No.
In the
United States Court of Appeals
for the Fifth Circuit
▬▬▬▬▬▬▬▬▬▬▬▬
In re: NOVO POINT LLC,
Petitioner
▬▬▬▬▬▬▬▬▬▬▬▬
NOVO POINT LLC,
Petitioner
v.
DANIEL J. SHERMAN,
Real Party In Interest
▬▬▬▬▬▬▬▬▬▬▬▬
On Petition for Writ of Mandamus to
The United States Bankruptcy Court
Northern District of Texas, Dallas Division
Bankruptcy Case No. 09-34784-sgj11
Honorable Stacey G. C. Jernigan, Judge Presiding
and
Tawana C. Marshall, Clerk of Court
▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬
PETITION FOR WRIT OF MANDAMUS
▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬
Gary N. Schepps
Texas State Bar No. 00791608
5400 LBJ Freeway, Suite 1200
Dallas, Texas 75240
(972) 200-0000 - Telephone
(972) 200-0535 - Facsimile
Email: legal@schepps.net
For Petitioner
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CERTIFICATE OF INTERESTED PERSONS
The undersigned counsel of record certifies that the following
listed persons and entities have an interest in the outcome of this case.
These representations are made in order that the judges of this Court
may evaluate possible disqualification or recusal.
1. PRINCIPAL PARTIES IN THE BANKRUPTCY CASE
a. DEBTOR: Ondova Ltd.
b. Beneficial Equity holder of Debtor: Jeffrey Baron
c. Chapter 11 Trustee: Daniel J. Sherman
2. PARTIES OF INTEREST IN THIS PETITION
a. Petitioner: Novo Point LLC
b. Real Party in Interest: Daniel J. Sherman
c. Respondents:
a. Honorable Stacey G. C. Jernigan
b. Tawana C. Marshall, Clerk of Court
3. ATTORNEYS & THEIR PARTIES
Daniel J. Sherman
representing Daniel J. Sherman (Trustee)
Sherman & Yaquinto
509 N. Montclair Ave.
Dallas, TX 75208-5498
(214) 942-5502
djsherman@syllp.com
Jay Ong
representing Daniel J. Sherman Trustee Munsch Hardt Kopf Harr, P.C.
& Lee Jacob Pannier
Munsch, Hardt, Kopf & Harr, P.C.
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3800 Lincoln Plaza
500 N Akard St
Dallas, TX 75201
(214) 855-7500
Raymond J. Urbanik
representing Daniel J. Sherman; Munsch Hardt Kopf & Harr, P.C.
Munsch, Hardt, Kopf & Harr PC
500 N. Akard St., Ste. 3800
Dallas, TX 75201-6659
214-855-7590
214-978-4374 (fax)
rurbanik@munsch.com
Charla Aldous
representing Aldous Law Firm
Aldous Law Firm
2305 Cedar Springs, Suite 200
Dallas, TX 75201
214-526-5595
Mark Edward Andrews
representing Grupo Andrea, S.A. de C.V.
Cox Smith Matthews Incorporated
1201 Elm Street, Suite 3300
Dallas, TX 75270
(214)698-7800
(214)698-7899 (fax)
Stanley D. Broome
representingJeffrey Baron
The Broome Law Firm, PLLC
105 Decker Court
Suite 850
Irving, TX 75062
(214)574-7500
(214)574-7501 (fax)
sbroome@broomelegal.com
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Gerrit M. Pronske
representingPronske & Patel, PC
Pronske & Patel, P.C.
2200 Ross Avenue
Suite 5350
Dallas, TX 75201
214 658-6500
214-658-6509 (fax)
Craig Alan Capua
representing Iguana Consulting, LLC, Novo Point, LLC, Quantec, LLC
West & Associates, LLP
320 South R.L. Thornton Fwy.,
Ste. 300
Dallas, TX 75203
(214) 941-1881
(214) 941-1399 (fax)
craig.c@westllp.com
Jeanne Crandall
representing Reyna Hinds & Crandall
Reyna, Hinds & Crandall
1201 Elm Street, Suite 3850
Dallas, TX 75270
(214) 760-8100 x103
(214) 760-8109 (fax)
jeannecrandall@sbcglobal.net
Angela B. Degeyter
representing VeriSign, Inc.
Vinson & Elkins, LLP
2001 Ross Ave., Ste. 3700
Dallas, TX 75201-2975
(214) 220-7763
(214) 999-7763 (fax)
adegeyter@velaw.com
James Michael Eckels
Purportedly representing “Quantec, LLC Novo Point, LLC, The Village Trust”
7505 John Carpenter Freeway
Dallas, TX 75247
(972) 439-1882
(817) 704-4489 (fax)
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jamesmeckels@gmail.com
William Lloyd Foreman
representing Owens, Clary & Aiken, LLP
Owens, Clary & Aiken, L.L.P.
700 N. Pearl St., No. 1600
Dallas, TX 75201
(214)698-2107
214-698-2121 (fax)
wforeman@oca-law.com
Michael A. Grow
representing Grupo Andrea, S.A. de C.V.
Arent Fox LLP
1050 Connecticut Ave, NW
Washington, DC 20036
202-857-6395
Michael S. Haynes
representing Peter S. Vogel
Akin Gump Strauss
Hauer & Feld LLP
1700 Pacific Avenue
Suite 4100
Dallas, TX 75201
(214)969-2845
(214)969-4343 (fax)
mhaynes@akingump.com
Melissa S. Hayward
representing Manila Industries, Inc. ; Netsphere, Inc.; Franklin
Skierski Lovall Hayward LLP
Franklin Skierski Lovall Hayward LLP
10501 N. Central Expry, Ste. 106
Dallas, TX 75231
972-755-7104
972-755-7114 (fax)
MHayward@FSLHlaw.com
Edwin Paul Keiffer
representing Ondova Limited Company; Wright Ginsberg Brusilow, P.C.
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Wright Ginsberg Brusilow P.C.
Republic Center, Suite 4150
325 North St. Paul Street
Dallas, TX 75201
(214) 651-6517
(214) 744-2615 (fax)
pkeiffer@wgblawfirm.com
Bradley Clay Knapp
representing Locke Lord Bissell & Liddell LLP
Locke Lord Bissell & Liddell
2200 Ross Avenue, Suite 2200
Dallas, TX 75201
(214)740-8586
(214)756-8586 (fax)
bknapp@lockelord.com
Ryan Kenneth Lurich
representingFriedman & Feiger, L.L.P.
Friedman & Feiger, L.L.P.
5301 Spring Valley Rd. Ste 200
Dallas, TX 75254
(972) 788-1400
(972) 788-2667 (fax)
rlurich@fflawoffice.com
Gary G. Lyon
representing Gary G. Lyon
Gary G. Lyon, Attorney at Law
P.O. Box 1227
Anna, TX 75409-1227
972-977-7221
214-831-0411 (fax)
glyon.attorney@gmail.com
Dennis Oliver Olson
representing Novo Point, LLC
Olson, Nicoud & Gueck, LLP
1201 Main Street, Suite 2470
Dallas, TX 75202
(214) 979-7300
(214) 979-7301 (fax)
denniso@dallas-law.com
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Franklin H. Perry
Representing Payne and Blanchard, LLP; HCB, LLC; Marshden, LLC;
Realty Investment Management, LLC; Denis Kleinfeld
Payne and Blanchard, LLP
Plaza of the Americas
700 N. Pearl St.
Ste 500, North Tower
Dallas, TX 75201-7424
Patrick W. Powers
representing Powers Taylor LLP
Cash Powers Taylor, LLP
Powers Taylor LLP
8150 N. Central Expressway, Suite 1575
Dallas, TX 75206
(214) 239-8900
(214) 239-8901 (fax)
patrick@cptlawfirm.com
Jeffrey H. Rasansky
representing Rasansky Law Firm
Rasansky Law Firm
2525 McKinnon, Suite 725
Dallas, TX 75201
214-651-6100
rwolf@jrlawfirm.com
David D. Ritter
representing Grupo Andrea, S.A. de C.V.
Kane, Russell, Coleman & Logan
3700 Thanksgiving Tower
1601 Elm St.
Dallas, TX 75201-7207
(214)777-4200
(214)777-0049 (fax)
dritter@krcl.com
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Alec P. Rosenberg
representing Grupo Andrea, S.A. de C.V.
Arent Fox LLP
1050 Connecticut Ave N.W.
Washington, DC 20036
202-857-6395
Deirdre B. Ruckman
representing Peter S. Vogel
Gardere,Wynne & Sewell
1601 Elm St., Suite 3000
Dallas, TX 75201
(214) 999-4250
(214) 999-3250 (fax)
druckman@gardere.com
Eric Lopez Schnabel
representing VeriSign, Inc.
Dorsey & Witney (Delaware) LLP
300 Delaware Ave., Ste 1010
Wilmington, DE 19801
302-425-7171
302-425-7175 (fax)
Doug D. Skierski
representing Manila Industries, Inc.; Netsphere, Inc.;
Franklin Skierski Lovall Hayward LLP
10501 N. Central Expwy, Suite 106
Dallas, TX 75231
(972) 755-7100
(972) 755-7110 (fax)
dskierski@fslhlaw.com
Eric J. Taube
representing Asia Trust Limited, as Trustee of The, Village Trust;
Iguana Consulting, LLC; Novo Point, Mark C. Taylor LLC; Quantec,
LLC;Hohmann, Taube & Summers, L.L.P
Hohmann. Taube & Summers, L.L.P.
100 Congress Ave., 18th Floor
Austin, TX 78701
512-472-5997
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512-472-5248 (fax)
erict@hts-law.com,markt@hts-law.com,sherris@hts-law.com,annmariej@hts-law.com
Martin Keith Thomas
purportedly representing Jeffrey Baron
Thomas & Sobol
P.O. Box 36528
Dallas, TX 75235
214-951-9466
214-951-9007 (fax)
thomas12@swbell.net
Gary N. Schepps
Drawer 670804
Dallas, Texas 75367
(972) 200-0000 - Telephone
(972) 200-0535 - Facsimile
legal@schepps.net
For Petitioner
CERTIFIED BY: /s/ Gary N. Schepps
Gary N. Schepps
COUNSEL FOR PETITIONER
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TABLE OF CONTENTS
CERTIFICATE OF INTERESTED PERSONS .......................................... 3
TABLE OF CONTENTS................................................................................ 11
TABLE OF AUTHORITIES ......................................................................... 14
RELIEF SOUGHT.......................................................................................... 18
(1) The Clerk of the Bankruptcy Court of the Northern District of
Texas, Dallas Division to process and deliver to the U.S. District
Clerk for the Northern District of Texas for docketing and random
assignment to a District Court, the appeals taken pursuant to the
following notices of appeal filed in Bankruptcy Case 09-34784-sgj11:..........18
a. Notice of Appeal [DE # 610], filed 8/16/11;................................................18
b. Notice of Appeal [DE # 612], filed 8/18/11;................................................18
c. Notice of Appeal [DE # 613], filed 8/18/11; and ........................................18
d. Amended Notice of Appeal [DE # 614], filed 8/18/11. ..............................18
(2) The Bankruptcy Judge to Vacate the Bankruptcy Judge’s
orders striking the above listed Notices of Appeal and Ordering
counsel for the Petitioner to Show Cause why they should not be
sanctioned and held in Contempt for appealing orders of the
Bankruptcy Judge...............................................................................................18
STATEMENT OF THE FACTS.................................................................... 19
The Bankruptcy Court Proceedings....................................................... 19
Novo Point LLC, not the debtor Ondova, owns the domain
name asset “mondial.com”...................................................................... 19
The Value of “Mondial.com” is Substantial........................................... 21
Novo Point LLC and the Vogel ‘Receivership’....................................... 22
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REASONS WHY THE WRIT SHOULD ISSUE ........................................ 31
ISSUE 1: Notices of Appeal were timely filed from decisions of the
Bankruptcy Court. The right to file such notices is granted
pursuant Federal Rule of Bankruptcy Procedure 8001, and
29 U.S.C. §158. The Bankruptcy Court Judge found (without a
noticed hearing) that the appeals were not properly authorized, and
struck the notices of appeal from her orders. The Bankruptcy Clerk
has accordingly refused to process the appeals or docket them with
the District Clerk. The Bankruptcy Judge, however, lacks both the
authority and jurisdiction to strike the notices of appeal or to
otherwise prevent the filing of appeals from her orders.................................31
ISSUE 2: Bankruptcy Court Judges are not Article III judges and
the right to seek appeal from the orders of a Bankruptcy Court
Judge is fundamental to the constitutionality of proceedings before
the Bankruptcy Court. Further, the threat of imposition of a
penalty for having pursued a right of appeal is a violation of due
process of law. The Bankruptcy Judge has ordered attorneys not to
appeal her orders and has cited the attorneys who filed notices of
appeal from her orders to appear at contempt hearings for having
appealed her orders. In order to protect the integrity of the
appellate process, litigants and their counsel must be free of
apprehension of retaliation and sanction from the Bankruptcy
Judge in exercising their right to appeal from orders of the
Bankruptcy Court...............................................................................................33
A. The Bankruptcy Court has Attempted to Divest Article III
Courts of their Supervisory Jurisdiction Over the Bankruptcy
Court’s Orders ......................................................................................... 33
B. The Bankruptcy Court’s Attempt to Penalize a Party for
Appealing its Orders is also a Violation of Due Process........................ 35
ISSUE 3: This Honorable Court has authority to issue the
requested writ. ....................................................................................................37
PRAYER........................................................................................................... 38
a. Notice of Appeal [DE # 610], filed 8/16/11;................................................38
b. Notice of Appeal [DE # 612], filed 8/18/11;................................................38
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c. Notice of Appeal [DE # 613], filed 8/18/11; and ........................................38
d. Amended Notice of Appeal [DE # 614], filed 8/18/11. ..............................38
CERTIFICATE OF COMPLIANCE............................................................ 40
CERTIFICATE OF SERVICE ..................................................................... 40
EXHIBITS........................................................................................................ 41
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TABLE OF AUTHORITIES
FEDERAL CASES
Armstrong v. Manzo,
380 U.S. 545, 552 (1965) ..................................................................................29
Boddie v. Connecticut,
401 U.S. 371, 379 (1971) ..................................................................................29
Booth v. Clark,
58 U.S. 322, 333, 17 How. 322, 15 L.Ed. 164 (1854)........................................30
Cochrane v. WF Potts Son & Co.,
47 F.2d 1026, 1029 (5th Cir. 1931)....................................................................28
Cooter & Gell v. Hartmarx Corp.,
496 U.S. 384, 407-408 (1990) ...........................................................................36
Gannett Co. v. DePasquale,
443 U.S. 368, 412 (1979) ..................................................................................29
Goss v. Lopez,
419 U.S. 565, 579 (1975) ..................................................................................29
Griggs v. Provident Consumer Discount Co.,
459 U.S. 56, 58 (1982) ......................................................................................31
Hardwick v. Doolittle,
558 F.2d 292, 299-300 (5th Cir. 1977) ..............................................................36
Hogg v. United States,
411 F.2d 578, 579-580 (6th Cir. 1969) ..............................................................31
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In re Transtexas Gas Corp.,
303 F.3d 571, 579 (5th Cir. 2002)................................................................31, 35
Landy v. Federal Deposit Insurance Corporation,
486 F.2d 139 (3rd Cir. 1973).............................................................................30
Matter of Statistical Tabulating Corp., Inc.,
60 F.3d 1286, 1289 (7th Cir. 1995)....................................................................35
Moses H. Cone Memorial Hospital v. Mercury Constr. Corp.,
460 U.S. 1, 18 (1983) ........................................................................................37
Myers v. Collins,
8 F.3d 249, 252 fn 4 (5th Cir. 1993)...................................................................32
North Carolina v. Pearce,
395 U.S. 711, 724 (1969) ............................................................................35, 36
Northern Pipeline Constr. Co. v. Marathon Pipe Line Co.,
458 US 50, 81....................................................................................................33
Pennoyer v. Neff,
95 U.S. 714, 737 (1878) ....................................................................................29
Phillips v. Vandygriff,
711 F.2d 1217, 1227 (5th Cir. 1983)..................................................................29
Registration Control Systems v. Compusystems, Inc.,
922 F.2d 805, 807 (Federal Cir. 1990)...............................................................29
Securities & Exchg. Com'n v. Spence & Green Chemical,
612 F.2d 896, 903 (5th Cir. 1980)......................................................................30
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Stern v. Marshall,
131 S.Ct. 2594...................................................................................................33
United States v. Krezdorn,
718 F.2d 1360, 1363 (5th Cir. 1983)..................................................................32
Webster v. Sowders,
846 F.2d 1032, 1040 (6th Cir. 1988)..................................................................36
World-Wide Volkswagen Corp. v. Woodson,
444 U.S. 286, 291 (1980) ..................................................................................30
FEDERAL STATUTES
28 U.S.C. §2075....................................................................................................32
28. U.S.C. §158 ..............................................................................................32, 34
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ISSUES PRESENTED
ISSUE 1: Notices of Appeal were timely filed from decisions of the
Bankruptcy Court. The right to file such notices is granted
pursuant Federal Rule of Bankruptcy Procedure 8001, and
29 U.S.C. §158. The Bankruptcy Court Judge found (without a
noticed hearing) that the appeals were not properly authorized, and
struck the notices of appeal from her orders. The Bankruptcy Clerk
has accordingly refused to process the appeals or docket them with
the District Clerk. The Bankruptcy Judge, however, lacks both the
authority and jurisdiction to strike the notices of appeal or to
otherwise prevent the filing of appeals from her orders.
