-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VErNRqkQTnOCu/ertUJKNLelF5Swk7KsjB59guUnT/oXFx1+IWkanKdCQtU9bg+B d+uGcxY3IKU4yRH6BdAxlw== 0000895345-98-000048.txt : 19980210 0000895345-98-000048.hdr.sgml : 19980210 ACCESSION NUMBER: 0000895345-98-000048 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19980209 SROS: NYSE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: FIRST UNION REAL ESTATE EQUITY & MORTGAGE INVESTMENTS CENTRAL INDEX KEY: 0000037008 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 346513657 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-19676 FILM NUMBER: 98526313 BUSINESS ADDRESS: STREET 1: 55 PUBLIC SQUARE STREET 2: STE 1900 CITY: CLEVELAND STATE: OH ZIP: 44113 BUSINESS PHONE: 2167814030 MAIL ADDRESS: STREET 1: 55 PUBLIC SQUARE SUITE 1910 CITY: CLEVELAND STATE: OH ZIP: 44113 FORMER COMPANY: FORMER CONFORMED NAME: FIRST UNION REALTY DATE OF NAME CHANGE: 19691012 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GOTHAM PARTNERS LP /NY/ CENTRAL INDEX KEY: 0000899983 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 363593298 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 110 EAST 42ND ST 18TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2122860300 MAIL ADDRESS: STREET 1: 110 EAST 42 ND ST 18TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 SC 13D/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. 18) First Union Real Estate Equity and Mortgage Investments - ------------------------------------------------------------------------------- (Name of Issuer) Shares of Beneficial Interest, $1.00 par value - ------------------------------------------------------------------------------- (Title of Class of Securities) 337400105 -------------------------------------------------------------- (CUSIP Number) Stephen Fraidin, P.C. Fried, Frank, Harris, Shriver & Jacobson One New York Plaza New York, New York 10004 (212) 859-8140 - ------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) February 9, 1998 -------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|. Check the following box if a fee is being paid with the statement |_|. (A fee is not required only if the reporting person: (1) has a previous statement on file reporting beneficial ownership of more than five percent of the class of securities described in Item 1; and (2) has filed no amendment subsequent thereto reporting beneficial ownership of five percent or less of such class.) (See Rule 13d-7.) NOTE: Six copies of this statement, including all exhibits, should be filed with the Commission. See Rule 13d-1(a) for other parties to whom copies are to be sent. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). SEC1746(12-91) SCHEDULE 13D - ------------------------------ ------------------------------------ CUSIP NO. 337400105 PAGE 2 OF 6 PAGES --------------- ----- ----- - ------------------------------ ------------------------------------ - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Gotham Partners, L.P. - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X| (b) |_| - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(e) |_| - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION New York, U.S.A. - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF 2,601,951 Shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8 SHARED VOTING POWER OWNED BY 0 ------------------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING 2,601,951 Shares ------------------------------------------------------------------ PERSON 10 SHARED DISPOSITIVE POWER WITH 0 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,601,951 Shares - ------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.25% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN - ------------------------------------------------------------------------------- * SEE INSTRUCTIONS SCHEDULE 13D - ------------------------------ ------------------------------------ CUSIP NO. 337400105 PAGE 3 OF 6 PAGES --------------- ----- ----- - ------------------------------ ------------------------------------ - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Gotham Partners II, L.P. - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X| (b) |_| - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(e) |_| - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION New York, U.S.A. - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER OF 30,449 Shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8 SHARED VOTING POWER OWNED BY 0 ------------------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING 30,449 Shares ------------------------------------------------------------------ PERSON 10 SHARED DISPOSITIVE POWER WITH 0 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 30,449 Shares - ------------------------------------------------------------------------------ 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.11% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN - ------------------------------------------------------------------------------- * SEE INSTRUCTIONS This Amendment No. 18 amends and supplements the Statement on Schedule 13D (the "Schedule 13D") relating to the shares of Beneficial Interest, par value $1.00 per share ("Shares"), of First Union Real Estate Equity and Mortgage Investments, an Ohio business trust (the "Company") previously filed by Gotham Partners, L.P. ("Gotham") and Gotham Partners II, L.P. ("Gotham II" and together with Gotham, the "Reporting Persons"), both New York limited partnerships. Capitalized terms used and not defined in this Amendment have the meanings set forth in the Schedule 13D. Except as specifically provided herein, this Amendment does not modify any of the information previously reported on the Schedule 13D. Item 4 is hereby amended to add the following information: "Item 4. Purpose of the Transaction On February 6, 1998, counsel for the Reporting Persons filed a Motion for Leave to File Surreply Brief in Opposition to First Union's Motion to Remand in the United States District Court for the Northern District of Ohio, Eastern Division (the "U.S. District Court"). A copy of such Motion is attached as Exhibit 34 hereto and incorporated herein by this reference. On February 6, 1998, counsel for the Reporting Persons filed a Surreply Brief in Opposition to First Union's Motion to Remand in the U.S. District Court. A copy of such Brief is attached as Exhibit 35 hereto and incorporated herein by this reference. On February 6, 1998, counsel for the Reporting Persons filed a Reply Memorandum in Support of Gotham's Motion for Court to Accept Reassignment of Related Case in the U.S. District Court. A copy of such Memorandum is attached as Exhibit 36 hereto and incorporated herein by this reference. On February 6, 1998, counsel for the Reporting Persons filed a Plaintiffs' Reply Brief in Support of Their Motion for Reassignment in the U.S. District Court. A copy of such Brief is attached as Exhibit 37 hereto and incorporated herein by this reference." Item 7. Is hereby amended to add the following information: "Item 7. Material to be Filed as Exhibits. 34. Motion for Leave to File Surreply Brief in Opposition to First Union's Motion to Remand filed in the U.S. District Court by counsel for the Reporting Persons on February 6, 1998. 35. Surreply Brief in Opposition to First Union's Motion to Remand filed in the U.S. District Court by counsel for the Reporting Persons on February 6, 1998. 36. Reply Memorandum in Support of Gotham's Motion for Court to Accept Reassignment of Related Case filed in the U.S. District Court by counsel for the Reporting Persons on February 6, 1998. 37. Plaintiffs' Reply Brief in Support of Their Motion for Reassignment filed in the U.S. District Court by counsel for the Reporting Persons on February 6, 1998." After reasonable inquiry and to the best of our knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct. February 9, 1998 GOTHAM PARTNERS, L.P. By: Section H Partners, L.P., its general partner By: Karenina Corporation, a general partner of Section H Partners, L.P. By: /s/ William A. Ackman ---------------------------- William A. Ackman President By: DPB Corporation, a general partner of Section H Partners, L.P. By: /s/ David P. Berkowitz ---------------------------- David P. Berkowitz President GOTHAM PARTNERS II, L.P. By: Section H Partners, L.P., its general partner By: Karenina Corporation, a general partner of Section H Partners, L.P. By: /s/ William A. Ackman ---------------------------- William A. Ackman President By: DPB Corporation, a general partner of Section H Partners, L.P. By: /s/ David P. Berkowitz ---------------------------- David P. Berkowitz President EX-99.1 2 EXHIBIT 34 IN THE UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION FIRST UNION REAL ESTATE EQUITY ) CIVIL ACTION NO. 98 CV 0105 AND MORTGAGE INVESTMENTS, ) ) JUDGE ANN ALDRICH Plaintiff, ) ) v. ) ) GOTHAM PARTNERS, L.P., et al., ) ) Defendants and Counterclaimants. ) GOTHAM'S MOTION FOR LEAVE TO FILE SURREPLY BRIEF IN OPPOSITION TO FIRST UNION'S MOTION TO REMAND Defendants and Counterclaimants Gotham Partners, L.P. and Gotham Partners II, L.P. move this Court for leave to file the attached Surreply Brief to correct certain factual misstatements contained in First Union's Reply