No. 10-11202

In the

United States Court of Appeals

for the Fifth Circuit

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NETSPHERE, INC. Et Al,

Plaintiffs

JEFFREY BARON,

Defendant-Appellant

ONDOVA LIMITED COMPANY,

Defendant-Appellee

▬▬▬▬▬▬▬▬▬▬▬

Appeal of Order Appointing Receiver in Settled Lawsuit

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Cons. w/ No. 11-10113

NETSPHERE INC., Et Al, Plaintiffs

JEFFREY BARON, Et Al, Defendants

QUANTEC L.L.C.; NOVO POINT L.L.C.,

Appellants

PETER S. VOGEL,

Appellee

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Appeal of Order Adding Non-Parties Novo Point, LLC

and Quantec, LLC as Receivership Parties

▬▬▬▬▬▬▬▬▬▬▬

From the United States District Court

Northern District of Texas, Dallas Division

Civil Action No. 3-09CV0988-F

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REPLY BRIEF FOR APPELLANT JEFFREY BARON

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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

(214) 210-5940 - Telephone

(214) 347-4031 - Facsimile

Email: legal@schepps.net

FOR JEFFREY BARON

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TABLE OF CONTENTS

TABLE OF CONTENTS.................................................................................. 3

TABLE OF AUTHORITIES ........................................................................... 6

REPLY ISSUES PRESENTED FOR CONSIDERATION ...................... 10

REPLY STATEMENT OF FACTS .............................................................. 11

Mr. Baron Did Not Fire 19 Law Firms.................................................. 11

The District Court Made No Finding As To The Validity of The

Alleged Debt ............................................................................................ 11

No Threat to Ondova’s creditors, no evidence of “Disruption” or

Halted Progress ....................................................................................... 12

Other Sherman Facts Not Supported by the Record............................ 12

ARGUMENT SUMMARY.............................................................................. 13

The Granted Motion Expressly Sought Receivership to Seize

All of Jeff Baron’s Property so that He could Not Hire an

Attorney ................................................................................................... 13

Receivership is Not Authorized as a Remedy for Vexatious

Litigation ................................................................................................. 15

Fifth Amendment Due Process .............................................................. 16

The Fourth Amendment........................................................................... 16

ARGUMENT & AUTHORITY ...................................................................... 18

REPLY ISSUE 1: THE POST-DEPRIVATION FRAP 8(A)

HEARING DID NOT CURE THE LACK OF A PRE-

DEPRIVATION HEARING REQUIRED BY THE FIFTH

AMENDMENT ............................................................................................... 18

A Matter of Established Law ................................................................. 18

This Rule also Applies to allegations of Vexatious Litigation ............. 19

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Whatley v. Philo....................................................................................... 19

Appeal divests the Trial Court of Jurisdiction Over the Matter

Appealed .................................................................................................. 20

REPLY ISSUE 2: FAILURE OF DUE PROCESS WITH

RESPECT TO THE FRAP 8(A) HEARING .................................................. 23

Factual Background of the FRAP 8(a) Hearing.................................... 23

Failure Due Process ................................................................................ 24

REPLY ISSUE 3: RECEIVERSHIP IS NOT AUTHORIZED AS A

REMEDY FOR VEXATIOUS LITIGATION ................................................ 28

Controlling Access to the Court ............................................................. 28

Pre-Filing Injunction is the Authorized Remedy for Vexatious

Litigation ................................................................................................. 29

The limits of Inherent Power: De Beers................................................. 31

Seizing Jeff Baron’s Assets was not Necessary to Enable the

Court to Exercise any of its Powers ....................................................... 33

Sherman’s Argument: ............................................................................. 34

The Specific Remedy of Equity Receivership is Not Authorized

to be Used as a Stand-Alone Remedy .................................................... 40

REPLY ISSUE 4: THERE IS A CONSTITUTIONAL RIGHT TO

ASSOCIATE WITH AND RETAIN LEGAL COUNSEL ............................. 41

REPLY ISSUE 5: THE SEIZURE OF ALL OF JEFF BARON’S

PROPERTY IS OBJECTIVELY UNREASONABLE AND THUS

VIOLATES THE FOURTH AMENDMENT................................................. 42

REPLY ISSUE 6: A RECEIVER’S FIDELITY BOND IS NOT A

MOVANT’S BOND TO COMPENSATE FOR DAMAGES

CAUSED IN CASE OF WRONGFUL ENJOINMENT................................ 47

REPLY ISSUE 7: INVOLUNTARY SERVITUDE ...................................... 50

CONCLUSION ................................................................................................ 51

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CERTIFICATE OF COMPLIANCE............................................................ 55

CERTIFICATE OF SERVICE ..................................................................... 56

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TABLE OF AUTHORITIES

FEDERAL CASES

Animale Group Inc. v. Sunny's Perfume Inc., 256 Fed.Appx. 707 (5th Cir. 2007)

(unpublished).....................................................................................................38

Baum v. Blue Moon Ventures, LLC, 513 F. 3d 181, 187

(5th Cir. 2008).............................................................................................28, 30

Boddie v. Connecticut, 401 U.S. 371, 378 (1971).................................................26

Cleveland Bd. of Ed. v. Loudermill, 470 U.S. 532, 543 (1985).............................20

Connecticut v. Doehr, 501 U.S. 1, 4 (1991) ..........................................................49

Dailey v. Vought Aircraft Co., 141 F. 3d 224, 230 (5th Cir. 1998) .................18, 27

Dayton Indep. School Dist. v. US Mineral Prods. Co., 906 F.2d 1059, 1063

(5th Cir. 1990)...................................................................................................21

De Beers Consol. Mines, Ltd. v. United States, 325 U.S. 212, 220 (1945).....31, 32,

35, 36

Desarrollo, SA v. Alliance Bond Fund, Inc., 527 U.S. 308, 318 (1999) ................37

Elrod v. Burns, 427 U.S. 347, 373 (1976) .............................................................49

Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546, 552 (2005)...........28

Farguson v. MBank Houston, NA, 808 F.2d 358, 360 (5th Cir. 1986) ..................28

Farmhand, Inc. v. Anel Engineering Industries, Inc., 693 F.2d 1140, 1146

(5th Cir. 1982)...................................................................................................21

Fuentes v. Shevin, 407 U.S. 67, 82-85 (1972).......................................................18

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Gordon v. Washington, 295 U.S. 30, 37 (1935) ........................................15, 16, 40

Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58 (1982)...................20

Hale v. Townley, 45 F.3d 914 (5th Cir. 1995).......................................................43

Harrington v. Colquitt County Board of Education, 449 F.2d 161, at 267-268

(5th Cir. 1971)...................................................................................................48

In re Fredeman Litigation, 843 F.2d 821, 826 (5th Cir. 1988)...............................34

In re Hartford Textile Corp., 681 F.2d 895, 897 (2d Cir. 1982).............................30

ITT Community Development Corp. v. Barton, 569 F.2d 1351, 1360

(5th Cir. 1978).............................................................................................32, 37

John Deere Co. v. American Nat. Bank, Stafford, 809 F.2d 1190, 1192

(5th Cir. 1987)...................................................................................................27