ISSUE 2: Bankruptcy Court Judges are not Article III judges and
the right to seek appeal from the orders of a Bankruptcy Court
Judge is fundamental to the constitutionality of proceedings before
the Bankruptcy Court. Further, the threat of imposition of a
penalty for having pursued a right of appeal is a violation of due
process of law. The Bankruptcy Judge has ordered attorneys not to
appeal her orders and has cited the attorneys who filed notices of
appeal from her orders to appear at contempt hearings for having
appealed her orders. In order to protect the integrity of the
appellate process, litigants and their counsel must be free of
apprehension of retaliation and sanction from the Bankruptcy
Judge in exercising their right to appeal from orders of the
Bankruptcy Court.
ISSUE 3: This Honorable Court has authority to issue the
requested writ.
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RELIEF SOUGHT
The Petitioner, Novo Point, LLC, a limited liability company
chartered pursuant to laws of the Cook Islands, respectfully petitions
the Justices of this Honorable Court to issue a Writ of Mandamus
(requested by May 15, 2012) jointly and in the alternative directing:
(1) The Clerk of the Bankruptcy Court of the Northern District
of Texas, Dallas Division to process and deliver to the U.S.
District Clerk for the Northern District of Texas for
docketing and random assignment to a District Court, the
appeals taken pursuant to the following notices of appeal
filed in Bankruptcy Case 09-34784-sgj11:
a. Notice of Appeal [DE # 610], filed 8/16/11;
b. Notice of Appeal [DE # 612], filed 8/18/11;
c. Notice of Appeal [DE # 613], filed 8/18/11; and
d. Amended Notice of Appeal [DE # 614], filed 8/18/11.
(2) The Bankruptcy Judge to Vacate the Bankruptcy Judge’s
orders striking the above listed Notices of Appeal and
Ordering counsel for the Petitioner to Show Cause why they
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should not be sanctioned and held in Contempt for appealing
orders of the Bankruptcy Judge.
STATEMENT OF THE FACTS
The Bankruptcy Court Proceedings
The Bankruptcy Court has attempted to prevent appellate review
of a series of its orders regarding the sale of property by ordering [DE #
648] that the notices of appeal from its orders be stricken. Because the
Bankruptcy Court has ordered the appeals stricken, mandamus is
necessary.
The stricken appeals seek review of orders of the Bankruptcy
Court relating to the liquidation of a substantial asset not owned by the
Ondova bankruptcy estate, as follows:
Novo Point LLC, not the debtor Ondova, owns the
domain name asset “mondial.com”
As a matter of law, Novo Point LLC owns the domain name
“mondial.com”. The chain of title to the domain name discussed briefly
below. On December 30, 2005, Ondova Limited Company (“Ondova”)
owned the domain name and transferred it, along with all other domain
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names it owned not then in litigation, to Macadamia Management, LLC
(“Macadamia”). Pursuant to the terms and conditions of the
Assignment, Ondova conveyed all right, title and interest which it had
in “All domain names owned by Assignor on December 29, 2005, as
registrant, less those domain names that are currently subject to active
claims ...” The domain name mondial.com was registered with Ondova
Limited Company before December 29, 2005 and was not then subject
to any active claim against Ondova. Accordingly, the domain name was
conveyed pursuant to the Assignment from Ondova to Macadamia on
December 30, 2005, and Ondova has no ownership interest in this
name.
Macadamia, a US Virgin Islands limited liability company, filed a
Change of Name Certificate with the Secretary of State's office of the
US Virgin Islands on March 10, 2006, pursuant to which it changed its
name to Blue Horizon Limited Liability Company (“Blue Horizon”).
Novo Point LLC is the successor in interest to all Blue Horizon domain
names pursuant to the Mutual Settlement and Release Agreement
which was approved by the Bankruptcy Court on or about July 28, 2010
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and which became a final Order on or about August 28, 2010 (“the
Settlement Agreement”). Pursuant to the Settlement Agreement,
Ondova and the Trustee quitclaimed “any interest in any and all
domain names that were previously registered through Ondova,
exclusive of the Even Group Portfolio, the Odd Group Portfolio, and any
domain name not registered through or at Ondova as of February 22,
2010, pokerstar.com and servers.com and the Excluded Disputed
Domains.” As Ondova had previously assigned all of its right, title and
interest in these names, neither it nor the Trustee had any ownership
interest to quitclaim in such names. Accordingly, ownership was
transferred to NovoPoint LLC by virtue of the quitclaim from Blue
Horizon as a part of the Global Settlement Agreement.
The Value of “Mondial.com” is Substantial
In Europe, and much of the world, “Mondial” means the World
Cup, which is equivalent to something along the line of the Super Bowl
and Olympics combined. Accordingly, the domain name has been
appraised in value as high as $6,000,000.00.
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Novo Point LLC and the Vogel ‘Receivership’
The overall background of the Vogel ‘receivership’ is as follows:
1
(1) The Ondova Chapter 11 bankruptcy Trustee, Sherman, induced
Jeffrey Baron, the equity owner of Ondova, to fund the Ondova
Bankruptcy Estate with an approximate net three million
Dollars by promising to immediately pay off all the creditor
claims and return Ondova to Baron with around $1 million
Dollars in the bank and all the non-cash assets intact. In the
words of Sherman’s counsel: “The negotiation was to pay the
debts and give the keys back to Mr. Baron. But that didn't
happen.” R. 4598:11-12.
(2) Instead of using the funding provided by Baron to pay off
Ondova’s creditors and close the bankruptcy, Sherman started
using the Baron funding to run up hundreds of thousands of
Dollars in attorneys’ fees.
(3) Using the normal, legally proper channels, Baron objected by
having his counsel file a formal objection with the Bankruptcy
1
The legal authority discussed in this section is presented as background relating
to various positions asserted by the relevant parties and is not offered as argument
for the underlying relief sought in this Petition.
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Court. Instead of using the normal, legally proper channels to
reply to Baron’s objection, Sherman went to work behind closed
doors at the federal courthouse. Within three business days of
Baron’s objection, Sherman privately consulted ex parte with the
Special Master Peter Vogel over in the District Court, to have the
District Judge act in secret, without notice or an opportunity for
Baron to be heard, to issue a complete and total receivership
order over Baron and to use Vogel to seize all of Baron’s exempt
and non-exempt assets, and to prevent Baron from hiring an
attorney to defend himself.
(4) Sherman then participated in private off-the-record ex parte
proceedings before the District Court to implement the plan
worked out with Vogel and to convince the District Court that
Baron was a menace to society (or at least to Attorneys) by
constructing, ex parte, a false picture for the District Court by:
a. Falsely representing to the District Court that the
Bankruptcy Judge recommended a receiver be placed over
Baron should his bankruptcy lawyer Thomas withdraw;
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b. Falsely representing to the District Court that Baron didn’t
pay Thomas’ fees and thus forced Thomas to withdraw
(whereas, in reality Thomas was neither owed unpaid fees
nor withdrew);
c. Falsely representing that Baron caused a Court ordered
mediation to fail (Vogel was also the mediator and, in
reality, had not even scheduled the mediation);
d. Failing to disclose to the District Court that Ondova had
more than sufficient cash in the bank to pay ALL of the
creditors who filed claims with Ondova, plus ALL of the
attorney ‘claimants’ who had not so filed; and
e. Participating in a concerted effort to mislead the District Court
into falsely believing that under the bankruptcy code, a
creditor such as Baron was liable to indemnify the
bankruptcy estate for the substantial contributions of his
counsel—when no such law exists and the law is exactly
opposite, i.e., the bankruptcy estate and not the creditor
must ultimately pay for qualifying substantial contributions.
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(5) Then, after obtaining the ex parte Vogel receivership order in the
private off the record ex parte proceedings, Sherman and Vogel
made concerted efforts to cover-up and deny the existence of the
ex parte proceedings and to conceal the fact that the Vogel
receivership order [Doc 124] had been signed hours before
Sherman’s motion for such an order was filed [Doc 123]; and
(6) Since Baron has been held down by the District Court and
prohibited from retaining trial counsel to defend himself and the
property of Ondova, Sherman has engaged in a non-stop blizzard
of billing. The billing is so massive that it has used up the two
million Dollar funding Baron had provided and has completely
emptied the bank account of Ondova, leaving only an escrow
amount deposited by Baron. At the same time, Vogel, as
receiver, has completely emptied Baron’s personal savings
accounts into his firm’s pockets by billing more than a million
Dollars from Baron’s personal lifetime Savings accounts as ‘fees’.
In addition, Vogel also gutted Novo Point LLC by liquidating
millions of Dollars of assets of Novo Point LLC to pay for
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additional million Dollar ‘fees’.
(7) Thus, after using private off the record ex parte proceedings to
secure an ex parte order preventing Baron from having any paid
counsel to represent him, Sherman and Vogel have vigorously
gone after the assets of Baron, Ondova, and the other
receivership entities, emptying the estate of Ondova and lining
their and their firms’ pockets with over five million Dollars in
‘fees’. Notably, all the litigation Baron was involved with had
settled prior to the Vogel ‘receivership’ order. Yet, although
Baron funded the bankruptcy with a net multi-million Dollar
cash infusion, no claimant has received a penny. Instead, the
multi-million dollar funding of Ondova has been completely
drained by Sherman for ‘fees’. Sherman and Vogel, of course,
attempt to place the blame on the whipping boy, Baron who has
been tied down helplessly by the District Court’s ‘receivership’
order– without any property or basic legal rights, and prohibited
from hiring any paid counsel to defend himself while Sherman
and Vogel have their way with him and the estates’ assets.
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(8) Sherman argues that his and Vogel’s actions cannot be
challenged because in addition to Baron, the management and
rights of Novo Point LLC, a Cook Islands entity, were also seized
by the District Court’s November 2010 Vogel receivership order
(that Novo Point LLC was neither a party to, nor served any
process for). Sherman argues that because of the ex parte Vogel
Receivership order, Novo Point LLC is, like Baron, helpless to
defend itself and that Sherman and Vogel can have their way
with the assets, legally unimpeded by any party. Further,
Sherman argues that because Novo Point LLC, its owner,
SouthPac Trust, and its trustor, Baron, have all been ordered
into the Vogel ‘receivership’ that Vogel and Sherman are free to
act with impunity as no one has the authority to complain.
(9) However, Novo Point LLC of the Cook Islands was not named in
the Vogel receivership order. Sherman responsively argues that
after the receivership order was appealed (and the District Court
was divested of jurisdiction over the matter), the District Court
then had the power to seize control of the Cook Islands’ entity
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“Novo Point LLC” by a subsequent order that “the Receiver
Order's definition of Receivership Parties has always included
Novo Point, LLC [sic, with address and nation of origin
undefined]”.
