ACCEPTED 04-14-00569-CV FOURTH COURT OF APPEALS SAN ANTONIO, TEXAS 9/2/2015 11:38:21 PM KEITH HOTTLE CLERK -14 -00569- CV FILED IN 4th COURT OF APPEALS Jn 'ar:be QCourt <!&f §ppealg SAN ANTONIO, TEXAS jfor 'ar:be jfourtb f!\igtritt <!&f 'ar:exag 09/2/2015 11:38:21 PM g,an §nto nio 'ar:exag KEITH E. HOTTLE Clerk

BURTON KAHN APPELLANT V. HELVETIA ASSET RECOVERY INC. APPELLEE.

On Appeal From The 37th Judicial District Court Of Bexar County, Texas Trial Court, No. 2013-CI -18355 Hon. Michael Mery, Judge Presiding

APPELLANTS MOTION FOR REHEARING AND REINSTATEMENT

Burton Kahn pro se 1706 Alpine Circle San Antonio, TX 78248 210-408-9199 [email protected] IDENTITY OF PARTIES AND COUNSEL Appellant certifies that the following is a complete list of the parties, attorneys and any other person who has any interest in the outcome of this lawsuit: Attorneys for Appellant: Burton Kahn Pro-se 1706 Alpine Circle San Antonio, TX 78248 Tel (210) 408-9199 [email protected] Attorneys for Appellee: Elizabeth Conry Davidson Attorney at Law Chulie Drive San Antonio, Texas 78216 (210) 380-4899 telephone (210) 225-2300 facsimile [email protected]

Resigned Haynes and Boone LLP Lisa Barkley E. Pecan St. Suite 1200 San Antonio, TX 78205 - 1524 Tel (210) 978-7427 Fax (210) 0427 Lisa.Barkley@ haynesboone.com Resigned Haynes & Boone, LLP Werner A. Powers Natalie DuBose Scott Everett 2323 Victory Avenue, Suite 700 Dallas, Texas 7 5219 Tel (214) 651-5487 Fax (214) 200-0468 [email protected]

Real Party of Interest Puerto Verde Ltd. (Bahamian)

Trial Judge: Hon. Michael Mery th Judicial District Court Bexar County, Texas Previous Attorney Appellant Appellant has represented himself pro se since December 14, 2013. His previous counsel was: L. Terry George died on June 29, 2014.

Fort Worth, Texas Jay R. Petterson Jay R. Petterson, Attorney at Law, PLLC 12274 Bandera Road, Suite 210 Helotes, Texas 78023 Kathleen A. Cassidy Goodman Law Office of Kathleen Cassidy Goodman 12274 Bandera Road, Suite 210 Helotes, Texas 78023 Richard H. Sommer 8610 N. New Braunfels Ave., Suite San Antonio, Texas 78217 Robert W. Wachsmuth Zachary J. F anucci Robert Wachsmuth & Associates 9311 San Pedro, Suite 707 San Antonio, Texas 78216

1111 TABLE OF CONTENTS Page IDENTITY OF PARTIES ........ ... .......... ..... ....... ............. ......... ..... ..... ,,, ... .i TABLE OF CONTENTS .................................................................. .iv TABLE OF AUTHORITIES .......................................................... vi INTRODUCTION ............................................................................................ 1

RESPONSE TO BACKGROUND .................................................................... 1 ARGUMENT AND AUTHORITIES ............................................................... 4 ISSUEl ............................................................................................................. 4 The Appellate Court errored when the Court declared that the trustee has exclusive standing to assert legal claims belonging to the 2013-CI-18355 case ("Defamation Trial Case") because it was a non-core proceeding, not in the Bankruptcy Court's jurisdiction to make a judgment and not was not in accordance with the Constitution of the United States.

ISSUE 2 .......................................................................................................... 15 The Appellate Court errored when the court it is relied on In re Croft 737 F 3d. 372, 376-77 (5th Cir. 2013)( per curiam) because all the circumstances of this case were not the same (core, non-core) and the appeal at no benefit a to the estate.

ISSUE 3 .......................................................................................................... 16 The bankruptcy order entitled "Order Authorizing Sale of All Non-Exempt Assets, Claims and Causes of Actions" should be declared null and void thus the Trustee does not have standing in this Appeal. iv lV Order of Sale On Appeal ............ ................................... 17 Fourteenth Amendment to the Constitution of the United States .. 17 Sale Procedures And Boa Fide Purchaser U. S.C. § 853 (n)(6)(B) .............................................. 19 NO CONSIDERATION ...... .. . ......... .. .......... .. . ....... 20 l lU.S.C. § 554 ABANDONMENT. ............................. 20 ISSUE 4 ..................................................................................... 21 U.S. C. § 1509 A foreign Corporation needs to register to have Direct Access CONCLUSION ........................................................................... 23 PRAYER ............................................................................................... 24 VERIFICATION ............................................................................ 25 CERTIFICATE OF COMPLIANCE ................................................... 25 CERTIFICATE OF SERVICE .......................................................... 25 APPENDIX ............... ........................ .......................................... 27 EXHIBITS I.OPINION 2. ORDER AND MOTION OF 2013-CI-17516 3. CROFT'S BANKRU PT PETITION 11-52905-CAG 4. TRANSCRIPT MOTION TO SELL BANKRUPT CASE 14-50980-CAG 5. EMAILRWWACHSMUTHNOTNOTICED 6. EMAIL OF TRUSTEE THOMAS NO DISTRIBUTION 7. ORDER DENYING MOTION TO DISQUALIFY PUERTO VERDE LTD. TO MAINTAIN LAWSUIOT IN TEXAS

iv v INDEX OF AUTHORITIES CASES Abramowitz v. Palmer, 999 F.2d 1274, 1277 (8th Cir. 1993) ...... ... ....... ........... ... ....... ............... 5,6 Arbaugh v. Y & H Corp., 546 U. S. 500 ...................... ........... ... ....... ........... ... ....... ............... 10 Baumgartner v. Ford Motor Credit Co., Ltd (W.D.Mo. 7-9-2007) ....................................................................... 5 Fariasantos v. Rosenberg & Associates, (E.D.Va. 2-27-2015) ............ ... .................. ... .......... ..... ... .......... ..... 18 Freedom Path v. Lerner, (N.D.Tex. 2-24-2015) ............ ... ....... ........... ... .......... ..... ... .......... ..... 18 Henderson v. Shinseki, U. S.428 .. ............................ ......... ..... ......... ..... ......... .............. .............. ........... 10 In the Matter of CV, 12-10542 (5th Cir. 1-7-2013) ............ ..................... ..................... ... .... 23 In re Condor Ins. Ltd., 601 F.3d 319, 324 (5th Cir. 2010) ....................................................... 23 In Re C-Power Prods., .Inc, 230 B.R. 800,803 ......................................................................... 16 In re Croft F 3d. 372, 376-77 (5th Cir. 2013)( per curiam) .................................. 14 In Re Dewsnup, 908 F.2d 588 (10th Cir. 1998) ................ ... ...................... ... ... ... ....... 20 IN Re Marshall, 600 F3d. 1037,1047 (9th Cir 2010) ...................................................... 12

Vl In re Wood, 825 F.2d 90, 97 (5th Cir. 1987) ............ ... .................. ...................... 6,12 Joseph v, Hess Oil V.I. Corp., 651 F.3d 348, 351 (3d Cir. 2011) .................................................... 22 Latshaw v. Johnston, 167 F.3d 208 (5th Cir. 1999) ........................................................... 18 Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U. S. 50 ......................................................................... 8,10,11 Pacor, Inc. v. Higgins, 743 F.2d 984, 994 (3d Cir. 1984) ............. ........ ..................... ............. 6 Race Tires Am., Inc. v. Hoosier Racing Tire Corp .. 614 F. 3d 57, 84 (3d Cir. 2010) ...................................................... 23 Scurlock Oil Co. v. Smithwick, 724 S.W.2d 1 (Tex. 1986) ............ ... ....... ........... ... ....... ........ ... ....... 17 Specialty Mills v. Citizens State Bank, 51F.3d770, 773 (8th Cir. 1995).......... ........... ... ....... ........ ... ......... 5,6,16 Stern v Marshall, 131 S.Ct 2594 (2011) ...................... ... ... ... ................................. 6,12 Stern v. Marshall, 01- 02-00114- CV (Tex,App.-Houston[l st Dist.] 7-14-2015) ..................... 12 Tex. Ass'n ofBus. v. Tex. Air Control Ed., 852 S.W.2d 440, 444-45 (Tex. 1993) ...... .... .. ................ .................... 22 U.S. Home Corporation v. Settlers Crossing (D.Md. 8-14-2012) ...... ... .......... ........................ ........... ... .......... ...... 22 United States v. Brown, 509F.Supp.2d 1239, 1246 (M.D. Fla. 2007) ............................................. 19 United States v. Cox,

Vll 575F.3d352, 356 (4th Cir. 2009) ....... ........ ... ...................... ........ ... ....... 19 United States v. Reckmever:i F .2d200, 208 (4th Cir. 1987) ... ... ....... ........ ... ................................ 19 USA v. Real Property, Located at 246 Main Street, Dansville, Livingston Co., NY (M.D.Fla. 7-13-2015) .................................................................... 19 STATUTES Article III of the Constitution of the United States ..................... .4,10.11,12,17 Bankruptcy Act of 1978 ....... ........ ..................... ..................... ......... 11 Fourteenth Amendment to the Constitution of the United States ..................... 17 11 U.S.C. § 363 .... ... ... ... ................................ .... ... .. ................... 19 l lU.S.C. § 544 ......... .... ... ... .. ............................... ... ............... 17, 20 U. S.C. § 1509 .................................................................... 17, 21 21 U.S.C. § 853 ........................... .... ... ... .................................. 9, 17 28 U.S.C. § 157 ... ... .......... ........ ..................... ... ........ 5,6,7,8,9,10,11, 14 RULES Federal Rule of Evidence 701. ........................................................... 18 Tx. R. APP. P. 8.2 .... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..................... 15

vm To The Honorable Fourth Court of Appeals: Burton Kahn (Kahn") ("Appellant") files this Motion For Rehearing and Reinstatement in accordance with Tex.R.App.P. 49. land in support would show the Court as follows: I· ' INTRODUCTION Appellant, Kahn seeks the panel to review of the opinion in this case issued on August 19, 2015. The panel that rendered judgment in this case consisted of Marialyn Barnard, Justice, Patricia 0. Alvarez, Justice and Jason Pulliam, Justice.

