Jeffrey Baron’s Emergency Motion for
Stay Pending Appeal Page 1
Stephen R. Cochell
The Cochell Law Firm, P.C.
7026 Old Katy Road, Ste. 259
Houston, Texas 77096
Telephone: (713)980-8796
Facsimile: (214) 980-1179
srcochell@gmail.com
Counsel for Jeffrey Baron
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
IN RE: §
§
ONDOVA LIMITED COMPANY, § CASE NO. 09-34784-SGJ
§ (CHAPTER 11)
DEBTOR. §
JEFFREY BARON’S RESPONSE TO TRUSTEE’S COMMENT ON BARON’S
EMERGENCY MOTION FOR STAY PENDING APPEAL
TO THE HONORABLE JUDGE OF SAID COURT:
Jeffrey Baron (“Baron”)
1
Appellant, files this Response to the Trustee’s Comments
Regarding Jeffrey Baron’s Emergency Motion for Stay Pending Appeal [957] and states:
1. The Trustee’s position underscores the need for a stay to allow investigation. As set
out below, the Trustee’s position appears to be a reaction to potential criticism of the
United States Trustee’s Office for violating the Congressional mandate in Rule
1
It is respectfully noted that the Trustee refers to Jeffrey “Barron” instead of Jeffrey “Baron”
throughout her brief.
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9003(b) prohibiting the Trustee from participating in ex parte discussions with
bankruptcy or trial judges.
2. Baron objected to any ex parte communication between this court and Mr. Lieberman
during the hearing but was particularly concerned that the witness was still on the
witness stand testifying when the Court cleared the courtroom and engaged in an ex
parte communication that was apparently designed to change the witness’ refusal to
testify in a way that allowed the Court to approve the sale. Counsel advised the
Trustee of his concerns about the Trustee’s failure to object to the communication
prior to filing Baron’s Motion for Stay Pending Appeal, at which time the Assistant
United States Trustee became very incensed and angry at the suggestion that the
Trustee failed to comply with Rule 9003(b).
3. The Trustee engages in a series of ad hominem arguments that reflect that the
Trustee’s Office has lost objectivity about its role in this case. The Trustee did not
merely participate in an “in camera session with the Court.” [Doc. 957at 1]. Rule
9003(b) states, in pertinent part, that: “Except as otherwise permitted by applicable
law, the United States trustee and assistants to and employees or agents of the United
States trustee shall refrain from ex parte meetings and communications with the court
concerning matters affecting a particular case or proceeding.” This Congressional
prohibition is not optional and subject to the after-the-fact rationalization by any
Trustee. Congress said what it meant and meant what it said. Ex parte
communications are prohibited.
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4. Counsel was unable to cross examine this witness on what happened at the hearing
because he was not there. If there was a legitimate issue to be addressed, it should
have been raised on the record, and subject to cross examination by Baron’s counsel.
The record is sealed, presumably because the Court felt there was something that
should not be disclosed to the public, or to Baron. Baron moved to recuse the trial
judge because of the ex parte communication and conduct of the trial judge. If the
Court now believes that the communication is or was not improper, then the Court
may decide to unseal the record.
5. The issue is not whether the Trustee supports or opposes unsealing of a transcript, or
whether the communication, in the Trustee’s opinion, did not impact confirmation.
The issue is that an ex parte communication occurred in the middle of a witness’
testimony, after counsel moved to strike the witness’ testimony, and where the Court
abandoned its role as neutral and impartial fact-finder by holding an ex parte hearing
after which the witness changed his testimony. If this type of contact had been
initiated by one of the trial attorneys in the middle of a witness’ testimony, the Court
would legitimately be concerned about witness tampering.
6. Since the Trustee raises the issue of its participation in the ex parte communication,
counsel respectfully suggests that the United States Trustee should have been at
counsel’s side objecting to the ex parte communication---not participating in a
communication prohibited by Congress. It is deeply disturbing that the Trustee fails
to understand a basic duty mandated by Congress---to protect the integrity of
bankruptcy process and maintain confidence in the judicial system.