Kelleam v. Maryland Casualty Co. of Baltimore, 312 U.S. 377, 381 (1941).........15

Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375,380 (1994)....29, 53

Local Loan Co. v. Hunt, 292 U.S. 234, 245 (1934)..............................................50

Marshall Durbin Farms, Inc. v. National Farmers Org., Inc., 446 F.2d 353, 356

(5th Cir. 1971)...................................................................................................26

McCuin v. Texas Power & Light Co., 714 F.2d 1255 (5th Cir. 1983) ...................41

Mosley v. St. Louis Southwestern Ry., 634 F. 2d 942, 945-946

(5th Cir. 1981)...................................................................................................41

Natural Gas Pipeline Co. v. Energy Gathering, Inc., 2 F.3d 1397, 1409

(5th Cir. 1993)...................................................................................................37

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Phillips v. Chas. Schreiner Bank, 894 F.2d 127, 131 (5th Cir.1990) .....................49

Powell v. Alabama, 287 U.S. 45, 53 (1932) ..............................................25, 26, 41

Pusey & Jones Co. v. Hanssen, 261 U.S. 491, 497 (1923)...............................15, 45

Qureshi v. U.S., 600 F.3d 523, 526 (5th Cir. 2010).........................................19, 29

Registration Control Systems v. Compusystems, Inc., 922 F.2d 805, 807

(Federal Cir. 1990) ............................................................................................26

Roberts v. United States Jaycees, 468 U.S. 609, 618 (1984) .................................41

Scaife v. Associated Air Center Inc., 100 F. 3d 406, 411 (5th Cir. 1996).............43

Sniadach v. Family Finance Corp. of Bay View, 395 U.S. 337, 342 (1969)..........20

Spallone v. United States, 493 U.S. 265, 280 (1990).............................................53

Tucker v. Baker, 214 F.2d 627, 631 (5th Cir. 1954)..............................................40

United States v. First Nat. City Bank, 379 U.S. 378, 85 S.Ct. 528 (1965).......34, 35

United States v. Hall, 472 F.2d 261, 267 (5th Cir.1972)........................................48

US v. Stewart, 93 F.3d 189, 192 (5th Cir. 1996) ...................................................42

Whatley v. Philo, 817 F.2d 19 (5th Cir. 1987) ......................................................19

White v. Balderama, 153 F.3d 237, 241 (5th Cir. 1998)........................................42

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FEDERAL STATUTES

11 U.S.C. § 105(b)................................................................................................45

11 U.S.C. §503(b)(4) ............................................................................................44

FEDERAL RULES

FED. R. APP. P. 32(a)(5)......................................................................................55

FED. R. APP. P. 32(a)(6)......................................................................................55

FED. R. APP. P. 32(a)(7)(B).................................................................................55

FED. R. APP. P. 8(a)(1)..................................................................................23, 24

FED. R. APP. P. 8(a)(2)(A)(ii)..............................................................................12

FED. R. CIV. P. 65(c)...........................................................................................47

FED. R. CIV. P. 7.................................................................................................26

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REPLY ISSUES PRESENTED FOR CONSIDERATION

Reply Issue 1: The post-deprivation FRAP 8(a) hearing did not cure

the lack of a pre-deprivation hearing required by the Fifth

Amendment

Reply Issue 2: Failure of due process with respect to the FRAP 8(a)

hearing

Reply Issue 3: Receivership is not authorized as a remedy for

vexatious litigation

Reply Issue 4: There is a Constitutional right to associate with and

retain legal counsel

Reply Issue 5: The seizure of all of Jeff Baron’s property is

objectively unreasonable and thus violates the Fourth Amendment

Reply Issue 6: A receiver’s fidelity bond is not a movant’s bond to

compensate for damages caused in case of wrongful enjoinment

Reply Issue 7: Involuntary Servitude

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REPLY STATEMENT OF FACTS

Mr. Baron Did Not Fire 19 Law Firms

The record does not support Sherman’s factual assertion that Jeff

Baron hired and fired 19 law firms. For the dozen or so actions over the

past half-decade listed in Sherman’s record citation, the record does not

disclose who of the over dozen independent entities involved as

defendants hired the firms, or how the representation ended.

The District Court Made No Finding As To The Validity

of The Alleged Debt

Significantly, the record does not support Sherman’s factual

allegation that “Most of the lawyers had not been paid the amounts

owed them”. (Sherman’s Principal Brief, “Sherman’s Brief”, page 3). The

District Court’s judicial notice cited to by Sherman expressly states there

is no finding as to the validity of the alleged debt. SR. v2 p361.

Additionally, the ‘claims’ giving rise to alleged debt have been shown to

be groundless and to have been solicited. SR. v8 pp1197-1201,1212-1235.

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No Threat to Ondova’s creditors, no evidence of

“Disruption” or Halted Progress

The record does not support Sherman’s factual assertions

(Sherman’s Brief, pages 2-3): (1) that the grounds of Sherman’s motion

for receivership were to prevent “continued disruption of the Bankruptcy

and District Court proceedings”, (2) that claims threatened the ability of

Ondova to pay unsecured creditors, and (3) that the appearance of new

lawyers sometimes completely halted progress toward winding up the

bankruptcy and dismissing the District Court lawsuit.

Other Sherman Facts Not Supported by the Record

Mr. Baron’s motion for stay was not held pending the outcome of

proceedings, but was denied without prejudice. Sherman errs in

averring that Baron filed a motion “falsely claiming that the District

Court had denied his Emergency Motion”. The District Court declined

to grant emergency relief and put off the hearing on relief to a date 40

days after the receivership was imposed. Mr. Baron then moved for

emergency relief in the Court of Appeals pursuant to the second tier of

FRAP 8(a)(2)(A)(ii), averring that the district court had failed to afford

the emergency relief requested.

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ARGUMENT SUMMARY

The Granted Motion Expressly Sought Receivership to

Seize All of Jeff Baron’s Property so that He could Not

Hire an Attorney

In an act unprecedented in the history of American jurisprudence,

the District Court below granted a motion to seize all of an individual’s

assets in order to prevent them from hiring an attorney.

As explained

by the District Judge: “[T]he receivership is an effort to stop the parade

of lawyers trying to wiggle out of lawful injunctions from judicial

officers. Yes, sir.”

Jeff Baron was warned that he was “prohibited from

retaining any legal counsel” and that if he did “the Receiver may move

the Court to find you in contempt”.

In case that threat was not

sufficient, in order to stop Jeff from having any money to hire a lawyer,

all of his assets (exempt and non-exempt) were seized

, as were all of

his future earnings

. Jeff was ordered not to cash any checks

or enter

R. 1578 (paragraph 13, “the appointment of a receiver is necessary under the

circumstances in order to remove Baron from control of his assets and end his

ability to further hire and fire a growing army of attorneys.” ), 1619-1632.

R. 4593-4594.

SR. v8 p1213.