(10) Novo Point LLC’s position is that the ex parte receivership order
and subsequent ‘clarification’ are void ab initio, as follows:
a. The Vogel ‘receivership order’ is void ab initio for lack of
subject matter jurisdiction. The district court lacked subject
matter jurisdiction as Novo Point LLC was not a party to the
lawsuit and no claim for relief regarding the Novo Point LLC or
its property was pled before that court. See Cochrane v. WF
Potts Son & Co., 47 F.2d 1026, 1029 (5th Cir. 1931) (absent
pleadings asserting a claim in and to the property subject of the
receivership, an order appointing a receiver over that property
is “absolutely void in the strictest sense of the term”).
b. Further, an ex parte order such as the ‘receivership order’ that
was signed without a motion on file to support it, and without
notice, opportunity to be heard, sworn affidavits, or bond to
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protect the rights of those adversely affected by the order, etc.,
is an order fundamentally devoid of due process and void as a
matter of law. Failure to afford a party the opportunity to be
heard on a motion seeking relief against them is fundamentally
inconsistent with the notion of due process. See e.g., Armstrong
v. Manzo, 380 U.S. 545, 552 (1965); Goss v. Lopez, 419 U.S. 565,
579 (1975); Boddie v. Connecticut, 401 U.S. 371, 379 (1971);
Phillips v. Vandygriff, 711 F.2d 1217, 1227 (5th Cir. 1983);
Registration Control Systems v. Compusystems, Inc., 922 F.2d
805, 807 (Federal Cir. 1990). Similarly, the Supreme Court has
described secret judicial proceedings as “a menace to
liberty”. Gannett Co. v. DePasquale, 443 U.S. 368, 412 (1979).
Because the Vogel ‘receivership order’ was entered without the
most basic aspects of Due Process, it is subject to collateral
attack in the Bankruptcy Proceedings as being void ab initio.
See e.g., Pennoyer v. Neff, 95 U.S. 714, 737 (1878) (“such
proceeding is void as not being by due process of law”); World-
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Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291 (1980)
(“rendered in violation of due process is void in the rendering”).
c. Even had the District Court been vested with subject matter
jurisdiction and respected the requirements of fundamental
Due Process, Novo Point LLC, as a Cook Islands' entity, can not
be seized by the U.S. District Court because of the District
Court's territorial jurisdictional limits, e.g., Booth v. Clark, 58
U.S. 322, 333, 17 How. 322, 15 L.Ed. 164 (1854). Further, Novo
Point LLC as a legal entity exists by virtue of the laws of the
Cook Islands, and pursuant to those laws (which U.S. treaty
obligations require be respected), absent an application for
ancillary receivership filed with the courts of the Cook Islands,
Novo Point LLC is immune from seizure by the U.S. District
Court.
2
2
Novo Point has also noted that even if its assets had been subject to seizure after
Due Process in legally authorized receivership proceedings by a U.S. court with
subject matter jurisdiction over the property, derivative stakeholders such as the
Cook Islands’ management still have standing to assert the company's rights in
court when the receiver refuses to bring suit or 'where it would be a vain thing to
make a demand upon [it]' . See e.g., Securities & Exchg. Com'n v. Spence & Green
Chemical, 612 F.2d 896, 903 (5th Cir. 1980), citing with approval Landy v .Federal
Deposit Insurance Corporation, 486 F.2d 139 (3rd Cir. 1973).
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REASONS WHY THE WRIT SHOULD ISSUE
ISSUE 1: Notices of Appeal were timely filed from decisions of
the Bankruptcy Court. The right to file such notices is granted
pursuant Federal Rule of Bankruptcy Procedure 8001, and
29 U.S.C. §158. The Bankruptcy Court Judge found (without a
noticed hearing) that the appeals were not properly authorized,
and struck the notices of appeal from her orders. The
Bankruptcy Clerk has accordingly refused to process the
appeals or docket them with the District Clerk. The Bankruptcy
Judge, however, lacks both the authority and jurisdiction to
strike the notices of appeal or to otherwise prevent the filing of
appeals from her orders.
The Supreme Court has held that the filing of a notice of appeal is
an event of jurisdiction significance and divests the trial court of its
control over those aspects of the case involved in the appeal. Griggs v.
Provident Consumer Discount Co., 459 U.S. 56, 58 (1982). This
Honorable Court has held that “This rule applies with equal force to
bankruptcy cases.” In re Transtexas Gas Corp., 303 F.3d 571, 579 (5th
Cir. 2002). Accordingly, the Bankruptcy Court lacked jurisdiction to
strike the notices of appeal after they were filed. Hogg v. United States,
411 F.2d 578, 579-580 (6th Cir. 1969) (This rule applies even where the
lower court was of the opinion that the appeal was not properly
authorized).
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Secondly, this Honorable Court has held that where the right to
appeal has been granted a litigant, constitutional rights of Due Process
in the free exercise of that right are invoked. Myers v. Collins, 8 F.3d
249, 252 fn 4 (5th Cir. 1993); and see United States v. Krezdorn, 718 F.2d
1360, 1363 (5th Cir. 1983) (recognizing the right to appeal as a due
process right invoking constitutional protection). Congress has vested
district courts with jurisdiction to hear appeals from the bankruptcy
court. 28. U.S.C. §158. Similarly, the Supreme Court established the
right to appeal from orders of the Bankruptcy Court as a procedural
right. Fed.R.Bankr.P. 8001; 28 U.S.C. §2075. However, the Bankruptcy
Judge has failed to respect this clear legal right of appeal from her
orders. Rather, in clearly unauthorized action outside of the Bankruptcy
Judge’s jurisdiction, the Bankruptcy Judge has attempted to reach up
into the appellate process and divest the Article III courts of jurisdiction
over appeals from her orders by striking the notices of appeal.
Accordingly, the Petitioner has the clear legal right to have its
timely filed notices of appeal processed by the Bankruptcy Clerk, and to
proceed with its appeals before an Article III court.
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ISSUE 2: Bankruptcy Court Judges are not Article III judges
and the right to seek appeal from the orders of a Bankruptcy
Court Judge is fundamental to the constitutionality of
proceedings before the Bankruptcy Court. Further, the threat
of imposition of a penalty for having pursued a right of appeal
is a violation of due process of law. The Bankruptcy Judge has
ordered attorneys not to appeal her orders and has cited the
attorneys who filed notices of appeal from her orders to appear
at contempt hearings for having appealed her orders. In order
to protect the integrity of the appellate process, litigants and
their counsel must be free of apprehension of retaliation and
sanction from the Bankruptcy Judge in exercising their right to
appeal from orders of the Bankruptcy Court.
A. The Bankruptcy Court has Attempted to Divest
Article III Courts of their Supervisory Jurisdiction Over
the Bankruptcy Court’s Orders
In examining the constitutionality of non-Article III judges
adjudicating bankruptcy claims, the Supreme Court has held that the
Constitution requires that “[T]he functions of the adjunct must be
limited in such a way that ‘the essential attributes’ of judicial power are
retained in the Art. III court.” Northern Pipeline Constr. Co. v.
Marathon Pipe Line Co., 458 US 50, 81. The Supreme Court held in
Stern v. Marshall, 131 S.Ct. 2594, 564 U.S. __ (2011), that where “[The]
exercise of judicial power may nonetheless be taken from the Article III
Judiciary … then Article III would be transformed from the guardian of
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individual liberty and separation of powers we have long recognized
into mere wishful thinking.” Stern at 2615. Allowing a bankruptcy
court to ‘declare independence’ from review by the Article III Judiciary,
engenders the bankruptcy court with the power to exercise all of the
attributes of judicial power as a fully independent judiciary. As a
matter of constitutional separation of powers, Congress is not
authorized to create an independent, non-Article III Judiciary. Thus,
the fundamental premise of the constitutionality of the present system
of bankruptcy court judges rests on the direct supervision of their
orders by Article III judges. See e.g., 28 U.S.C. §158. Accordingly, an
attempt by a bankruptcy court to prevent review of its orders by Article
III courts is a usurpation of authority and a violation of the U.S.
Constitution.
Moreover, a bankruptcy court’s attempt to deprive Article III
courts of jurisdiction over an appeal is a threat to the integrity of
the appellate process. This risk has been recognized by the Seventh
Circuit, in a case cited with approval by this Honorable Court in Matter
of Transtexas Gas Corp., 303 F.3d 571 (5th Cir. 2002). The Seventh
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Circuit held as follows:
“[T]he integrity of the appellate process is at
serious risk if a bankruptcy court can deprive a
district court of jurisdiction over an appeal”.
Matter of Statistical Tabulating Corp., Inc., 60 F.3d 1286,
1289 (7th Cir. 1995)(emphasis).
B. The Bankruptcy Court’s Attempt to Penalize a Party
for Appealing its Orders is also a Violation of Due
Process
The Supreme Court has held that the imposition of a penalty for
having pursued a statutory right of appeal is a violation of due process
of law. North Carolina v. Pearce, 395 U.S. 711, 724 (1969). Further,
Due Process requires that litigants be freed even of apprehension of
retaliatory motivation on the part of the judge when exercising their
right to appeal. Id. at 725. The Supreme Court has held that allowing a
trial court to sanction a litigant for exercising their statutory right to
appeal would:
“[C]reate doubt, ambiguity, and uncertainty, making it
impossible for citizens to know which one of the two
conflicting laws to follow, and would thus violate one of
the first principles of due process.”
Id. at 738-739.
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Similarly, this Honorable Court has held that due process of law
requires that the potential for “judicial vindictiveness” must not enter
into the appellate process. Hardwick v. Doolittle, 558 F.2d 292, 299-300
(5th Cir. 1977). Likewise, the Supreme Court has cited with approval
the Sixth Circuit’s holding in Webster v. Sowders, 846 F.2d 1032, 1040
(6th Cir. 1988), that “Appeals of district court orders should not be
deterred by threats from district judges”. Cooter & Gell v. Hartmarx
Corp., 496 U.S. 384, 407-408 (1990). Further, the Supreme Court has
held that due process requires that litigants can exercise the right to
appeal from a trial court’s orders free from the apprehension of a
penalty imposed by the trial court. Pearce, 395 U.S. at 724-725.
Accordingly, for the reasons discussed above, the Bankruptcy Court
exceeded its authority and violated the petitioner’s constitutional rights to
due process by subjecting the petitioner’s counsel to contempt proceedings
for seeking appellate relief from the Bankruptcy Court’s orders pursuant
to the Federal Rules of Bankruptcy Procedure. Similarly, as a
constitutional matter of due process, the Bankruptcy Court exceeded its
authority in ordering the petitioner and its counsel not to appeal it orders.
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ISSUE 3: This Honorable Court has authority to issue the
requested writ.
The Supreme Court has held that the extraordinary writ of
mandamus is appropriate “[T]o confine an inferior court to a
lawful exercise of its prescribed authority, or to compel it to
exercise its authority when it is its duty to do so”. Moses H. Cone
Memorial Hospital v. Mercury Constr. Corp., 460 U.S. 1, 18 (1983). As
discussed above, the Bankruptcy Court clearly exceeded its jurisdiction
and authority and the Bankruptcy Clerk has failed to act on the notices
of appeal filed with the Clerk, when the Bankruptcy Clerk has a clear
legal duty to do so. Further, because the Bankruptcy Clerk has refused
to process the appeals, the issues raised on the noticed appeals can only
be addressed if the requested mandamus relief is granted.
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PRAYER
Petitioner, jointly and in the alternative prays that a Writ or
Writs be issued directing:
(1) The Clerk of the Bankruptcy Court of the Northern District of
Texas, Dallas Division to process and deliver to the U.S.
District Clerk for docketing and random assignment to a
District Court, the appeals taken pursuant to the following
notices of appeal filed in Bankruptcy Case 09-34784-sgj11:
a. Notice of Appeal [DE # 610], filed 8/16/11;
b. Notice of Appeal [DE # 612], filed 8/18/11;
c. Notice of Appeal [DE # 613], filed 8/18/11; and
d. Amended Notice of Appeal [DE # 614], filed 8/18/11.
(2) The Bankruptcy Judge to Vacate the Bankruptcy Judge’s order
[DE # 648] striking the above listed Notices of Appeal and
Ordering counsel for the Petitioner to Show Cause why they
should not be sanctioned and held in Contempt for appealing
orders of the Bankruptcy Judge.
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Respectfully submitted,
/s/ Gary N. Schepps
Gary N. Schepps
Texas State Bar No. 00791608
5400 LBJ Freeway, Suite 1200
Dallas, Texas 75240
(972) 200-0000 - Telephone
(972) 200-0535 - Facsimile
Email: legal@schepps.net
FOR PETITIONER
NOVO POINT LLC
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CERTIFICATE OF COMPLIANCE
WITH TYPE-VOLUME LIMITATION, TYPEFACE
REQUIREMENTS, AND TYPE STYLE REQUIREMENTS
1. This brief complies with the type-volume limitation of FED. R.
APP. P. 32(a)(7)(B) because: this brief does not exceed 30 pages
exclusive of the the parts of the brief exempted by FED. R. APP. P.
21(d)
2. This brief complies with the typeface requirements of FED. R.
APP. P. 32(a)(5) and the type style requirements of FED. R. APP. P.
32(a)(6) because: this brief has been prepared in a proportionally spaced
typeface using MS Word 2000 in 14 and 15 point century font.
DATED: April 20, 2012.
CERTIFIED BY: /s/ Gary N. Schepps
Gary N. Schepps
COUNSEL FOR APPELLANTS
CERTIFICATE OF SERVICE
This is to certify service this day of this Petition on the
Respondents and real parties in interest by US Mail and by electronic
service to counsel for all parties to the US District Case 3:09-cv-00988-F
in the Northern District of Texas.