The opinion was authored by the Honorable Marialyn Barnard , Justice. A copy of the opinion is attached as Exhibit 1.

RESPONSE TO BACKGROUND 1. Kahn was the president, secretary, and sole director ofHelvetia from October 2009 until he was terminated in August 2013.

Kahn was never terminated because he never worked for Robert Ripley nor did he have any contract with Robert Ripley. Kahn was the one third owner of the Corporation named Joabert Development Company. (5RR 343-345) 2. Upon discovering what Kahn was doing, Helvetiafi"led suit to set aside the deeds. The trial court ordered the deeds set aside and thereafter, on November 4, 2013, Puerto Verde Ltd. in the name of Helvetia filed suit.

3. The trial court granted the ex parte order based on documents filed by Kahn, who claimed to be acting as president and authorized representative of Helvetia.

Kahn was the president and or visit authorized representative of Helvetia as per the Secretary of State. (Except for period September 27, 2013 to October 4, 2013) (5RR131-136, 213) The ex parte order .(5RR 160-161) is a ministerial act and does not make any findings as to any underlying claims of the parties.

4. Kahn failed to disclose, however, that in the prior litigation filed by Helvetia in October 2013, another trial court had declared as fraudulent the deeds Kahn transferred to Paradiv, determining Kahn had no authority to act on behalf ofHelvetia.

There is no evidence that Kahn' s attorney Jay Petterson what conversations had with Judge Gabriel and the finding was purely a ministerial act and it would not of have made any difference.

The court does not declare as fraudulent the deeds. Order of 2013-CI- l 7 516 Exhibit 2 ((Appellate case 04-14-00357CV) (5RR 128-139) states: that the deeds are not created by implied or express consent or agreement of the obligor debtor or owner of the real property or by implied or express consent or agreement of an agent to insure rather represented of that person it does state that the Court does not grant parity any interest in the property. The Court states that it makes no finding

as to any underlying claims of the parties involved and expressly limits its finding of fact and law of a ministerial act.

Kahn formed Paradiv to prevent Robert Ripley a non-owner of Joabert to prevent a takeover of Robert Ripley. The funds that Paradiv would receive would go to Helvetia.

5. After an evidentiary hearing in December 2013, the trial court overturned its prior order, finding Kahn made false claims in order to secure the prior order.

The hearing of December 9 through 11 was a temporary injunction hearing not evidentiary hearing. The Supplement Temporary Injunction Order (5RR322- 330) on page 333 only that it is probable that Kahn the made false claims not finding.

6. After another evidentiary hearing, the trial court imposed sanctions against Kahn. The trial court found, among other things, that Kahn did not own Helvetia or its stock.

There was no evidentiary hearing it was a sanction hearing. The Court stated that she would not hear any evidence in regarding ownership The Final Judgment And Sanction Order ("Sanction Order") (5RR255-284) never states specifically that Kahn did not own the shares of Helvetia only applies dicta.

7. Rather, the trial court determined the sole owner ofHelvetia is Puerto Verde, Ltd. (''Puerto Verde''), which is owned by Robert Ripley.

The sanction order never specifically states that the sole owner of Helvetia is Puerto Verde. The finding implies that the self serving handwritten note on an e- mail address to Kahn was the document proving ownership. The Sanction Order neglects to say that the document does not mention Helvetia only Holdco and that the document was not presented at the ex parte motion of case 2003-CI-17516 (5RR 347-371) as proof of ownership and the document was not known to Robert Ripley and the Bank Trust Officer as late as 2008.(SRR 18) 8. Kahn raises numerous issues challenging the trial court's judgment.

In response, Helvetia contends, among other things, that this court must dismiss Kahn's appeal because we lack jurisdiction.

The issue that a foreign Corporation not registered to the Secretary of State cannot maintain a lawsuit in Texas is paramount prior to the bankruptcy standings and should be addressed by either denying the issue or finding for Kahn not the foreigner Puerto Verde Ltd. (Bahamian).

ARGUMENTS AND AUTHORITIES ISSUE 1 The Appellate Court errored when the Court declared that the trustee has exclusive standing to assert legal claims belonging to the 2013-CI-18355 case ("Defamation Trial Case") because it was a non-core proceeding, not in the Bankruptcy Court' s jurisdiction to make a judgment and not was not in accordance with the Constitution of the United States.

On April 4, 2014, while case 2013-CI-18355 suit was pending, but prior to trial, Kahn filed a voluntary petition for bankruptcy, which immediately stayed the Defamation Trial Court proceedings. The Bankruptcy Court conducted a hearing on the lifting the automatic stay for the Defamation Trial Case on April 28, 2014 and granted the stay. The lifting of the stay relinquished the Bankruptcy's jurisdiction for the Defamation Trial Case.

Thereafter, the case proceeded to jury trial. The cause of action was not listed on the bankruptcy schedules because it was purely defensive and that the Sanction Order purported that the shares were not Kahn's. The petition wass never reopened to include the Defamation Trial Case verdict. The Defamation Trial Case is non-core because it was only some what related to PVL's-Helvetia claim, and the resolution of the Trial case would have no bearing on the bankruptcy. In Baumgartner v. Ford Motor Credit Co., Lld (W.D.Mo. 7-9-2007) stated "the district courts shall have original but not exclusive jurisdiction of all civil proceedings arising under title 11, or arising in or related to cases under title 11." 28 U.S.C. § 1334(b). Thus, "[c]ivil proceedings in a bankruptcy case are divided into two categories, core proceedings and non-core, related proceedings." Specialty Mills v. Citizens State Bank, 51 F.3d 770, 773 (8th Cir. 1995); Abramowitz v. Palmer, 999 F.2d 1274, 1277 (8th Cir. 1993). A non-exhaustive list of "core proceedings" is enumerated at 28 U.S.C. § 157(b)(2). In general, "core

proceedings" are "those which arise only in bankruptcy or involve a right created by federal bankruptcy law." Specialty Mills, 51 F.3d at 773 (citing In re Wood, 825 F.2d 90, 97 (5th Cir. 1987); see also 28 U.S.C. § 157(b)(2). By contrast, "[n]on- core, related proceedings are those which do not invoke a substantive right created by federal bankruptcy law and could exist outside of a bankruptcy, although they may be related to a bankruptcy." Specialty Mills, 51 F.3d at 773-74. In determining whether a case falls into the latter category, the Eighth Circuit has adopted the "conceivable effect" test developed by the Third Circuit in Pacor, Inc. v. Higgins, 743 F.2d 984, 994 (3d Cir. 1984): The test for determining whether a civil proceeding is related to bankruptcy is whether the outcome of that proceeding could conceivably have any effect on the estate being administered in the bankruptcy.... An action is related to bankruptcy if the outcome could alter the debtor's rights, liabilities, options, or freedom of action ... and which in any way impacts upon the handling and administration of the bankrupt estate. Specialty Mills, 51 F.3d at 74 (quotingPacor, 743 F.2d at 994); see also Abramowitz, 999 F.2d at 1278 (interpretation of "related to" jurisdiction should promote judicial economy by facilitating resolution of all matters related to a bankruptcy case).

I.

The Supreme Court Case of Stern v Marshall, 131 S.Ct 2594 (2011) 1s on point with the present Appeal.

Vickie filed suit against Pierce prior to her filing bankruptcy ... .

Pierce filed a proof of claim in that proceeding, asserting that he should be able to recover damages from Vickie's bankruptcy estate because Vickie had defamed him .

The Bankruptcy Court granted Vickie summary judgment on the defamation claim and eventually awarded her hundreds of millions of dollars in damages on her counterclaim. Pierce objected that the Bankruptcy Court lacked jurisdiction to enter a final judgment on that counterclaim because it was not a "core proceeding" as defined by 28 U.S.C. § 157(b)(2)(C). As set forth in§ 157(a).

Congress has divided bankruptcy proceedings into three categories: those that "aris[e] under title 11 ";those that "aris[e] in" a Title 11 case; and those that are "related to a case under title 11." District courts may refer all such proceedings to the bankruptcy judges of their district, and bankruptcy courts may enter final judgments in "all core proceedings "arising under" title 11, or "arising in" a case under title 11." §§ 157(a), (b)(l). In non-core proceedings, by contrast, a bankruptcy judge may only "submit proposed findings of fact and conclusions of law to the district court." § 157(c)(1 ). Section l 57(b)(2) lists 16 categories of core proceedings, including "counterclaims by the estate against persons filing claims against the estate." § l 57(b)(2)(C).

The Bankruptcy Court lacked jurisdiction to enter a final judgment on that counterclaim because it was not a "core proceeding" as defined by 28 U.S.C. § 157(b)(2)(C). As set forth in§ 157(a), Congress has divided bankruptcy proceedings into three categories: those that "aris[e] under title 11 ";those that "aris[e] in" a Title 11 case; and those that are "related to a case under title 11." District courts may refer all such proceedings to the bankruptcy judges of their district, and bankruptcy courts may enter final judgments in "all core proceedings arising under title 11, or arising in a case under title 11." §§ 157(a), (b)(l). In non- core proceedings, by contrast, a bankruptcy judge may only "submit proposed findings of fact and conclusions of law to the district court." § 157(c )(1 ). Section l 57(b)(2) lists 16 categories of core proceedings, including "counterclaims by the estate against persons filing claims against the estate. " § 15 7 (b )( 2)(C).

The Bankruptcy Court concluded that Vickie's counterclaim was a core proceeding. The District Court reversed, reading this Court's precedent in Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U. S. 50, to "suggest[] that it would be unconstitutional to hold that any and all counterclaims are core." The court held that Vickie's counterclaim was not core because it was only somewhat related to Pierce's claim, and it accordingly treated the Bankruptcy Court's judgment as proposed, not final. Although the Texas state court had by that time conducted a jury trial on the merits of the parties' dispute and entered a judgment in

Pierce's favor, the District Court went on to decide the matter itself, in Vickie's favor. The Court of Appeals ultimately reversed. It held that the Bankruptcy Court lacked authority to enter final judgment on Vickie's counterclaim because the claim was not "so closely related to [Pierce's] proof of claim that the resolution of the counterclaim is necessary to resolve the allowance or disallowance of the claim itself." Because that holding made the Texas probate court's judgment the earliest final judgment on matters relevant to the case, the Court of Appeals held thatthe District Court should have given the state judgment preclusive effect.