R. 1620.

R. 1622 paragraph F.

R. 1620, 1621 paragraph C.

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into any business transactions

Jeff Baron has been in a civil lockdown since the day the

challenged order was issued ex parte. Since that day, Mr. Baron has

been forced to live off a monthly sustenance stipend from the remaining

dollars of his life savings disbursed to him by the receiver. Under the

express threat of contempt, Jeff Baron is allowed to purchase only

“local transportation, meals, home utilities, medical care and

medicine.”

Mr. Baron’s business, savings, right to work, and life as a

free member of society were taken from him by the challenged order.

Further, unless this Court grants relief, Jeff Baron’s savings

accounts have been stripped from him forever. While this matter has

been on appeal, the District Court has distributed essentially all of

Jeff’s savings account balances to the receiver and his law firm. The

amount is staggering— almost a million dollars. SR. v8 p990-992.

Only by order of this Court (1) reversing the receivership order, (2)

ordering the receivership assets disbursed while the matter has been on

appeal returned, and (3) ordering the receivership costs be born by the

R. 1620, 1622, 1627 paragraph A.

SR. v8 p1213.

Only $23,182.52 was left in Mr. Baron’s savings accounts by the start of June. Id.

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Appellee, can the property that has been unreasonably and without Due

Process of law been taken from Jeff Baron be restored to him.

Receivership is Not Authorized as a Remedy for

Vexatious Litigation

The only basis for the receivership put forth by Sherman is that

Mr. Baron was guilty of vexatious litigation. Sherman argues that

equity receivership seizing all of a citizen’s property is an authorized

remedy for vexatious litigation. However, equity receivership is not

authorized as a means of providing any form of final relief. Pusey &

Jones Co. v. Hanssen, 261 U.S. 491, 497 (1923) (“[R]eceivership is not

final relief.”). The District Court has discretion to impose a receivership

only where it is ancillary to some other final equitable remedy sought in

the property which is pending before the court. Kelleam v. Maryland

Casualty Co. of Baltimore, 312 U.S. 377, 381 (1941). The Supreme

Court established nearly a hundred years ago that receivership was

only authorized as an intermediate remedy to preserve property

pending adjudication of disposition of that property. Gordon v.

Washington, 295 U.S. 30, 37 (1935). As held by the Gordon Court,

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“There is no occasion for a court of equity to appoint a receiver of

property of which it is asked to make no further disposition.” Id.

Fifth Amendment Due Process

Sherman argues that the post-deprivation, post-appeal TRAP 8(a)

hearing provided ‘due process’ for the prior ex parte seizure of Jeff

Baron’s assets and the firing of his trial counsel. As discussed in the

briefing below, such an argument is contrary to settled law. Further, if

a post-deprivation, post-appeal, hearing could satisfy the requirements

of due process, it does not in this case because there was also a failure of

Due Process with respect to the post-deprivation hearing. With respect

to the post-deprivation hearing, Mr. Baron was denied the opportunity

to retain experienced trial counsel, his documents were stripped from

him, and he was denied the opportunity to conduct discovery.

The Fourth Amendment

The Fourth Amendment to our Constitution should protect every

citizen against the unreasonable seizure of their property. That

Constitutional protection is fundamental to freedom in our society.

However, the words “Fourth Amendment” are noticeably absent from

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Sherman’s responsive briefing. There are two core Fourth Amendment

protections involved in this appeal:

(1) Objective reasonableness.

Objective reasonableness is required before a citizen’s

property may be seized. Objective reasonableness is an issue

of law reviewed de novo on appeal.

(2) Probable Cause upon sworn oath.

As a core procedural protection against unreasonable

seizure, no warrant for the seizure of a citizen’s property

may issue without probable cause shown upon sworn oath or

affirmation. However, no oath or affirmation of probable

cause preceded the issuance of the challenged order.

Sherman has not contested either the factual or legal

argument briefed on this issue.

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ARGUMENT & AUTHORITY

REPLY ISSUE 1: THE POST-DEPRIVATION FRAP 8(A) HEARING

DID NOT CURE THE LACK OF A PRE-DEPRIVATION HEARING

REQUIRED BY THE FIFTH AMENDMENT

A Matter of Established Law

Sherman erroneously argues that because Jeff Baron had notice of

post appeal hearings in which he sought relief pursuant to the rules of

appellate procedure, a pre-deprivation hearing was not required.

(Sherman’s Brief, page 24). Sherman ignores the Fifth Circuit’s holding

in Dailey v. Vought Aircraft Co., 141 F. 3d 224, 230 (5th Cir. 1998) (a

post-deprivation hearing does “not repair the district court's violation of

her rights to due process under the Constitution and the court rules”).

The law regarding this issue is well established in the context of seizure

of property and specifically of wages. Eg. Fuentes v. Shevin, 407 U.S. 67,

82-85 (1972) (“[N]o later hearing and no damage award can undo the

fact that the arbitrary taking that was subject to the right of procedural

due process has already occurred.”).

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This Rule also Applies to allegations of Vexatious

Litigation

Prior notice and hearing are established mandatory pre-requisites

for declaring litigants vexatious. Sherman’s own cases establish this

principle. E.g. Qureshi v. U.S., 600 F.3d 523, 526 (5th Cir. 2010) (citing

Fuentes v. Shevin, 407 U.S. 67, 80, 92 (1972)).

Whatley v. Philo

Sherman relies upon Whatley v. Philo, 817 F.2d 19 (5th Cir. 1987)

as his sole authority for the proposition that no pre-deprivation hearing

was required in the proceedings below. Sherman’s reliance is misplaced.

The constitutional requirements of ex parte receivership are not

addressed in Whatley. The Whatley appellant conceded that he enjoyed

“no clearly established constitutional right to pre-deprivation notice and

hearing in the circumstances of [that case]”. Id. at 21. Whatley

involved a statutory scheme regulating title insurance. Id. at 21, fn. 5.

Appellant does not argue a per se constitutional prohibition

against seizing property ex parte. Rather, there are Due Process

safeguards required in granting ex parte relief seizing a citizen’s

significant property interest, and there is a constitutional prohibition

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against granting such ex parte relief where those safeguards are

absent.

Those safeguards were absent in the proceedings below.

There is also a per se prohibition against pre-hearing seizure with

respect to an individual’s most basic property rights. Those rights have

been recognized to include an individual’s right to work and right to

wages earned. E.g. Sniadach v. Family Finance Corp. of Bay View, 395

U.S. 337, 342 (1969), Cleveland Bd. of Ed. v. Loudermill, 470 U.S. 532,

543 (1985). Both of these rights were taken from Mr. Baron by the ex

parte order challenged in this appeal and, as a matter of established law,

a post-deprivation hearing, if one were held, is not sufficient to satisfy

constitutional Due Process. Id. R. 1620, 1622, 1628.

Appeal divests the Trial Court of Jurisdiction Over the

Matter Appealed

An appeal “confers jurisdiction on the court of appeals and divests

the district 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). Accordingly, the district court was without jurisdiction to hear

Jeff Baron’s Principal Brief, pages 61-63.

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new arguments and evidence in support of the receivership order once it

had been appealed. Coastal Corp. v. Texas Eastern Corp., 869 F.2d 817,

820 (5th Cir. 1989). As explained by the Fifth Circuit in Dayton Indep.

