Stephen R. Cochell

The Cochell Law Firm, P.C.

7026 Old Katy Road, Ste. 259

Houston, Texas 77096

Telephone: (713)980-8796

Facsimile: (214) 980-1179

srcochell@cochellfirm.com

LEAD ATTORNEY FOR JEFFREY BARON

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

JEFFREY BARON,

Respondent,

vs.

ELIZABETH SCHURIG, et. al.,

Movants.

§ CIVIL ACTION NO. 3:13-cv-03461-L

§ (Bankruptcy Case No. 12-37921)

BARON’S OBJECTION TO MOVANTS’ EMERGENCY

MOTION FOR STAY PENDING APPEAL

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TABLE OF CONTENTS

TABLE OF AUTHORITIES .......................................................................................................... ii

ARGUMENT & AUTHORITIES .................................................................................................. 1

I. Introduction .............................................................................................................................. 1

II. Movants’ Procedural Deficiencies .......................................................................................... 6

III. Movants Are Unlikely to Succeed on ................................................................................... 7

the Merits of Their Appeal .......................................................................................................... 7

A. Movants Erroneously Assert that the Law of the Case Is Applicable .................................8

B. No Remand Is Required .......................................................................................................9

IV. Movants Face No Irreparable Harm .................................................................................... 12

V. Baron Faces Substantial Harm if Stay Is Granted ................................................................ 13

VI. Granting a Stay Will Not Serve the Public Interest ............................................................ 15

VII. Conclusion ......................................................................................................................... 16

CERTIFICATE OF SERVICE ..................................................................................................... 17

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TABLE OF AUTHORITIES

CASES

Armstrong v. Collier,

536 F.2d 72 (5th Cir. 1976) ....................................................................................................... 11

Arnold v. Garlock,

278 F.3d 426 (5th Cir. 2001) ....................................................................................................... 7

Christianson v. Colt Indus. Operating Corp.,

486 U.S. 800 (1988) .................................................................................................................... 8

De Beers Consolidated Mines v. United States,

325 U.S. 212 (1945) .................................................................................................................. 13

Dixie Carriers, Inc. v. Channel Fueling Services, Inc.,

843 F.2d 821 (5th Cir. 1988) ............................................................................................... 13, 14

In re Texas Equip. Co., Inc.,

283 B.R. 222 (Bankr. N.D. Tex. 2002) ....................................................................................... 7

Matter of Beverly Hills Bancorp,

752 F.2d 1334 (9th Cir. 1984) ................................................................................................... 11

Miles v. Great N. Ins. Co.,

634 F.3d 61 (1st Cir. 2011) ....................................................................................................... 10

Morrow v. Dillard,

580 F.2d 1284 (5th Cir. 1978) ..................................................................................................... 8

Myore v. Principi,

323 F.3d 1347 (Fed. Cir. 2003) ................................................................................................. 12

Netsphere, Inc. v. Baron,

703 F.3d 296 (5th Cir. 2012) ............................................................................................. 2, 5, 12

Public Service Company of New Hampshire,

116 B.R. 347 (Bankr. D.N.H. 1990) ......................................................................................... 15

Pusey & Jones Co. v. Hanssen,

261 U.S. 491 (1923) .................................................................................................................... 2

Ruiz v. Estelle,

650 F.2d 555 (5th Cir. 1981) ....................................................................................................... 7

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Sbicca-Del Mac, Inc. v. Milius Shoe Co.,

145 F.2d 389 (8th Cir. 1944) ..................................................................................................... 11

Silver Star Enters. v. M/V Saramacca,

19 F.3d 1008 (5th Cir. 1994) ..................................................................................................... 11

Smith v. Schmidt,

2007 U.S. Dist. LEXIS 41901, *12 (S.D. Tex June 8, 2007 ....................................................... 7

Societe Des Produits Nestle, S.A. v. Casa Helvetia, Inc.,

982 F.2d 633 (1st Cir. 1992) ..................................................................................................... 10

Swanson & Youngdale, Inc. v. Seagrave Corp.,

561 F.2d 171 (8th Cir. 1977) ..................................................................................................... 11

Talley v. United States Postal Serv.,

720 F.2d 505 (8th Cir. 1983) ..................................................................................................... 11

USPPS Ltd. v. Avery Dennison Corp.,

647 F.3d 274 (5th Cir. 2011) ....................................................................................................... 8