Held: Although the Bankruptcy Court had the statutory authority to enter judgment on Vickie's counterclaim, it lacked the constitutional authority to do so. Pp. 6-38.

1. Section 157(b) authorized the Bankruptcy Court to enter final judgment on Vickie's counterclaim. Pp. 8-16.

(a) The Bankruptcy Court had the statutory authority to enter final judgment on Vickie's counterclaim as a core proceeding under§ 157(b)(2)(C). Pierce argues that § l 57(b) authorizes bankruptcy courts to enter final judgments only in those proceedings that are both core and either arise in a Title 11 case or arise under Title itself. But that reading necessarily assumes that there is a category of core

proceedings that do not arise in a bankruptcy case or under bankruptcy law, and the structure of§ 157 makes clear that no such category exists. Pp. 8-11.

(b) In the alternative, Pierce argues that the Bankruptcy Court lacked jurisdiction to resolve Vickie's counterclaim because his defamation claim is a "personal injury tort" that the Bankruptcy Court lacked jurisdiction to hear under § 157 (b )(5). The Court agrees with Vickie that§ l 57(b)(5) is not jurisdictional, and Pierce consented to the Bankruptcy Court's resolution of the defamation claim. The Court is not inclined to interpret statutes as creating a jurisdictional bar when they are not framed as such. See generally Henderson v. Shinseki, 562 U. S. -~

Arbaugh v. Y & H Corp., 546 U.S. 500. Section 157(b)(5) does not have the hallmarks of a jurisdictional decree, and the statutory context belies Pierce's claim that it is jurisdictional. Pierce consented to the Bankruptcy Court's resolution of the defamation claim by repeatedly advising that court that he was happy to litigate his claim there. Pp. 12-16.

2. Although § 157 allowed the Bankruptcy Court to enter final judgment on Vickie's counterclaim, Article III of the Constitution did not. Pp. 16-38.

(a) Article III is "an inseparable element of the constitutional system of checks and balances" that "both defines the power and protects the independence of the

Judicial Branch." Northern Pipeline, 458 U. S., at 58 (plurality opinion). Article III protects liberty not only through its role in implementing the separation of powers, but also by specifying the defining characteristics of Article III judges to protect the integrity of judicial decision making ..

This is not the first time the Court has faced an Article III challenge to a bankruptcy court's resolution of a debtor's suit. In Northern Pipeline, the Court considered whether bankruptcy judges serving under the Bankruptcy Act of 1978 - who also lacked the tenure and salary guarantees of Article III - could "constitutionally be vested with jurisdiction to decide [a] state-law contract claim" against an entity that was not otherwise part of the bankruptcy proceedings. Id. , at 53, 87, n. 40 (plurality opinion). The plurality in Northern Pipeline recognized that there was a category of cases involving "public rights" that Congress could constitutionally assign to "legislative" courts for resolution. A full majority of the Court, while not agreeing on the scope of that exception, concluded that the doctrine did not encompass adjudication of the state law claim at issue in that case, and rejected the debtor's argument that the Bankruptcy Court's exercise of jurisdiction was constitutional because the bankruptcy judge was acting merely as an adjunct of the district court or court of appeals. Id., at 69-72; see id., at 90-91 (Rehnquist, J., concurring in judgment). After the decision in Northern Pipeline, Congress revised the statutes governing bankruptcy jurisdiction and bankruptcy

judges. With respect to the "core" proceedings listed in§ 157(b)(2), however, the bankruptcy courts under the Bankruptcy Amendments and Federal Judgeship Act of 1984 exercise the same powers they wielded under the 1978 Act. The authority exercised by the newly constituted courts over a counterclaim such as Vickie's exceeds the bounds of Article III. Pp. 16-22. Stern P. 1-4.

The Appellate Court in IN Re Marshall, 600 F3d. 1037,1047 (9th Cir 2010) concluded that Vickie Lynn Marshall's counterclaim was a non-core proceeding because it was some what related and the Court found for Peirce. The Supreme Court in Stern affirmed the opinion of the 9th Cir. A recent Texas Case Stern v. Marshall, 01- 02-00114- CV (Tex,App.-Houston[l st Dist.] 7-14-2015) also affirmed that Vickie' s counterclaim was anon-core proceeding. The Houston Court visited the core and non-core proceedings and found the same results.

II.

In this appeal the Defamation Trial claim: is not arising~ nor arising under nor related to as described by In Re Wood, 825 F.2d 90,97 (5th Cir. 1987), "[28] As defined above, the phrases "arising under" and "arising in" are helpful indicators of the meaning of core proceedings. If the proceeding involves a right created by the federal bankruptcy law, it is a core proceeding~ for example, an action by the trustee to avoid a preference. If the proceeding is one that would arise only in bankruptcy, it is also a core proceeding~ for example, the filing of a proof

of claim or an objection to the discharge of a particular debt. If the proceeding does not invoke a substantive right created by the federal bankruptcy law and is one that could exist outside of bankruptcy it is not a core proceeding~ it may be related to the bankruptcy because of its potential effect, but under section 157(c)(l) it is an "otherwise related" or non-core proceeding. [29] Finally, the interpretation of core proceeding based on its equation with "arising under" and "arising in" proceedings comports with the interpretation suggested by Marathon. Justice Brennan's description of "core" matters parallels that of matters "arising under" title 11 - matters invoking a substantive right created by federal bankruptcy law. Moreover, his comment that the matter could have proceeded absent the bankruptcy suggests a contrast with "arising in" proceedings - matters that could arise only in bankruptcy. [30] We hold, therefore, that a proceeding is core under section 157 if it invokes a substantive right provided by title 11 or if it is a proceeding that, by its nature, could arise only in the context of a bankruptcy case. The proceeding before us does not meet this test and, accordingly, is a non-core proceeding. The plaintiffs suit is not based on any right created by the federal bankruptcy law. It is based on state created rights.[fn34] Moreover, this suit is not a proceeding that could arise only in the context of a bankruptcy. It is simply a state contract action that, had there been no bankruptcy, could have proceeded in state court."

The Defamation trial case is simply a state contract action had there been no bankruptcy has proceeded in state court and therefore is a non-core proceeding and when the stay was lifted the Bankruptcy Court's jurisdiction to sell the non- core case's appeal rights was relinquished.

The bankruptcy Court issued "Order Authorizing Sale of All Non-Exempt Assets, Claims and Causes of Actions" which is a Final Order on a non-core proceeding without submitting proposed findings of fact and conclusions of law to the district court." 28 § 157 (c )(1). A bankruptcy judge may hear a proceeding that is not a core proceeding but that is otherwise related to a case under title 11. In such proceeding, the bankruptcy judge shall submit proposed findings of fact and conclusions of law to the district court, and any final order or judgment shall be entered by the district judge after considering the bankruptcy judge's proposed findings and conclusions and after reviewing de novo those matters to which any party has timely and specifically objected. The Bankruptcy Court did not submit proposed findings of fact and conclusions of law to the district court, which is contrary to Article III of the Constitution of the United States , Stern v. Marshall, supra, and such sale should be null and voided. Thus the Trustee does not have any authority to appear in the Appeal.

ISSUE 2

The Appellate Court errored when the court it is relied on In re Croft 737 F 3d.

372, 376-77 (5th Cir. 2013)( per curiam) because all the circumstances of this case were not the same (core, non-core) and the appeal at no benefit a to the estate.

In re Croft 73 7 F 3d. 372, 37 6-77 (5th Cir. 2013 )( per curiam) Bradley Croft was involved in two lawsuits that ultimately resulted in sanctions against him and an award of attorney's fees in favor of his opponent. Id. at 374. Croft appealed those decisions to the Fourth Court of Appeals.

Thereafter, Croft filed a voluntary bankruptcy petition. As required, the Appellate Court abated Croft's appeals because of the automatic bankruptcy stay. Id.; see Tx. R. APP. P. 8.2 (stating bankruptcy suspends appeal). In response, Croft filed a motion in the bankruptcy court seeking to lift the automatic stay and allow the appeals to continue. Id. Croft's motion was opposed under the theory that Croft's right to appeal was part of the bankruptcy estate and only the trustee could prosecute the appeals. Id Croft appeal was filed on August 5, 2011, before Croft filed bankruptcy on August 24, 2011 listing the creditors of the Sanction Orders.

Exhibit 3 (Original Schedules of Croft from Bankruptcy case l l-52905cag) By listing the creditors of the sanction order Croft made the suits a core proceedings. Kahn agrees with the District Court and the Fifth Circuit that a successful Appeal would have reduced Crofts debt. This would modify a Crofts debt and would be a core proceeding under the Related definition of

-6 - core proceedings. The test for determining whether a civil proceeding is related to bankruptcy is whether the outcome of that proceeding could conceivably have any effect on the estate being administered in the bankruptcy. . . .An action is related to bankruptcy if the outcome could alter the debtor's rights, liabilities, options, or freedom of action ... and which in any way impacts upon the handling and administration of the bankrupt estate. Specialty Mills, 51 F.3d at 74 Kahn's debt from the Defamation trial case was adjudged after the bankruptcy petition was filed. As briefed in Issue 1 the case is a non-core proceeding and not in the jurisdiction of the bankruptcy court to sell its appeal rights. A successful appeal of the Defamation trial case will not effect the debtor's rights, liabilities, options, or freedom of action ... and which in any way impacts upon the handling and administration of the bankrupt estate.

The marked difference between Kahn and Croft is that Kahn is non-core and Croft is Core. Kahn agrees with the Court that the case of In Re C-Power Prods., .Inc, 230 B.R. 800,803 the malpractice claim was directly related to the bankruptcy and is a core proceeding.

ISSUE 3 The bankruptcy order entitled "Order Authorizing Sale of All Non-Exempt Assets, Claims and Causes of Actions" should be declared null and void thus the Trustee does not have standing in this Appeal.

The "Order Authorizing Sale of All Non-Exempt Assets, Claims and Causes of Actions' ("Sales Order") should be declared null and void for the following reasons: I.

Order of Sale On Appeal The motion for sale to sell is currently on appeal in the United States District Court for the Western District of Texas case number SA-14-CA- 1109.