School Dist. v. US Mineral Prods. Co., 906 F.2d 1059, 1063 (5th Cir.

1990), a district court does not have the power to “alter the status of the

case as it rests before the Court of Appeals”.

Sherman offers a partial quote from Farmhand, Inc. v. Anel

Engineering Industries, Inc., 693 F.2d 1140, 1146 (5th Cir. 1982), that a

district court may “support” its judgment post-appeal. The Farmhand

holding uses the word “support” but clearly refers to a district court’s

authority to maintain the status quo created by an appealed from order.

Id. Farmhand’s “support” is the power to “to enforce its order by civil

contempt proceedings.” Id. This is not the authority to alter the status

of an order on appeal by holding new hearings on the motion and

entering findings to “support” (in the sense of ‘prop up’) the order on

appeal. As the Fifth Circuit has held in Coastal Corp., 869 F.2d at 820,

“the district court lacks jurisdiction ‘to tamper in any way with the

order then on interlocutory appeal other than to issue orders designed

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to preserve the status quo of the case as it sat before the court of

appeals.’”

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REPLY ISSUE 2: FAILURE OF DUE PROCESS WITH RESPECT

TO THE FRAP 8(A) HEARING

Factual Background of the FRAP 8(a) Hearing

1. Timing of the Hearing

Although multiple requests for an emergency hearing were made,

the District Court postponed the FRAP 8(a) hearing until December 17,

2010, started and then continued the hearing to January 4, 2011, some

40 days after Jeff Baron’s property was seized. R. 27-34.

2. Motion Strictly Limited as an Appellate Motion Pursuant

to FRAP 8(a)

Baron filed his notice of appeal on December 2, 2010 and the next

day filed for relief expressly “pursuant to Federal Rule of Appellate

Procedure 8(a)(1)”. R.1699, 1702. The motion specified the specific

designation of the provision of the Federal Rules under which the

motion was filed. That Rule was FRAP 8(a)(1). Id. The district judge

expressly understood and accepted the motion as a post appeal motion

and ruled that “this matter would fall within the scope of

representation of Mr. Baron’s appellate counsel, Mr. Schepps,

who states in the instant motion that his representation is

limited to the appeal of the Order Appointing Receiver.”

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R. 3557. The FRAP 8(a) motion did not request a re-hearing, but

requested pursuant to FRAP 8(a)(1) either stay or vacation of the order.

R. 1702, 1708-1709. Baron argued that the order could be vacated

pursuant to FRAP 8(a)(1) because the order was void ab initio. R. 4404.

Notably, the burden at the FRAP 8(a) hearing was upon Jeff

Baron as movant. The district court ruled against Jeff because it found

“that Baron has not met his burden to show that the Court should stay

the Receivership”. SR v2 p 359.

Failure of Due Process

On December 13, Mr. Baron moved the District Court to be allow

access to his money to hire an experienced Federal trial counsel to

represent him before the District Court. R. 2720. In his motion

Mr. Baron noted that:

(1) His personal papers and money had been seized,

and

(2) He had no way to fairly defend himself without: (A)

access to his money to hire experienced Federal

trial counsel to represent him before the trial court,

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(B) his papers and evidence, and (C) an opportunity

to conduct discovery.

Id.

The district court denied Mr. Baron’s requests. R. 3557. The

district court refused to allow Mr. Baron any discovery. R. 3565-3566.

The district court denied Mr. Baron’s request to have access to his own

money in order to hire experienced trial counsel to represent him at the

hearing. R. 2720, 3557.

The District Court erred because Mr. Baron was entitled to be

“afforded the fair opportunity to secure counsel of his own choice.”

Powell v. Alabama, 287 U.S. 45, 53 (1932) (emphasis added). Moreover,

the District Court’s refusal to afford Mr. Baron the opportunity to

secure counsel of his own choice is a denial of due process in the

constitutional sense. Id. at 69. Prior to the ex parte receivership order

Mr. Baron was represented by an AV rated trial attorney, and was in

possession of his papers and documents, and could have defended

himself at a hearing to appoint a receiver if that hearing was heard

before the receivership was imposed upon him. R. 3890-3892. Upon his

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appointment, the receiver fired Mr. Baron’s trial counsel and seized his

documents. Id. A fundamental violation of due process should be clear

when party is put to defend the seizure of their property and the forced

firing of their trial attorney

, after their documents have been seized

and their trial counsel has been fired by the court’s receiver. Id.

Additionally, the particularity requirement in Rule 7 requires that

a non-movant be afforded notice of the grounds upon which relief is

based, in order to provide that party with a meaningful opportunity to

respond. Fed.R.Civ.P. 7; e.g., Registration Control Systems v.

Compusystems, Inc., 922 F.2d 805, 807 (Federal Cir. 1990). The Fifth

Circuit has held “The right of defendants to present controverting

factual data is illusory unless there is adequate notice of plaintiffs’

claims.” Marshall Durbin Farms, Inc. v. National Farmers Org., Inc.,

446 F.2d 353, 356 (5th Cir. 1971). The Constitution requires that the

opportunity to be heard be granted in a meaningful manner. Boddie v.

Connecticut, 401 U.S. 371, 378 (1971). As a basic matter of due process,

a district court cannot issue relief based on grounds not advanced by the

Mr. Baron’s appellate counsel handles Federal appeals, not Federal trials. He has

never on his own handled a Federal trial, bench or jury, and has always relied upon

experienced co-counsel for trials in the Federal court. SR. v5 p1256.

Case: 10-11202 Document: 00511542409 Page: 26 Date Filed: 07/15/2011

moving party in their motion. See John Deere Co. v. American Nat.

Bank, Stafford, 809 F.2d 1190, 1192 (5th Cir. 1987) (summary judgment

context); and cf. Vought Aircraft Co., 141 F.3d at 230 (sanctions

context). Notably, the motion for receivership did not allege the matters

found by the trial court in its post-appeal order denying Mr. Baron’s

FRAP 8(a) motion. For example, the motion for receivership did not

allege that Jeff was a vexatious litigant, or had “engaged in a

consistent pattern and practice during this federal litigation of

defrauding his own counsel”, or that there was a threat Jeff would move

his assets. R. 1575-1579. Yet, these are precisely the asserted

justifications Sherman argues in his briefing.

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REPLY ISSUE 3: RECEIVERSHIP IS NOT AUTHORIZED AS A

REMEDY FOR VEXATIOUS LITIGATION

Controlling Access to the Court

The Fifth Circuit has based a court's power to control vexatious

litigants on the inherent power of the court to protect its jurisdiction

and judgments and to control its docket. Farguson v. MBank Houston,

NA, 808 F.2d 358, 360 (5th Cir. 1986). The inherent power of a district

court to deter vexatious litigation that has been recognized by the Fifth

Circuit extends to the imposing of pre-filing injunctions to control access

to the court. E.g., Baum v. Blue Moon Ventures, LLC, 513 F. 3d 181,

187 (5th Cir. 2008).