Zarnow v. City of Wichita Falls Tex.,

614 F.3d 161 (5th Cir. 2010) ....................................................................................................... 8

STATUTES

11 U.S.C. § 303 ............................................................................................................................. 12

28 U.S.C. § 1334 ........................................................................................................................... 13

28 U.S.C. §§ 158 ........................................................................................................................... 13

RULES

Fed. R. Bankr. P. 8015 .................................................................................................................. 17

Local Rule 7.1 ................................................................................................................................. 9

Local Rule 7.2 ................................................................................................................................. 9

OTHER AUTHORITIES

9 CHARLES A. WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND

PROCEDURE § 2577 (1971) ................................................................................................... 14

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TO THE HONORABLE SAM A. LINDSAY,

UNITED STATES DISTRICT JUDGE:

NOW COMES, Jeffrey Baron (“Baron”) and files this Objection to Pronske Goolsby &

Kathman, PC, f/k/a Pronske & Patel, P.C., Shurig Jetel Beckett Tackett, Dean Ferguson, Gary G.

Lyon, Robert Garrey, Powers Taylor, LLP, Jeffrey Hall, and David Pacione’s (together, the

“Movants” or “Petitioning Creditors”) Emergency Motion for Stay Pending Appeal (the

“Motion”) [Dkt. 56], and in support thereof would respectfully show this Court as follows:

ARGUMENT & AUTHORITIES

I. INTRODUCTION

1. After having been paid over $3 million dollars, the Petitioning Creditors are

asking this Court to reward them with a stay pending appeal—an appeal, which by the

Petitioning Creditors’ own admission, is partly necessary due to the obvious tactical mistakes

they made in attempting to collect their alleged attorney fee claims against Jeff Baron.

Prominent among these foreseeable errors in judgment was the decision to lobby for a receiver to

be appointed in Netsphere, Inc. v. Baron, pending before this Court

for the purpose of

marshaling Mr. Baron’s personal assets to pay their contingent, unliquidated, and disputed

attorney fee claims. As a result of this error, from November 24, 2010 forward, Jeffrey Baron

was involuntarily placed in “financial lockdown,” stripped of all his personal assets, including all

of his assets exempt from his creditors’ claims under Texas law—IRA accounts and 401k

accounts—and the assets of two entities owned by a trust to which he and an unconnected

diabetes research non-profit are beneficiaries, Quantec, LLC and Novo Point, LLC. Moreover,

Mr. Baron was deprived of the right to engage counsel to defend himself against the actions

Netsphere, Inc. v. Baron, Civil Action No. 3:09-cv-0988-L; in the United States United States

District Court for the Northern District of Texas, Dallas Division.

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taken by the Petitioning Creditors and the Receiver, as evidenced by email dated December 2,

2010, from the Receiver’s attorney, Barry Golden (A true and correct copy is attached as exhibit

A). Two years later, and after the payment of at least $5,200,000 in fees and expenses incurred

by the Receiver and his attorneys, funded with Baron’s assets, the Fifth Circuit found that the

appointment of the Receiver was an abuse of discretion. Netsphere, Inc. v. Baron, 703 F.3d 296,

302 (5th Cir. 2012). The Court reasoned:

A receiver may be appointed for a secured creditor who has legitimate fears his

security may be dissipated; “an unsecured simple contract creditor has, in the

absence of a statute, no substantive right, legal or equitable, in or to the property

of his debtor.” . . . Establishing a receivership to secure a pool of assets to pay

Baron’s former attorneys, who were unsecured contract creditors, was beyond the

court’s authority.” Netsphere, Inc. v. Baron, 703 F.3d 296, 308 (5th Cir. 2012)

(quoting Pusey & Jones Co. v. Hanssen, 261 U.S. 491, 497 (1923)).

2. Within two hours of the Fifth Circuit’s issuance of the Netsphere, Inc. v. Baron

opinion on December 18, 2012, the Petitioning Creditors chose to ignore the Fifth Circuit’s

admonition to liquidate their claims in state court and filed an involuntary bankruptcy proceeding

against Mr. Baron. The overarching purpose, as stated by Creditors’ counsel, Gerrit Pronske,

was to keep Mr. Baron from moving assets from the reach of Petitioning Creditors. Doc. 56, ¶

12 at 5. Specifically, Petitioning Creditors assert:

The Petitioning Creditors filed a Chapter 7 Involuntary Petition against Alleged

Debtor on the Petition Date out of concern that the Alleged Debtor might divert

assets from the jurisdiction of the United States Courts and beyond the reach of

creditors with significant claims against the Alleged Debtor.