to Gotham's Memorandum of Law in Opposition to First Union's Motion To Remand. Respectfully submitted, OF COUNSEL: /s/ Michael J. Garvin -------------------------------------- David C. Weiner (0013351) Michael J. Garvin (0025394) HAHN LOESER & PARKS LLP 3300 BP America Building 200 Public Square Cleveland, Ohio 44114-2301 Phone: (216) 621-0150 Fax: (216) 241-2824 OF COUNSEL: /s/ Alexander R. Sussman --------------------------------------- Alexander R. Sussman(FN1) FRIED, FRANK, HARRIS, SHRIVER 25th Floor & JACOBSON One New York Plaza New York, New York 10004-1980 Attorneys for Defendants and Counterclaimants - ----------------------- [FN] 1 Application to appear pro hac vice pending. EX-99.2 3 EXHIBIT 35 IN THE UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION FIRST UNION REAL ESTATE EQUITY ) CIVIL ACTION NO. 98 CV 0105 AND MORTGAGE INVESTMENTS, ) ) JUDGE ANN ALDRICH Plaintiff, ) ) v. ) ) GOTHAM PARTNERS, L.P., et al., ) ) Defendants and Counterclaimants. ) GOTHAM'S SURREPLY BRIEF IN OPPOSITION TO FIRST UNION'S MOTION TO REMAND --------------------------------- Defendants and Counterclaimants Gotham Partners, L.P. and Gotham Partners II, L.P. (the "Gotham Partnerships") are submitting this Surreply Brief in Opposition to Plaintiff First Union's Motion to Remand because First Union has asserted factually misleading arguments in its Reply in support of that Motion. ARGUMENT -------- First Union suggests that it should not be estopped from asserting that it has citizenship in states other than Ohio, despite the fact that it alleged that it was a citizen of Ohio in federal lawsuits invoking diversity jurisdiction which it filed in 1992 and 1993. Carefully choosing its words, First Union asserts that at the time of the filing these federal lawsuits, "it had a different Board of Trustees" and "Mr. DeVos, for instance, was not even a Trustee at the time." See Reply Mem. at 2. First Union thus intimates that at the time it filed the suits asserting that it was an Ohio citizen for purposes of diversity jurisdiction, its Trustees were all Ohio citizens. Information contained in First Union's own proxy filings in 1992 and 1993 (the pertinent dates of the prior federal actions) is evidence that at least two of First Union's trustees were domiciliaries of states other than Ohio. See Exhibit A (chart of First Union's Trustees' residencies based on its 1992 and 1993 proxy statements) and Exhibit B (First Union's 1992 and 1993 proxy statements). If, as the evidence suggests, First Union had Trustees who were not Ohio citizens at the time it filed the 1992 and 1993 diversity complaints, its argument is entirely undermined and it should be estopped from now claiming that it is not an Ohio citizen for diversity purposes. Moreover, the "evidence" submitted by First Union regarding Trustee DeVos' citizenship raises more questions than answers. First Union has failed properly to establish that Mr. DeVos' domicile is in Michigan as required by the diversity statute. See Mas v. Perry, 489 F.2d 1396 (5th Cir. 1974); Webb v. Nolan, 361 F. Supp. 418 (D.N.C. 1972). Furthermore, an unexplained statement in affidavit from an officer of First Union as to a Trustee's citizenship is hardly sufficient; any such evidence should come from the Trustee himself, or at least from a reliable source such as a filing by the Trust with the Ohio Secretary of State. Finally, First Union resorts to the unsubstantiated argument that diversity does not exist because one of the Gotham Partnerships' second-tier limited partners is an Ohio citizen. First Union fails, however, to even attempt to rebut the factual showing in the affidavit of David S. Klafter and the legal authorities submitted by the Gotham Partnerships demonstrating that their second-tier partners should not be considered for diversity purposes. CONCLUSION ---------- Based on the record before this Court, First Union's Motion to Remand should be denied. If, however, this Court is not inclined to deny that motion at this time, as shown above, evidence needs to be adduced on the following significant fact questions: (1) whether First Union should be estopped from asserting that it is not solely an Ohio citizen for diversity purposes; and (2) whether its Trustee DeVos is a Michigan citizen for diversity purposes. As the Gotham Partnerships have previously suggested, it would make sense to adduce such evidence at the time of the March 5, 1998 hearing on the parties' respective motions for preliminary injunction. Respectfully submitted, OF COUNSEL: /s/ Michael J. Garvin -------------------------------------- David C. Weiner (0013351) Michael