There is a wide chasm between (A) inherent jurisdiction over

access to the court, and (B) jurisdiction over a citizen's property not

subject to any claim or controversy before the court. The district courts

of the United States are “courts of limited jurisdiction”. Exxon Mobil

Corp. v. Allapattah Services, Inc., 545 U.S. 546, 552 (2005). While courts

have been recognized to have the jurisdiction to lock a vexatious litigant

out of the courthouse,

they have not been recognized to have the

E.g., Baum, 513 F. 3d at 187.

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inherent jurisdiction to lock a litigant out of the litigant's own house.

Cf. Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375,380

(1994)( “the power asked for here is quite remote from what courts

require in order to perform their functions” ).

Pre-Filing Injunction is the Authorized Remedy for

Vexatious Litigation

The cases that Sherman has briefed set out the well-established

precedent that the authorized remedy for controlling vexatious

litigation is pre-filing injunction. Every vexatious litigation case cited

by Sherman has the same holding: the authorized remedy is injunction.

The cases cited by Sherman do not support his argument to the

contrary on this issue. For example:

1. Sherman argues Qureshi to hold there is a general “power to

create a remedy” for vexatious litigants (Sherman’s Brief,

page 6). However, the Qureshi Court ruled that “we hold

that a pre-filing injunction like the one imposed here

falls within ... the court’s jurisdiction.” Qureshi, 600 F.3d

at 526.

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2. Sherman argues Baum v. Blue Moon Ventures, LLC, 513

F.3d 181 (5th Cir. 2008) to hold that a court can enter

whatever orders it feels are necessary to control a vexatious

litigant (Sherman’s Brief, page 10). However, Baum holds

that “A district court has jurisdiction to impose a pre-filing

injunction to deter vexatious, abusive, and harassing

litigation”. Id. at 187. Moreover, the pre-filing injunction

must preserve “the legitimate rights” of the litigant. Id.

3. Sherman argues In re Hartford Textile Corp., 681 F.2d 895,

897 (2d Cir. 1982) to hold that courts have been

traditionally allowed enter whatever orders they feel are

necessary to control a vexatious litigant. (Sherman’s Brief,

pages 13-14). However, Hartford holds “The equity power of

a court to give injunctive relief against vexatious

litigation is an ancient one which has been codified in the

All Writs Statute,”. Id. at 897.

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The Court can control access to its door by locking its door and

placing the key in the hands of a judge to supervise access— That is

pre-filing injunction. The Court does not need to, and is not authorized

to, go to a litigant’s house and smash his legs so that he can’t come

around any more.

The limits of Inherent Power: De Beers

Sherman argues that ‘Federal Courts also have the power to

appoint receivers where equity requires it to insure compliance with the

orders of the Court’. (Sherman’s Brief, page 14). However, that is

exactly what the law expressly prohibits. The Supreme Court held in

De Beers Consol. Mines, Ltd. v. United States, 325 U.S. 212, 220 (1945),

that the court’s inherent authority to ‘protect is jurisdiction and

authority’ does not extend to the power to provide security that its

orders will be complied with. Id. De Beers expressly holds that

“[P]roviding security for compliance with other process which

conceivably may be issued” is not authorized.

Sherman also errs in concluding that the injunction sought in De

Beers was not intended to protect the exercise of the court’s power.

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(Sherman’s Brief, page 13). That was clearly the intention— the

injunction in De Beers was intended as “a method of providing security

for compliance with other process which conceivably may be issued”. De

Beers, 325 U.S. at 220. De Beers held that a district court lacks

authority to order the “requisition of such security on the footing of a

complaint in equity”. Id. As the Supreme Court explained in De Beers,

the power to disable a party’s use of property as security for compliance

with possible decrees of the court has never been thought justified in

the “long history of equity jurisprudence”. Id. at 222.

Sherman acknowledges that De Beers holds that the All Wits Act

and inherent powers authority are justified only in order to preserve the

court’s subject matter jurisdiction or necessary to processing a

litigation. Id. at 826. (Sherman’s Brief, page 10). However, Sherman’s

argument ignores the meaning of that holding. The Fifth Circuit made

clear in ITT Community Development Corp. v. Barton, 569 F.2d 1351,

1360 (5th Cir. 1978) that there are limitations to the scope of inherent

powers. One limit is that inherent powers “be used only as required for

the performance of duties” (emphasis in original). Id. Pivotally, there

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is no duty or power of the district court that it could not exercise

without seizing Jeff Baron’s property.

Seizing Jeff Baron’s Assets was not Necessary to Enable

the Court to Exercise any of its Powers

The receivership ordered against Jeff Baron was not necessary to

protect the District Court’s exercise of any its powers. For example:

(1) The District Court has power to authorize or reject the

appearance of any attorney before it and does not need to

seize Jeff Baron’s assets in order to exercise that power.

(2) The District Court has power to delay proceedings or to

refuse to delay them. The District Court did not need to

seize Jeff Baron’s house keys in order to exercise its power

to control its docket.

(3) The District Court has power to sign the stipulated

dismissal with prejudice entered into by the parties in the

lawsuit below. Stripping Jeff Baron of his property was not

necessary for the District Court to exercise that power.

(4) The bankruptcy court has power to allow, disallow, set a

deadline for filing, and sanction any groundless filings with

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respect to claims for substantial contribution. The District

Court did not have to seize all of Jeff Baron’s assets for the

bankruptcy court to exercise its authority over substantial

contribution claims.

Notably, Sherman offers no explanation as to why or how seizing

all of Jeff’s assets met the standard in Fredeman that the seizure be

“essential to preserving the court’s subject matter jurisdiction or

processing the litigation”. In re Fredeman Litigation, 843 F.2d 821, 826

(5th Cir. 1988). A stipulated dismissal of all claims in the lawsuit was

entered into by all parties in the suit below. R. 2346-2355. All the

District Court needed to do to complete the pending case was to sign the

dismissal order.

Sherman’s Argument:

1. United States v. First Nat. City Bank

Sherman appears to attempt to make up for the lack of necessity

discussed above by citation to United States v. First Nat. City Bank, 379

U.S. 378, 85 S.Ct. 528 (1965), although it is unclear how the case

supports Sherman’s position. In First Nat. City, the Supreme Court

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noted that review of a statutory grant of authority must be in light of

the public interest involved. Id. at 383.

The Supreme Court in First

Nat. City Bank held:

Unlike De Beers Mines v. United States, 325 U.S. 212,

there is here property which would be “the subject of the

provisions of any final decree in the cause.”

Id. at 385.

The case at bar is like De Beers and unlike First Nat. City Bank— the

property subject to the challenged order in this appeal was not subject

to any claim in the underlying suit. That is one of the key issues raised

in this appeal —the pivotal distinction between authority over property

subject to claims before the court and lack of authority over property

“not subject to any final decree in the cause”.

2. Receivership is Authorized as a form of Final Relief if it

has a Purpose

Sherman also argues that receivership is authorized as a form of

final relief where it is a means to achieve a desired end. (Sherman’s

Brief, page 12). However, Sherman has offered no authority for allowing

The court’s review of a statutory grant of authority is in contrast to the review of

the exercise of inherent power, which is reviewed in light of Chancery Court

practices.