Id.

3. However, this was precisely the abuse of process condemned by the Fifth Circuit.

Nevertheless, Petitioning Creditors intentionally took action designed to circumvent, emasculate,

and defy the decision of the Fifth Circuit even before the Court issued its Mandate. Clearly,

Petitioning Creditors (several of whom are bankruptcy lawyers) are fearful of taking their claims

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before a state court where a jury will likely reject their claims and grant Jeff Baron substantial

relief on his counterclaims—their mission was to keep Jeff Baron’s personal assets frozen and to

continue to deprive him of his “day in court,” where he might have an impartial trial by a court

and jury with respect to the attorney fee claims being asserted against him and his claims against

the attorneys.

4. To say the claims of the Petitioning Creditors were disputed is an understatement.

Petitioning Creditors were paid in full, over $3 million, in accordance with their agreements.

Some of the Petitioning Creditors even had settlement agreements with Mr. Baron that fully

settled their claims for fees against Baron.

5. Petitioning Creditors’ attempted to prove up their claims in the involuntary

proceeding by arguing the claims were “liquidated, and non-contingent” by virtue of the May 18,

2011 Fee Order. This illustrates their legitimate fear of a full blown trial on the merits. This

Court’s ruling that the May 18, 2011 Fee Order had no preclusive effect and simply applied

bedrock legal principles that Petitioning Creditors chose to ignore in their quest to continue a

freeze on Jeff Baron’s assets and keep him in financial lockdown for as long as possible.

Petitioning Creditors’ current motion ignores the equities posed by the facts in this case. All of

Jeff Baron’s assets, including assets not even the subject of dispute in the Netsphere case, were

seized, held and liquidated at great cost to Jeff Baron in an illegal receivership. Petitioning

Creditors appear to ignore that, if they had meritorious claims, they could have pursued Mr.

Baron in state court----- their lawful remedy.

. Instead, their insistence on pursuing receivership

Four of the petitioning creditors had fee disputes against Baron that were initiated, but none

received any judgments in their favor.

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and then bankruptcy has ironically resulted in payment of millions to dozens of other lawyers but

not one penny to these alleged creditors.

6. Although Petitioning Creditors’ make the “remand” versus “render” issue the

centerpiece of their complaints about this Court’s Amended Memorandum Opinion and

Judgment (Dkt. Nos. 52 and 53, respectively), they inexplicably failed to file a motion for

rehearing pursuant to Federal Rule of Bankruptcy Procedure 8015, where the Court might have

had the opportunity to correct the alleged error more expediently and efficiently than filing an

appeal to the Fifth Circuit.

If the Court grants a stay pending appeal, this decision has the

benefit to Petitioning Creditors of prolonging the litigation in the hope that Baron is unable to

simultaneously defend himself in the Fifth Circuit and the bankruptcy court without adequate

access to his own resources.

7. A motion for rehearing was clearly the Petitioning Creditors’ adequate remedy at

law, which the Petitioning Creditors could have pursued, but consciously chose not to. Instead,

the Petitioning Creditors now “throw themselves on the mercy of this Court” requesting

equitable, injunctive relief in the form of a stay, while they spend the next year to two years

appealing this Court’s Amended Memorandum Opinion and Judgment all the while liquidating

Baron’s assets in the bankruptcy court. Given the Fifth Circuit’s previous mandate and this

Court’s rulings, the real question at this juncture is: how quickly can this Court return to Mr.

Baron his personal assets and unfreeze his exempt IRA and other retirement accounts. It is not

Baron does not believe the Court erred in effectively rendering a Judgment.

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whether Mr. Baron’s assets should be tied up for another two years, or two more seconds, to

reward the Petitioning Creditors for their tactical mistakes.

8. Employing every “trick in the book,” the Petitioning Creditors have continued to

avoid and short-circuit the inevitable trial on the merits before a judge and jury in order to prove

up their attorney fee claims, an avenue where Jeff Baron might be afforded his minimum due

process rights under the Fourth and Fourteenth Amendment to the United States Constitution, his

right to a trial by jury, and his right to be represented by counsel of his choosing. However, the

cost to Jeff Baron continues to grow. Mr. Baron has been separated from his assets for over two

years, including his exempt property. His assets have been depleted by the substantial fees and

expenses of the Receiver and his counsel in excess of $5,200,000. The Fifth Circuit issued a

mandate directing a prompt return of Mr. Baron’s assets to him more than ten months ago. Yet,

this has not occurred. To the contrary, the Receiver and his attorneys continue to “rack up” fees

and expenses in a head-long effort to side with the Petitioning Creditors and deprive Mr. Baron

of his personal assets, including property exempt from creditors’ claims under Texas law.

