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Lake Austin Properties I, Ltd. – Seventh Update

Urban Thier Federer > Uncategorized  > Lake Austin Properties I, Ltd. – Seventh Update

Lake Austin Properties I, Ltd. – Seventh Update

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Lake Austin Properties I, Ltd. – Seventh Update

The Importance of Understanding Your Chosen Law Firm’s Litigation Strategy and Your Own Litigation Priorities 

Based upon conversations with current and prospective Urban Thier & Federer, P.A., clients and other Lake Austin Reserve purchasers, there appears to be some confusion over the priorities involved in taking legal action and the different litigation strategies being employed by the various law firms representing purchasers in the Lake Austin Reserve development. As of April 14, 2011, Urban Thier & Federer, P.A., has represented over 400 Lake Austin Reserve units (of which 317 have been fully concluded, over six times as many as all other law firms combined). (See also – Fuel USA/Fuel Wealth Management and Affiliated Attorneys and Solicitors.)

I believe this is due to the fact that as purchasers explore their legal rights and options, the majority of Lake Austin Reserve purchasers realize that the top priority is to ensure that they are fully and finally released from any contractual obligation to purchase a unit at the Lake Austin Reserve. The next priority is to ensure that purchasers recover as much of their deposit as possible. Additional priorities include ensuring that the litigation strategy is tailored to each purchaser’s specific case and facts, ensuring that it is formulated to minimize the possibility that the purchaser client may need to travel to the United States in connection with their lawsuit to attend depositions, mediation, trial or other court proceedings, and ensuring that the law firm has the experience and resources to enforce any settlement or judgement.

As a direct result of these considerations, Urban Thier & Federer, P.A.’s Lake Austin Reserve litigation strategy very deliberately involves filing a separate lawsuit in federal court for each purchaser client (for clients with multiple Lake Austin Reserve units, this may involve a single or separate lawsuits as the analysis of relevant factors dictates).

Federal versus State Court 

Urban Thier & Federer, P.A., files in federal court for several reasons. Federal judges are appointed for life (and are thereby somewhat insulated from local political considerations). Federal judges are equipped to adjudicate technical legal matters that require significant judicial resources, such as resource attorneys and magistrate judges who can adjudicate or recommend rulings for the main judge. The federal rules of procedure allow a party to move for summary judgment (essentially a trial on paper) even if discovery has not yet been started. The federal rules also allow a judge to grant summary judgment more readily based upon the papers (essentially the defendant cannot simply claim a fact dispute requiring trial but must affirmatively present its own evidence of a fact dispute).

In contrast, state court judges are elected, serve terms and have to be re-elected. They also have limited resources (compared to a federal judge). For example, a state court judge may share a single research attorney with one or two other state court judges. The state court rules of procedure allow a defendant to more easily defer ruling on summary judgment until discovery, and possibly mediation, have been completed (both the plaintiff’s discovery deposition and mediation usually require the plaintiff to be present in person). The rules are also more favorable to a defendant/someone opposing summary judgment because the burden of proof on the plaintiff/moving party is higher than in federal court (more specifically, a party opposing summary judgment may be able to stop the judge from granting summary judgment by simply asserting that there is a factual dispute precluding summary judgment). Due to these considerations, we feel strongly that especially clients located outside of the United States are best served by having an individual lawsuit filed on their behalf in federal court.

Although virtually all cases can be filed in state court, there are only two ways for purchaser plaintiffs to file in federal court, one of them is that the matter involves a federal question, i.e. a federal law is at issue. The other way is “diversity jurisdiction”, i.e. the parties to the case have to be from different states or countries and the amount at issue must be at least US$75,000.00. Considering that most Lake Austin Reserve purchasers are UK residents (or residents of countries other than the United States) the first requirement of diversity jurisdiction is already fulfilled. Most clients also fulfill the requirement of $75,000.00 as their deposits range in the US$75,000 – $110,000+ range. Even if a purchaser’s deposit is below US$75,000.00, that purchaser can be combined with one other purchaser unit to exceed the $75,000.00 minimum.

Other Considerations: 
In addition to the federal versus state court consideration, there are also other significant litigation strategy considerations and differences. It appears that virtually all of the cases filed by law firms other than Urban Thier & Federer, P.A., have been filed in state court. Additionally, the majority of those cases have been filed in batches of up to 10 to 15 units in a single lawsuit. This may be convenient and expedient for the lawyers, but may not be in the best interest of purchasers.

It appears that the other law firms filing lawsuits against Lake Austin Properties I, Ltd., are one and two attorney law firms or solo-practice attorneys. Purchasers should ensure that any law firm that they contemplate retaining has the attorneys, staff and other resources to diligently handle their case regardless of what contingencies may arise in the future. Another factor that may influence an attorney’s litigation strategy is the fact that all Florida Bar licensed attorneys can file lawsuits in Florida state court. However, in order to file in federal court, the attorney must be admitted to the Florida State Bar and also separately admitted to the applicable Federal Court Bar.