There are several issues of Law to be reviewed de nova: (A)Article III of the Constitution of the United States;(B) Fourteenth Amendment to the Constitution of the United States;.(C)l l U.S.C. § 1509 A foreign Corporation needs to register to have Direct Access;(D) Sale procedures and bona fide purchaser 21 U.S.C. § 853 (n)(6)(B); ;(E).11 U.S.C. § 544 abandonment, Based on the In Scurlock Oil Co. v. Smithwick, 724 S. W.2d 1 (Tex. 1986) "ta judgment is final for the purposes of issue and claim preclusion "despite the taking of an appeal unless what is called an appeal actually consists of a trial de novo." The Sales Order is not a final as per Scurlock Oil Co and collateral estoppel of the Sales Order is not applicable at this time. thus the Trustee does not have standing in this Appeal II..

Fourteenth Amendment to the Constitution of the United States

The Bankruptcy Court did not allow Kahn to testify as to the value of the Joabert property Exhibit 4 (Transcript of Motion to Sell Hearing on October 15, 2014 in Bankruptcy Case 14-50980-cag) P.92 (A violation of Kahn's Fourteenth Amendment rights) and Court declared value to be zero. Kahn is an 1/3 owner and a Professional Engineer, licensed in the State of Texas, who designed the project and was the President of the contractor. Kahn has knowledge of the property and is an expert witness. Fariasantos v. Rosenberg & Associates, (E.D.Va. 2-27-2015) based on Federal Rule of Evidence 701, stated, "most courts have permitted the owner or officer of a business to testify to the value ... of the business, without the necessity of qualifying the witness ... by virtue of his or her position in the business." In Kahn's case 2013-CI-17012 ("Joabert Case") First Amended Original Petition Request For Appointment Of Commissioners, Alternative Request For Appointment Of Receiver," a sworn petition has included on page 13 an detail analysis of each section of the property and an estimate of the cost to complete. The Bankruptcy Court would not allow Kahn to testify. Kahn' s testimony would have been enough detail to show the worth of the Joabert property and as such that Kahn's value would exceed his debts and the sale would not have been approved. Appellee did not file an answer to the amended petition which is uncontroverted. In Freedom Path v. Lerner, (N.D.Tex. 2-24-2015) "a court . . . . must accept as true the uncontroverted allegations in the complaint and

resolve in favor of the plaintiff any factual conflicts posed by the affidavits.

Latshaw v. Johnston, 167 F.3d 208 (5th Cir. 1999). If Kahn had testified and showed the value of Joabert exceeded the would have exceeded the debt, the Sales Order would not have been approved. Thus the Trustee does not have standing in this Appeal.

III Sale Procedures And Bona Fide Purchaser 21 U.S.C. § 853 (n)(6)(B); 11 U.S.C. § 363 requires notice prior to sale. Robert Wachsmuth a creditor did not get notice of the sale or hearing date. Exhibit 5(Email) This violation makes the sale null and void.

11 U.S.C. § 363 (m) (n) requires the sale to be a good faith. The sale was to one of the creditors Helvetia who claimed 97% of the debt. Therefore with the price of $10,000 Helvetia would get distributed back $9700, or only cost $300. In USA v. Real Property, Located at 246 Main Street, Dansville, Livingston Co., NY(M.D.Fla. 7-13-2015) states: "Although we have not previously addressed this question, we agree with the majority view that unsecured or general creditors cannot be considered bona fide purchasers for value within the meaning of§ 853(n)(6)(B). ")~United States v. Reckmever, 836F.2d200, 208 (4th Cir. 1987) (stating that the term includes "all persons who give value ... in an arms-length transaction with the expectation case "was paid for the rendition that they would receive equivalent value in return."). While "a person who receives property subject to forfeiture as a 'gift' cannot be

a bona fide purchaser for value," United States v. Brown, 509F.Supp.2d 1239, 1246 (M.D. Fla. 2007), the term "bona fide purchaser for value must be construed liberally to include all persons who give value ... in an arms- length transaction with the expectation that they would receive equivalent value in return." United States v. Cox, 575F.3d352, 356 (4th Cir. 2009) The sale was not to a bona fide purchaser and was not an arms length transaction and not in good faith.

NO CONSIDERATION The Motion to Sell was granted but the Trustee did not distribute the funds. Exhibit 6.(E mail) The sale is not complete until the funds are distributed.

This violation makes the sale null and void until funds are distributed. Thus at present time, the Trustee does not have standing in this Appeal until he distributes the funds.

llU.S.C. § 554 ABANDONMENT The hearing on the Motion to Sell was on October 15,2014. Transcripyt of that hearing is Exhibit 4. The Court on pages 43, 45 and 93 stated that the value of 2013-CI-18355 and its Appeal Case 05-14-00568-CV are worth zero. The Trustee stated on page l 7and 21 that the litigation of these claims is totally unreasonable.

11 U.S.C. § 554 states: the trustee may abandon any property of the estate that is burdensome to the estate that is in consequential value and

benefit to the estate. By the Trustee and the Court finding no value the of the causes they are abandon and reverts to the debtor and stands as if no bankruptcy petition was filed. In Re Dewsnup, 908 F.2d 588 (1 oth Cir. 1998) Therefore Kahn owns the cause of action and the Trustees has no standing in the appeal.

ISSUE 4 llU.S.C. § 1509 A foreign Corporation needs to register to have Direct Access Registration for a foreign Corporation is a very important issue. A Foreign Corporation can camouflage their operations and can avoid taxes and enable illegal activities such as money laundering and terrorist activities.

Helvetia Asset Recovery, Inc. ("Helvetia"), creditor and party-in-interest, is a misnomer. Helvetia is a Texas Corporation. Burton Kahn ("Kahn") is president of that corporation per Secretary of State. (Except for period September 27, 2013 to October 4, 2013) (5RR131-136, 213). Record in Case 2013-CI-18394 and Appeal 4-14-00357-CV (5RR365). This Appeal of Case 2013-CI-18355 was to determine who owns the shares of Helvetia. The real party in interest is Puerto Verde, Ltd a Bahamian Corporation ("PVL") Robert Ripley testified that he is President of PVL and claims that PVL owns the shares of Helvetia. The ownership of Helvetia' s stock was decided without litigation or jurisdiction in

the Final Judgment and Sanction Order dated April 1, 2014. 11 U. S. C. § 1509 requires that a foreign corporation have a Right Direct access .. A Motion to Disqualify Puerto Verde Ltd. To Have Direct Access to this Court. (a) A foreign representative may commence a case under section 1504 by filing directly with the court a petition for recognition of a foreign proceeding under section 1515.

However no such request has been made. PVL does not have standing in this court and standing is a component of subject matter jurisdiction. Tex. Ass'n ofBus. v. Tex. Air Control Ed., 852 S. W.2d 440, 444-45 (Tex. 1993). Because subject matter jurisdiction is essential to the authority of a court to decide a case, it will cannot be waived and may be raised for the first time on appeal.

Thus all judgments in thus case and in other related cases are void and there is no debt to Helvetia /PVL. The bankruptcy court's order in Denying the Motion to Disqualify Puerto Verde Ltd. To Maintain A Lawsuit was based sole on good cause and this Court should not allowed the Order as collateral estoppel (ECF No. 45) (Bankruptcy Court Case 14-50980-cag) Exhibit 7 states for the reason of denial, good cause without having any evidence or reasons to dispute these motions. This is not allowed per In U.S. Home Corporation v. Settlers Crossing (D.Md. 8-14-2012) .. "Good cause' is understood to mean '[a] legally sufficient reason,' and it reflects 'the burden placed on a litigant to show why a request should be granted or an action excused." Joseph v, Hess Oil V.I. Corp., 651 F.3d 22 348, 351 (3d Cir. 2011) (quoting Blacks Law Dictionary 251 (9th ed. 2009)). The "good cause" inquiry "focuses on the moving party's burden to show due diligence." Race Tires Am., Inc. v. Hoosier Racing Tire Corp .. 614 F. 3d 57, 84 (3d Cir. 2010).

In In the Matter ofCV, 12-10542 (5th Cir. 1-7-2013) states: "Chapter 15 provides for a broad range of relief. This includes the ability to sue and be sued in United States courts, to apply directly to a United States court for relief, to commence a non-Chapter 15 case, and to intervene in any United States case to which the debtor is a party. In re Condor Ins. Ltd., 601 F.3d 319, 324 (5th Cir. 2010)" The process in the federal system chapter 15 requires a Court order and hearing for a foreign Corporation needs to register to have Direct Access and that the corporation shall met specific requirements. Texas only requests filing a registration form and a fee. However PVL has done neither and that PVL should not be able to sue or be sued. Thus the Sales Order is null and void and the Trustee does not have standing in this Appeal.

CONCLUSION The Appellant has shown that this motion that the "Order Authorizing Sale of All Non-Exempt Assets, Claims and Causes of Actions' should be declared null and void for the following reasons: the order was in violation of Article III of the Constitution of the United States; the 14th

amendment to the Constitution of the United States; the order his untimely because of appeal which will be reviewed as de novo; sales procedures such as notice and consideration and a bona fide purchaser and the abandonment of the cause of action making the cause of action revert back to Kahn.

The trustee does not have standing in this appeal.

PRAYER Appellant, Burton Kahn is an American Citizen, born in Brooklyn, New York in 1933 from parents that were both born in Brooklyn, New York in 1904 and served his country in the United States Army for two deployments, moved to Texas in 1977 and desires justice and his rights as an U.S. Citizen, which has been deprived in favor of Appellee, who is a Canadian citizen living in Columbia South America, banks in the Bahamas with secret accounts and does not pay United States Taxes. For the reasons above Appellant prays that this Appellate Court find that this Motion for Rehearing is Granted and that this Honorable Court find that the Appellant is entitled to a new Trial.

Respectfully Submitted

Burton Kahn Pro-se 1706 Alpine Cir., San Antonio, TX 8248 glentrailyahoo.com

Tel (210) 408-9199 VERIFICATION State of Texas § County of Bexar § Tex. Civ. Prac. & Rem. Code § 132.001 My name is Burton Kahn. I am over the age of 18 and am fully competent to make this unsworn declaration. My date of birth is in August 1933 and my address is 1706 Alpine Circle, San Antonio, Texas 78248. I declare under penalty of perjury that the foregoing is true and correct and the Exhibits presented are the true and correct copies of the record. Executed in Bexar County, State of Texas on the day of September 2, 2015.

Burton Kahn

CERTIFICATE OF COMPLIANCE WITH RULE 9.4(e), (i) This motion complies with the type-volume limitation of Texas Rule of Appellate Procedure 9.4(1) because, according to the Microsoft Word 2010 word count function, it contains 5,848 words on pages 1-26, excluding the parts of the brief exempted by Texas Rule of Appellate Procedure 9.4(e)(l)(l).