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the appointment of a receiver to seize an individual’s property that was

not subject to a claim pled before the Court.

Sherman argues that Gordon merely forbids receivership where it

can accomplish no purpose. (Sherman’s Brief, page 12). However, in

Gordon there was a clear purpose requested of the Receivership. In

Gordon, the movant was not happy with the way a trustee was

handling certain property. Id at 33-34. The movant complained that

interest on many of the mortgages in a certain mortgage pool had not

been paid, and little effort was being made by the trustee to compel

payment of the taxes on the mortgaged properties. Id. The court placed

the properties into receivership to provide a remedy. The ‘end sought’

was to have the interest collected on the mortgages and effort made to

have the debtors pay taxes on the mortgaged property. However, in

reversing the lower court’s decision the Supreme Court explained that

receivership is not a form of equitable relief which a court is authorized

to give. Rather, receivership must be “ancillary to some form of final

relief which is appropriate for equity to give” Id. at 39. Moreover, that

form of final equitable relief must involve disposition of the property

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placed into receivership. Id. at 37 (“there is no occasion for a court of

equity to appoint a receiver of property of which it is asked to make no

further disposition.”).

The Supreme Court and the Fifth Circuit have delineated, with

clarity, the strict limitations on the authorized exercise of a court’s

inherent or equitable powers. That delineation is the strict limit fixed

by the powers of the Chancery Court in 1789. Grupo Mexicano de

Desarrollo, SA v. Alliance Bond Fund, Inc., 527 U.S. 308, 318 (1999).

Moreover, it has been firmly established by the holdings of the Fifth

Circuit in ITT Community Development, 569 F.2d at 1359, and Natural

Gas Pipeline Co. v. Energy Gathering, Inc., 2 F.3d 1397, 1409 (5th Cir.

1993) that a court’s inherent and ‘all writs’ powers are limited to the

powers exercised by the Court of Chancery at the time of the enactment

of the Judiciary Act. As the Supreme Court explained in Gordon,

because the Court of Chancery limited the issuance of receivership

orders exclusively to conserve property over which the court had been

asked to make a further disposition, the equitable authority of the

The reason for this limitation is jurisdictional. As explained in Gordon, “The

English chancery court from the beginning declined to exercise its jurisdiction for

that purpose.” Id. at 37.

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district court to impose a receivership is limited by the same restraint

and thus receivership is only authorized when it is ancillary to a claim

seeking a final decree disposing of the property. Gordon at 37-38.

Sherman, however, disagrees and relies upon an unpublished

opinion, which pursuant to the Fifth Circuit’s local rule 46.5.4 is not

precedent, to argue that Grupo Mexicano does not hold that a court’s

equitable powers are limited. (Sherman’s Brief, page 12). However,

even the unpublished case relied upon by Sherman recognizes that

Grupo Mexicano holds “that a federal court’s equitable power is limited

to the jurisdiction exercised by the High Court of Chancery in England

at the time of the enactment of the Judiciary Act of 1789.”

3. Governmental Receivership

Sherman has offered governmental receivership cases from other

circuits. The receivership power recognized in those circuits springs

from the constitutional structure of the branches of government (as

viewed in those circuits), and not from the power of the Court of

Animale Group Inc. v. Sunny’s Perfume Inc., 256 Fed.Appx. 707 (5th Cir. 2007)

(unpublished).

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Chancery.

Receivership over a governmental agency for

“constitutional purposes” is not at issue in the case at bar.

Gordon, De Beers, Grupo Mexicano, ITT Community Development,

Natural Gas Pipeline, and Tucker are the applicable and controlling

precedent to the issues at bar in this case. To adopt an ‘all things

reasonable’ expansion of a court’s equity and inherent powers would

reverse the well established controlling precedent setting forth the

source and limits of a court’s equitable and inherent power as the

Chancery Court. As explained by the Supreme Court in Gordon and the

Fifth Circuit in Tucker, receivership is not the ‘catch all’ tool of last

resort argued by Sherman. (Sherman’s Brief, page 15). It can be

tempting for a court to try to use receivership beyond the narrow

purpose for which it is authorized, and for that reason the Fifth Circuit

has held that receiverships “are to be watched with jealous eyes lest

their function be perverted”. Tucker, 214 F.2d at 631.

See Jeff Baron’s Principal Brief, page 33, fn2.

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The Specific Remedy of Equity Receivership is Not

Authorized to be Used as a Stand-Alone Remedy

It is well settled law that receivership is not authorized as a

stand-alone-remedy. Gordon v. Washington, 295 U.S. 30, 37-38 (1935).

The district court lacks authority to administer receivership as a

remedy for ultimate relief. Id. at 38. Equity Receivership is authorized

only to conserve property where distribution of that property is sought

pursuant to some equitable form of relief. Tucker v. Baker, 214 F.2d

627, 631 (5th Cir. 1954).

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REPLY ISSUE 4: THERE IS A CONSTITUTIONAL RIGHT TO

ASSOCIATE WITH AND RETAIN LEGAL COUNSEL

Sherman acknowledges the purpose of the receivership is to

restrict Jeff Baron’s right to retain counsel. (Sherman’s Brief, page 23).

However, Sherman’s argument confuses a court’s authority to control

its docket

with a citizen’s constitutional right to associate with and

retain counsel of their choice. E.g.¸ Powell, 287 U.S. at 53; Mosley v. St.

Louis Southwestern Ry., 634 F. 2d 942, 945-946 (5th Cir. 1981); Roberts

v. United States Jaycees, 468 U.S. 609, 618 (1984). Contrary to

Sherman’s unsupported assertion that Jeff Baron never moved for

access to his funds to hire an attorney to represent him, the record

establishes a multiplicity of such motions filed and denied in the court

below. R. 2720, 3556-3668, SR. v2 p385-390, SR. v4 p119.

Eg., McCuin v. Texas Power & Light Co., 714 F.2d 1255 (5th Cir. 1983).

Case: 10-11202 Document: 00511542409 Page: 41 Date Filed: 07/15/2011

REPLY ISSUE 5: THE SEIZURE OF ALL OF JEFF BARON’S

PROPERTY IS OBJECTIVELY UNREASONABLE AND THUS

VIOLATES THE FOURTH AMENDMENT

Sherman responds to the constitutional issues by arguing that the

standard of review for a district court’s factual findings is the clearly

erroneous standard. (Sherman’s Brief, pages 17, 22). However:

(1) The objective reasonableness required by the Fourth

Amendment is not a question of fact, but is an issue of

law reviewed de novo. E.g., White v. Balderama, 153

F.3d 237, 241 (5th Cir. 1998); US v. Stewart, 93 F.3d

189, 192 (5th Cir. 1996);

(2) The District Court’s post-appeal findings do not cure the

absence of a sworn showing of probable cause prior to the

issuance of the warrant for the receiver to seize all of Jeff

Baron’s property;

(3) Looking to post-appeal justifications for an order

presents a moving target on appeal; and

(4) Baron was denied Due Process at the post-deprivation

hearing as his trial counsel was fired by the receiver, he

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was stripped of all his papers and documents, and he

was not allowed to conduct discovery.