Factual Analysis of Federal versus State Court Litigation Strategies: 
Based upon the factual information as reflected in the federal and state court public records/court dockets, the following is an analysis to assist purchasers in understanding the real world differences between Urban Thier & Federer, P.A.’s litigation strategy and that of the other approximately 10 law firms and solo-practice attorneys representing Lake Austin Reserve purchasers (this is a snap shot as of April 14, 2011):

Urban Thier & Federer, P.A.:

Total Units: Total Lawsuits Filed Against Lake Austin: Court Filed: Total Units Resolved: Percent of Units Resolved:
417 358 Federal 322 77%


All other law firms representing Lake Austin Reserve Purchasers:

Total Units: Total Lawsuits Filed Against Lake Austin: Court Filed Total Units Resolved: Percent of Units Resolved:
235 44 State 54 23%
5 5 Federal 5 100%

The oldest lawsuit filed by Urban Thier & Federer, P.A., against Lake Austin, that is still pending, was filed on December 29, 2010, and is already fully briefed and awaiting the federal court judge’s summary judgment ruling.

In stark contrast, all of the other law firms’ pending cases include ones filed as far back as 2008 – all in state court. Even more alarming to purchasers should be the fact that not a single one of the other law firms’ cases is at the summary judgment stage. Essentially, the vast majority of the other law firms’ cases are languishing in state court because, presumably, the attorneys are waiting and hoping for a settlement offer from Lake Austin or they are simply too busy and/or too understaffed to handle their case load.

Purchasers should be aware that Urban Thier & Federer, P.A., believes that the number of units is the most appropriate and objective basis for comparison of law firms and that law firms, lawyers and others who mix the words units and clients are being dishonest. This is because a single unit can have one to four purchasers/clients and therefore comparison of the number of clients makes for an unclear and misleading basis for comparison.

Urban Thier & Federer, P.A., encourages all purchasers to do their own independent due diligence and research. You can also learn more about Lake Austin Properties I, Ltd.’s Lake Austin Reserve Grande Palisades, The Avalon and Magnolia Woods Resort phases via these previous articles and updates:

Current Updates:

  • Lake Austin Properties I, Ltd. Tenth Update – Urban Thier & Federer, P.A. Answers Lake Austin reserve Purchasers’ Questions in Person in the United Kingdom and Provides Factual Information
  • Lake Austin Properties I, Ltd. Ninth Update – Lake Austin Properties I, Ltd., Raises Bankruptcy and Other Issues to Encourage Grande Palisades, Avalon and Magnolia Woods Purchasers to Continue with an Economically Unjustifiable Purchase.
  • Lake Austin Properties I, Ltd. Eighth Update – Lake Austin Reserve Developer Visits United Kingdom to Propose REIT Concept

See also previous updates:

  • Lake Austin Properties I, Ltd. Sixth Update – Lake Austin Joins Forces with IAP/IAP Global Veteran to Replace The Affinity Partnership, Ltd.
  • Lake Austin Properties I, Ltd. Fifth Update – The Grande Palisades and Lake Austin Properties I, Ltd. High Pressure Tactics
  • Lake Austin Properties I, Ltd. Fourth Update – The Future of the Grande Palisades and the Oversupply of Disney Area Condominium Hotels (Condo-Hotels)
  • Lake Austin Properties I, Ltd. Third Update – Fuel USA and Affiliated Attorneys and Solicitors
  • Lake Austin Properties I, Ltd. Second Update – The Affinity Partnership, Ltd. and Related Entities
  • Lake Austin Properties I, Ltd. Update – Status of Buyers’ Deposits
  • Lake Austin Properties I, Ltd. Grande Palisades, Avalon and Magnolia Woods – Status and Rights

We encourage all purchasers to interview any attorney that they may be contemplating to retain and to ask that attorney for their experience, record in this area of the law, number of cases taken to final judgment, number of cases affirmed on appeal, number of attorneys in the firm, firm staff, resources, etc. We sincerely believe that purchasers should not retain an attorney or law firm until they are confident that 1) the law firm has the experience and resources to represent their best interest and 2) they fully understand the law firm’s litigation strategy. See also Fuel USA Blog for additional considerations.

The Florida Bar, which regulates all attorneys who are licensed to practice law in the State of Florida, provides strict guidelines which prohibit us from referring to past successes or results obtained for other purchasers in this or other developments. However, we can provide you with this and other information in response to any inquiry. Accordingly, we encourage you to contact us via the “Contact Us” page and we will promptly respond with additional information.

With attorneys in Orlando, Florida, and Munich, Germany, Urban Thier & Federer, P.A., continues to assist buyers throughout the United States and European Union countries who are seeking to terminate their pre-construction purchase agreements. Most cases can be handled on a contingency fee basis (client is responsible for costs).

We encourage you to explore our website – www.urbanthier.com to learn more about Urban Thier & Federer, P.A., its attorneys and practice areas. Urban Thier & Federer, P.A.’s representation of buyers includes litigation of cases in state court, federal court and arbitration proceedings. We encourage you to become informed of your rights and options. You should also ensure that any law firm you consult or retain to represent you has the experience, resources and ability to take your case through trial and appellate courts, if necessary.

Please note that Urban Thier & Federer, P.A., does not represent you and cannot take any action on your behalf unless and until you enter into a formal written Legal Representation Agreement.

John L. Urban, Shareholder