J. Garvin (0025394) HAHN LOESER & PARKS LLP 3300 BP America Building 200 Public Square Cleveland, Ohio 44114-2301 Phone: (216) 621-0150 Fax: (216) 241-2824 OF COUNSEL: /s/ Alexander R. Sussman --------------------------------------- Alexander R. Sussman(FN1) FRIED, FRANK, HARRIS, SHRIVER 25th Floor & JACOBSON One New York Plaza New York, New York 10004-1980 Attorneys for Defendants and Counterclaimants - ---------------------- [FN] 1 Application to appear pro hac vice pending. CERTIFICATE OF SERVICE ---------------------- I hereby certify that a true and accurate copy of the foregoing was served via messenger upon Frances Floriano Goins, Squire, Sanders & Dempsey, attorneys for Plaintiff, this 6th day of February, 1998. /s/ Michael J. Garvin -------------------------------------- One of the Attorneys for Defendant and Counterclaimants EX-99.3 4 EXHIBIT 36 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION FIRST UNION REAL ESTATE EQUITY ) CASE NO. 1:98CV0105 AND MORTGAGE INVESTMENTS, ) ) JUDGE ALDRICH Plaintiff, ) ) REPLY MEMORANDUM IN v. ) SUPPORT OF GOTHAM'S MOTION ) FOR COURT TO ACCEPT GOTHAM PARTNERS, L.P., et al., ) REASSIGNMENT OF RELATED ) CASE Defendants. ) -------------------------- Defendants and Counterclaimants ("Gotham"), which are also plaintiffs and now counterclaim defendants in the related case before Judge Nugent (Case No. 1:98CV0292) submit this memorandum in reply to First Union's February 2, 1998 letter to this Court and to Judge Nugent opposing Gotham's motion to transfer the case before Judge Nugent to this Court. Copies of First Union's Brief in Opposition to Plaintiff Gotham's Motion for Reassignment and First Union's Answer and Counterclaim in the related case are attached as Exhibits A and B for the Court's convenience. Gotham is also filing a reply brief in response to First Union's Brief in Opposition on the reassignment issue, a courtesy copy of which will also be provided to this Court. It is now apparent that First Union has been court shopping and it is, therefore, doubly ironic that First Union has falsely accused Gotham of requesting reassignment of the related case to this Court because, according to First Union, Gotham was "dissatisfied" with the assignment of the related case to Judge Nugent. On the contrary, as the Court docket reflects, the Complaint in the related case and the Motion for Reassignment were filed simultaneously without regard to which Judge would be or was assigned to that case. The sole reason for the motion was the pendency of the earlier-filed action before this Court. It appeared to Gotham that, since this Court had considered the pending scheduling motions in the instant case and Gotham's request for a preliminary injunction and had set a briefing and hearing schedule on both parties' motions for preliminary injunction, judicial economy would be achieved by having the related case reassigned to this Court in accordance with Local Rule 3.1(b). Given the clear benefit of having related cases before the same Judge of this Court, First Union's objection to reassignment rings hollow. Indeed, it is now clear that First Union itself is engaged in blatant court shopping. As alleged in Gotham's Complaint in the related case, a copy of which is attached as Exhibit C, at P.P.34-44, First Union's state law claims were filed prematurely on January 16, 1998, in state court. The reason is now clear. At the time of the state court filing, First Union had related federal securities law claims, for which there was exclusive federal jurisdiction, which it first asserted yesterday in the related case. See First Union's Answer and Counterclaim P.P.18-51 and Counts III-V. Thus, First Union intentionally delayed making those claims, so that it could seek immediate relief in state court, without risking consolidation of all claims and proceedings in this Court. Accordingly, Gotham respectfully requests that this Court accept reassignment of the related case to ensure that all court proceedings affecting the parties herein and the impending proxy contest are adjudicated in this Court. Respectfully submitted, OF COUNSEL: /s/ Michael J. Garvin ----------------------------------- David C. Weiner (0013351) Michael J. Garvin (0025394) HAHN LOESER & PARKS LLP 3300 BP America Building 200 Public Square Cleveland, Ohio 44114-2301 (216) 621-0150 -and- OF COUNSEL: /s/ Alexander R. Sussman ----------------------------------- Alexander R. Sussman(FN1) FRIED, FRANK, HARRIS, SHRIVER & JACOBSON 25th Floor One New York Plaza New York, New York 10004-1980 (212) 859-8000 Attorneys for Defendants - ------------------------- [FN] 1 Application to appear