CERTIFIED BY: /s/ Gary N. Schepps
Gary N. Schepps
COUNSEL FOR PETITIONER
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THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
IN RE: §
§
ONDOVA LIMITED COMPANY, § Case No. 09-34784-SGJ-11
§
Debtor. §
ORDER: (A) GRANTING, IN SUBSTANTIAL PART, TRUSTEE’S MOTION TO:
(I) SHOW CAUSE WHY CHRISTOPHER PAYNE AND GARY SCHEPPS SHOULD NOT
BE HELD IN CONTEMPT AND SANCTIONED; AND (II) STRIKE NOTICES
OF APPEAL AND MOTION TO STAY SALE ORDER [DE # 637]; AND
(B) SETTING SHOW CAUSE HEARING ON OCTOBER 24,2011, AT 10:30 A.M.,
AS TO ACTIONS OF LAWYERS CHRISTOPHER PAYNE AND GARY SCHEPPS
I. INTRODUCTION.
The court held a hearing on September 1, 2011 on the
Trustee’s Motion to: (I) Show Cause Why Christopher Payne and
Gary Schepps Should Not Be Held in Contempt and Sanctioned; and
(II) Strike Notices of Appeal and Motion to Stay Sale Order (the
“Motion”) [DE # 637]. Appearing at the hearing, among others,
were: (a) the Chapter 11 Trustee for Ondova Limited Company
(“Ondova”), Daniel Sherman (“Trustee”); (b) the Trustee’s
-1-
Signed September 06, 2011
U.S. BANKRUPTCY COURT
NORTHERN DISTRICT OF TEXAS
ENTERED
TAWANA C. MARSHALL, CLERK
THE DATE OF ENTRY IS
ON THE COURT'S DOCKET
The following constitutes the ruling of the court and has the force and effect therein described.
United States Bankruptcy Judge
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counsel; (c) counsel for the Receiver, Peter Vogel (the
“Receiver”), who was appointed, in 2010, by United States
District Judge Royal Furgeson in Civil Action No. 3:09-CV-0988-F,
as receiver over Jeffrey Baron, the former principal of Ondova,
and related entities (the “Baron Receivership Action”); (d)
Joshua Cox, counsel for Novo Point, LLC, which entity is a Baron-
related entity that is subject to the Baron Receivership Action
(Mr. Cox’s authority to act as counsel for Novo Point, LLC was
previously approved and/or acknowledged in the Baron Receivership
Action); (e) Christopher Payne, an attorney appearing for
himself, and who has recently purported to represent Novo Point,
LLC in the above-referenced bankruptcy case; and (f) Gary
Schepps, an attorney appearing for himself, and who purports to
be appellate counsel for Jeffrey Baron and perhaps Baron-related
entities.
In the Motion, the Trustee requested that the bankruptcy
court strike five pleadings (the “Five Pleadings”) that were
signed by Christopher Payne and, in all but one case,
electronically filed by Gary Schepps. The Five Pleadings were
allegedly filed by Payne/Schepps on behalf of Novo Point, LLC,
which entity—as mentioned above—is related to Jeffrey Baron and
is under the control of the Receiver, pursuant to Orders signed
by District Judge Royal Furgeson on November 24, 2010, and
December 17, 2010. In fact, the main purpose of Judge Furgeson’s
-2-
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Order dated December 17, 2010 was to specifically clarify that
the entity Novo Point, LLC was a part of the Baron Receivership
Action and any individuals allegedly representing it were to
comply with all instructions given to them by the Receiver.
1
Such December 17, 2010 Order was agreed to by Joshua Cox and
James Eckles—who were then attorneys for Novo Point, LLC. The
Trustee has requested that the Five Pleadings be stricken, since
Christopher Payne and Gary Schepps had no authority from the
Receiver to file them on behalf of Novo Point, LLC. The Trustee
also asked for a Show Cause Order why Christopher Payne and Gary
Schepps should not be sanctioned and held in contempt of the
bankruptcy court, since the bankruptcy court has previously ruled
that Christopher Payne, his firm, Dennis Olson, and Dennis
Olson’s firm may not appear in the bankruptcy court on behalf of
Novo Point, LLC without first filing a motion for authority to do
so, which motion must be supported by compelling evidence,
including live testimony from a Brian Mason and Lisa Katz–i.e.,
the ones who have allegedly given instructions to Christopher
Payne to take legal positions for Novo Point, LLC. See DE ## 605
& 609.
II. THE FIVE PLEADINGS.
The Five Pleadings that the Trustee asked to have stricken
1
The December 17, 2010 Order contained similar clarification
provisions concerning a Baron-related entity known as Quantec, LLC.
-3-
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were:
1. Notice of Appeal
2
[DE # 610], filed 8/16/11.
2. Notice of Appeal
3
[DE # 612], filed 8/18/11.
3. Notice of Appeal
4
[DE # 613], filed 8/18/11.
4. Amended Notice of Appeal
5
[DE # 614], filed 8/18/11.
5. Motion for Stay Pending Appeal
6
[DE # 615], filed 8/18/11.
2
This Notice of Appeal pertained to an Order [DE # 605]
granting the Receiver’s Motion for Show of Authority, in which the
bankruptcy court ruled that Christopher Payne, his firm, Dennis Olson,
and Dennis Olson’s firm had no authority to appear in the bankruptcy
court for the entities Novo Point, LLC and Quantec, LLC, and that they
may not appear before the bankruptcy court in the future for these
entities without filing first a motion for authority to do so, which
is supported by compelling evidence including live testimony from
Brian Mason and Lisa Katz (the human beings who supposedly gave
authority to Payne/Olson to take legal positions for Novo Point, LLC
and Quantec, LLC).
3
This Notice of Appeal pertained to an Order [DE # 607]
granting the Trustee’s Motion to Sell Property of the Estate (“Sale
Motion”), in which the bankruptcy court ruled that the Trustee may
engage in efforts to sell a certain Internet domain name owned by
Ondova called “mondial.com.”
4
This Notice of Appeal pertained to an Order [DE # 609]
granting the Trustee’s Motion to Strike the objection to the Trustee’s
Sale Motion, which objection had been filed purportedly on behalf of
Novo Point, LLC by attorneys Christopher Payne and Dennis Olson.
5
This Amended Notice of Appeal (like the Notice of Appeal found
at DE #610), pertained to the Order [DE # 605] granting the Receiver’s
Motion for Show of Authority, in which the bankruptcy court ruled that
Christopher Payne, his firm, Dennis Olson, and Dennis Olson’s firm had
no authority to appear in the bankruptcy court for the entities Novo
Point, LLC and Quantec, LLC and that they may not appear before the
bankruptcy court in the future for these entities without filing first
a motion for authority to do so, which is supported by compelling
evidence including live testimony from Brian Mason and Lisa Katz (the
human beings who supposedly gave authority to Payne/Olson to take
legal positions for Novo Point, LLC and Quantec, LLC). It is unclear
what necessitated the amendment.
6
This Motion for Stay Pending Appeal pertained to the Order [DE #
607] granting the Trustee’s Motion to Sell Property of the Estate (the
“Sale Motion”), in which the bankruptcy court ruled that the Trustee
may engage in efforts to sell a certain Internet domain name owned by
Ondova called “mondial.com.”
-4-
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All of the Five Pleadings were signed by Christopher Payne.
Additionally, all of the Five Pleadings except DE #610 were filed
electronically by attorney Gary Schepps who, as mentioned above,
describes himself as appellant counsel to Jeffrey Baron and
Baron’s related entities (DE # 610 was hand-filed by Christopher
Payne who represented that he is not an E-Filer).
III. EXPLANATIONS AND ARGUMENTS GIVEN BY CHRISTOPHER PAYNE AND
GARY SCHEPPS.
Christopher Payne represented to the bankruptcy court at the
September 1, 2011 hearing that he did not believe a Notice of
Appeal fell within the scope of the bankruptcy court’s orders
banning him from appearing in the bankruptcy court on behalf of
Novo Point, LLC, since a Notice of Appeal is essentially directed
to the district court. He also represented that he had no choice
but to file the Motion for Stay Pending Appeal at the bankruptcy
court level, due to Bankruptcy Rule 8005. Gary Schepps allegedly
only became entangled in all of this because Christopher Payne
does not have the ability to E-File in the bankruptcy court and
Schepps agreed to help him. Additionally, Gary Schepps (somehow)
does not believe that Notices of Appeal are “pleadings,” nor that
filing documents with the Bankruptcy Clerk is the same as filing
documents with the court.
IV. RULING.
The positions now taken by Messrs. Payne and Schepps appear
weak at best. The court is more inclined to believe that
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USCA5 933
vexatious litigation tactics and gamesmanship are at play. As
pointed out by the Trustee, Messrs. Payne and Schepps could have
filed motions for authority to file the Notices of Appeal and the
Motion for Stay Pending Appeal, and presented evidence and
testimony from Brian Mason and Lisa Katz explaining their basis
for taking legal actions on behalf of Novo Point, LLC. Mr. Payne
and Mr. Schepps do not seem to understand basic notions of
corporate governance (at least where this Baron Receivership
Action is concerned). Multiple entities cannot speak for or be
in control of Novo Point, LLC. Right now, pursuant to a District
Court Order, the Receiver has governance and control over Novo
Point, LLC. The District Court Order is on appeal. The District
Court Order may be overturned. But meanwhile, the Order is not
stayed and it controls. Parties who are aggrieved by that Order
have standing to appeal it and take legal positions to protect
their interests. Such parties might include stakeholders of Novo
Point, LLC (such as creditors or shareholders). But Novo Point,
LLC—unless and until the District Court’s Receivership Orders are
reversed—speaks through only one master. The bankruptcy
court—despite this seemingly unrefutable fact—gave Mr. Payne the
opportunity to file a motion for authority to file pleadings on
behalf of Novo Point, LLC, if he wanted to try and convince the
bankruptcy court that there is some legal way for Novo Point, LLC
to appear and file pleadings in the bankruptcy court absent
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USCA5 934
instructions to do so from the Receiver. But, rather than file
such a motion, Payne decided to ignore that opportunity and
attempt an appeal. Even when the court held a hearing on the
Trustee’s Motion, Messrs. Payne and Schepps showed up in the
bankruptcy court with no witnesses and no documentation that
might somehow support their authority to act for Novo Point, LLC.
WHEREFORE, the court now ORDERS as follows:
1. The court has jurisdiction over the Trustee’s Motion
pursuant to 28 U.S.C. § 1334 and 28 U.S.C. § 157(b).
7
The court
overrules the arguments of Messrs. Payne and Schepps that the
case of Stern v. Marshall 131 S. Ct. 63 (2011) deprives a non-
Article III court from policing activity of lawyers and parties
before the court through mechanisms such as sanctions and
contempt.
8
2. The Five Pleadings are hereby STRICKEN.
3. Even if it is somehow not appropriate to strike the
7
While this court recognizes that the filing of a notice of
appeal is an event of jurisdictional significance, which event has
sometimes been stated as divesting a trial court over those aspects of
the case involved in the appeal, e.g., Blinco v. Green Tree Servicing,
LLC, 366 F.3d 1249, 1251 (11th Cir. 2004), Bradford-Scott Data Corp.
Physician Computer Network, Inc., 128 F.3d 504, 505 (7th Cir. 1997),
this court interprets the relevant rules and case law in this regard
to mean that once an appeal is actually docketed, such jurisdiction of
the trial court is divested. See, e.g., Fed. R. Civ. P. 60(a) (last
sentence).
8
Accepting the arguments of Messrs. Payne and Schepps,
apparently an attorney could strip naked and scream obscenities in the
courtroom and there would not be a thing that a non-Article III judge
could do about it (except, perhaps, call law enforcement so that the
attorney could be arrested).
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USCA5 935
Motion for Stay Pending Appeal, it is hereby denied since the
movant (even if the “movant” had authority) cannot show a
likelihood or probability of success on the merits in an appeal;
nor that the movant faces irreparable injury if the stay is not
granted; nor that a stay would not substantially harm other
parties; nor that a stay would serve the public interest.
4. Christopher Payne and Gary Schepps shall file, within 5
days, a statement making the disclosures contemplated by
Bankruptcy Rule 2019 (for every entity that Christopher Payne and
Gary Schepps allege that they represent in connection with the
Ondova bankruptcy matters, the Baron Receivership Action matters,
and appeals—and regardless of whether they represent more than
one entity).
5. Christopher Payne and Gary Schepps shall appear before
this bankruptcy court on October 24, 2011, at 10:30 a.m., and
SHOW CAUSE why they should not be held in contempt of court and
sanctioned for filing the Five Pleadings in apparent violation of
the court’s Orders appearing at DE ## 605 & 609, and for
otherwise purporting to appear and take legal positions for the
entity Novo Point, LLC without any legal authority.
9
9
The court acknowledges that Gary Schepps was not named in the
Orders that appear at DE ## 605 & 609, but he assisted Christopher
Payne in violating those Orders and would in all ways appear to have
the same standing problem of Christopher Payne, in that the Receiver
has not directed Mr. Schepps to take actions on behalf of Novo Point,
LLC.
-8-
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USCA5 936
IT IS SO ORDERED.
###END OF ORDER###
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IN
THE
UNITED
STATES
DISTRICT
COURT
FOR
THE
NORTHERN
DISTRICT
OF
TEXAS
DALLAS
DIVISION
NETSPHERE
INC.,
§
§
§
§
§
§
§
§
§
MANILA
INDUSTRIES,
INC.;
and
MUNISH
KRISHAN
Plaintiffs,
vs.
JEFFREY
BARON
and
ONDOVA
LIMITED
COMPANY,
Defendants
CIVIL
ACTION
NO.
3-09CV0988-F
ORDER
APPOINTING
RECEIVER
The
Court
hereby
appoints
a
receiver
and
imposes
an
ancillary relief
to
assist
the
receiver
as
follows:
APPOINTMENT
OF
RECEIVER
IT
IS
HEREBY
ORDERED
that
Peter
S.
Vogel
is
appointed
Receiver
for
Defendant
Jeffrey
Baron
with
the
full
power
of
an
equity
receiver.
The
Receiver
shall
be
entitled
to
possession
and
control
over
all
Receivership
Assets,
Receivership
Parties
and
Receivership
Documents
as
defined
herein,
and
shall
be
entitled
to
exercise
all
powers
granted
herein.