Assuming for the moment that it is proper to consider post-appeal

findings of the trial court made in deciding a TRAP 8(a) motion in

testing an order challenged on appeal, a fundamental question

presented is whether seizure of Jeff Baron’s property was excessive in

relation to the need for action.

That standard is not met by the

retrospective justifications offered by Sherman.

Specifically:

4. Sherman’s argued justification: to prevent vexatious delay

caused by substitution of counsel.

The District Court’s post-appeal finding of Mr. Baron’s “vexatious

litigation” was based on the allegation that he was firing attorneys and

causing delay. SR. v2 p345. However, control of delay in court

proceedings does not require stripping a litigant of all of their property

and property rights. A court can simply not delay when an attorney is

Cf. Hale v. Townley, 45 F.3d 914 (5th Cir. 1995) (objectively unreasonable if

excessive in relation to the need for action); Spallone v. United States, 493 U.S. 265,

280 (1990) (a court must exercise “[T]he least possible power adequate to the end

proposed”); Scaife v. Associated Air Center Inc., 100 F. 3d 406, 411 (5th Cir. 1996)

(same).

Sherman’s Brief, page 16.

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substituted. Further, there are other much less excessive remedies

than seizure of a litigant’s property that would prevent delay caused by

substitution of counsel. For example, a court could simply refuse to

allow substitution.

5. Sherman’s argued justification: Allowing a creditor of a

bankrupt company to hire attorneys exposes the

bankruptcy case to claims.

Sherman’s justification is a legal fallacy, since the only claims

‘exposed’ are substantial contribution claims, which require that the

creditor make a substantial beneficial contribution to the case. (Jeff

Baron’s Brief, pages 53-54). Moreover, if it were constitutional to

prevent hiring attorneys, the court could simply enter an injunction to

prevent a creditor from hiring an attorney— seizure of all of a litigant’s

assets to achieve that purpose is patently unreasonable and excessive.

Similarly, if the purpose was to pay attorneys so that Mr. Baron would

have to make any substantial contribution claim directly (which

provides zero net benefit to the bankruptcy estate, as the same claim is

being made)

, Mr. Baron could have simply been ordered to pay the

By statute, a professional’s direct claim for substantial contribution is allowable

only where the expense would be allowable to the creditor. 11 U.S.C. §503(b)(4).

Case: 10-11202 Document: 00511542409 Page: 44 Date Filed: 07/15/2011

attorneys.

Notably, receivership is expressly prohibited as an

extension of the bankruptcy proceedings or as an alternative procedure

to the established bankruptcy claims processes. 11 U.S.C. § 105(b) ("[A]

court may not appoint a receiver in a case under this title.").

6. Sherman’s argued justification: To ensure compliance

with court orders.

It is objectively unreasonable to take action to ensure compliance

with an order that does not exist. The District Court erred in believing

an order was entered prohibiting Jeff Baron from retaining counsel.

Moreover, if such an order had been entered, unless the District Court

has tried lesser sanctions first, (such as a fine), it is unreasonable to

seize all of a party’s assets and property rights. It is also unreasonable

to seize a quantity of property with no proportionality to the alleged

threatened harm.

As a factual matter the record establishes the groundlessness of the solicited

former attorneys “claims”. SR. v8 pp1197-1244. As a legal matter, receivership is

not authorized as a vehicle to bypass an individual’s Fifth Amendment right to Due

Process and Seventh Amendment right to trial by jury, in order to collect allegedly

past due attorney’s fees. E.g,. Pusey & Jones Co. v. Hanssen, 261 U.S. 491, 497

(1923)

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7. Sherman’s argued justification: because Jeff is accused of

defrauding lawyers.

If the district court had jurisdiction over claims of attorneys being

defrauded, the court could issue an injunction, require the posting a of

bond, order that the fees be paid, etc. Seizure of all of a citizen’s

property is patently unreasonable, as is seizure of property without any

proportion to the amount of the alleged debt.

8. Sherman’s argued justification: to ‘maintain jurisdiction’

over assets so that justice may be done.

It is patently unreasonable to protect ‘jurisdiction’ when there are

no claims pending in the district court over the property seized.

Moreover, when a lawsuit has settled and a stipulated dismissal

entered into by all parties

, there is no ‘jurisdiction’ to protect. It is

also unreasonable to seize an individual’s assets for ambiguous

purposes such as “doing justice”.

R. 2346-2355.

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REPLY ISSUE 6: A RECEIVER’S FIDELITY BOND IS NOT A

MOVANT’S BOND TO COMPENSATE FOR DAMAGES CAUSED IN

CASE OF WRONGFUL ENJOINMENT

Sherman offers no authority in support of his novel argument that

the requirement for security to pay the damages sustained by any party

found to have been wrongfully enjoined is satisfied by a receiver’s

fidelity bond. (Sherman’s Brief, page 9). A receiver’s fidelity bond

securing his faithful execution of the court’s order has nothing to do

with a bond to secure the damages caused if a party was wrongfully

enjoined. The receiver’s bond in this case was conditioned on “the

faithful discharge by Vogel of duties as receiver in the above entitled

and numbered cause, and obedience to the orders of the court”. R. 1692.

That clearly does not satisfy the requirement for security “to pay the

costs and damages sustained by any party found ... wrongfully enjoined”

as required by Rule 65. Fed.R.Civ.P. 65(c).

Sherman argues in the alternative that no bond is required

because the injunction is merely ‘in rem’. However, the challenged

order imposes clear personal injunctions against Jeff Baron. For

example, Jeff is prohibited from entering any business transactions,

Case: 10-11202 Document: 00511542409 Page: 47 Date Filed: 07/15/2011

from filing any law suits, etc. R. 1619-1632.

Further, Sherman errs in reading United States v. Hall, 472 F.2d

261, 267 (5th Cir.1972) as recognizing in rem injunctions as being

exempt from, and falling outside of the requirements of Rule 65.

(Sherman’s Brief, page 8). The holding in Hall expressly did not reverse

Harrington v. Colquitt County Board of Education, 449 F.2d 161, at

267-268 (5th Cir. 1971). Instead, the Fifth Circuit ruled in Hall that:

“[T]he portion of the court’s order here complained of may

be characterized as a temporary restraining order, which

under Rule 65(b) may be issued ex parte.”

Hall, at 267.

Additionally, the scope of the issue in Hall is limited to Rule

65(d)(2). Even if Hall had created an exception allowing injunctions to

be valid against the world,

that exception would bypass only the

requirements of 65(d)(2) and not the entirety of Rule 65 as argued by

Sherman. Nothing in Hall does away with the requirements of notice,

hearing, mandatory findings, and bond.

This is an exception that Hall expressly holds it does not create. As the Fifth

Circuit expressly noted, “We do not hold that courts are free to issue permanent

injunctions against all the world” Hall, 472 F.2d at 267.