This notion complies with the typeface requirements of Texas Rule of Appellate Procedure 9 .4(e) because it has been prepared in a proportionally spaced typeface using Microsoft Word 2010 software in Times New Roman 14 point font in text.

Burton Kahn CERTIFICATE OF SERVICE I certify that a copy of this Motion was served on Appellee Helvetia Asset Recovery Inc. through counsel of record on September 2, 2015 by

4'.ZD Burton Kahn Via Email Elizabeth Conry Davidson, Attorney at Law Chulie Drive San Antonio, Texas 78216 (210) 380-4899 telephone (210) 225-2300 facsimile [email protected]

APPENDIX EXHIBITS 1.0PINION 2. ORDER AND MOTION OF 2013-Cl-17516 3. CROFT'S BANKRU PT PETITION 11-52905-CAG 4. TRANSCRIPT MOTION TO SELL BANKRUPT CASE 14-50980-CAG 5. EMAIL RW WACHSMUTH NOT NOTICED 6. EMAIL OF TRUSTEE THOMAS NO DISTRIBUTION 7. ORDER DENYING MOTION TO DISQUALIFY PUERTO VERDE LTD. TO MAINTAIN LAWSUIOT IN TEXAS EXHIBIT 1 jfourtb QCourt of ~ppra:l.% $an ~ntonio, W:exa% OPINION No. 04-14-00569-CV Burton KAHN, Appellant V.

HELVETIA ASSET RECOVERY, INC., Appellee From the 37th Judicial District Court, Bexar County, Texas Trial Court No. 2013-CI-18355 Honorable Michael E. Mery, Judge Presiding Opinion by: Marialyn Barnard, Justice Sitting: Marialyn Barnard, Justice Patricia 0. Alvarez, Justice Jason Pulliam, Justice Delivered and Filed: August 19, 2015 DISMISSED FOR WANT OF JURISDICTION A jury found appellant Burton Kahn ("Kahn") breached his fiduciary duty to appellee Helvetia Asset Recovery, Inc. ("Helvetia"), used another company to perpetrate a fraud for his benefit, retained money belonging to Helvetia, slandered Helvetia's title to certain real property, and filed fraudulent court records against real property owned by Helvetia. The jury awarded sizeable actual damages as well as punitive damages and attorney's fees. The trial court rendered .a judgment based on the jury's verdict and granted Helvetia a permanent injunction to preclude Kahn from interfering in Helvetia's business. On appeal, Kahn raises numerous issues challenging 04-14-00569-CV

the judgment. However, because Kahn lacks standing to prosecute this appeal, we have no jurisdiction and dismiss the appeal.

BACKGROUND Given our disposition of the appeal, a detailed rendition of the facts 1s unnecessary.

Accordingly, we provide only a brief factual and procedural statement for context.

Helvetia is a company that owns and sells real estate lots to builders in San Antonio. Kahn was the president, secretary, and sole director of Helvetia from October 2009 until he was - terininafed in August 201 :r. Kfter he wa-s terminated, Kahn b-egan to take actions detrimental to Helvetia, including transferring by deed numerous properties owned by Helvetia to a company created by Kahn after his termination - Paradiv Corporation. Upon discovering what Kahn was doing, Helvetia filed suit to set aside the deeds. The trial court ordered the deeds set aside and thereafter, on November 4, 2013, Helvetia filed a suit against Kahn alleging numerous causes of action based on Kahn's activities after his termination. 1

1The day after Helvetia filed suit, Kahn also filed suit, seeking to set aside several deeds from Helvetia to certain buyers ("the Lien Case"). Kahn claimed the deeds from Helvetia to the buyers were fraudulent. Initially, the trial court granted the relief sought by Kahn, rendering an ex parte temporary restraining order. Kahn filed that order in the deed records, thereby clouding Helvetia' s title. The trial court granted the ex parte order based on documents filed by Kahn, who claimed to be acting as president and authorized representative of Helvetia. Kahn failed to disclose, however, that in the prior- litigation-filed by Helvetia-in October 20Br>motheLtrial cnurtllad declared as fraudulent the deeds Kahn transferred to Paradiv, determining Kahn had no authority to act on behalf of Helvetia. After Helvetia discovered what Kahn had done, Helvetia filed a motion to set aside the trial court's order, advising the trial court of the prior ruling and seeking injunctive relief to preclude Kahn from interfering with Helvetia's business or holding himself out as an authorized representative. After an evidentiary hearing in December 2013, the trial court overturned its prior order, finding Kahn made false claims in order to secure the prior order. The trial court enjoined Kahn from acting on behalf of Helvetia in the future.

In addition to seeking to set aside the trial court's order in the Lien Case, Helvetia sought sanctions against Kahn.

After another evidentiary hearing, the trial court imposed sanctions against Kahn. The trial court found, among other things, that Kahn did not own Helvetia or its stock. Rather, the trial court determined the sole owner of Helvetia is Puerto Verde, Ltd. ("Puerto Verde"), which is owned by Robert Ripley. Kahn appealed the sanctions order to this court. On July 22, 2015, this court dismissed Kahn's appeal for want of prosecution. See Jn Re A Purported Lien or. Claim Against Helvetia Asset Recovery, Inc., No. 04-14-00357-CV, 2015 WL 4479600, at *1-*2 (Tex. App.-San Antonio July 22, 2015, no pet. h.) (mem. op.).

-2- 04-14-00569-CV

On April 4, 2014, while Helvetia's suit was pending, but prior to trial, Kahn filed a voluntary petition for bankruptcy, which immediately stayed the trial court proceedings. However, the bankruptcy stay was lifted by order of the bankruptcy court on April 28, 2014. Thereafter, the case proceeded to trial.

Ultimately, the jury found Kahn breached his fiduciary duty to Helvetia, misappropriated funds from Helvetia, used Paradiv to perpetrate a fraud for his benefit, held money belonging to Helvetia, slandered Helvetia's title to certain real property, and filed a fraudulent court record or document against real property owned by Helvetia. The jury awarded damages for each claim.

The jury also determined Kahn's breach of fiduciary duty and perpetration of fraud was committed "either maliciously, fraudulently, or through gross neglect," resulting in an award of punitive damages in favor of Helvetia in the amount of $900,000.00. Finally, the jury awarded trial and appellate attorney's fees. The trial court rendered judgment based on the jury's verdict and rendered a permanent injunction, precluding Kahn from interfering in Helvetia's business. Kahn perfected an appeal from the judgment.

ANALYSIS Kahn raises numerous issues challenging the trial court's judgment. In response, Helvetia contends, among other things, that this court must. dismiss Kahn's appeal because we lack jurisdiction. More specifically, Helvetia contends that as a result of his decision to file a voluntary bankruptcy petition, Kahn has no standing to pursue this appeal because his appellate rights in this appeal vested with the bankruptcy trustee, who sold those rights to Helvetia in a sale approved by the bankruptcy court. Thus, before we can review any issues raised by Kahn, we must first determine whether he has standing to pursue this appeal.

-3- 04-14-00569-CV

Standard ofReview & Relevant Law - Standing Standing is a component of subject matter jurisdiction that we review de novo. Sneed v. Webre, No. 12-0045, 2015 WL 3451653, at *7 (Tex. May 29, 2015) (citing Tex. Dep 't ofTransp. v. City ofSunset Valley, 146 S.W.3d 637, 646 (Tex. 2004); Tex. Ass'n ofBus. v. Tex. Air Control Bd, 852 S.W.2d 440, 444-45 (Tex. 1993)). Standing is a constitutional prerequisite to maintaining suit. Sneed, 2015 WL 3451653, at *7 (quoting Williams v. Lara, 52 S.W.3d 171, 178 (Tex. 2001)).

In the absence of standing, a court lacks subject matter jurisdiction to hear the case. Austin Nursing Ctr, Inc. v. Lovato, 171 S.W.3d 845, 849 (Tex. 2005); Wolff v. Deputy Constables Ass 'n, 441 S.W.3d 362, 365 (Tex. App.-San Antonio 2013, no pet.).

As recently reiterated by the supreme court in Sneed, "[t]he issue of standing focuses on whether a party has a sufficient relationship with the lawsuit so as to have a 'justiciable interest' in its outcome." 2015 WL 3451653, at *7 (quoting Lovato, 171 S.W.3d at 848). In Texas, standing does not exists unless (a) there is a real controversy between the parties, which (b) will be actually determined by the judicial declaration sought. Id. (quoting Tex. Ass 'n ofBus., 852 S. W.2d at 446) (quoting Bd of Water Eng'rs v. City of San Antonio, 155 Tex. 111, 283 S.W.2d 722, 724 (Tex. 1955)). A determination of standing focuses on whether a party has a "justiciable interest" in the outcome of the lawsuit, such as when it is personally aggrieved or has an enforceable right or interest. Lovato, f71 S.W.3d af849 (citing Nootsie, Ltd v. Williamson Cnty. Appraisal Dist., 925 S.W.2d 659, 661 (Tex. 1996)); Wolff, 441 S.W.3d at 365.

Application - Standing In this case, Helvetia contends Kahn lacks standing to prosecute this appeal as a result of his voluntary bankruptcy filing. According to Helvetia, Kahn's right to pursue this appeal vested in the bankruptcy trustee, who sold those rights to Helvetia - an action approved by the

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bankruptcy court. Accordingly, Helvetia contends Kahn no longer has any right or interest in this appeal, and therefore, no standing to pursue it.

Filing a voluntary petition for bankruptcy creates a bankruptcy estate, which is comprised of "all legal or equitable interests of the debtor in property as of the commencement of the case." 11 U.S.C. § 541 (a); see Douglas v. Delp, 987 S.W.2d 879, 882 (Tex. 1999); Rodriguez v. City of San Antonio, 113 S.W.3d 378, 380 (Tex. App.-San Antonio 2003, pet. denied). This includes causes of action or legal claims that belonged to the debtor before the bankruptcy petition was filed. Douglas, 987 S. W.2d at 882. The bankruptcy trustee, as the representative of the bankruptcy estate, has exclusive standing to assert legal claims that become part of the estate. Douglas, 987 S.W.2d at 882; Rodriguez, 113 S.W.3d at 381. In other words, by voluntarily filing a bankruptcy petition, the bankruptcy debtor relinquishes to the trustee any standing to prosecute or dispose of the claims included in the estate. Douglas, 987 S. W.2d at 882; Rodriguez, 113 S. W.3d at 381.

