United States District Court, D. South Carolina, Anderson/Greenwood Division
Beattie B. Ashmore, in his capacity as court-appointed Receiver for Ronnie Gene Wilson and Atlantic Bullion & Coin, Inc., Plaintiff,
Lucile M. and Hewlett K. Sullivan, Jr., Defendants.
ORDER AND OPINION
Beattie B. Ashmore, in his capacity as court-appointed
Receiver for Ronnie Gene Wilson (“Wilson”) and
Atlantic Bullion and Coin, Inc. (“AB&C”),
filed this action against Defendants Lucile M. Sullivan and
Hewlett K. Sullivan, Jr. to recover grossly excessive
payments received by Defendants as a return on their
investment in the Wilson-AB&C Ponzi scheme.
matter is before the court pursuant to Plaintiff's Motion
to Substitute (ECF No. 93). Specifically, Plaintiff requests
that the court, pursuant to Rule 25 of the Federal Rules of
Civil Procedure, substitute Lucille M. Sullivan as successor
to the Estate of Hewlett K. Sullivan, Jr. for Hewlett K.
Sullivan, Jr., now deceased, in this action. For the reasons
set forth below, the court GRANTS
Plaintiff's Motion to Substitute (ECF No. 93).
RELEVANT FACTUAL AND PROCEDURAL BACKGROUND
is the court appointed Receiver in In Re: Receiver for
Ronne Gene Wilson and Atl. Bullion & Coin, Inc., C/A
No.: 8:12-cv-02078-JMC, ECF No.1 (D.S.C. July 25, 2012), a
case related to this matter. Plaintiff alleges that
“[o]n August 24, 2001, Defendants made an initial
‘investment' [in the Wilson-AB&C Ponzi scheme]
of $21, 750.00.” (ECF No. 1 at 4 ¶ 24.)
“Subsequently, Defendants made additional
‘investments' of $211, 350.00 between September 8,
2003 and February 3, 2009 for a total investment of $239,
100.00.” (Id. at ¶ 25.) Plaintiff further
alleges that “Defendants withdrew a total of $3, 448,
110.00 [from the Wilson-AB&C Ponzi scheme] between
September 2002 and February 2012 resulting in a profit of $3,
209, 010.00.” (Id. at ¶ 26.)
on his appointment as Receiver tasked with “locating,
managing, recouping, and distributing the assets of the
Wilson-AB&C investment scheme, ” Plaintiff
commenced this action against Defendants on February 6, 2015,
asserting claims for fraudulent transfer (in violation of the
Statute of Elizabeth, SC Code Ann. § 27-23-10 (2014)),
and unjust enrichment. (ECF No. 1 at 1 ¶ 1 & 6
¶ 38-7 ¶ 52.)
August of 2015, Hewlett K. Sullivan, Jr. passed away. (ECF
No. 94 at 2.) On December 11, 2017, Plaintiff filed a Motion
to Substitute Lucile M. Sullivan, Hewlett's wife and
successor to the Estate of Hewlett K. Sullivan, Jr., for
Hewlett K. Sullivan, Jr. (ECF No. 93.) On December 4, 2017,
Defendant Lucille M. Sullivan filed a response in opposition
to Plaintiff's Motion stating that (1) Plaintiff's
Motion is untimely under Federal Rule of Civil Procedure 25
and (2) in the alternative, the action under the Statute of
Elizabeth does not survive Hewlett's K. Sullivan,
Jr.'s death. (ECF No. 94.) On December 11, 2017,
Plaintiff filed a reply to Defendant's response stating
that (1) the time limit for filing a motion to substitute
under Rule 25 has not expired and (2) it is fair to permit
the substitute of a party under the circumstances of this
case. (ECF No. 98.)
Federal Rule of Civil Procedure 25(a)(1)
25(a)(1) of the Federal Rules of Civil procedure states:
If a party dies and the claim is not extinguished, the court
may order substitution of the proper party. A motion for
substitution may be made by any party or by the
decedent's successor or representative. If the motion is
not made within 90 days after service of a statement noting
the death, the action by or against the decedent must be
Lucile M. Sullivan asserts that the reference, specifically
in her Answer and 26.03 Interrogatory Responses, to the death
of Hewlett K. Sullivan, Jr. or Plaintiff's knowledge of
Mr. Sullivan's death are sufficient to trigger the 90-day
deadline set forth in Rule 25 of the Federal Rules of Civil
Procedure. (ECF No. 94 at 3.)
Defendant Lucile M. Sullivan never served a statement noting
his death as required by Rule 25. Specifically, Rule 25
requires service of a “statement noting death”
pursuant to Rule 4 of the Federal Rules of Civil Procedure.
Fed.R.Civ.P. 25. “The statement noting death is a
formal filing that must be in writing and served on all
parties.” Morris v. Santander Bank, N.A., 2017
U.S. Dist. LEXIS 186908, at *2 (S.D. W.Va. Nov. 13, 2017).
“That the parties know about the death of a party, or
the mere reference to a party's death in pleadings, is
not sufficient to qualify as a statement noting death.
Id. at *3. “Thus, neither the parties'
knowledge of the death, nor the mentioning of death in
pleadings will trigger the 90-day window for filing the
motion to substitute [and] there is no time limit for filing
the statement noting death.” Id.; see also
Fariss v. Lynchburg Foundry, 769 F.2d 958, 962 (4th Cir.
1985) (‘[Rule 25] imposes no time limit for the
substitution other than that commenced by proper service of a
suggestion of death upon the record.”).
Hewlett's death, no formal estate was ever opened and, as
such, no personal representative was ever appointed. (ECF No.
93 at 1 n.1.) Lucile M. Sullivan is, however, listed as the
successor on the forms submitted to the probate court. (ECF
No. 93-1.) “The successors or representatives of the
decedent are those empowered to assert any legal claims of
the decedent not extinguished by death, or to defend the
estate against others' claims.” Law v. Town of
Fairfax, 2017 U.S. Dist. LEXIS 103220, at *3 n.2 (D.S.C.
July 5, 2017). As such, Lucile M. Sullivan, as successor to
the Estate of Hewlett K. Sullivan, Jr., is the proper party
to be substituted in the case.