RECEIVERSHIP
PARTIES,
ASSETS,
AND
RECORDS
IT
IS
FURTHER
ORDERED
that
the
Court
hereby
takes
exclusive
jurisdiction
over,
and
grants
the
Receiver
excl\Jsive
control
over,
any
and
all
"Receivership
Parties",
which
term
shall
include
Jeffrey
Baron
and
the
following
entities:
Village
Trust,
a
Cook
Islands
Trust
Equity
Trust
Company
IRA
19471
Daystar
Trust,
a
Texas
Trust
Belton
Trust,
a
Texas
Trust
Novo
Point,
Inc.,
a
USVI
Corporation
Iguana
Consulting,
Inc.,
a
USVI
Corporation
Quantec,
Inc.,
a
USVI
Corporation
Shiloh,
LLC,
a
Delaware
Limited
Liability
Company
Novquant,
LLC,
a
Delaware
Limited
Liability
Company
ORDER
APPOINTING
RECEIVER
-
Page
1
IN
THE
UNITED
STATES
DISTRICT
COURT
FOR
THE
NORTHERN
DISTRICT
OF
TEXAS
DALLAS
DIVISION
NETSPHERE
INC.,
§
§
§
§
§
§
§
§
§
MANILA
INDUSTRIES,
INC.;
and
MUNISH
KRISHAN
Plaintiffs,
vs.
JEFFREY
BARON
and
ONDOVA
LIMITED
COMPANY,
Defendants
CIVIL
ACTION
NO.
3-09CV0988-F
ORDER
APPOINTING
RECEIVER
The
Court
hereby
appoints
a
receiver
and
imposes
an
ancillary relief
to
assist
the
receiver
as
follows:
APPOINTMENT
OF
RECEIVER
IT
IS
HEREBY
ORDERED
that
Peter
S.
Vogel
is
appointed
Receiver
for
Defendant
Jeffrey
Baron
with
the
full
power
of
an
equity
receiver.
The
Receiver
shall
be
entitled
to
possession
and
control
over
all
Receivership
Assets,
Receivership
Parties
and
Receivership
Documents
as
defined
herein,
and
shall
be
entitled
to
exercise
all
powers
granted
herein.
RECEIVERSHIP
PARTIES,
ASSETS,
AND
RECORDS
IT
IS
FURTHER
ORDERED
that
the
Court
hereby
takes
exclusive
jurisdiction
over,
and
grants
the
Receiver
excl\Jsive
control
over,
any
and
all
"Receivership
Parties",
which
term
shall
include
Jeffrey
Baron
and
the
following
entities:
Village
Trust,
a
Cook
Islands
Trust
Equity
Trust
Company
IRA
19471
Daystar
Trust,
a
Texas
Trust
Belton
Trust,
a
Texas
Trust
Novo
Point,
Inc.,
a
USVI
Corporation
Iguana
Consulting,
Inc.,
a
USVI
Corporation
Quantec,
Inc.,
a
USVI
Corporation
Shiloh,
LLC,
a
Delaware
Limited
Liability
Company
Novquant,
LLC,
a
Delaware
Limited
Liability
Company
ORDER
APPOINTING
RECEIVER
-
Page
1
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USCA5 938
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Manassas,
LLC,
a
Texas
limited liability
Company
Domain
Jamboree,
LLC,
a
Wyoming
Limited
Liability
Company
10
Genesis,
LLC,
a
Utah
Limited
Liability
Company
and
any
entity
under
the
direct
or
indirect
control
of
Jeffrey
Baron,
whether
by
virtue
of
ownership,
beneficial
interest, a
position
as
officer,
director,
power
of attorney
or
any
other
authority
or
right
to
act.
The
Court
hereby
enjoins
any
person
from
taking
any
action
based
upon
any
presently
existing
directive
from
any
person
other
than
the
Receiver
with
regard
to
the
affairs
and
business
of
the
Receivership
Parties,
including
but
not
limited
to
proceeding
with
the
transfer of a
portfolio
of internet
domain
names
("Domain
Names")
for
which
Ondova
Limited
Company
("Ondova")
acted
as
registrar.
Specifically,
but
without limitation,
VeriSign
Inc
and
The
Internet
Corporation
for
Assigned
Names
and
Numbers
("ICANN"),
and
any
other
entity
connected
to
the
transfer of
the
Domain
Names,
shall
immediate
cease
such
efforts
and
shall
terminate
any
movement
of
the
Domain
Names.
IT
IS
FURTHER
ORDERED
that
the
Court
hereby
takes
exclusive
jurisdiction
over,
and
grants
the
Receiver
exclusive
control
over,
any
and
all
"Receivership
Assets",
which
term
shall
include
any
and
all
legal
or
equitable
interest
in,
right
to,
or
claim
to,
any
real
or
personal
property
(including
"goods,"
"instruments,"
"equipment,"
''fixtures,''
"general
intangibles,"
"inventory,"
'checks,"
or
"notes"
(as
these
terms
are
defined
in
the
Uniform
Commercial
Code)),
lines
of
credit,
chattels,
leaseholds,
contracts,
mail
or
other
deliveries,
shares
of
stock,
lists
of
consumer
names,
accounts,
credits,
premises,
receivables,
funds,
and
all
cash,
wherever
located,
and
further
including
any
legal
or
equitable
interest
in
any
trusts,
corporations,
partnerships,
or
other
legal
entities of
any
nature,
that
are:
1.
owned,
controlled,
or
held
by,
in
whole
or
in
part,
for
the
benefit
of,
or
subject
to
access
by,
or
belonging
to,
any
Receivership
Party;
2.
in
the
actual
or
constructive
possession
of
any
Receivership
Party;
or
3.
in
the
actual
or
constructive
possession
of,
or
owned,
controlled,
or
held
by,
or
subject
to
access
by,
or
belonging
to,
any
other
corporation,
partnership,
trust,
or
any
ORDER APPOINTING RECEIVER - Page 2
Manassas,
LLC,
a
Texas
limited liability
Company
Domain
Jamboree,
LLC,
a
Wyoming
Limited
Liability
Company
10
Genesis,
LLC,
a
Utah
Limited
Liability
Company
and
any
entity
under
the
direct
or
indirect
control
of
Jeffrey
Baron,
whether
by
virtue
of
ownership,
beneficial
interest, a
position
as
officer,
director,
power
of attorney
or
any
other
authority
or
right
to
act.
The
Court
hereby
enjoins
any
person
from
taking
any
action
based
upon
any
presently
existing
directive
from
any
person
other
than
the
Receiver
with
regard
to
the
affairs
and
business
of
the
Receivership
Parties,
including
but
not
limited
to
proceeding
with
the
transfer of a
portfolio
of internet
domain
names
("Domain
Names")
for
which
Ondova
Limited
Company
("Ondova")
acted
as
registrar.
Specifically,
but
without limitation,
VeriSign
Inc
and
The
Internet
Corporation
for
Assigned
Names
and
Numbers
("ICANN"),
and
any
other
entity
connected
to
the
transfer of
the
Domain
Names,
shall
immediate
cease
such
efforts
and
shall
terminate
any
movement
of
the
Domain
Names.
IT
IS
FURTHER
ORDERED
that
the
Court
hereby
takes
exclusive
jurisdiction
over,
and
grants
the
Receiver
exclusive
control
over,
any
and
all
"Receivership
Assets",
which
term
shall
include
any
and
all
legal
or
equitable
interest
in,
right
to,
or
claim
to,
any
real
or
personal
property
(including
"goods,"
"instruments,"
"equipment,"
''fixtures,''
"general
intangibles,"
"inventory,"
'checks,"
or
"notes"
(as
these
terms
are
defined
in
the
Uniform
Commercial
Code)),
lines
of
credit,
chattels,
leaseholds,
contracts,
mail
or
other
deliveries,
shares
of
stock,
lists
of
consumer
names,
accounts,
credits,
premises,
receivables,
funds,
and
all
cash,
wherever
located,
and
further
including
any
legal
or
equitable
interest
in
any
trusts,
corporations,
partnerships,
or
other
legal
entities of
any
nature,
that
are:
1.
owned,
controlled,
or
held
by,
in
whole
or
in
part,
for
the
benefit
of,
or
subject
to
access
by,
or
belonging
to,
any
Receivership
Party;
2.
in
the
actual
or
constructive
possession
of
any
Receivership
Party;
or
3.
in
the
actual
or
constructive
possession
of,
or
owned,
controlled,
or
held
by,
or
subject
to
access
by,
or
belonging
to,
any
other
corporation,
partnership,
trust,
or
any
ORDER APPOINTING RECEIVER - Page 2
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USCA5 939
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other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by,
or
under
common
control
with,
any
Receivership
Party,
including,
but
not
limited
to,
any
assets
held
by
or
for
any
Receivership
Party
in
any
account
at
any
bank
or
savings
and
loan
institution,
or
with
any
credit
card
processing
agent,
automated
clearing
house
processor,
network
transaction
processor,
bank
debit
processing
agent,
customer
service
agent,
commercial
mail
receiving
agency,
or
mail
holding
or
forwarding
company,
or
any
credit
union,
retirement
fund
custodian,
money
market
or
mutual
fund,
storage
company,
trustee,
or
with
any
broker-dealer,
escrow
agent,
title
company,
commodity
trading
company,
precious
metal
dealer,
or
other
financial
institution
or
depository
of
any
kind,
either
within
or
outside
of
the
State
of
Texas.
IT
IS
FURTHER
ORDERED
that
the
Receiver
shall
be
entitled
to
any
document
that
any
Receivership
Party
is
entitled
to
possess
as
of
the
signing
of
this
order
("Receivership
Documents").
IT
IS
FURTHER
ORDERED
that
all
persons
who
receive
actual
notice
of
this
Order
by
personal
service
or
otherwise
are
hereby
restrained
and
enjoined
from:
A.
Transferring,
liquidating,
converting,
encumbering,
pledging,
loaning,
selling,
concealing,
dissipating,
disbursing,
assigning,
spending,
withdrawing,
granting
a
lien
or
security
interest
or
other
interest
in,
or
otherwise
disposing
of
any
Receivership
Assets.
B.
Opening
or
causing
to
be
opened
any
safe
deposit
boxes,
commercial
mail
boxes,
or
storage
facilities
titled
in
the
name
of
any
Receivership
Party,
or subject
to
access
by
any
Receivership
Party
or
under
any
Receivership
Party's
control,
without
providing
the
Receiver
prior
notice
and
an
opportunity
to
inspect
the
contents
in
order
to
determine
that
they
contain
no
assets
covered
by
this
Section;
C.
Cashing
any
checks
or
depositing
any
payments
from
customers
or
clients
of a
Receivership
Party;
D.
Incurring
charges
or
cash
advances
on
any
credit
card
issued
in
the
name,
singly
or
jointly,
of
any
Receivership
Party;
or
ORDER
APPOINTING
RECEIVER
-
Page
3
other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by,
or
under
common
control
with,
any
Receivership
Party,
including,
but
not
limited
to,
any
assets
held
by
or
for
any
Receivership
Party
in
any
account
at
any
bank
or
savings
and
loan
institution,
or
with
any
credit
card
processing
agent,
automated
clearing
house
processor,
network
transaction
processor,
bank
debit
processing
agent,
customer
service
agent,
commercial
mail
receiving
agency,
or
mail
holding
or
forwarding
company,
or
any
credit
union,
retirement
fund
custodian,
money
market
or
mutual
fund,
storage
company,
trustee,
or
with
any
broker-dealer,
escrow
agent,
title
company,
commodity
trading
company,
precious
metal
dealer,
or
other
financial
institution
or
depository
of
any
kind,
either
within
or
outside
of
the
State
of
Texas.
IT
IS
FURTHER
ORDERED
that
the
Receiver
shall
be
entitled
to
any
document
that
any
Receivership
Party
is
entitled
to
possess
as
of
the
signing
of
this
order
("Receivership
Documents").
IT
IS
FURTHER
ORDERED
that
all
persons
who
receive
actual
notice
of
this
Order
by
personal
service
or
otherwise
are
hereby
restrained
and
enjoined
from:
A.
Transferring,
liquidating,
converting,
encumbering,
pledging,
loaning,
selling,
concealing,
dissipating,
disbursing,
assigning,
spending,
withdrawing,
granting
a
lien
or
security
interest
or
other
interest
in,
or
otherwise
disposing
of
any
Receivership
Assets.
B.
Opening
or
causing
to
be
opened
any
safe
deposit
boxes,
commercial
mail
boxes,
or
storage
facilities
titled
in
the
name
of
any
Receivership
Party,
or subject
to
access
by
any
Receivership
Party
or
under
any
Receivership
Party's
control,
without
providing
the
Receiver
prior
notice
and
an
opportunity
to
inspect
the
contents
in
order
to
determine
that
they
contain
no
assets
covered
by
this
Section;
C.
Cashing
any
checks
or
depositing
any
payments
from
customers
or
clients
of a
Receivership
Party;
D.
Incurring
charges
or
cash
advances
on
any
credit
card
issued
in
the
name,
singly
or
jointly,
of
any
Receivership
Party;
or
ORDER
APPOINTING
RECEIVER
-
Page
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E.
Incurring
liens
or
encumbrances
on
real
property,
personal
property,
or
other
assets
in
the
name,
singly
or
jointly,
of
any
Receivership
Party
or
of
any
corporation,
partnership,
or
other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by
any
Receivership
Party.
F.
The
funds,
property,
and
assets
affected
by
this
Order
shall
include
both
existing
assets
and
assets
acquired
after
the
effective
date
of
this
Order.
IT
IS
FURTHER
ORDERED
that
any
financial
institution,
business
entity,
or
person
maintaining
or
having
custody
or
control
of
any
account
or
other
asset
of
any
Receivership
Party,
or
any
corporation,
partnership,
or
other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by,
or
under
common
control
with
any
Receivership
Party,
which
is
served
with
a
copy
of
this
Order,
or
otherwise
has
actual
or
constructive
knowledge
of
this
Order,
shall:
A.
Hold
and
retain
within
its
control
and
prohibit
the
withdrawal,
removal,
assignment,
transfer,
pledge,
hypothecation,
encumbrance,
disbursement,
dissipation,
conversion,
sale,
liquidation,
or
other
disposal
of
any
of
the
assets,
funds,
documents,
or
other
property
held
by,
or
under
its
control:
1.
on
behalf
of,
or
for
the
benefit
of,
any
Receivership
Party;
2.
in
any
account
maintained
in
the
name
of,
or
for
the
benefit
of,
or
subject
to
withdrawal
by,
any
Receivership
Party;
and
3.
that
are
subject
to
access
or
use
by,
or
under
the
signatory
power
of,
any
Receivership
Party.