9. The Petitioning Creditors allege in their Motion for Stay that Mr. Baron will

remove and secrete away his personal assets without a status quo stay. Yet such allegations are

not supported by any affidavits or declarations attached to the Motion for Stay, nor were such

allegations ever supported by any credible evidence. This frivolous assertion was previously

made to the Fifth Circuit, which squarely rejected Gerrit Pronske’s claim that Jeff Baron was

moving assets off shore to evade the Court’s jurisdiction; instead, holding that there was no

evidence that “any discrete assets subject to the settlement agreement were being moved beyond

With the sweep of a pen, this Court can and should sua sponte, order the Receiver to unfreeze

Jeff Baron’s exempt property IRA and Retirement Accounts within twenty-four hours.

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the reach of the court.” Netsphere, Inc. v. Baron, 703 F.3d at 307. This argument flies in the

face of the Fifth Circuit’s holding and appears to be made vexatiously to mislead this Court.

10. The Petitioning Creditors allege in their Motion for Stay that Mr. Baron will not

be harmed by the imposition of a stay pending appeal. Simply stated, this assertion ignores the

last three years of litigation designed to freeze Mr. Baron’s assets while the Petitioning Creditors

misused the receivership process to avoid state court litigation. Such a stay will unjustifiably

continue the freeze on Mr. Baron’s assets and deprive Mr. Baron of the funds he desperately

needs to defend himself against the claims of the Petitioning Creditors. Granting a stay,

however, effectively continues the freeze on Mr. Baron’s assets, which is contrary to the

mandate of the Fifth Circuit in Netsphere, Inc. v. Baron. In Netsphere, the Fifth Circuit directed

the return of Mr. Baron’s personal assets. For this reason alone, the Petitioning Creditors’

Motion should be denied.

II. MOVANTS’ PROCEDURAL DEFICIENCIES

11. Movants are all attorneys, mainly bankruptcy attorneys, and are represented by

reputable law firms. However, while Movants seemingly followed all procedural rules in their

presentations to the bankruptcy court and before other Judges of this District, Movants appear to

flaunt the rules in the way they are proceeding with their appeal.

12. In addition to the deficiencies identified in this Court’s Order at Dkt. 58, Movants

failed to discuss or otherwise Meet and Confer prior to filing their Motion as required by Local

Rule 7.1. Indeed, with this Motion, Movants failed to include the required Certificate of

Conference.

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13. Local Rule 7.1 further requires a brief to accompany a Motion for Stay, which

was also neglected by Movants, whom squeezed their arguments into a 24-page “Emergency

Motion.”

14. Movants 24-page Emergency Motion filed several weeks after this Court’s Order

also fail to include a table of contents and table of cases, as required for documents exceeding

10-pages by Local Rule 7.2.

15. Such procedural deficiencies and errant legal positions urged by Movants do little

more than deplete resources; yet, they graphically illustrate the point Baron has tried to make for

the last several years—Movants seek to obtain money they have not earned by following the

rules only when it suits them, and by making conclusory accusations that fail when closely

examined.

III. MOVANTS ARE UNLIKELY TO SUCCEED ON

THE MERITS OF THEIR APPEAL

16. The decision to grant or deny a motion for stay pending appeal lies in the sound

discretion of the court, subject to an abuse of discretion standard of review. See Arnold v.

Garlock, 278 F.3d 426, 438–39 (5th Cir. 2001). Courts in the Fifth Circuit use four factors to

evaluate a motion to stay: (1) the movant’s likelihood of success on the merits, (2) irreparable

harm to the movant if the stay is not granted, (3) substantial harm to other parties if the stay is

granted, and (4) the public interests implicated in granting or denying the stay. Id., 278 F.3d at

438–39. As correctly identified by the Trustee in opposition to Baron’s earlier Motion for Stay,

a Movant’s failure to satisfy any one of the four prongs identified herein defeats a motion to stay.