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7. The Trustee also seeks to redefine other issues raised by Baron. Baron is not
objecting to the Court refusing to transfer domain names with sexually suggestive
titles. Baron is objecting to unsupported, unnecessary character attacks suggesting
that he is a pornographer. Baron testified and explained how the domain names were
created and there is no evidence that shows that any of the domain names were
actually used to sell pornography. Under a First Amendment analysis, the name itself
is not “pornographic.” All that being said, Baron never objected, and does not object
to the names being culled out. The Trustee’s argument on a non-issue is devoid of
merit and again, suggests that the Trustee is not objectively viewing the facts in this
case.
8. The Trustee then criticizes counsel for Baron for failing to produce evidence of the
Receiver’s exclusion of competing bidders. Counsel for Baron represented to the
Court that he had hearsay evidence of exclusion of a qualified bidder, but was not in a
position to present the evidence that day, requesting a brief continuance.
a. Before this court confirmed the Chapter 11 Plan, counsel filed Jeffrey
Baron’s Emergency Motion to Clarify [Dkt. 937] and specifically told the
Court that he was prepared to submit the “declaration of a potential bona fide
and qualified bidder who will testify that the was excluded from the auction
by the receiver and/or his counsel.”
b. Counsel also warned that the Court “should not blindly accept the telephonic
representations of an attorney withyout allowing discovery of Mr. Lieberman,
the two off-shore companies and Domain Holdings to ensure the integrity of
the bankruptcy process.”
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c. Regrettably, the Trustee did not join in Baron’s Motion.
d. Counsel filed a Motion on Appearance of Impropriety [Dkt. 938] setting out
in detail Baron’s concerns about the integrity of the bankruptcy process.
e. Regrettably, the Trustee did not join in Baron’s Motion.
f. The Court did not express interest in the declaration referred to, which has
now been filed.
g. Baron’s counsel has filed motions for continuance, a contempt motion and a
motion to compel and for continuance---all designed to obtain information
that clearly was relevant then, and that are still relevant to determining if the
bankruptcy process has been tainted by misconduct.
9. The documents that would reveal the extent to which bidders were rejected by the
Receiver, were ordered by the Court to be produced by the Receiver on October 19,
2012. The Trustee did not, and still does not express interest in these documents,
which would appear directly relevant to the issue of exclusion of bidders. Instead,
the Trustee seeks attorney work product information and privileged communications
from counsel for Baron.
10. The Trustee asserts that: “While the Trustee’s Office has worked and is working to
gather the facts, the facts are not well developed. Additional evidence, including
evidence in Barron’s possession, is required. The issue is not ripe.” [Doc. 957 at 4].
The Trustee did nothing while Baron filed motions and attempted to obtain evidence
that would demonstrate the failure of the bankruptcy process, despite full knowledge
of Baron’s limited resources and the ability of one lawyer to oppose two large law
firms without meaningful discovery.
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11. The Trustee cannot have it both ways; that is, tell the Court that there is a need to
investigate this case, but then suggest that a stay should not be granted. The Trustee’s
duty is to ensure the integrity of the bankruptcy process---not engage in procedural
debate about a serious issue going to the heart of the bankruptcy process.
12. Incredibly, the Trustee fails to provide any guidance to the Court about the collusion
between Special Jewel, Trans and Domain Holdings. There is now evidence before
the Court that requires further investigation.
13. Regrettably, it appears that the United States Trustee does not intend to pursue a
critical breakdown in the bankruptcy process.
14. In sum, Baron respectfully submits that the Trustee has lost objectivity about her role
in this case and has simply become another advocate for the Receiver and Trustee.
WHEREFORE, Jeffrey Baron prays that this Court grant his Motion for Stay Pending
Appeal and for such other and further relief to which it may show himself justly entitled.
Very respectfully,
/s/ Stephen R. Cochell
Stephen R. Cochell
The Cochell Law Firm, P.C.
Texas Bar No. 24044255
7026 Old Katy Rd., Ste 259
Houston, Texas 77096
(713)980-8796 (phone)
(713)980-1179 (facsimile)
srcochell@cochellfirm.com
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CERTIFICATE OF SERVICE
This is to certify that, on November 27, 2012, a copy of the above was served on all
counsel of record through the Court’s ECF filing system.
/s/ Stephen R. Cochell
Stephen R. Cochell
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