B.
Deny
any
person
other
than
the
Receiver
or
his
designee
access
to
any
safe
deposit
boxes
or
storage
facilities
that
are
either:
1.
titled
in
the
name,
individually
or
jointly,
of
any
Receivership
Party;
or
2.
subject
to
access
by
any
Receivership
Party.
C.
Provide
the
Receiver
an
immediate
statement
setting
forth:
ORDER APPOINTING RECEIVER - Page 4
E.
Incurring
liens
or
encumbrances
on
real
property,
personal
property,
or
other
assets
in
the
name,
singly
or
jointly,
of
any
Receivership
Party
or
of
any
corporation,
partnership,
or
other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by
any
Receivership
Party.
F.
The
funds,
property,
and
assets
affected
by
this
Order
shall
include
both
existing
assets
and
assets
acquired
after
the
effective
date
of
this
Order.
IT
IS
FURTHER
ORDERED
that
any
financial
institution,
business
entity,
or
person
maintaining
or
having
custody
or
control
of
any
account
or
other
asset
of
any
Receivership
Party,
or
any
corporation,
partnership,
or
other
entity
directly
or
indirectly
owned,
managed,
or
controlled
by,
or
under
common
control
with
any
Receivership
Party,
which
is
served
with
a
copy
of
this
Order,
or
otherwise
has
actual
or
constructive
knowledge
of
this
Order,
shall:
A.
Hold
and
retain
within
its
control
and
prohibit
the
withdrawal,
removal,
assignment,
transfer,
pledge,
hypothecation,
encumbrance,
disbursement,
dissipation,
conversion,
sale,
liquidation,
or
other
disposal
of
any
of
the
assets,
funds,
documents,
or
other
property
held
by,
or
under
its
control:
1.
on
behalf
of,
or
for
the
benefit
of,
any
Receivership
Party;
2.
in
any
account
maintained
in
the
name
of,
or
for
the
benefit
of,
or
subject
to
withdrawal
by,
any
Receivership
Party;
and
3.
that
are
subject
to
access
or
use
by,
or
under
the
signatory
power
of,
any
Receivership
Party.
B.
Deny
any
person
other
than
the
Receiver
or
his
designee
access
to
any
safe
deposit
boxes
or
storage
facilities
that
are
either:
1.
titled
in
the
name,
individually
or
jointly,
of
any
Receivership
Party;
or
2.
subject
to
access
by
any
Receivership
Party.
C.
Provide
the
Receiver
an
immediate
statement
setting
forth:
ORDER APPOINTING RECEIVER - Page 4
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1.
The
Identification
number
of
each
account
or
asset
titled
in
the
name,
individually
or
jointly, of
any
Receivership
Party,
or
held
on
behalf
thereof,
or for
the
benefit
thereof,
including
all
trust
accounts
managed
on
behalf
of
any
Receivership
Party
or
subject
to
any
Receivership
Party's
control;
2.
The
balance
of
each
such
account,
or
a
description
of
the
nature
and
value
of
such
asset;
3.
The
Identification
and
location
of
any
safe
deposit
box,
commercial
mail
box,
or
storage
facility
that
is
either
titled
in
the
name,
individually
or
jointly, of
any
Receivership
Party,
whether
in
whole
or
in
part;
and
4.
If
the
account,
safe
deposit
box,
storage
facility, or other
asset
has
been
closed
or
removed,
the
date
closed
or
removed
and
the
bai<;Jnce
on
said
date.
D.
Immediately
provide
the
Receiver
with
copies
of
all
records
or other
documentation
pertaining
to
each
such
account
or
asset,
including,
but
not
limited
to,
originals
or
copies
of
account
applications,
account
statements,
corporate
resolutions,
signature
cards,
checks,
drafts,.
deposit
tickets,
transfers
to
and
from
the
accounts,
all
other debit
and
credit
instruments
or
slips,
currency
transaction
reports,
1099
forms,
and
safe
deposit
box
logs;
and
E.
Immediately
honor
any
requests
by
the
Receiver
with
regard
to
transfers
of
assets
to
the
Receiver
or
as
the
Receiver
may
direct.
DUTIES
OF
DEFENDANTS
REGARDING
ASSETS
AND
DOCUMENTS
IT
IS
FURTHER
ORDERED
that
Defendants
shall:
A.
Within
three
business
days
following
service
of
this
Order,
take
such
steps
as
are
necessary
to
turn
over
control
to
the
Receiver
and
repatriate
to
the
Northern
District
of
Texas
all
Receivership
Documents
and
Receivership
Assets
that
are
located
outside
of
the
Northern
District
of
Texas
and
are
held
by
or
for
the
Receivership
Parties
or
are
under
the
Receivership
Parties'
direct
or
indirect
control,
jointly,
severally,
or
individually;
ORDER
APPOINTING
RECEIVER
-
Page
5
1.
The
Identification
number
of
each
account
or
asset
titled
in
the
name,
individually
or
jointly, of
any
Receivership
Party,
or
held
on
behalf
thereof,
or for
the
benefit
thereof,
including
all
trust
accounts
managed
on
behalf
of
any
Receivership
Party
or
subject
to
any
Receivership
Party's
control;
2.
The
balance
of
each
such
account,
or
a
description
of
the
nature
and
value
of
such
asset;
3.
The
Identification
and
location
of
any
safe
deposit
box,
commercial
mail
box,
or
storage
facility
that
is
either
titled
in
the
name,
individually
or
jointly, of
any
Receivership
Party,
whether
in
whole
or
in
part;
and
4.
If
the
account,
safe
deposit
box,
storage
facility, or other
asset
has
been
closed
or
removed,
the
date
closed
or
removed
and
the
bai<;Jnce
on
said
date.
D.
Immediately
provide
the
Receiver
with
copies
of
all
records
or other
documentation
pertaining
to
each
such
account
or
asset,
including,
but
not
limited
to,
originals
or
copies
of
account
applications,
account
statements,
corporate
resolutions,
signature
cards,
checks,
drafts,.
deposit
tickets,
transfers
to
and
from
the
accounts,
all
other debit
and
credit
instruments
or
slips,
currency
transaction
reports,
1099
forms,
and
safe
deposit
box
logs;
and
E.
Immediately
honor
any
requests
by
the
Receiver
with
regard
to
transfers
of
assets
to
the
Receiver
or
as
the
Receiver
may
direct.
DUTIES
OF
DEFENDANTS
REGARDING
ASSETS
AND
DOCUMENTS
IT
IS
FURTHER
ORDERED
that
Defendants
shall:
A.
Within
three
business
days
following
service
of
this
Order,
take
such
steps
as
are
necessary
to
turn
over
control
to
the
Receiver
and
repatriate
to
the
Northern
District
of
Texas
all
Receivership
Documents
and
Receivership
Assets
that
are
located
outside
of
the
Northern
District
of
Texas
and
are
held
by
or
for
the
Receivership
Parties
or
are
under
the
Receivership
Parties'
direct
or
indirect
control,
jointly,
severally,
or
individually;
ORDER
APPOINTING
RECEIVER
-
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B.
Within
three
business
days
following
service
of
this
Order,
provide
Plaintiff
and
the
Receiver
with
a
full
accounting
of
all
Receivership
Documents
and
Receivership
Assets
wherever
located,
whether
such
Documents
or
Assets
held
by
or
for
any
Receivership
Party
or
are
under
any
Receivership
Party's
direct
or
indirect
control,
jointly,
severally,
or
individually,
including
the
addresses
and
names
of
any
foreign
or
domestic
financial
institution
or
other
entity
holding
the
Receivership
Documents
and
Receivership
Assets,
along
with
the
account
numbers
and
balances;
and
D.
Immediately
following
service
of
this
Order,
provide
Plaintiff
and
the
Receiver
access
to
Defendants'
records
and
Documents
held
by
Financial
Institutions
or
other
entities,
wherever
located.
POWERS
AND
DUTIES
OF
RECEIVER
IT
IS
FURTHER
ORDERED
that
the
Receiver
shall
immediately
present
a
sworn
statement
that
he
will
perform
his
duties
faithfully
and
shall
post
a
cash
deposit
or
bond
in
the
amount
of
$1
,000.
IT
IS
FURTHER
ORDERED
that
in
addition
to
all
powers
granted
in
equity
to
receivers,
the
Receiver
shall
immediately
have
the
following
express
powers
and
duties:
A.
To
have
immediate
access
to
any
business
premises
of
the
Receivership
Party,
and
immediate
access
to
any
other
location
where
the
Receivership
Party
has
conducted
business
and
where
property
or
business
records
are
likely
to
be
located.
B.
To
assume
full
control
of
the
Receivership
Party
by
removing,
as
the
Receiver
deems
necessary
or
advis.able,
any
director,
officer,
independent
contractor,
employee
or
agent
of
the
Receivership
Party,
including
any
Defendant,
from
control
of,
management
of,
or
participation
in,
the
affairs
of
the
Receivership
Party;
C.
To
take
exclusive
custody,
control,
and
possession
of
all
assets
and
documents
of,
or
in
the
posseSSion,
custody
or
under
the
control
of,
the
Receivership
Party,
wherever
ORDER
APPOINTING
RECEIVER
-
Page
6
B.
Within
three
business
days
following
service
of
this
Order,
provide
Plaintiff
and
the
Receiver
with
a
full
accounting
of
all
Receivership
Documents
and
Receivership
Assets
wherever
located,
whether
such
Documents
or
Assets
held
by
or
for
any
Receivership
Party
or
are
under
any
Receivership
Party's
direct
or
indirect
control,
jointly,
severally,
or
individually,
including
the
addresses
and
names
of
any
foreign
or
domestic
financial
institution
or
other
entity
holding
the
Receivership
Documents
and
Receivership
Assets,
along
with
the
account
numbers
and
balances;
and
D.
Immediately
following
service
of
this
Order,
provide
Plaintiff
and
the
Receiver
access
to
Defendants'
records
and
Documents
held
by
Financial
Institutions
or
other
entities,
wherever
located.
POWERS
AND
DUTIES
OF
RECEIVER
IT
IS
FURTHER
ORDERED
that
the
Receiver
shall
immediately
present
a
sworn
statement
that
he
will
perform
his
duties
faithfully
and
shall
post
a
cash
deposit
or
bond
in
the
amount
of
$1
,000.
IT
IS
FURTHER
ORDERED
that
in
addition
to
all
powers
granted
in
equity
to
receivers,
the
Receiver
shall
immediately
have
the
following
express
powers
and
duties:
A.
To
have
immediate
access
to
any
business
premises
of
the
Receivership
Party,
and
immediate
access
to
any
other
location
where
the
Receivership
Party
has
conducted
business
and
where
property
or
business
records
are
likely
to
be
located.
B.
To
assume
full
control
of
the
Receivership
Party
by
removing,
as
the
Receiver
deems
necessary
or
advis.able,
any
director,
officer,
independent
contractor,
employee
or
agent
of
the
Receivership
Party,
including
any
Defendant,
from
control
of,
management
of,
or
participation
in,
the
affairs
of
the
Receivership
Party;
C.
To
take
exclusive
custody,
control,
and
possession
of
all
assets
and
documents
of,
or
in
the
posseSSion,
custody
or
under
the
control
of,
the
Receivership
Party,
wherever
ORDER
APPOINTING
RECEIVER
-
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situated,
including
without
limitation
all
paper
documents
and
all
electronic
data
and
devices
that
contain
or
store
electronic
data
including
but
not
limited
to
computers,
laptops,
data
storage
devices,
back-up
tapes,
DVDs,
CDs,
and
thumb
drives
and
all
other
extemal
storage
devices
and,
as
to
equipment
in
the
possession
or
under
the
control
of
the
Receivership
Parties,
all
PDAs,
smart
phones,
cellular
telephones,
and
similar
devices
issued
or
paid
for
by
the
Receivership
Party.
D.
To
act
on
behalf
of
the
Receivership
Party
and,
subject
to
further
order
of
the
Court,
to
have
the
full
power
and
authority
to
take
all
corporate
actions,
including
but
not
limited
to,
the
filing
of a
petition
for
bankruptcy
as
the
authorized
responsible
person
as
to
the
Receivership
Party,
dissolution
of
the
Receivership
Party,
and
sale
of
the
Receivership
Party.
E.
To
divert
mail.
F.
To
sue
for,
coUect,
receive,
take
in
possession,
hold,
and
manage
all
assets
and
documents
of
the
Receivership
Party
and
other
persons
or
entities
whose
interests
are
now
held
by
or
under
the
direction,
possession,
custody
or
control
of
the
Receivership
Party.
G.
To
investigate,
conserve,
hold,
and
manage
all
Receivership
Assets,
and
perform
all
acts
necessary
or
advisable
to
preserve
the
value
of
those
assets
in
an
effort
to
prevent
any
irreparable
loss,
damage
or injury
to
consumers
or
to
creditors
of
the
Receivership
Party
including,
but
not
limited
to,
obtaining
an
accounting
of
the
assets,
and
preventing
transfer,
withdrawal
or
misapplication
of
assets.
H.
To
enter
into
contracts
and
purchase
insurance
as
advisable
or
necessary.
I.
To
prevent
the
inequitable
distribution
of
assets
and
determine,
adjust,
and
protect
the
interests
of
creditors
who
have
transacted
business
with
the
Receivership
Party.
J.
To
manage
and
administer
the
business
of
the
Receivership
Party
until
further
order
of
this
Court
by
performing
all
incidental
acts
that
the
Receiver
deems
to
be
advisable
or
necessary,
which
include
retaining,
hiring,
or
dismissing
any
employees,
independent
contractors,
or
agents.
ORDER
APPOINTING
RECEIVER
-
Page
7
situated,
including
without
limitation
all
paper
documents
and
all
electronic
data
and
devices
that
contain
or
store
electronic
data
including
but
not
limited
to
computers,
laptops,
data
storage
devices,
back-up
tapes,
DVDs,
CDs,
and
thumb
drives
and
all
other
extemal
storage
devices
and,
as
to
equipment
in
the
possession
or
under
the
control
of
the
Receivership
Parties,
all
PDAs,
smart
phones,
cellular
telephones,
and
similar
devices
issued
or
paid
for
by
the
Receivership
Party.
