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No. DC-10-11915
JEFF BARON,
Plaintiff,
v.
GERRIT M. PRONSKE, Individually,
AND PRONSKE, GOOLSBY &
KATHMAN, P.C. f/k/a PRONSKE &
PATEL, P.C.,
Defendants.
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IN THE DISTRICT COURT
OF DALLAS COUNTY, TEXAS
193
RD
JUDICIAL DISTRICT
SECOND OBJECTION TO PROPOSED FINAL SUMMARY JUDGMENT
TO THE HONORABLE CARL GINSBERG:
Jeffrey Baron files this Second Objection to Proposed Final Summary Judgment pro-
posed by Mr. Pronske and his firm for the following reasons:
A. The Letter of Mr. Pronske (Attached)
Baron has never had the opportunity to respond to any summary judgment evidence or argu-
ment regarding prejudgment interest issue. Had Baron the opportunity to do so, Baron would
have pointed out that prejudgment interest was inappropriate for a variety of reasons. Most im-
portant, the captioned case was abated by the Bankruptcy Court because the parties were en-
joined by the Receivership Order from proceeding forward with the case. Pronske sought to un-
abate the case in March of this year. See Exhibit “2”. In such motion filed with the Bankruptcy
Court, Pronsek stated:
11 There is no longer cause to abate the adversary proceeding because of in-
tervening proceedings that address the subject matter of the parties’ dispute. The ad-
versary proceeding was first abated after the appointment of the Receiver by the Dis-
trict Court, and the abatement continued throughout the duration of the Baron Re-
ceivership. Yet the circumstances have changed substantially since November 2010.
The Fifth Circuit has reversed and vacated the appointment of the Receiver, and the
District Court is taking steps to expeditiously wind-down the Receivership, includ-
FILED
DALLAS COUNTY
9/3/2014 2:26:14 PM
GARY FITZSIMMONS
DISTRICT CLERK
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ing the return of Baron’s assets on or before March 14, 2014. As a result, Baron is
soon to be in possession of his assets, and the Receiver will soon be discharged from
his duties under the Receivership Order. These significant changes in circumstances
support lifting the abatement of the removed State Court lawsuit so that the parties
may be free to pursue their claims against each other.
12. Although never expressly articulated by the Court, the abatement of the ad-
versary proceeding continued past the Fifth Circuit’s reversal of the Receivership
Order because of the intervening involuntary bankruptcy petition filed against Baron
immediately after the Fifth Circuit’s opinion reversing the Receivership Order was
released. As before, the circumstances of the involuntary bankruptcy against Baron
have also materially changed. The District Court reversed the Order for Relief on
appeal entered against Baron in the involuntary matter, and although that reversal
has been appealed to the Fifth Circuit, the Fifth Circuit has declined to stay the re-
versal pending resolution of the appeal. Although the involuntary case is still open,
all that remains to be resolved prior to dismissal of the case is the potential assess-
ment of attorneys’ fees against the Petitioning Creditors under 11 U.S.C. § 303(i).
The Defendants have filed a motion for relief from the bankruptcy automatic stay in
Baron’s individual bankruptcy case contemporaneously with the filing of this Mo-
tion, although the Defendants believe Baron is judicially estopped from opposing re-
lief from the automatic stay given his prior positions and arguments during the
course of the appeal of the Order for Relief. For these reasons, the intervening invol-
untary bankruptcy case against Baron no longer supports abatement of the adversary
proceeding.
Baron should not be responsible for paying prejudgment interest for a period in time when
this case was abated. In fact, after filing the Motion to Abate, Pronske then withdrew the Motion
to Abate. The case was then remanded in May 2014. Baron did not ask for the Adversary Pro-
ceeding (this case) to be abated. The Bankruptcy Court did so due to the injunction entered by
the District Court in the Receivership Proceedings. Baron should not be charged prejudgment
interest under such circumstances. Baron cannot properly research such issue unless the Court
provides further time to do so, and since it was never asserted in the Amended Summary Judg-
ment Motion, no briefing was done by Baron at the time.
1
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Of course, it is because of this abatement and the injunction that Baron has argued that the substantial contribution
claim could not have been res judicata or collateral estoppel, but such arguments will be made in a Motion for Re-
consideration and on appeal.
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Respectfully Submitted,
Pendergraft & Simon, LLP
2777 Allen Parkway, Suite 800
Houston, TX 77019
Tel. (713) 528-8555
Fax. (713) 868-1267
/s/ William P. Haddock
By: Leonard H. Simon
Texas Bar No. 18387400
lsimon@pendergraftsimon.com
William P. Haddock
Texas Bar No. 00793875
whaddock@pendergraftsimon.com
Counsel for Jeff Baron
Certificate of Service
I hereby certify that a true and correct copy of the above SECOND Objection to Proposed Final
summary Judgment has been served on the following counsel/parties of record in accordance
with TEX. R. CIV. P. 21a and local rules for electronic filing and service on this 3
rd
day of Sep-
tember 2014.