It is not simply causes of action or claims that become part of the bankruptcy estate. The Fifth Circuit, applying Texas law, has specifically held that defensive appellate rights are property under Texas law and become part of the bankruptcy estate. In re Croft, 737 F.3d 372, 376--77 (5th Cir. 2013) (per curiam). As the court explained, "[w]hile it is true that a judgment against the debtor is an obligation and has no value to the estate-and would therefore not be included in a list of property-the right to appeal that judgment certainly has a quantifiable ~alue to the debtor, and therefore constitutes property under Texas law." Id. (emphasis in original). Thus, property rights in a legal cause of action include not only the cause of action itself, but any appellate rights related thereto. Id. at 375.

We find the Fifth Circuit's decision in Croft instructive. In Croft, Bradley Croft was involved in two lawsuits that ultimately resulted in sanctions against him and an award of ·attorney's fees in favor of his opponent. Id. at 374. Croft appealed those decisions to this court. -5- 04-14-00569-CV

Id. Thereafter, Croft filed a voluntary bankruptcy petition. Id As required, we abated Croft's appeals because of the automatic bankruptcy stay. Id.; see TEX. R. APP. P. 8.2 (stating bankruptcy suspends appeal). In response, Croft filed a motion in the bankruptcy court seeking to lift the automatic stay and allow the appeals to continue. Id Croft's motion was opposed under the theory that Croft's right to appeal was part of the bankruptcy estate and only the trustee could prosecute the appeals. Id The Fifth Circuit, applying Texas property law, held Croft's defensive appellate rights, allowing him to appeal the sanctions order and award of attorney's fees, became part of the bankruptcy estate when he filed the voluntary bankruptcy petition. Id. at 378. Accordingly, Croft no longer had standing to pursue the appeals because his defensive rights in the appeals were property of the bankruptcy estate and thus, the bankruptcy trustee had the right to sell the appellate rights pursuant to a bankruptcy court order of sale. Id Here, as described above, Kahn was involved in a lawsuit that ultimately resulted in the award of monetary damages against him, including punitive damages and attorney's fees. Kahn voluntarily filed a petition for bankruptcy, creating a bankruptcy estate. Thus, Kahn's legal claims, as well as his defensive appellate rights in this appeal, i.e., his right to appeal the judgment in this case, was a valuable property right that became part of the bankruptcy estate. See id. The bankruptcy court recognized that this appeal was part of the bankruptcy estate as demonstrated in its order entitled "Order Authorizing Sale of Aii Non-Exempt Assets, Claims and Causes of Actions." In that order, the bankruptcy court specifically listed this appeal - or the rights to pursue it - among the assets the trustee was authorized to sell. The relevant portion of the order states: ORDERED that movant, Johnny W. Thomas, Trustee, be and is hereby authorized and directed to sell all property owned or claimed to be owned by the Debtor to include all the Debtor's non-exempt assets, claims and causes of action now -6- 04-14-00569-CV

existing or hereafter arising, all rights, titles and interests in any business or business enterprise that currently exist or has ever existed to Helvetia Asset Recovery, Inc. or its assigns, for $!0,000.00. This property includes, but is not limited to, the following: * * * All claims or causes of action held by or for the debtor, including but not limited to the following:

Burton Kahn v. Helvetia Asset Recovery, Inc., No. 04-14-00569-CV; Fourth Court of Appeals, San Antonio, Texas.

The trustee, in order to maximize the estate's value, sold the defensive appellate rights to Helvetia, a sale that was approved by the bankruptcy court. Accordingly, we hold Kahn has no "justiciable interest" in this appeal as he has no enforceable rights therein. See Sneed, 2015 WL 3451653, at *7; Lovato, 171 S.W.3d at 849; Wolff, 441 S.W.3d at 365. It therefore follows, and we hold, Kahn has no standing to pursue this appeal as that right has been sold as part of the estate by the trustee, who had exclusive standing to prosecute or dispose of the property of the bankruptcy estate. See Croft, 737 F.3d at 376-77; Douglas, 987 S.W.2d at 882; Rodriguez, 113 S.W.3d at 381.

In his reply brief, Kahn argues his defensive appellate rights in this appeal are not part of the bankruptcy estate because the trial court's judgment was rendered after the commencement of the bankruptcy proceeding. Thus, according to Kahn, the defensive appellate rights created by the judgment were not part of the bankruptcy estate. We disagree. Although this case is distinguishable from Croft because in Croft, the defensive appellate rights were created prior to the filing of bankruptcy, the bankruptcy code specifically states that any interest in property that the estate acquired after commencement of the case becomes property of the bankruptcy estate. 11 U.S.C. § 541(a)(7) (2015); see In re C-Power Prods., Inc., 230 B.R. 800, 803 (Bankr. N.D. -7 - 04-14-00569-CV

Tex. 1998) (holding that not only pre-bankruptcy petition malpractice claim became property of bankruptcy estate, but post-bankruptcy petition malpractice claim likewise became property of bankruptcy estate.). Accordingly, we hold the fact that the trial court's judgment was not rendered until after the bankruptcy petition was filed is irrelevant. Kahn's defensive appellate rights in the appeal became a part of the bankruptcy estate whether they existed before or after the bankruptcy petition was filed by Kahn. See 11 U.S.C. § 541(a)(7); C-Power Prods., 230 B.R. at 803.

CONCLUSION Based on the foregoing, we hold Kahn had no justiciable interest in the right to pursue this appeal. The defensive rights to this appeal became part of Kahn's bankruptcy estate, and the trustee was authorized to sell the rights pursuant to the bankruptcy court's order. Accordingly, we hold Kahn has no standing. Given Kahn's lack of standing, a component of subject matter jurisdiction, we hold we have no jurisdiction over this appeal. Accordingly, we dismiss the appeal for want of jurisdiction.

Marialyn Barnard, Justice

-8- jfourtb QCourt of ~ppeals g,an ©:ntonio, \!rexag August 19, 2015 No. 04-14-00569-CV Burton KAHN, Appellant v. HELVETIA ASSET RECOVERY, INC., Appellee From the 37th Judicial District Court, Bexar County, Texas Trial Court No. 2013-CI-18355 Honorable Michael E. Mery, Judge Presiding ORDER In accordance with this court's opinion of this date, this appeal is DISMISSED FOR WANT OF JURISDICTION.

We order that appellee Helvetia Asset Recovery, Inc. recover its costs of this appeal from appellant Burton Kahn.

It is so ORDERED on August 19, 2015.

d affixed the seal of the said EXHIBIT 2 • ~ EXHIBIT ~ <?! ~-=+-- MISC. DOCKET NO. 20l3-CJ-l75 l 6 JN RE: A PURPORTED LIEN § JN THE DISTRICT COURT OR CLAIM AGAINST HELVETIA § ASSET RECOVERY, INC. § 43lffH JUDICIAL DISTRICT § Property Owner § BEXAR COUNTY, TEXAS §

JUDICIAL FINDING OF FACT AND CONCLUSION OF LAW REGARDING A DOCUMENTOR INSTRUMENT PURPORTING TO CREATE.A LIEN OR CLAIM On the - day of OCT .2 aZDD ' 2013, in the above entitled and numbered ca.u3c, thi3 Court reviewed a. motion,- verified by a.ffida.vit, of Robert Ripley a.nd the documentation attached thereto. Additionally, the Court reviewed the "Warranty Deed" and "Correction Warranty Deed" attached hereto. No testimony was taken from any party, nor was · there any notioa of the Court'c revie\v, the Court ha.ving made fhe -detetmina.tion that a. deoiaton could be made solely on review of the documentation under the authority vested in the Court under Subchapter J, Chapter 51 of the Texas Government Code. The Court finds: a~ follow_s: the Warr.mty D~ed, attached hereto -su~ Exhibit I; the Revised Warranty Deed, attached hereto as Exhibit 2; and the Correction Warranty Deed, attached hereto as Exhibit 3 (collectively, the "Warranty Deeds"), are NOT created by implied or express

express c6nsent or agreement of an agent, fiduciary, or other. representative of that person. The Watranty Deeds, attached hereto as Exhibits 1-3, do not grant Parad[v Corporation any interest in the property described therein.

The Court makes no finding as to any underlying claims of the parties involved, and expressly limits its finding of fact and conclusion of law to the review of a ministerial act. The

JUDICIAL FINDING OF FACT AND CONCLUSION OF LAW RE.GARDING A DOCUMENT OR INSTRUMENT PURPORTING TO CREATE A LIEN OR CLAIM Page I county clerk shall file this finding of fact and conclusion of law In the same class of records as the subject documentation or instrument was originally filed, and the court directs the county clerk to index it using the same names that were used in indexing the subject documentation or instrument.

0Ci.tt8 Signed on this the __ day of _____________

IJl:STRICT JUIJGc Bexar County, Texas

JUDICIAL FINDING Of FACT AND CONCLUSION OF LAW REGARDING Page2 A DOCUMENT OR INSTRUMENT PURPORTING TO CREATE A LlllNOR CLAIM ...--------------···.

5CAl"tlEO WARRANTY DEED Granror: HELVETIA ASSET RECOVERY, INC. BBXAR COUNTY TEXAS GRANTEE: PARADTV CORPORATrON BEXAR COUNTY, TEXAS Consideration: TEN AND NO/JOO DOLLARS and other good and valullb!c consideration Property (including any improvements) BLOCK 3 WT! , BLOCK3 LOT2, BLOCK 3 LOT 3 , BLOCK 3 LOT 4, BLOCK 3 LOT 5 .