pro hac vice pending. CERTIFICATE OF SERVICE ---------------------- I hereby certify that a copy of the foregoing was served by messenger upon Frances Floriano Goins, Squire, Sanders & Dempsey L.L.P., 4900 Key Tower, 127 Public Square, Cleveland, Ohio 44114-1304, attorneys for defendant, this 6th day of February, 1998. /s/ Michael J. Garvin ----------------------------------------- One of the Attorneys for Defendants EX-99.4 5 EXHIBIT 37 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION GOTHAM PARTNERS, L.P., et al., ) CASE NO. 1:98CV0272 ) Plaintiffs, ) JUDGE NUGENT ) v. ) PLAINTIFFS' REPLY BRIEF IN SUPPORT ) OF THEIR MOTION FOR REASSIGNMENT ---------------------------------- FIRST UNION REAL ESTATE EQUITY AND ) MORTGAGE INVESTMENTS, ) ) Defendant. ) Plaintiffs ("Gotham") strenuously object to Defendant First Union's false accusation that Gotham's motion to reassign this case to Judge Aldrich had anything to do with their being "dissatisfied" with the assignment of this case to this Court. See First Union's Brief in Opp. at 2. As the docket herein reflects, the Complaint and Motion for Reassignment were filed simultaneously without regard to which Judge would be or was assigned to that case. The sole reason for the motion was the pendency of the earlier-filed action before Judge Aldrich. As Judge Aldrich had already considered the pending motions in the earlier filed action and, after reviewing the parties' conflicting views on the timing of a hearing, had set a schedule for briefing and hearing both parties' motions for preliminary injunctions, Gotham believed when the instant action was filed, as we do now, that judicial economy can be achieved by this Court and Judge Aldrich concurring in the reassignment of this case to Judge Aldrich. Local Rule 3.1(b) was drafted to promote judicial economy and preclude judge shopping by transferring cases to judges familiar with the underlying dispute or who were assigned to related cases as a means of easing and rationalizing the administration of the Court's business. First Union argues for a highly mechanistic reading of Rule 3.1(b) that would defeat its purpose. Applied practically, its undeniable purpose would be served by assigning this case to the judge who has already gained some familiarity with the underlying dispute. Apparently to bolster its claim that Gotham improperly removed the earlier-filed action, First Union only provided its side of the remand issue; it failed to provide this Court with Gotham's brief and affidavit in opposition to the motion to remand. That brief and affidavit, and the reply brief filed by Gotham, are attached for the Court's convenience as Exhibits A and B. Moreover, First Union's false accusation against Gotham is ironic in that it appears First Union is the party that has been court shopping. As alleged in Gotham's Complaint herein at P.P. 34-44, First Union's state law claims were filed prematurely on January 16, 1998, in state court. The reason is now clear. At the time of the state court filing, First Union had related federal securities law claims, for which there was exclusive federal jurisdiction, which it first asserted yesterday in the instant action. See First Union's Answer and Counterclaim P.P. 18-51 and Counts III-V. Thus, First Union intentionally delayed making those claims, so that it could attempt to fix a state court forum and avoid adjudication of all of both parties' claims, federal and state, in this Court. Accordingly, Gotham respectfully requests that this Court and Judge Aldrich concur in the reassignment of the instant action to Judge Aldrich and issue an order so indicating. Respectfully submitted, OF COUNSEL: /s/ Michael J. Garvin ----------------------------------- HAHN LOESER & PARKS LLP David C. Weiner (0013351) Michael J. Garvin (0025394) 3300 BP America Building 200 Public Square Cleveland, Ohio 44114-2301 (216) 621-0150 -and- OF COUNSEL: /s/ Alexander R. Sussman ----------------------------------- Alexander R. Sussman(FN1) FRIED, FRANK, HARRIS, SHRIVER & JACOBSON 25th Floor One New York Plaza New York, New York 10004-1980 (212) 859-8000 Attorneys for Plaintiffs - -------- [FN] 1 Application to appear pro hac vice pending. CERTIFICATE OF SERVICE ---------------------- I hereby certify that a copy of the foregoing was served by messenger upon Frances Floriano Goins, Squire, Sanders & Dempsey L.L.P., 4900 Key Tower, 127 Public Square, Cleveland, Ohio 44114-1304, attorneys for defendant, this 6th day of February, 1998. /s/ Michael J. Garvin ----------------------------------- One of the Attorneys for Plaintiffs -----END PRIVACY-ENHANCED MESSAGE-----