Gerrit M. Pronske
Jason P. Kathman
Melanie P. Goolsby
Pronske Goolsby & Kathman, PC
2200 Ross Ave., Suite 5350
Dallas, TX 75201
Fax. 214-658-6509
/s/ William P. Haddock
William P. Haddock
214.658-6500 Telephone | 214.658-6509 Facsimile | www.pgkpc.com
PGK|
PRONSKE GOOLSBY & KATHMAN, P.C.
A Professional Corporation | 2200 Ross Avenue| Suite 5350 | Dallas, Texas 75201
Gerrit M. Pronske
214-658-6501
gpronske@pgkpc.com
September 3, 2014
Honorable Carl Ginsberg
193rd District Court
Dallas County
600 Commerce Street
Dallas, TX 75248
Re: Jeff Baron v. Gerrit M. Pronske, Individually, et al; Case No. DC-10-11915
Dear Judge Ginsberg:
I am in receipt of the Objection to Proposed Final Summary Judgment submitted
yesterday by counsel for Jeff Baron, Leonard Simon. His Objection is incorrect, and this letter is
in response.
Mr. Simon raises essentially 2 objections to the Proposed form of Final Summary
Judgment that I submitted to the Court yesterday. Mr. Simon cites the Court to no law and no
cases that support his incorrect positions.
First, Mr. Simon argues that the proposed Judgment provides for prejudgment
interest “when the Amended Motion for Summary Judgment made such request.” I believe he
meant to say “did not make such a request.” The Defendant’s First Amended Answer and
Counterclaim filed in this case on May 16, 2014, specifically requested, in the prayer for relief,
“pre-judgment and post-judgment interest on all monetary relief sought herein at the highest
rates allowed by law.” In the Amended Motion for Summary Judgment, filed on July 25, 2014,
we requested, in the prayer for relief, "any such other and further relief, whether based in law or
equity, that Defendants may be lawfully entitled.” Under Texas law, the Texas Supreme Court
holds that statutory or contractual interest may be predicated on a prayer for general
relief. Benavidez v. Isles Constr. Co., 726 S.W.2d 23, 25 (Tex. 1987); see also Olympia Marble
& Granite v. Mayes, 17 S.W.3d 437 (Tex. App. — Houston [1st Dist.] 2000, no pet.). In the
present case, our request in the Counterclaim was specific, and the request in the Motion for
Summary Judgment was general. This is more than sufficient under Texas law for an entitlement
to prejudgment interest.
Second, Mr. Simon argues that the "proposed order impermissibly allows for
prejudgment interest at the State Rate of Interest,” instead of the federal rate for the time that the
case was pending in the federal court. Again, Mr. Simon cites no law and, again, he is incorrect.
It is ironic that Mr. Simon claims that he should be entitled to the rate of interest in the federal
court that he caused to remand this case to the state court. However, the law provides that what
court the case is in is irrelevant. Even if this case had remained in the federal court, the Texas
Honorable Carl Ginsberg
September 3, 2014
Page 2
PGK|
PRONSKE GOOLSBY & KATHMAN
P.C.
State prejudgment interest rate would have governed. The Fifth Circuit Court of Appeals has
held that prejudgment interest is determined according to the substantive law of the state
governing the claim giving rise to the damages. Bott v. American Hydrocarbon Corp., 458 F.2d
229, 231 (5
th
Cir. 1972); Wood v. Armco, Inc., 814 F.2d 211, 213 n.2 (5
th
Cir. 1987).
Based on the above, I respectfully request this Court to enter the form of Final Summary
Judgment submitted yesterday, September 2, 2014. Thank you for your consideration of this
matter.
Very truly yours,
/s/ Gerrit M. Pronske
Gerrit M. Pronske
GMP:slm
Enclosure
cc: Leonard Simon
William P. Haddock
Via Email: lsimon@pendergraftsimon.com
Via Email: whaddock@pendergraftsimon.com
Alan L. Busch
Via Email: busch@buschllp.com
Via Email: albert@buschllp.com
Mark Stromberg
Via Email: mark@strombergstock.com
Jonathan B. Bailey
Via Email: jbaileylaw@hotmail.com
Gary Lyon
Via Email: glyon.attorney@gmail.com
DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 1 of 7
Gerrit M. Pronske
State Bar No. 16351640
Melanie P. Goolsby
State Bar No. 24059841
PRONSKE GOOLSBY & KATHMAN, PC
2200 Ross Avenue, Suite 5350
Dallas, Texas 75201
(214) 658-6500 - Telephone
(214) 658-6509 – Telecopier
Email: gpronske@pgkpc.com
Email: mgoolsby@pgkpc.com
COUNSEL FOR GERRIT M. PRONSKE AND
PRONSKE GOOLSBY & KATHMAN, PC,
F/K/A PRONSKE & PATEL, PC
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
In re:
ONDOVA LIMITED COMPANY,
Debtor.