(NDTX 3:13-cv-03461-O, Doc. 9-1, pg. 4) (citing Smith v. Schmidt, 2007 U.S. Dist. LEXIS

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41901, *12 (S.D. Tex June 8, 2007) (citing In re Texas Equip. Co., Inc., 283 B.R. 222, 227

(Bankr. N.D. Tex. 2002)); see also Arnold, 278 F.3d at 438–39.

17. Thus, even if Movants raise serious legal questions and make a substantial case on

the merits, Movants must show that the remaining Ruiz equities “weigh heavily” in favor of

granting a stay. Ruiz v. Estelle, 650 F.2d 555, 565 (5th Cir. 1981).

A. Movants Erroneously Assert that the Law of the Case Is Applicable

18. In an interlocutory order, this Court suggested in a footnote that the Attorneys Fee

Order was not affected by the Fifth Circuit Court of Appeals. (Order Denying Appellant’s

Emergency Motion for Stay Pending Appeal of Order for Relief and Order Appointing Interim

Trustee, p. 4, n.1) [Dkt. 22]. Movants’ argument that the “law of the case” doctrine precluded

this Court from making a contrary finding hinges on this footnote. Movants are wrong.

19. The law of the case doctrine, as formulated in the U.S. Court of Appeals for the

Fifth Circuit, generally precludes reexamination of issues of law or fact decided on appeal, either

by a district court on remand or by the appellate court itself on a subsequent appeal. USPPS

Ltd. v. Avery Dennison Corp., 647 F.3d 274, 282 (5th Cir. 2011). Thus, Movants’ arguments are

misplaced as to scope, where the doctrine applies only to issues that were decided in a former

proceeding. Morrow v. Dillard, 580 F.2d 1284, 1290 (5th Cir. 1978). This circumstance clearly

does not apply in the instant case, where the District Court revisited its own interlocutory

order—not a final order on remand or decided on appeal to the Fifth Circuit.

20. Moreover, the law of the case doctrine does not operate to prevent a district court

from reconsidering prior rulings. While the rule yields to adequate reason, where courts are

guided to revisit prior decisions of its own or of a coordinate court in circumstances such as

where the initial decision was clearly erroneous and would work a manifest injustice, a court has

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the power to revisit prior decisions of its own in any circumstance. See Zarnow v. City of

Wichita Falls Tex., 614 F.3d 161, 171 (5th Cir. 2010); Christianson v. Colt Indus. Operating

Corp., 486 U.S. 800, 817, 831 (1988)).

21. The Fifth Circuit has, accordingly, rejected the argument that the law of the case

doctrine precludes the reversal of prior, interlocutory, orders. Zarnow, 614 F.3d at 171. Such

orders properly within the court’s jurisdiction leave it free to reconsider and reverse its decision

for any reason it deems sufficient, even in the absence of new evidence or an intervening change

in or clarification of the substantive law. Id. (addressing a district court’s decision to reverse its

summary judgment determination on remand).

22. As such, the law of the case doctrine is inapplicable to the instant case because the

Court’s footnote in a prior order was not made after the court had been divested of jurisdiction

and on remand, or otherwise by the appellate court on a subsequent appeal; Baron’s Motion for

Stay Pending Appeal of Order for Relief and Order Appointing Interim Trustee was an

interlocutory matter still under the Court’s jurisdiction.

B. No Remand Is Required

23. Movants argue that a reversal on a summary judgment would normally yield a

remand for trial on the merits, is only partially true. The involuntary bankruptcy proceedings can

hardly be equated to a “normal” proceeding given the history of the case and the fact that jury

trials and other due process rights are routinely accorded debtors in state court

24. The bankruptcy code is clear—a contested involuntary petition can survive a

motion to dismiss only if the petitioning creditors’ claims are not contingent as to liability or the

Indeed, Baron’s Motion for Reconsideration was pending at the time the Order for Relief was

reversed

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subject of a bona fide dispute. 11 U.S.C. § 303(b)(1), (h)(1). If the alleged debtor controverts

the Petitioning Creditors’ claims in a timely fashion, the bankruptcy court must decide whether

the creditors’ claims are the subject of a bona fide dispute and, if they are, must dismiss the

petition. The standard for determining whether there is a bona fide dispute is analogous to a

reverse summary judgment standard. If there is a genuine issue of a material fact that bears upon

Baron’s liability, then the petition must be dismissed. The bankruptcy court erred, as a matter of

law, when it denied Baron’s Motion to Dismiss, and this Court correctly reversed the Order for

Relief and interlocutory orders, at Baron’s urging, on appeal.