Case: 10-11202 Document: 00511542409 Page: 48 Date Filed: 07/15/2011

As a matter of settled law, a bond must be required to protect

against wrongful injunction where damages will flow from that

injunction. E.g., Phillips v. Chas. Schreiner Bank, 894 F.2d 127, 131

(5th Cir.1990). In the case at bar, the challenged order enjoins Jeff

Baron from “Cashing any checks or depositing any payments from

customers or clients” or “Transacting” any business.

The injunction

also removes Jeff from controlling the content of his “web sites”

directly impinging his First Amendment rights. As a matter of law that

necessarily involves injury. E.g., Elrod v. Burns, 427 U.S. 347, 373

(1976).

In addition to the requirements of the Rules of Federal Procedure,

as a mater of constitutional law, a pre-hearing deprivation of property

violates Due Process unless a bond to compensate for wrongful

deprivation is required. Connecticut v. Doehr, 501 U.S. 1, 4 (1991).

R. 1627.

R. 1629.

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REPLY ISSUE 7: INVOLUNTARY SERVITUDE

The right to possess property, the right to enter into business

transactions, the right to receive wages for one’s work, and the right to

spend one’s money freely are all rights necessarily inherent in freedom.

See e.g,. Local Loan Co. v. Hunt, 292 U.S. 234, 245 (1934).

A free citizen has the right to earn money and use that money as

he sees fit, for example: to travel out of state, to purchase gifts for

others, to buy flowers, and if he desires, to take out a newspaper or

radio advertisement and tell the world what is happening to him.

Jeff Baron has been expressly prohibited from doing all of these things.

He has been prohibited from entering into any business transactions,

and is permitted to purchase only “local transportation, meals, home

utilities, medical care and medicine.” SR. v8 p1213. Similarly, Jeff has

been expressly prohibited from retaining legal counsel. Id The issue of

the district court’s imposition of involuntary servitude upon Jeff Baron

and ordering him under the control of a receiver is neither frivolous nor

rhetorical. Sherman offers no responsive legal authority on the issue.

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CONCLUSION

The Fourth Amendment prohibits the issuance of any warrant to

seize a citizen’s property unless there is first presented a showing of

probable cause made under oath. The challenged order fails this

fundamental Constitutional requirement and no further showing should

be necessary to declare the order void.

As discussed in Jeff Baron’s Principal Brief pages 61-63, there are

established mandatory Constitutional safeguards required whenever

property is seized without a pre-deprivation hearing. None of those

mandatory Due Process safeguards were provided in the proceedings

below. Sherman argues that after the receivership order was appealed,

Jeff Baron was found to be a vexatious litigant. However:

(1) As a preliminary matter, the law requires that Jeff Baron be

afforded due process before he can be declared vexatious. Jeff

was not afforded that—He was provided no notice that a

hearing was being held to determine that he was a vexatious

litigant, and prior to the hearing Jeff was stripped by the

District Court of his evidence, his money, and his trial counsel;

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(2) As a matter of well established constitutional law, a post-

deprivation hearing is insufficient to satisfy the requirements of

Due Process absent the required pre-deprivation safeguards;

and

(3) The law provides that appeal divests the trial court of

jurisdiction over all aspects of the matter appealed. Once an

order is appealed, the district court was without jurisdiction to

hear new evidence and issue new findings to justify the

previously appealed from order.

Aside from the constitutional issues, as a matter of well-established

law, a receivership order is not authorized as a remedy to control

vexatious litigation. Two distinct principles apply:

(1) The remedy of equity receivership is authorized only to

conserve property pending its final disposition pursuant to a

primary claim for equitable relief in the property; and

(2) Exercise of power over property that is not the subject of

a controversy before the court falls outside a court’s inherent

authority and subject matter jurisdiction.

Case: 10-11202 Document: 00511542409 Page: 52 Date Filed: 07/15/2011

Our system is that of a free society, where a court will exercise–by

law must exercise– the least power necessary to achieve any authorized

use of its power. Spallone v. United States, 493 U.S. 265, 280 (1990). A

court can control access to its door by telling a litigant not to enter

without permission. It is not necessary, reasonable, nor within the

authority of a court to control access to the courts by seizing all of a

litigant’s property. In America, it should not be possible for a citizen to

wake up one morning, and have his cell phone, house keys, bank

accounts, life savings, credit cards, personal papers, wages, and all his

earthly possessions seized ex parte by a judge based on a finding months

later that the person was a vexatious litigant and ‘delayed’ court

proceedings.

As the Supreme Court explained in Kokkonen, 511 U.S. at 380,

“the power asked for here is quite remote from what courts require in

order to perform their functions”.

Case: 10-11202 Document: 00511542409 Page: 53 Date Filed: 07/15/2011

Respectfully submitted,

/s/ Gary N. Schepps

Gary N. Schepps

Texas State Bar No. 00791608

5400 LBJ Freeway, Suite 1200

Dallas, Texas 75240

(214) 210-5940 - Telephone

(214) 347-4031 - Facsimile

Email: legal@schepps.net

FOR JEFFREY BARON

Case: 10-11202 Document: 00511542409 Page: 54 Date Filed: 07/15/2011

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 contains 6,982 words, excluding

the parts of the brief exempted by FED. R. APP. P. 32(a)(7)(B)(iii).

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: July 15, 2011.

CERTIFIED BY: /s/ Gary N. Schepps

Gary N. Schepps

COUNSEL FOR APPELLANT JEFFREY BARON

Case: 10-11202 Document: 00511542409 Page: 55 Date Filed: 07/15/2011

CERTIFICATE OF SERVICE

This is to certify that this brief was served this day on all parties who

receive notification through the Court’s electronic filing system.

CERTIFIED BY: /s/ Gary N. Schepps

Gary N. Schepps

COUNSEL FOR APPELLANT JEFFREY BARON

Case: 10-11202 Document: 00511542409 Page: 56 Date Filed: 07/15/2011

United States Court of Appeals

FIF TH CIRC U IT

OF F IC E O F T H E C LER K

LYL E W . C A YC E

CL E R K

TEL . 504-310-7700

600 S. M A EST R I P LA C E

NE W O R LEA N S , L A 70130

July 18, 2011

Mr. Gary N. Schepps

Schepps Law Offices

5400 Lyndon B. Johnson Freeway

Dallas, TX 75240-0000

No. 10-11202, Netsphere, Inc. v. Jeffrey Baron

USDC No. 3:09-CV-988

You must submit the seven paper copies of your brief required by

5TH CIR. R. 31.1 within 5 days of the date of this notice

pursuant to 5th Cir. ECF Filing Standard E.1.

Failure to timely provide the appropriate number of copies will

result in the dismissal of your appeal pursuant to 5th Cir. R.

42.3.

Sincerely,

LYLE W. CAYCE, Clerk

By:_________________________

Renee S. McDonough, Deputy Clerk

504-310-7673

cc: Mr. Barry M. Golden

Mr. Richard M. Hunt

Mr. Peter L. Loh

Mr. Stacy R. Obenhaus

Mr. Raymond James Urbanik

Case: 10-11202 Document: 00511543254 Page: 1 Date Filed: 07/15/2011