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CASE NO. 09-34784-SGJ-11
CHAPTER 11
JEFF BARON,
Plaintiff,
v.
GERRIT M. PRONSKE,
INDIVIDUALLY, AND PRONSKE &
PATEL, P.C.,
Defendants.
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ADVERSARY NO. 10-03281-SGJ
GERRIT M. PRONSKE AND
PRONSKE & PATEL, P.C.,
Counter-Plaintiffs and Third-
Party Plaintiffs,
v.
JEFF BARON,
Counter-Defendant, and
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Case 10-03281-sgj Doc 36 Filed 03/13/14 Entered 03/13/14 15:09:51 Page 1 of 7
DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 2 of 7
THE VILLAGE TRUST,
Third-Party Defendant.
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DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT
TO THE HONORABLE STACEY G.C. JERNIGAN,
UNITED STATES BANKRUPTCY JUDGE:
Gerrit M. Pronske (“Pronske”) and Pronske Goolsby & Kathman, PC, f/k/a Pronske
& Patel, PC (“PGK” and, together with Pronske, the “Defendants”), defendants, cross-
plaintiffs, and third party plaintiffs in the above-captioned adversary proceeding, hereby
file this Emergency Motion to Lift Abatement (the “Motion”), and in support of this
Motion, state as follows:
I. BACKGROUND
A. The Involuntary Case
1. On December 18, 2012 (the “Petition Date”), PGK and other petitioning
creditors (together, the “Petitioning Creditors”) filed an involuntary bankruptcy petition
against Jeffrey Baron (“Baron” or the “Debtor”) under Chapter 7 of the Bankruptcy Code
[Docket No. 1, later amended at Docket No. 45].
2. On June 26, 2013, after conducting an involuntary trial over two days, the
Court entered an Order for Relief in an Involuntary Case (the “Order for Relief”) [Docket
No. 240].
3. On January 2, 2014, the United States District Court for the Northern
District of Texas (the “District Court”) entered an Amended Memorandum Opinion and
Order reversing this Court’s Order for Relief and remanding the matter to this Court the
Case 10-03281-sgj Doc 36 Filed 03/13/14 Entered 03/13/14 15:09:51 Page 2 of 7
DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 3 of 7
limited purpose of considering potential claims for attorney’s fees under 11 U.S.C. § 303(i)
and dismissal of the case.
4. PGK and the other Petitioning Creditors have appealed the District Court’s
reversal of the Order for Relief to the United States Court of Appeals for the Fifth Circuit.
They also requested stay of the District Court’s order pending appeal, which was denied by
the Fifth Circuit on March 6, 2014.
5. The District Court has recently entered an order requiring the Baron
Receiver to return receivership assets to Baron, Novo Point LLC, and Quantec LLC on or
before March 14, 2014. See Order entered February 28, 2014 at Document No. 1368 in
Netsphere, Inc., et al v. Baron, et al, Civil Action No. 3:09-CV-0988-L.
B. The Ondova Adversary Proceeding
6. Prior to the Petition Date, on September 15, 2010, Baron filed his Original
Petition for Declaratory Judgment, Original Petition, Application for Temporary
Restraining Order and Request for Disclosure (the “Complaint”) against Gerrit M.
Pronske, individually, and Pronske & Patel, PC (together, the “Defendants”) in the 193rd
Judicial District Court of Dallas County, Texas (the “State Court”).
7. On that same date, the Defendants filed a Notice of Removal of the
Complaint to the United States Bankruptcy Court for the Northern District of Texas in the
bankruptcy case styled In re Ondova Limited Company, Case. No. 09-34784-SGJ-11 (the
“Ondova Case”).
8. On September 27, 2010, the Defendants filed their Original Answer and
Counter-Claim and Third Party Complaint (the “Answer”). The Answer states claims
against Baron and The Village Trust for theft of services, breach of contract, quantum
meruit, attorney’s fees, fraud, and alter ego.
Case 10-03281-sgj Doc 36 Filed 03/13/14 Entered 03/13/14 15:09:51 Page 3 of 7
DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 4 of 7
9. On November 3, 2010, this Court entered its Order Abating Adversary
Proceeding and Setting Status Conference temporarily abating the adversary proceeding to
December 16, 2010.
