COUNTY
BOND PURCHASE, L.L.C., >
PKaintiff, >>
V. ) C.A. No.. 16643
>
PATRIOT TAX CREDIT PROPERTIES, )
L.P. and RCC PARTNERS 96, L.L.C., )
>
Defendants. >
Submitted: February 5, 1999
Decided: July 23, 1999
O P I N I O N
Craig B. Smith and Robert J. Katzenstein of Smith, Katzenstein & Furlow, Wilmington,
Delaware. Attorneys for Plaintiff.
Gregory V. Varallo and Kelly A. Herring of Richards, Layton & Finger, Wilmington,
Delaware. OF COUNSEL: Joel S. Weiss, Mark Walfish and Adrienne B. Koch of
Esanu Katsky Korins & Siger, New York, New York. Attorneys for Defendants.
STEELE, V.C.
I. Issues Presented
At issue is whether the defendant limited partnership is required to provide,
pursuant to 6 De1.C. Section 17-305 and section 14.1 of the limited partnership
agreement, the plaintiff, a non-limited partner investor in the defendant through its
ownership of Beneficial Unit Certificates ("BUC$") issued by the defendant, with a list
of the names and addresses of the defendant's partners and other BUC$ owners.
Although the plaintiffs desire to use the list to conduct a mini-tender offer for 4.9% of
the defendant's outstanding partnership interests is a "proper purpose" under 6 Del. C.
Section 17-305(a), plaintiff does not have a statutory right to the list because the
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4
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L.L.C. V. PATRIOT TAX CREDIT PROPERTIES L.P LETTER
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EXTRACTED KEY WORDS
COURT GUIDELINES JUDICIAL NOTICE DEFENDANTS WILLIAMS ACT TRUTH SEEKING ADOPT GUIDANCE CONFORM PLAIN OUTSTANDING SECURITIES ISSUER REGULATION UNDERCUTS VIOLATE PLAINTIFFS POSITION RIPE ADJUDICATION INFLUENCE SUBMITTING CLEARLY INADMISSIBLE NEWSPAPER DECLINE BS/WMW REGISTER CHANCERY GREGORY VARALLO ESQUIRE |
8
A t t o r n e y s a t Law
February 3,1999
Craig B. Smith
Robert J. Katzenstein
David A. Jenkins V I A F E D E R A L
Susan L. Parker
Laurence v. Cron1n The Honorable Myron T. Steele
Brett D. Fallon Court of Chancery
Stephen M. Miller 417 South State Street
Dover, DE 1990 1
Charles E. Butler
Michele C. Gott Re: Bond Purchase, L.L.C. v. Patriot Tax Credit
Kathleen M. Miller C.A. No. 16643 NC
Of Counsel Dear Vice Chancellor Steele:
Clark MT. Furlow
Anne E. Bookout On behalf of plaintiff Bond Purchase LLC, we object to the
the Court take judicial notice of the newspaper article submitted
Varallo.
Mr. Varallo understandably does not even attempt to explain how
its contents are relevant to any matter presently before the Court,
and Exchange Commission ("SEC") may or may not do in the future is
of any fact relating to the claims or defenses asserted in this
Even if it were somehow relevant, the article and its contents
adjudicative facts so as to permit the Court to take judicial
generally, 21 Wright & Graham, Federal Practice and Procedure 9 5
2d, Evidence 5 31. Mr. Varallo's letter does not indicate with
for which judicial notice is sought or on what provision of Rule
Uniform Rules of Evidence the Court might rely to take judicial
article. The request is deficient. 21 Wright & Graham, supra, 0 5
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