BLOCK 3LOT6 ,BLOCK3 LOT7 ,BLOCK3 LOT8,BLOCK3LOT9 ,BLOCK.3 LOT 10, BIPCK 3 LOT 1I,BLOCK3 LOT 12. 5LOCK 3LOT13, 5LOCK 3 LOT 16, BLOCIU LOT J7, BLOCK3LOT 18,BLOCK3 LOTl9 , BLOCK 4.LOT I, BLOCK 4 LOT 6 .> BLOCK4 LOT 7, BLOCK4 LOT & , BLOCK 4 LOT 9, BLOCK 4 LOT I0, BLOCK 4 LOT II , BLOCK 4 LOT 12, BLOCK 4 LOT 13 , BLOCK 4 LOT 14, BLOCK4LOT l5,BLOCK4LOT16, BLOCK4LOT17,BLOCK4LOT18,BLOCK4LOT19, BLOCK4 LOT20.BLOCK4 LOT21 .BLOCK4LOT22 ,BLOCK4 LOT23 ,BLOCK4 LOT24, BLOCK 4 LOT 25 , BLOCK 4 LOT26. BLOCK 4 LOT 27 •BLOCK 4 LOT 28 , BJACJ( 5 LOT I, BLOCK 5 LOT 2, BLOCK 5 LOT 3. BLOCK 5 LOT 4, BLOCK LOT 5. s BLOCKS LOT 6, BLOCK' LOT 7, BLOCK' LOT 3, BLOCK 5 LOT 9, .BLOCK 5 LOT 10, BLOCKS LOT 11,BLOCKS LOT 12 ,BLOCK5LOT13 ,BLOCKS WT 14,BLOCKS LOT 15, BLOCKS LOT Hi, BLOCKS LOT 17 ,BLOCKS LOT 18 BLOCKS LOT 19 ,BLOCK5LOT20, 8LOCK S LOT 21 , BLOCK 5 LOT n , BLOCKS LOT23 , BLOCKS LOT 24 ,»LOCKS LOT 2~, BLOCKS LOT 26, BLOCKS LOT 27, BLOCK 5 LOT 28, BLOCKS LOT 29 , BLOCK 5 LOT 30 , BLOCK 5 LOT 31 , BLOCK 5 LOT 32 • BLOCK 6 LOT I • BLOCK 6 Lill 2 , BLOCK 6 LOT 3 .BLOCK6 LOT 4 •BLOCK 6 LOT 5 , 8LOCK6LOT6 ,BLOCK6LOT7, BLOCK 6 LOT 8, BLOCK6 LOT 9, BLOCK6LOT10.

BLOCK6 LOT II, BLOCK6LOT 12,BLOCK6LOT 13 .BLOCK6LOTl4,BLOCK6LOT15 ,BLOCK6LOT 16, BLOCK6LOT17, BLOCK6LOT 18, BL0cK6 LOT.19, BLOCK6 LQT20.

BLOCK 6 LOT 2 I • BLOCK 6 LOT 22, BLOCK 6 LOT 23 , BLOCK 6 LOT 24 , BLOCK 6 LOf 25 , BLOCK 6 LOT 26, BLOCK 6 Lor 27 ,BLOCK 6 LOT.28 , BLOCK 6 LOT 29, BLOCK 6 LOT 30 • BLOCK 6 LOT 31 , BLOCK 6 LOT 32, BLOCK 7 LOT 1 , BLOCK7 LOT 2, BLOCK 7 LOT 3, BLOCK7 LOT4, BLOCK 7 LOTS, BLOCK 7 LOT 6, BLOCK 7 LOT 7 , BLOCK 7 LOT 8 , BLOCK 7 LOT 9 , BLOCK 7 LOT IO, BLOCK 7 LOT 11, BLOCK ?LOT 12,BLOCK 7LOT13,BLOCK 7LQT14,BLOCK 7 LOT15 ,BLOCK 7LOT 16,BLOCK7LOT 17 ,BLOCK 7LOT 18 ,BLOCK 7LOT 19,BLOCK 7 LOT2.0, BLOCK 7 LOT 21 •BLOCK 7 LOT 22 , BLOCK7 LOT 23 , BLOCK 7 LOT 24 • BLOCK7 LOT25 .

BLOCK 7LOT26,BLOCK 7LOT27 ,BLOCK7LOT28, BLOCK? LOT42 ,BLOCK 7 LOT43, 3pgs

EXH!BlT1 ~ BLOCK 7LOT44, BLOCK 7 LOT 45 ,BLOCK 7L0T46., BLOCK 7LOT47,BLOCK 7LOT48, BLOCK 1 WT 49, BLOCK 1 WT 50, BLOCK TLOT 51 , BLOCK 7 LbT 52 ,BLOCK 7 LOT 53 , BLOCK7 LOT 54 , BLOCK 7 LOT SS, BLOCK TI.OT 56 , BL()CK 7 LOTS? , BLOCK 7 LOT 58, BLOC.K7I.oT ..· 59,BLOCK ... 7.WT60,BLOCK7LOT61,BLOCK7LOT62 -. - - - ' _, BLOCK7LOT63 - ' " BLOCK 7 LOT 64 , BLOCK. 7 LOT &S, BLOCK 7 LOT 66 , BLOCK 8 LOT .I , BLOCK 8 .LOT 2, BLOCK 8 LOT 3, BLOCK 8 LOT4, BLOCK 8 LOT .s, BLOCK 8 LOT 6, BLOC!( R LOT Ii. RJ.QCl(.t IDT IQ ,BJ..OC.ICllLOT20 ,BLOC:K:iLOT 21 ,BL()Cl:'. a. LOT 2:2, BLOCK 8 LOT 23 , BLOCK 8 LOT24 , BLOCK 8 LOT 25 , BLOCK 8 LOT 26 • BLOCK 8 LOT 27 , BLOCK 8 LOT 28, BLOCK 8, LOT 29, BLOCK 8, LOT 30 , BLOCK 8, LOT 31 • BLOCK 8, LOT 32, BLOCK 8, LOT 33 • BLOCKS, LOT 34, BLOCK 9 LOT I , BLOCK 9 LOT 2 , BLOCK 9 LOT 3 , BLOCK 9 LOT 4 , BLOCK 9 LOT 5 , BLOCK9 LOT 6, BLOCK 9 LOT 7, BLOCK 9 LOT B, BLOCK 9 LOT 9; BLOCK 9 Lot 10, BLOCK.!/ LUI' l I, HLUCK!I LU'!' ll ,HLUUI. !I LOT 13, l!LOCK9 LOT 14, HLOCK 9 LOT 15 .BLOCK9 LOT 16 ,BLOCK.9LOT17,BLOCK9LOT18,,BLOCK9LOT 19 ,BLOCK 9LOT 20, BLOCK 9LOT 21 , BLOCK 9 LOT 22, BLOCK 9 Lot 23 , BLOCK 9 LOT 24 , BLOCK.9 LOT :ZS ,BLOCK I> LOT :l6, BLOCK!> LOT 27, BLOCK 9 LOT 28, BLOCK 9 LOT W, BLOCK 9LOT 30 ,BLOCK9 LOTJI ,BLOCK 9 LOT 32,BLOCK9 LOT33 ,BLOCK9 LOT34, . KEY LARGO SUBDIVISION CB 05065 IN BEXAR COUNTY, TEXAS AS PLAT RECORDED JN VOLOMe 9573 PAGE 13 Property Records, BeJW"CQUlllY. Texas, ... : .

RllsERVATION From anQ Exceptions to Conveyance and Wan:anty: Easements, rights-of-way, and ~riptivc rights, whether of record or not; all presenlly ra;;opJcd Iu:strum~nt.:f. utlK:.r ibmJ li~JJft w:xJ convgywn.;;cs, ·lhaL llflbct lbQ prupc;;ny; ~c:s fur '11e current year, the payment of which Grantee assumes.

Grantnr~ fnr th~ cnn.qidemtion.. ~eipt nf which i,::: ar.lmnwlP..cfet-.rl._ A-nd ~nhjP.cl fn the n!V!t'VA1_i~n~ from and cx4'C)ltions to conveyance and wammty, grants, sells and conveys to GTantee the propeny, together with all and singular the rights and appunenances thereto in any wise. belonging to have lllJd hold it to Grantee, Grantee's heirs, executor, administrators, successors or assigns forever. Gtantor binds Grarttor anc1 Grantor's heirs, executors, adlnmistmtors ancl successors to w!lmllll ancl 1orever defend all and siugular the properly to Gtantee and Grantee's heirs, executon; administllltors, successors and assigns against every person whomsoeverlawfully claiming or to claim the same or any part thotoof,, oxocipt ao to tho reDervntioJtG &om and oxooptio~:to QOnvoycmoo cand Vt'QITIUtty.

nouns and pronouns include the plllllll.

Thi• instrument was acknowledged before me on Septembe~20!3 by Bm1on KJihn.

President, Helvetia Asset ]lecovery, fac. · !.

SEP 3D2013

·--·- oom:.s OF .CQIFillENJ'Il\LITY RIGllfS: IF YOU ~ II Nll1'URAL l'ERSOO, Ulf :rnr; fyLU.M.lf«.:i _J..rU!\JIU'V\'1..lU'f .t\QIJ l'H.l::S J.N:;fntU'ZNl" ~UlQ:i YOO MAY R<MlVE OR STRI!<!: NIY ll" 1::0 t·1LEIJ tUK Rf;CORD IN .THE l'IJBLIC RF.CXlRDS: YOOR SOCIAL SFD1Rl'l'Y NUHBER OR YO!la DRIVERS LICENSE NUMBER. !2E:Vf5t/JWARRANTY DEED Gra•tor: HELVETIA ASSET RECOVERY, INC. BEXAR COUNTY TEXAS ..

GRANTEE: PARADN CORPORATION BEXARCOUNTY, TEXAS Cousidemtion: TEN AND N0/100 DOLLARS aJld other good and valuable consideration Pronertr (inc!udfu2 1111Y imlll'OVl:mcnts) BLOCK3 LOT! ,BLOCKJ LOT2, BLOCK.3L01'3,BLOCK.3LOT4,BLOCK3 LOTS.

BLOCIO LOT 6, BLOCK3 LOT 7, BLOCK 3 WT 8, BLOCK 3 LOT 9, BLOCK 3LOT10, BLOCK3LOTll ,BLOCK3LOT12, BLOCK3 LOT ll,BLOCK3LOI'16,BLOCKJLOT 17, BLOC!( 3 LOT UI , BLOCll. J LOT 19 , BLOCK 4 LOT I , BLOCK. 4 LOT 6, BLOCK 4 LOT 7, BLOCK 4 LOT 8, BLOCK 4 LOT9, BLOCK4 LOT IO;BLOCK4 LOT ti, DLOCK4LOT12 0BLOCK4Ihr IJ, BLOCK4LOT 14, BLQCl{4 LOT 15 , BLOCK.4LOT16, BLOCK 4LOT17, BLOCK 4 LOT 18, BLOCIC.4. LOI' 19, BLOCK 4 LOT 20, BLOCK 4 LOT21 , BLOCK 4 LOT22, BLOCK 4 LOT23 , BLOCK 4 LOT 24, BLOCK4 LOT2S.BLOCK4LOT26.BLOCK4LOT27 .BLOCK4LOT28 , BLOC!{ 5LOT1 , BLOCKS LOT 2, BLOCKS LOT 3 , BLOCK 5 LOT4, BLOCKS LOTS, BLOCKS LOT 6, BLOCKS LOT 7, BLOCKS LOT 8, BLOCK. S LOT 9, BLOCK S LOT 10, BLOCK'. SLOT l1 , BLOCK SLOT 12 ,BLOCKS LOT Jj, BLOCKS LOT 14, BLOCKS I.OTIS, BLOCKS WT 16 ,BLOCKS LOTl7, BLOCKS LOT IS BLOCK SLOT 19, BLOCKS LOT20, BLOCKS LOT21,BLOCKSLOT22, BLOCKSLOT23 ,BLOCKS LOT24 ,BLOCKS LOT2S, BLOCK 5 LOT 26, BLOCKS LOT 27, BLOCK 5 LOT28, BLOCK 5 LOT 29, BLOCK S LOT 30 , BLOCKS LOT 31 , BLOCK S LOT 32 , JU.OCK 6 I.OT I. Rl.OCK 6 lflT2. RJ.OC~K 6I.OT1. Rlflr.K 11LOT4. RT .OCK 6 l.OT~.