25. In addition, the proceedings in the bankruptcy court support a determination that

no remand should be issued. Unlike other proceedings, the bankruptcy court is a court of equity

where the judge alone determines both fact and law in preparing its findings and final orders.

Here, with respect to liability and bona fide dispute issues, the bankruptcy court judge considered

the same facts and evidence for both the Summary Judgment and Order for Relief.

26. This Court sits as an appellate court to the bankruptcy court. 28 U.S.C. §§ 158

and 1334. Although appellate courts are generally reluctant to decide mixed questions of law

and fact in the first instance, there are exceptions that apply in the instant case. It is well

established that appellate courts will decide mixed questions of fact and law, where, as in the

instant case, no further development of facts is required in order to resolve the mixed question

and where a remand is neither necessary nor prudent. Miles v. Great N. Ins. Co., 634 F.3d 61, 66

(1st Cir. 2011) (citations omitted).

27. In Miles, the First Circuit quoted its decision in Societe Des Produits Nestle, S.A.

v. Casa Helvetia, Inc. Id. at 66–67 which has particular relevance to this case.

[I]it is not ordinarily the province of appellate courts to make findings of fact or to

resolve, in the first instance, mixed questions of law and fact. Yet, where only

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one resolution of a predominantly fact bound question would, on a full record, be

sustainable, courts of appeals can, and often should, decline to remand where

there has been an error committed.”

Societe Des Produits Nestle, S.A. v. Casa Helvetia, Inc., 982 F.2d 633, 642 (1st

Cir. 1992) (emphasis supplied).

The Miles Court declined “to remand where, once the court of appeals decided the correct rule of

law, the district court’s preexisting findings of fact rendered the result obvious.” Miles, 634 F.3d

at 67 (citing Societe Des Produits, 982 F.2d at 642).

28. The Fifth Circuit essentially adopted the same standard. When the court is

“sufficiently informed as to the district court’s rationale, and the record contains undisputed facts

which support the court’s ruling, a remand for findings of fact and conclusions of law is

unnecessary.” Silver Star Enters. v. M/V Saramacca, 19 F.3d 1008, 1014 n. 11 (5th Cir. 1994)

(citing Armstrong v. Collier, 536 F.2d 72, 77 (5th Cir. 1976) (“stating that a remand for failure to

comply with Fed.R.Civ.P. 52(a) is not required if a complete understanding of the issues may be

had without the aid of separate findings”); 9 CHARLES A. WRIGHT & ARTHUR R. MILLER,

FEDERAL PRACTICE AND PROCEDURE § 2577 (1971)).

29. The Ninth and Eighth Circuits have rendered opinions with similar language. See,

e.g., Matter of Beverly Hills Bancorp, 752 F.2d 1334, 1338 (9th Cir. 1984) (citations omitted)

(stating “[a]lthough remand generally is required for findings of fact, remand is not necessary

when the trial court fails to make such findings and the facts in the record are undisputed”);

Talley v. United States Postal Serv., 720 F.2d 505, 508 (8th Cir. 1983) (citing Swanson &

Youngdale, Inc. v. Seagrave Corp., 561 F.2d 171, 173 (8th Cir. 1977); Sbicca-Del Mac, Inc. v.

Milius Shoe Co., 145 F.2d 389, 400 (8th Cir. 1944); Armstrong, 536 F.2d at 77 (stating

“[a]lthough Rule 52 of the Federal Rules of Civil Procedure requires the district court in a non-

jury case to make findings of fact and state separately its conclusions of law, compliance with

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the rule is not a jurisdictional requirement for appeal. The appellate court may decide an issue

without remand if ‘the record itself sufficiently informs the court of the basis for the trial court’s

decision on the material issue’ … or when the facts with respect to a particular issue are

undisputed”).

30. The whole argument over whether this Court should have remanded the case to

the bankruptcy court is, by the Petitioning Creditors’ own admission, largely moot. In their

Motion, the Petitioning Creditors summarize evidence they offered at the trial regarding the fees

that were allegedly owed to them, allegedly giving the Petitioning Creditors standing under 11

U.S.C. § 303. (Mot. pp. 7–10). This evidence was in addition to the evidence supporting the

Petitioning Creditors’ summary judgment. Because Petitioning Creditors had an opportunity to

present this evidence, in addition to relying on a partial summary judgment, the Petitioning

Creditors are not entitled to have the case remanded for a “third bite” at the proverbial apple.