D.
To
act
on
behalf
of
the
Receivership
Party
and,
subject
to
further
order
of
the
Court,
to
have
the
full
power
and
authority
to
take
all
corporate
actions,
including
but
not
limited
to,
the
filing
of a
petition
for
bankruptcy
as
the
authorized
responsible
person
as
to
the
Receivership
Party,
dissolution
of
the
Receivership
Party,
and
sale
of
the
Receivership
Party.
E.
To
divert
mail.
F.
To
sue
for,
coUect,
receive,
take
in
possession,
hold,
and
manage
all
assets
and
documents
of
the
Receivership
Party
and
other
persons
or
entities
whose
interests
are
now
held
by
or
under
the
direction,
possession,
custody
or
control
of
the
Receivership
Party.
G.
To
investigate,
conserve,
hold,
and
manage
all
Receivership
Assets,
and
perform
all
acts
necessary
or
advisable
to
preserve
the
value
of
those
assets
in
an
effort
to
prevent
any
irreparable
loss,
damage
or injury
to
consumers
or
to
creditors
of
the
Receivership
Party
including,
but
not
limited
to,
obtaining
an
accounting
of
the
assets,
and
preventing
transfer,
withdrawal
or
misapplication
of
assets.
H.
To
enter
into
contracts
and
purchase
insurance
as
advisable
or
necessary.
I.
To
prevent
the
inequitable
distribution
of
assets
and
determine,
adjust,
and
protect
the
interests
of
creditors
who
have
transacted
business
with
the
Receivership
Party.
J.
To
manage
and
administer
the
business
of
the
Receivership
Party
until
further
order
of
this
Court
by
performing
all
incidental
acts
that
the
Receiver
deems
to
be
advisable
or
necessary,
which
include
retaining,
hiring,
or
dismissing
any
employees,
independent
contractors,
or
agents.
ORDER
APPOINTING
RECEIVER
-
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K.
To
choose,
engage,
and
employ
attorneys,
accountants,
appraisers,
and
other
independent
contractors
and
technical
specialists
(collectively,
"Professionals"),
as
each
Receiver
deems
advisable
or
necessary
in
the
performance
of
duties
and
responsibilities
under
the
authority
granted
by
this
Order.
L.
To
make
payments
and
disbursements
from
the
receivership
estate
that
are
necessary
or
advisable
for
carrying
out
the
directions
of,
or
exercising
the
authority
granted
by,
this
Order.
M.
To
institute,
compromise,
adjust,
defend,
appear
in,
Intervene
in,
or
become
party
to
such
actions
or
proceedings
in
state,
federal
or
foreign
courts
that
each
Receiver
deems
necessary
and
advisable
to
preserve
or
recover
the
assets
of
the
Receivership
Party
or
that
each
Receiver
deems
necessary
and
advisable
to
carry
out
the
Receiver's
mandate
under
this
Order,
including
but
not
limited
to,
the
filing
of a
petition
for
bankruptcy.
N.
To
conduct
investigations
and
to
issue
subpoenas
to
obtain
documents
and
records
pertaining
to,
or
in
aid
of,
the
receivership,
and
conduct
discovery
in
this
action
on
behalf
of
the
receivership
estate.
O.
To
consent
to
the
dissolution
of
the
receivership
in
the
event
that
the
Plaintiff
may
compromise
the
claim
that
gave
rise
to
the
appointment
of
the
Receiver,
provided,
however,
that
no
such
dissolution
shall
occur
without
a
motion
by
the
Plaintiff
and
service
provided
by
the
Plaintiff
upon
all
known
creditors
at
least
thirty
days
in
advance
of
any
such
dissolution.
LIMITATION
OF
RECEIVER'S
LIABILITY
IT
IS
FURTHER
ORDERED
that
except
for
an
act
of
gross
negligence,
the
Receiver
and
the
Professionals
shall
not
be
liable
for
any
loss
or
damage
incurred
by
any
of
the
Receivership
Parties,
their
officers,
agents,
servants,
employees
and
attorneys
or
any
other
person,
by
reason
of
any
act
performed
or
omitted
to
be
performed
by
the
Receiver
and
the
Professionals
in
connection
with
the
discharge
of
his
or
her
duties
and
responsibilities.
Additionally,
in
the
ORDER
APPOINTING
RECEIVER
-
Page
8
K.
To
choose,
engage,
and
employ
attorneys,
accountants,
appraisers,
and
other
independent
contractors
and
technical
specialists
(collectively,
"Professionals"),
as
each
Receiver
deems
advisable
or
necessary
in
the
performance
of
duties
and
responsibilities
under
the
authority
granted
by
this
Order.
L.
To
make
payments
and
disbursements
from
the
receivership
estate
that
are
necessary
or
advisable
for
carrying
out
the
directions
of,
or
exercising
the
authority
granted
by,
this
Order.
M.
To
institute,
compromise,
adjust,
defend,
appear
in,
Intervene
in,
or
become
party
to
such
actions
or
proceedings
in
state,
federal
or
foreign
courts
that
each
Receiver
deems
necessary
and
advisable
to
preserve
or
recover
the
assets
of
the
Receivership
Party
or
that
each
Receiver
deems
necessary
and
advisable
to
carry
out
the
Receiver's
mandate
under
this
Order,
including
but
not
limited
to,
the
filing
of a
petition
for
bankruptcy.
N.
To
conduct
investigations
and
to
issue
subpoenas
to
obtain
documents
and
records
pertaining
to,
or
in
aid
of,
the
receivership,
and
conduct
discovery
in
this
action
on
behalf
of
the
receivership
estate.
O.
To
consent
to
the
dissolution
of
the
receivership
in
the
event
that
the
Plaintiff
may
compromise
the
claim
that
gave
rise
to
the
appointment
of
the
Receiver,
provided,
however,
that
no
such
dissolution
shall
occur
without
a
motion
by
the
Plaintiff
and
service
provided
by
the
Plaintiff
upon
all
known
creditors
at
least
thirty
days
in
advance
of
any
such
dissolution.
LIMITATION
OF
RECEIVER'S
LIABILITY
IT
IS
FURTHER
ORDERED
that
except
for
an
act
of
gross
negligence,
the
Receiver
and
the
Professionals
shall
not
be
liable
for
any
loss
or
damage
incurred
by
any
of
the
Receivership
Parties,
their
officers,
agents,
servants,
employees
and
attorneys
or
any
other
person,
by
reason
of
any
act
performed
or
omitted
to
be
performed
by
the
Receiver
and
the
Professionals
in
connection
with
the
discharge
of
his
or
her
duties
and
responsibilities.
Additionally,
in
the
ORDER
APPOINTING
RECEIVER
-
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event
of a
discharge
of
the
Receiver
either
by
dissolution
of
the
receivership
or
order
of
this
Court,
the
Receiver
shall
have
no
further
duty
whatsoever.
PROFESSIONAL
FEES
IT
IS
FURTHER
ORDERED
that
each
Receiver
and
his
professionals,
including
counsel
to
the
Receiver
and
accountants,
are
entitled
to
reasonable
compensation
for
the
performance
of
duties
pursuant
to
this
Order
and
for
the
cost
of
actual
out-of-pocket
expenses
incurred
by
them,
which
compensation
shall
be
derived
exclusively
from
the
assets
now
held
by,
or
in
the
possession
or
control
of,
or
which
maybe
received
by
the
Receivership
Party
or
which
are
otherwise
recovered
by
the
Receiver,
against
with
the
Receiver
shall
have
a first
and
absolute
administrative
expense
lien.
The
Receiver
shall
file
with
the
Court
and
serve
on
the
parties
a
fee
application
with
regard
to
any
compensation
to
be
paid
to
professionals
prior
to
the
payment
thereof.
COOPERATION
WITH
RECEIVER
IT
IS
FURTHER
ORDERED
that
the
Defendants
and
all
other
persons
or
entities
served
with
a
copy
of
this
Order
shall
fully
cooperate
with
and
assist
the
Receiver.
This
cooperation
and
assistance
shall
include,
but
not
be
limited
to,
providing
any
information
to
the
Receiver
that
the
Receiver
deems
necessary
to
exercising
the
authority
and
discharging
the
responsibilities
of
the
Receiver
under
this
Order;
providing
any
password
required
to
access
any
computer,
electronic
account,
or
digital
file
or
telephonic
data
in
any
medium;
turning
over
all
accounts,
files,
and
records
including
those
in
possession
or
control
of
attorneys
or
accountants;
and
advising
all
pe.rsons
who
owe
money
to
the
Receivership
Party
that
all
debts
should
be
paid
directly
to
the
Receiver.
Defendants
are
hereby
temporarily
restrained
and
enjoined
from
directly
or
indirectly:
A.
Transacting
any
of
the
business
of
the
Receivership
Party;
ORDER APPOINTING RECEIVER - Page 9
event
of a
discharge
of
the
Receiver
either
by
dissolution
of
the
receivership
or
order
of
this
Court,
the
Receiver
shall
have
no
further
duty
whatsoever.
PROFESSIONAL
FEES
IT
IS
FURTHER
ORDERED
that
each
Receiver
and
his
professionals,
including
counsel
to
the
Receiver
and
accountants,
are
entitled
to
reasonable
compensation
for
the
performance
of
duties
pursuant
to
this
Order
and
for
the
cost
of
actual
out-of-pocket
expenses
incurred
by
them,
which
compensation
shall
be
derived
exclusively
from
the
assets
now
held
by,
or
in
the
possession
or
control
of,
or
which
maybe
received
by
the
Receivership
Party
or
which
are
otherwise
recovered
by
the
Receiver,
against
with
the
Receiver
shall
have
a first
and
absolute
administrative
expense
lien.
The
Receiver
shall
file
with
the
Court
and
serve
on
the
parties
a
fee
application
with
regard
to
any
compensation
to
be
paid
to
professionals
prior
to
the
payment
thereof.
COOPERATION
WITH
RECEIVER
IT
IS
FURTHER
ORDERED
that
the
Defendants
and
all
other
persons
or
entities
served
with
a
copy
of
this
Order
shall
fully
cooperate
with
and
assist
the
Receiver.
This
cooperation
and
assistance
shall
include,
but
not
be
limited
to,
providing
any
information
to
the
Receiver
that
the
Receiver
deems
necessary
to
exercising
the
authority
and
discharging
the
responsibilities
of
the
Receiver
under
this
Order;
providing
any
password
required
to
access
any
computer,
electronic
account,
or
digital
file
or
telephonic
data
in
any
medium;
turning
over
all
accounts,
files,
and
records
including
those
in
possession
or
control
of
attorneys
or
accountants;
and
advising
all
pe.rsons
who
owe
money
to
the
Receivership
Party
that
all
debts
should
be
paid
directly
to
the
Receiver.
Defendants
are
hereby
temporarily
restrained
and
enjoined
from
directly
or
indirectly:
A.
Transacting
any
of
the
business
of
the
Receivership
Party;
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B.
Destroying,
secreting,
defacing,
transferring,
or
otherwise
altering
or
disposing
of
any
documents
of
the
Receivership
Party
including,
but
not
limited
to,
books,
records,
accounts,
writings,
drawings,
graphs,
charts,
photographs,
audio
and
video
recordings,
computer
records,
and
other
data
compilations,
electronically-stored
records,
or
any
other
papers
of
any
kind
or
nature;
C.
Transferring,
receiving,
altering,
selling,
encumbering,
pledging,
assigning,
liquidating,
or
otherwise
disposing
of
any
assets
owned,
controlled,
or
in
the
possession
or
custody
of,
or
in
which
an
interest
is
held
or
claimed
by,
the
Receivership
Party
or
the
Receiver;
D.
Drawing
on
any
existing
line
of
credit
available
to
Receivership
Party;
E.
Excusing
debts
owed
to
the
Receivership
Party;
F.
Failing
to
notify
the
Receiver
of
any
asset,
including
accounts,
of
the
Receivership
Party
held
in
any
name
other
than
the
name
of
any
of
the
Receivership
Party,
or
by
any
person
or
entity other
than
the
Receivership
Party,
or
failing
to
provide
any
assistance
or
information
requested
by
the
Receiver
in
connection
with
obtaining
possession,
custody
or
control
of
such
assets;
G.
Doing
any
act
that
WOUld,
or
failing
to
do
any
act
which
failure
WOUld,
interfere
with
the
Receiver's
taking
custody,
control,
possession,
or
management
of
the
assets
or
documents
subject
to
this
receivership;
or
to
harass
or
interfere
with
the
Receiver
in
any
way;
or
to
interfere
in
any
manner
with
the
exclusive
jurisdiction of
this
Court
over
the
assets
or
documents
of
the
Receivership
Party;
or
to
refuse
to
cooperate
with
the
Receiver
or
the
Receiver's
duly
authorized
agents
in
the
exercise
of their
duties
or authority
under
any
Order of
this
Court;
and
H.
Filing,
or
causing
to
be
filed,
any
petition
on
behalf
of
the
Receivership
Party
for
relief
under
the
United
States
Bankruptcy
Code,
11
U.S.C.
§§
101-1330
(2002),
without
prior
permission
from
this
Court.
IT
IS
FURTHER
ORDERED
that:
ORDER
APPOINTING
RECEIVER
-
Page
10
B.
Destroying,
secreting,
defacing,
transferring,
or
otherwise
altering
or
disposing
of
any
documents
of
the
Receivership
Party
including,
but
not
limited
to,
books,
records,
accounts,
writings,
drawings,
graphs,
charts,
photographs,
audio
and
video
recordings,
computer
records,
and
other
data
compilations,
electronically-stored
records,
or
any
other
papers
of
any
kind
or
nature;
C.
Transferring,
receiving,
altering,
selling,
encumbering,
pledging,
assigning,
liquidating,
or
otherwise
disposing
of
any
assets
owned,
controlled,
or
in
the
possession
or
custody
of,
or
in
which
an
interest
is
held
or
claimed
by,
the
Receivership
Party
or
the
Receiver;
D.
Drawing
on
any
existing
line
of
credit
available
to
Receivership
Party;
E.
Excusing
debts
owed
to
the
Receivership
Party;
F.