10. The adversary proceeding has continued to be abated and/or stayed by the
intervening involuntary bankruptcy case against Baron since November 3, 2010, and the
Court has not conducted a hearing or entered an order on Baron’s Motion to Remand and
Motion to Strike Notice of Removal.
II. REQUEST FOR RELIEF
11. There is no longer cause to abate the adversary proceeding because of
intervening proceedings that address the subject matter of the parties’ dispute. The
adversary proceeding was first abated after the appointment of the Receiver by the District
Court, and the abatement continued throughout the duration of the Baron Receivership.
Yet the circumstances have changed substantially since November 2010. The Fifth Circuit
has reversed and vacated the appointment of the Receiver, and the District Court is taking
steps to expeditiously wind-down the Receivership, including the return of Baron’s assets
on or before March 14, 2014. As a result, Baron is soon to be in possession of his assets,
and the Receiver will soon be discharged from his duties under the Receivership Order.
These significant changes in circumstances support lifting the abatement of the removed
State Court lawsuit so that the parties may be free to pursue their claims against each other.
12. Although never expressly articulated by the Court, the abatement of the
adversary proceeding continued past the Fifth Circuit’s reversal of the Receivership Order
because of the intervening involuntary bankruptcy petition filed against Baron immediately
after the Fifth Circuit’s opinion reversing the Receivership Order was released. As before,
the circumstances of the involuntary bankruptcy against Baron have also materially
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DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 5 of 7
changed. The District Court reversed the Order for Relief on appeal entered against Baron
in the involuntary matter, and although that reversal has been appealed to the Fifth Circuit,
the Fifth Circuit has declined to stay the reversal pending resolution of the appeal.
Although the involuntary case is still open, all that remains to be resolved prior to
dismissal of the case is the potential assessment of attorneys’ fees against the Petitioning
Creditors under 11 U.S.C. § 303(i). The Defendants have filed a motion for relief from the
bankruptcy automatic stay in Baron’s individual bankruptcy case contemporaneously with
the filing of this Motion, although the Defendants believe Baron is judicially estopped
from opposing relief from the automatic stay given his prior positions and arguments
during the course of the appeal of the Order for Relief. For these reasons, the intervening
involuntary bankruptcy case against Baron no longer supports abatement of the adversary
proceeding.
WHEREFORE, PREMISES CONSIDERED, Defendants respectfully request that
the Court grant this Motion, lift the abatement of the above-captioned adversary
proceeding, and grant Defendants such other, further relief to which they may be entitled.
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DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 6 of 7
Dated: March 13, 2014. Respectfully submitted,
/s/ Gerrit M. Pronske
Gerrit M. Pronske
State Bar No. 16351640
Melanie P. Goolsby
State Bar No. 24059841
PRONSKE GOOLSBY & KATHMAN, PC
2200 Ross Avenue, Suite 5350
Dallas, Texas 75201
(214) 658-6500 - Telephone
(214) 658-6509 – Telecopier
Email: gpronske@pgkpc.com
Email: mgoolsby@pgkpc.com
COUNSEL FOR GERRIT M. PRONSKE
AND PRONSKE GOOLSBY &
KATHMAN, PC, F/K/A PRONSKE &
PATEL, PC
CERTIFICATE OF CONFERENCE
The undersigned hereby certifies that, on March 11, 2014, I conferred with Leonard
Simon, proposed counsel for Baron, regarding the relief sought in this Motion, who
indicated that Baron is opposed to the relief requested herein.
/s/ Gerrit M. Pronske
Gerrit M. Pronske
Case 10-03281-sgj Doc 36 Filed 03/13/14 Entered 03/13/14 15:09:51 Page 6 of 7
DEFENDANTS’ EMERGENCY MOTION TO LIFT ABATEMENT - Page 7 of 7
CERTIFICATE OF SERVICE
The undersigned does hereby certify that, on March 13, 2014, a true and correct
copy of the above and foregoing Motion was served upon the Debtor via email as
identified below, and also via ECF email on all parties accepting such service. Any party
may request a copy of the attached exhibits to the undersigned counsel.
Stephen Cochell
The Cochell Law Firm
7026 Old Katy Road, Suite 259
Houston, Texas 77024
srcochell@cochellfirm.com
COUNSEL FOR THE DEBTOR
Leonard H. Simon
Pendergraft & Simon, LLP
The Riviana Building, Suite 800
2777 Allen Parkway
Houston, Texas 77019
lsimon@pendergraftsimon.com
PROPOSED COUNSEL FOR THE
DEBTOR
/s/ Melanie P. Goolsby
Melanie P. Goolsby
Case 10-03281-sgj Doc 36 Filed 03/13/14 Entered 03/13/14 15:09:51 Page 7 of 7