See Myore v. Principi, 323 F.3d 1347, 1352–53 (Fed. Cir. 2003) (insufficient evidence presented

to overcome presumption warrants reversal, without a remand).

31. Thus, if the facts are undisputed and the lower court’s rationale is sufficiently

conveyed, this Court’s remand on a discrete issue concerning Movant’s summary judgment

motion is unnecessary.

IV. MOVANTS FACE NO IRREPARABLE HARM

32. Citing no law and providing no evidence, Movants continue to rehash old

arguments that were presented and rejected by the Fifth Circuit in Baron’s Receivership,

claiming they face irreparable harm because they believe Baron has a history of “removing [his

own] assets from the jurisdiction of the United States…” (Mot. at ¶ 46). As discussed above,

this frivolous assertion was previously made and rejected by the Fifth Circuit. Netsphere, Inc. v.

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Baron, 703 F.3d at 307. Moreover, Baron has neither been accused nor convicted of any crime.

He is a U.S. citizen with property rights that should not be held and slowly depleted by the

proverbial greedy lawyers.

33. Without presenting anything substantive, Movants’ conclusory statements

concerning Barons trusts are just that—conclusory and defamatory statements that are not

sufficient to satisfy their burden to show irreparable harm. This is particularly true when

Movants have no standing or claim to Baron’s property or the trusts. Moreover, this Court held,

as a matter of law, that it is Baron whom would suffer irreparable harm if he is forced to continue

in an involuntary bankruptcy while an appeal is pending, holding “[t]he Court finds that

Appellant [Baron] has established that he may suffer irreparable harm … because the liquidation

of his assets may be non-reversible.” (Dist. Ct. Order Denying Baron’s Motion for Stay, 3:13-

cv-03461-O, Doc. 22 at pg. 14).

V. BARON FACES SUBSTANTIAL HARM IF STAY IS GRANTED

34. “The general federal rule of equity is that a court may not reach a defendant’s

assets unrelated to the underlying litigation and freeze them so that they may be preserved to

satisfy a potential money judgment.” Dixie Carriers, Inc. v. Channel Fueling Services, Inc., 843

F.2d 821, 824 (5th Cir. 1988) (citing De Beers Consolidated Mines v. United States, 325 U.S.

212 (1945) (civil action under RICO for treble damages).

35. Despite this rule, Movants have sought, and have been mostly successful, in

divesting Baron of assets to defend against their vexatious litigation tactics since the beginning

of the illegal receivership. Baron lost his freedom and millions of dollars to the Receiver’s

lawyers and others in the illegal receivership. During this period, Baron was inexplicably told by

the receiver that he would be held in contempt and ostensibly jailed if he dared to hire a lawyer

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to fight against the receivership. Baron persevered and ultimately defeated the Receivership as

an abuse of discretion.Ironically, the receivership was recommended by the same bankruptcy

judge that issued Baron’s Order for Relief to involuntary bankruptcyThen, before the mandate

issued in Netsphere, Inc. v. Baron, the Petitioning Creditors caused Baron’s assets to continue to

be ”locked down” and frozen in a bankruptcy proceeding which this Court ruled was improper.

36. If this Court has determined that Baron faces irreparable harm if forced into

bankruptcy while an appeal is pending, it follows that he would suffer substantial harm,

particularly where here Petitioning Creditors have failed to file a bond either when the forced

Baron into bankruptcy or on appeal.

37. At this juncture, the Petitioning Creditors are asking this Court to “temporarily”

maintain this unacceptable status quo so they may spend a year, more or less,

appealing this

case to the Fifth Circuit. As set out in their Motion, the Petitioning Creditors allegedly require a

stay for the simple reason that they elected not to file a motion for rehearing during the 14 days

this Court still has jurisdiction to modify the judgment. See Fed. R. Bankr. P. 8015 (regarding the

time for filing motions for rehearing). If a motion for rehearing were filed, the status quo that

has existed since the date of the Order for Relief would have continued as a matter of course.

Instead, the Court is now powerless to modify its Judgment and order the remand that the

Petitioning Creditors desire. If a remand is what the Petitioning Creditors really wanted, the only

place they can urge such relief is the Fifth Circuit.