Failing
to
notify
the
Receiver
of
any
asset,
including
accounts,
of
the
Receivership
Party
held
in
any
name
other
than
the
name
of
any
of
the
Receivership
Party,
or
by
any
person
or
entity other
than
the
Receivership
Party,
or
failing
to
provide
any
assistance
or
information
requested
by
the
Receiver
in
connection
with
obtaining
possession,
custody
or
control
of
such
assets;
G.
Doing
any
act
that
WOUld,
or
failing
to
do
any
act
which
failure
WOUld,
interfere
with
the
Receiver's
taking
custody,
control,
possession,
or
management
of
the
assets
or
documents
subject
to
this
receivership;
or
to
harass
or
interfere
with
the
Receiver
in
any
way;
or
to
interfere
in
any
manner
with
the
exclusive
jurisdiction of
this
Court
over
the
assets
or
documents
of
the
Receivership
Party;
or
to
refuse
to
cooperate
with
the
Receiver
or
the
Receiver's
duly
authorized
agents
in
the
exercise
of their
duties
or authority
under
any
Order of
this
Court;
and
H.
Filing,
or
causing
to
be
filed,
any
petition
on
behalf
of
the
Receivership
Party
for
relief
under
the
United
States
Bankruptcy
Code,
11
U.S.C.
§§
101-1330
(2002),
without
prior
permission
from
this
Court.
IT
IS
FURTHER
ORDERED
that:
ORDER
APPOINTING
RECEIVER
-
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A.
Immediately
upon
service
of
this
Order
upon
them,
or
within
such
period
as
may
be
permitted
by
the
Receiver,
Defendants
or
any
other
person
or
entity
shall
transfer
or
deliver
possession,
custody,
and
control
of
the
following
to
the
Receiver:
1.
All
assets
of
the
Receivership
Party,
including,
without
limitation,
bank
accounts,
web
sites,
buildings
or
office
space
owned,
leased,
rented,
or
otherwise
occupied
by
the
Receivership
Party;
2.
All
documents
of
the
Receivership
Party,
including,
but
not
limited
to,
books
and
records
of
accounts,
legal
files
(whether
held
by
Defendants
or
their
counsel)
all
financial
and
accounting
records,
balance
sheets,
income
statements,
bank
records
(including
monthly
statements,
canceled
checks,
records
of
wire
transfers,
and
check
registers),
client
lists,
title
documents,
and
other
papers;
3.
All
of
the
Receivership
Party's
accounting
records,
tax
records,
and
tax
returns
controlled
by,
or
in
the
possession
of,
any
bookkeeper,
accountant,
enrolled
agent,
licensed
tax
preparer
or
certified
public
accountant;
4.
All
loan
applications
made
by
or
on
behalf
of
Receivership
Party
and
supporting
documents
held
by
any
type
of
lender
including,
but
not
limited
to,
banks,
savings
and
loans,
thrifts
or
credit
unions;
5.
All
assets
belonging
to
rnembers
of
the
public
now
held
by
the
Receivership
Party;
and
6.
All
keys
and
codes
necessary
to
gain
or
secure
access
to
any
assets
or
docurnents
of
the
Receivership
Party
including,
but
not
lirnited
to,
access
to
their
business
prernises,
means
of
communication,
accounts,
computer
systems
or
other
property;
B.
In
the
event
any
person
or
entity
fails
to
deliver
or
transfer
any
asset
or
otherwise
fails
to
comply
with
any
provision
of
this
Paragraph,
the
Receiver
may
file
ex
parte
an
Affidavit
of
Non-Compliance
regarding
the
failure.
Upon
filing
of
the
affidavit,
the
Court
may
authorize,
without
additional
process
or
demand,
Writs
of
Possession
or
Sequestration
or
other
equitable
ORDER APPOINTING RECEIVER - Page
11
A.
Immediately
upon
service
of
this
Order
upon
them,
or
within
such
period
as
may
be
permitted
by
the
Receiver,
Defendants
or
any
other
person
or
entity
shall
transfer
or
deliver
possession,
custody,
and
control
of
the
following
to
the
Receiver:
1.
All
assets
of
the
Receivership
Party,
including,
without
limitation,
bank
accounts,
web
sites,
buildings
or
office
space
owned,
leased,
rented,
or
otherwise
occupied
by
the
Receivership
Party;
2.
All
documents
of
the
Receivership
Party,
including,
but
not
limited
to,
books
and
records
of
accounts,
legal
files
(whether
held
by
Defendants
or
their
counsel)
all
financial
and
accounting
records,
balance
sheets,
income
statements,
bank
records
(including
monthly
statements,
canceled
checks,
records
of
wire
transfers,
and
check
registers),
client
lists,
title
documents,
and
other
papers;
3.
All
of
the
Receivership
Party's
accounting
records,
tax
records,
and
tax
returns
controlled
by,
or
in
the
possession
of,
any
bookkeeper,
accountant,
enrolled
agent,
licensed
tax
preparer
or
certified
public
accountant;
4.
All
loan
applications
made
by
or
on
behalf
of
Receivership
Party
and
supporting
documents
held
by
any
type
of
lender
including,
but
not
limited
to,
banks,
savings
and
loans,
thrifts
or
credit
unions;
5.
All
assets
belonging
to
rnembers
of
the
public
now
held
by
the
Receivership
Party;
and
6.
All
keys
and
codes
necessary
to
gain
or
secure
access
to
any
assets
or
docurnents
of
the
Receivership
Party
including,
but
not
lirnited
to,
access
to
their
business
prernises,
means
of
communication,
accounts,
computer
systems
or
other
property;
B.
In
the
event
any
person
or
entity
fails
to
deliver
or
transfer
any
asset
or
otherwise
fails
to
comply
with
any
provision
of
this
Paragraph,
the
Receiver
may
file
ex
parte
an
Affidavit
of
Non-Compliance
regarding
the
failure.
Upon
filing
of
the
affidavit,
the
Court
may
authorize,
without
additional
process
or
demand,
Writs
of
Possession
or
Sequestration
or
other
equitable
ORDER APPOINTING RECEIVER - Page
11
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writs
requested
by
the
Receivers,
The
writs
shall
authorize
and
direct
the
United
States
Marshal
or
any
sheriff
or
deputy
sheriff of
any
county,
or
any
other
federal
or
state
law
enforcement
officer,
to
seize
the
asset,
document
or
other
thing
and
to
deliver
it
to
the
Receivers,
IT
IS
FURTHER
ORDERED
that,
upon
service
of a
copy
of
this
Order,
all
banks,
broker-
dealers,
savings
and
loans,
escrow
agents,
title
companies,
leasing
companies,
landlords,
ISOs,
credit
and
debit
card
processing
companies,
insurance
agents,
insurance
companies,
commodity
trading
companies
or
any
other
person,
including
relatives,
business
associates
or
friends
of
the
Defendants,
or
their
subsidiaries
or
affiliates,
holding
assets
of
the
Receivership
Party
or
in
trust
for
Receivership
Party
shall
cooperate
with
all
reasonable
requests
of
each
Receiver
relating
to
implementation
of
this
Order,
including
freezing
and
transferring
funds
at
his
or
her
direction
and
producing
records
related
to
the
assets
of
the
Receivership
Party,
STAY
OF
ACTIONS
IT
IS
FURTHER
ORDERED
that:
A,
Except
by
leave
of
this
Court,
during
the
pendency
of
the
receivership
ordered
herein,
all
other
persons
and
entities
aside
from
the
Receiver
are
hereby
stayed
from
taking
any
action
to
establish
or
enforce
any
claim,
right,
or
interest
for,
against,
on
behalf
of,
in,
or
In
the
name
of,
the
Receivership
Party,
any
of their
partnerships,
assets,
documents,
or
the
Receiver
or
the
Receiver's
duly
authorized
agents
acting
in
their
capacities
as
such,
including,
but
not
limited
to,
the
following
actions:
1,
Commencing,
prosecuting,
continuing,
entering,
or
enforcing
any
suit
or
proceeding,
except
that
such
actions
may
be
filed
to
toll
any
applicable
statute
of
limitations;
2,
Accelerating
the
due
date
of
any
obligation
or
claimed
obligation;
filing
or
enforcing
any
lien;
taking
or
attempting
to
take
possession,
custody
or
control
of
any
asset;
ORDER
APPOINTING
RECEIVER
-
Page
12
writs
requested
by
the
Receivers,
The
writs
shall
authorize
and
direct
the
United
States
Marshal
or
any
sheriff
or
deputy
sheriff of
any
county,
or
any
other
federal
or
state
law
enforcement
officer,
to
seize
the
asset,
document
or
other
thing
and
to
deliver
it
to
the
Receivers,
IT
IS
FURTHER
ORDERED
that,
upon
service
of a
copy
of
this
Order,
all
banks,
broker-
dealers,
savings
and
loans,
escrow
agents,
title
companies,
leasing
companies,
landlords,
ISOs,
credit
and
debit
card
processing
companies,
insurance
agents,
insurance
companies,
commodity
trading
companies
or
any
other
person,
including
relatives,
business
associates
or
friends
of
the
Defendants,
or
their
subsidiaries
or
affiliates,
holding
assets
of
the
Receivership
Party
or
in
trust
for
Receivership
Party
shall
cooperate
with
all
reasonable
requests
of
each
Receiver
relating
to
implementation
of
this
Order,
including
freezing
and
transferring
funds
at
his
or
her
direction
and
producing
records
related
to
the
assets
of
the
Receivership
Party,
STAY
OF
ACTIONS
IT
IS
FURTHER
ORDERED
that:
A,
Except
by
leave
of
this
Court,
during
the
pendency
of
the
receivership
ordered
herein,
all
other
persons
and
entities
aside
from
the
Receiver
are
hereby
stayed
from
taking
any
action
to
establish
or
enforce
any
claim,
right,
or
interest
for,
against,
on
behalf
of,
in,
or
In
the
name
of,
the
Receivership
Party,
any
of their
partnerships,
assets,
documents,
or
the
Receiver
or
the
Receiver's
duly
authorized
agents
acting
in
their
capacities
as
such,
including,
but
not
limited
to,
the
following
actions:
1,
Commencing,
prosecuting,
continuing,
entering,
or
enforcing
any
suit
or
proceeding,
except
that
such
actions
may
be
filed
to
toll
any
applicable
statute
of
limitations;
2,
Accelerating
the
due
date
of
any
obligation
or
claimed
obligation;
filing
or
enforcing
any
lien;
taking
or
attempting
to
take
possession,
custody
or
control
of
any
asset;
ORDER
APPOINTING
RECEIVER
-
Page
12
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attempting
to
foreclose,
forfeit,
alter
or
terminate
any
interest
in
any
asset,
whether
such
acts
are
part
of a judicial
proceeding
or
are
acts
of
self-help
or
otherwise;
3.
Executing,
issuing,
serving
or
causing
the
execution,
issuance
or
service
of,
any
legal
process
including,
but
not
limited
to,
attachments,
garnishments,
subpoenas,
writs
of
replevin,
writs
of
execution,
or
any
other
form
of
process
whether
specified
in
this
Order or
not;
and
4.
Doing
any
act
or
thing
whatsoever
to
interfere
with
the
Receiver
taking
custody,
control,
possession,
or
management
of
the
assets
or
documents
subject
to
this
receivership,
or
to
harass
or
interfere
with
the
Receiver
in
any
way,
or
to
interfere
in
any
manner
with
the
exclusive
jurisdiction of
this
Court
over
the
assets
or
documents
of
the
Receivership
Party;
B.
This
Order
does
not
stay:
1.
The
commencement
or
continuation
of a
criminal
action
or
proceeding;
and
2.
Except
as
otherwise
provided
in
this
Order,
all
persons
and
entities
in
need
of
documentation
from
the
Receiver
shall
in
all
instances
first attempt
to
secure
such
information
by
submitting
a
formal
written
request
to
the
Receiver,
and,
if
such
request
has
not
been
responded
to
within
30
days
of
receipt
by
the
Receiver,
any
such
person
or
entity
may
thereafter
seek
an
Order of
this
Court
with
regard
to
the
relief
requested.
ORDER
APPOINTING
RECEIVER
-
Page
13
attempting
to
foreclose,
forfeit,
alter
or
terminate
any
interest
in
any
asset,
whether
such
acts
are
part
of a judicial
proceeding
or
are
acts
of
self-help
or
otherwise;
3.
Executing,
issuing,
serving
or
causing
the
execution,
issuance
or
service
of,
any
legal
process
including,
but
not
limited
to,
attachments,
garnishments,
subpoenas,
writs
of
replevin,
writs
of
execution,
or
any
other
form
of
process
whether
specified
in
this
Order or
not;
and
4.
Doing
any
act
or
thing
whatsoever
to
interfere
with
the
Receiver
taking
custody,
control,
possession,
or
management
of
the
assets
or
documents
subject
to
this
receivership,
or
to
harass
or
interfere
with
the
Receiver
in
any
way,
or
to
interfere
in
any
manner
with
the
exclusive
jurisdiction of
this
Court
over
the
assets
or
documents
of
the
Receivership
Party;
B.
This
Order
does
not
stay:
1.
The
commencement
or
continuation
of a
criminal
action
or
proceeding;
and
2.
Except
as
otherwise
provided
in
this
Order,
all
persons
and
entities
in
need
of
documentation
from
the
Receiver
shall
in
all
instances
first attempt
to
secure
such
information
by
submitting
a
formal
written
request
to
the
Receiver,
and,
if
such
request
has
not
been
responded
to
within
30
days
of
receipt
by
the
Receiver,
any
such
person
or
entity
may
thereafter
seek
an
Order of
this
Court
with
regard
to
the
relief
requested.
ORDER
APPOINTING
RECEIVER
-
Page
13
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JURISDICTION
IT
IS
FURTHER
ORDERED
that
this
Court
shall
retain
jurisdiction of
this
matter
for
all
purposes.
1J..
SO
ORDERED,
this
£daY
of
~
t»s
2010
ORDER
APPOINTING
RECEIVER
-
Page
14
JURISDICTION
IT
IS
FURTHER
ORDERED
that
this
Court
shall
retain
jurisdiction of
this
matter
for
all
purposes.
1J..
SO
ORDERED,
this
£daY
of
~
t»s
2010
ORDER
APPOINTING
RECEIVER
-
Page
14
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USCA5 951
