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Cathie Rowand | The Journal Gazette
Paula Phillips and her partners await the sheriff’s sale of the property on which her business sits. The sale will end a legal fight with Wells Fargo Bank.

Sheriff’s sale will end legal fight for Paula’s

Deal to result in full ownership of eatery’s building

– After about a dozen years, the battle between the owners of a well-known west-end restaurant and one of the country’s biggest banks is nearing an end.

With a court order to set a date for a sheriff’s sale for the building housing Paula’s on Main soon to be issued, it’s likely that within a few months Paula Phillips will have full control of the building at 1732 W. Main St., as well as the meals served inside.

“It’s been a long road,” Phillips said. “I’m glad it’s over.”

The complicated case pitted Phillips and her partners Frank Casagrande and Tom Sokolik against Wells Fargo Bank, so the comparisons by Casagrande and Phillips to David and Goliath were probably not too far off.

“We’re on third base and heading for home,” Casagrande said.

The case has been argued at the Indiana Court of Appeals three times and before the state’s Supreme Court twice.

The recent agreement hammered out with the bank came after the state’s highest court upheld an appellate court ruling giving Phillips what amounts to a lien on the property.

The case is extremely complex, and there were earlier cases and different cases that wound their way through the civil courts system dealing with the business, the relationships between the parties and their banks.

In sum, the fight began in the late 1990s when Phillips sued the owner of the building, Neil Summers, over trademark infringement. That case was settled in Phillips’ favor, and Summers eventually left the U.S. and moved to New Zealand, according to court documents.

Phillips shut the restaurant down and the financial service company the Money Store foreclosed on the property. Another restaurant was opened in the site from the spring of 2002 to the summer of 2003, but that closed and the old building on the north side of Main Street was vacant.

After seeing it vandalized and damaged, Phillips obtained permission from the Money Store to fix it up and reopen her restaurant.

With Casagrande’s and Sokolik’s financial backing, she repaired the building, opened a seafood market and reopened the restaurant, according to court documents.

When she found out some of the properties that made up the original loan had been sold at a tax sale, Phillips and her partners redeemed the lots and kept the property taxes current, according to court documents.

According to Allen County property tax records, it appears the property, including the buildings, is worth nearly $200,000.

Because of all the work Phillips did on the property and money she and her partners invested, the courts found that she earned the first place in line for a lien on the property.

What that means is that the property now owes Phillips and her partners more than $470,000 for their expenses and investments.

Whatever else is claimed by the Money Store’s successor in this case, megabank Wells Fargo, will have to wait until Phillips and her partners get what is due them.

The June ruling by the Indiana Supreme Court puts to bed any idea the bank might have to try to continue to fight Phillip’s position in line.

“(T)he Court cannot conclude that the Court of Appeals in the current appeal abused its discretion in applying the doctrine of law of the case,” Chief Justice Brent Dickson wrote. “(T)his appeal is at an end.”

After the final ruling by the state’s highest court, attorneys for the bank and Phillips hammered out an agreement for the property to be sold at sheriff’s sale.

Though it sounds strange that a business owner would be cheering for a sheriff’s sale, for Phillips it means that she has a nearly $500,000 head start on any bid anyone would want to make on the building.

“Paula will finally own her own building,” said her attorney Jeremy Grogg, a partner at Burt, Blee, Dixon, Sutton & Bloom, LLP. “It’s the right thing. The judgment is as it should be.”

A message left with Wells-Fargo’s public relations arm was not returned Tuesday afternoon.

The case files fill a conference room table, Grogg said, and Casagrande said his copies and paperwork related to it have taken over his office.

In those files are every receipt for every repair the partners made restoring the building and rebuilding the restaurant.

And with this ruling and the soon-to-be announced sheriff’s sale, it appears Paula’s name will not only be on the door, but on the title as well.