As of September 30, 2013, the median time from a notice of appeal to disposition at the Fifth

Circuit was 9.3 months. See Administrative Office of the U.S. Courts, U.S. Court of Appeals –

Judical Caseload Profile at 14, available at http://www.uscourts.gov/viewer.aspx?doc=/

uscourts/Statistics/FederalCourtManagementStatistics/2013/appeals-fcms-profiles-september-

2013.pdf&page=13.

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38. The Petitioning Creditors should not be rewarded for a litigation strategy,

mistake, or calculated decision that will now entail an appeal to the Fifth Circuit when they could

have, but failed to aske this Court for a remand. If the Petitioning Creditors are allowed to

continue to deprive Baron of his property rights, Baron will again face substantial harm, and

probably complete dissipation of his assets by the receiver and involuntary bankruptcy trustee,

harm not only to his property, but also to his ailing health

. Such harm would be totally

unjustified. See Dixie Carriers, Inc., 843 F.2d at 824.

39. Moreover, given the reversal of the Order of Relief, Baron may seek attorney fees

and damages for the more than two hundred thousand dollars in attorney fees he incurred in

fighting the involuntary bankruptcy. A stay would preclude Baron from expeditiously collecting

these funds and, as asserted by the Trustee in an earlier proceeding, “any suggestion that further

delay in payment causes no harm fails to take into account the time value of money.” See Public

Service Company of New Hampshire, 116 B.R. 347, 350 (Bankr. D.N.H. 1990) (“…delay caused

to creditors receiving their payments is also significant harm warranting denial of a stay.”).”

(Trustee Resp., Doc. 9-1, pg. 9).

VI. GRANTING A STAY WILL NOT SERVE THE PUBLIC INTEREST

40. The burden rests squarely on Movants to establish that granting a stay will serve

the public interest. However, Movants have not made a sufficient showing of the public interest

asserted in their Motion. After having been collectively paid in excess of $3.1 million prior to the

initiation of the illegal receivership, Movants are hard pressed to show that the public interest

Baron has submitted affidavits in the District and bankruptcy court with supporting doctor

reports.

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would be served by allowing them to continue to milk a cash cow over disputed claims until it

runs completely dry.

41. This Court correctly gave deference to the intent and mandate of the Fifth Circuit

Court of Appeals, which clearly articulated a public interest in the Netsphere decision—to

expeditiously return assets wrongfully seized in a receivership to the rightful owners. Petitioning

Creditors’ back door attempt to circumvent the higher court’s decision serves no public interest.

Mr. Baron has been deprived of the use of his assets long enough. Further delay will simply

continue a process of destroying assets that were built by Mr. Baron’s efforts, and which have

been needlessly squandered in repeated, vexatious attempts to freeze his assets and extract a

litigation advantage in a bankruptcy court that clearly advocated that Mr. Baron’s assets be

frozen and sold off to pay lawyer claims despite the clear mandate of the Fifth Circuit. Although

a court of equity, the power of bankruptcy courts must, at some point, have limits. It is in the

public interest to apply the law of the case doctrine, or principles of collateral estoppel where, as

here, the Fifth Circuit held that Jeffrey Baron should be released from “financial lockdown.”

VII. CONCLUSION

The Fifth Circuit mandated that Baron’s assets be given back to him

expeditiously. The Petitioning Creditors have done everything in their power to frustrate

implementation of the mandate. This Court should, once and for all, inform the

Petitioning Creditors that the mandate of the Fifth Circuit will be implemented. Based on

the foregoing, Jeffrey Baron Objects to the Movants’ Motion for Stay and prays that this

Court overrules the Motion and grant Baron any further relief to which he may show

himself justly entitled.

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/s/ M. Tayari Garrett

Dated: January 31, 2014

Respectfully submitted,

TAYARI LAW PLLC

By: ___________________________

Mpatanishi Tayari Garrett, Esq.

Texas Bar No. 24073090

100 Crescent Court, Ste. 700

Dallas, TX 75201

Tel. (214) 459-8266

Fax. (214) 764-7289

And

Stephen R. Cochell

The Cochell Law Firm, P.C.

7026 Old Katy Road, Ste. 259

Houston, Texas 77096

Telephone: (713)980-8796

Facsimile: (214) 980-1179

srcochell@cochellfirm.com

Attorneys for Jeffrey Baron on Appeal

CERTIFICATE OF SERVICE

The undersigned hereby certifies that a true and correct copy of the foregoing was served

via ECF on all parties receiving ECF Notices in the above-captioned case on January 31, 2014.

_/s/ Stephen R. Cochell

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