BLOCK 6 LOT 6, BLOCK 6 LOT 7 , BLOCK 6 LOT 8 , BLOCK 6 LOT 9 , BLOCK. 6 LOT 10 , BLOCK6LOT11, BLOCK6LOT 12,BLOCK6LOTl3,BLOCK6LOT 14,BLOCK.6LOT1S ,BLOCK6LOT 16,BLOCK6LOT17 ,BLOCK 6LOT Ill ,BLOCK 6LOT19 ,BLOCK.6LOT20, IJLOCK Ii L01· 21 , 8LUCK Ii LOT 2l, BLOCK.Ii WT B, BLOCK 0 WT 24, BLut;K 0 LOT;.!!) , BLOCK. 6 LOT 26, BLOCK 6 LOT TT, BLOCK 6 LOT28, BLOCK 6 LOT 29, BLOCK 6·LOT 30, BLOCK 6 LOT 31 , BLOCK 6 LOT 32, BLOCK 1 LOT I , BLOCK 7LOT 2, BLOCK 1LOT3 , BLOCK7 LOT 4, BLOCK 7 LOT 5, BLOCK. 7 LOT 6 , BLOCK 7 LOT 7 , BLOCK 7 LOT 8 , BLOCK 7 LOT 9 , BLOCK. 7 LOT 10 , BLOCK 7 LOT IL BLOCK7LOT12. BLOCK7 LOTl3. BLOCK 7WT14. BLOCK.7LOT15 , BLOCK 7LOT16, BLOCK 7 LOT 17, BLOCK 7 WT 18 , BLOCK 1 LOT19, BLOCK 7 LOT 20, BLOCK 7LOT 21, BLOCK 7LOT22,BLOCK1 LOT23, BLOCK7LOT24, BLOCK.7 LOT2S , BLOCK 7 LOT 26, BLOCK 7 LOT 27, BLOCK 7 LOT28, BLOCK7 LOT 42, BLOCK. 7 LOT 43 .• ·leak 163711 ~... 11157 3pgs

_,J EXHIBIT2 ···- ··--"---·---·-····· ----- BLOCK. TLOT 44, BLOCK 7 LOT4S , BLOCK 7 LOT 46, BLOCK 7 LOT47 , BLOCK 7 LOT 48 , B.LOCK 7 LOT 49, BLOCK7 LOT 50, BLOCK 7 LOT 51 , BLOCK 7 LOT 52. BLOCK 7 LOT 53, BLOCK7 LOT 54, BLOCK 7LO'f 55,BLOCK 7.LOT 56,BLOCK7 LOTS7,BLOCK 7L0Tj8, BLOCK 71.0T 59, Rl.OCK 7 LOT 60, DLOCK 7 LOT 61 , RLOCK7 LOT '2, RLOCK 7 LOT 63 , liLOCK 7 LOT 64, BLOCK. 7 LOT 65 , liLOCK. 7 LOT 66 , aLOCK 8 LOT 1 , RLOCIC SLOT 2. BLOCKS LOT3 .BLOCK8LOT4. BLOCK SLOT 5. BLOCKS LOT6.

BLOCK 8LOT18, BLOCK 8LOT19 ,BLOCKS LOT2(), BLOCK 8 LO'f 21 , BLOCKS LOT22, BLOCK 8LOT23, BLOCKS LOT24, BLOCK8LOT25, BLOCKS LOT26 ,BLOCK8LOT27, BL()CK 8 LOT28 , BLOCKS, LOT29, BLOCK8,LQT 30, BLOCK 8, LOT 31, BLOCK 8, LOT , BLUCJl I!, !..UT 33 , HLOCK. 8, LOT 34 , BLOCK 9 LOT l , BLOCK 9 LOT 2, BLOCK 9 LOT3, lll.OCK9 LOT 4 ,BLOCK 9 LOT 5, HLOCK 9 LOT <i, BLOCK 9 LOT 7, HLOCK 'J LOT&, HLOCK 9 LOT 9 •. HLOCK 9 LOT 10, BLOCK 9LOT II, BLOCK9LOT12,BLOCK9LOTl3,BLOCK9LOT14, BLOCK9LOT 15 ,BLOCK9LOT 16, BLOCK9LOT 17,BLOCK9LOT18,, BLOCK9LOT19, BLOCK9LOT .• BLOCK9LOT21. BLOCK 9 LOI' 22 .BLOCK9LOT2.1,BLOCK 9 WT 24. BU)CIC<.!

LOT 25, BLOCK 9 LOT 26, BLOCK 9 LOT 27 ,BLOCK 9 LOT 28, BLOCK 9 LOT29, BLOCK LOT30 ,BLOCK.9 LOT31 ,BLOCK.9 LOT 32,BLOCK9LOT33, BLOCK 9 LOT34, KEY LARGo SUBDIVISION CB OS06S IN BEXARCOUNTY. TEXAS AS PLAT RECORDED IN VULUMJ> 9:f/:J l'AGh IJ l'l'Openy RecOl'<ls, lleXllrCoumy, Texas.

RESERVATION From and Exceplions to Conveyance and Warranty: - . . U , right....,f-way, ond ~ve right•. wi...thtt of ,.,.,.nrd or nnt: all p - ' l y reiconkd jnstrwnents, other than liens Bild conveyances, that affect the property; taxes for the cunent year, the payment of wlllch Onintce assumes.

Gnmtor, .fur tile cousideralion, receipt or· wbieh is aclcnowledged, ana subject to the reservations trom and cxccplions to copveyanc:c and wamnty, gnmts, sells and conveys to Grantee the property, together witll all 8lld singular the rights and appurtcminccs thereto in any wise belonging to have and ltold it to Gun.tee, Onanteo'11 heim. executor, admi:d.i11tratoro,. suooeeeors or asa;gns f"ot'9V82'. Gnmtor binds Granter and Grantor's heirs, executors, adminiSlratOrs and sllccessots to wemmt and forever defend all and singular the prope:rly to Gnmtec and Granll:e's heirs, executors; adminisllalOl:s, succesaors and assigns against every P"""!." whomsoever lawfully claiming or to claim the same or any part thereof, except as to the reservations from and exceptions to conveyance and watranty.

uiRs, singular llOW1S and pronollll!! include the pluial. --=- RECOVERY, INC. B TON KAHN, PRESIDENT ACKNOWLEDGMENT This in3trwiicnt WM ..,Jwawfodgcd lx;for., me on Ootolx;r-4, 2013 l>Y Burton .~ President, Helvetia Asset Recovery, Inc.

-----·--- OCT 4 20l3

-~~ a Lil ··--· .... - ---· .. .. mnn~........,.N ·~·...., ., ·.· .... ...._ -- z . WARRANTY DEED . . ~ GI--: ___ , u · mum .....JllCO.\IHY.-BJC . 'BBXAR.COUNTYtmrAS 0 -. .,.. -'•. l'l'·'· . . ·". :).'.'. -, ~' ~ en . . . . . •, ·• -· • Jo'

GMND&: PARADIVca.tPORATION tiljOllDllUllNlilllfl BmcARcotlNTY. 'JECAS '!!-~T~2~ c JJ ,.- 'IllNANDNIYIOOnoltARS_.ollowllD04-' • "' .,_ r l' . t:r(i t ,. . • ~ . , • ..,. I ~ OU • Bl0CZ.3IDI'1,BWC[3J,IJ'l2,BUXX3 UlT3,fli.oc(3 LOI' 4, Bl.OCS:3tor5. .,..

Bl)XX31D'r6,mnrs:3UJr7 .J!WCX 3LOJ'l,'ll'.<X%31Dl'9 ,BIAXX3LOT10, RllY% 3LOT 11.Bl.<XX jU)T 12.• DLOCX3I.0'1' 13,Bl.0<%3LOT16,BLOCl'..3I.Or17, BLOCl:l LOr ll;BUXX3UJf19 ,8fl'JCX4LOT1.111ocx4WT6,BT-OtX4LOT7,BJocx.nm1.111ncr4IOT9, ~·wr 10, •.cxI+wr ll ,BUXX4U1J:U, BIOIX4IDr·13,ll.oa:.4ID1'14, 81.0CX4wr».BtOat4wrn .a.oa:• un:22..:arnrs:4wr23 ,BLOCX4 wrx.

Bl.OCX4LW 15,Jll.O(S4.Wfl6,~.iftor17 ,BUXX4LOTll ,:er.oat.CLOT 19.

Br.CVX4LOr2:S ,m:.ocx4UYr21S, lll.OCX4 J.J:IJ:%T, WOCZ:4~2S .~s LOT t, m.ocz: 5 l.OT2. I:IUXXS LOr3,Bl.OCS.5 4,Bl.OCS:: 5 LOTS. rm BUXX 5L01'6,•0C"l:SI.ot'7 ,Bl.OCW 5 U>Ta .BIDClt5J.QT9•mocr5r.or10.

BLOCX s LOT 11,BLOClt swr 12,BLOCK:sLOT13. m.ocxswr 14,Bl'...oa:s rm 1s. moorswr it. arnrs:star rt ,m.oats:rnr llBLOCr: SIDI' 19 ,Bl.OCXSim.20.

B1QCXswr21 ,BLO<XsI.01'22 ,m.oat' wrn ,m«1:s LOrM .~swr2S. m.oat5JDl'26 ,JllLOCK.S ID1'27 ,JltOCXS U7.1'21,Bl(llX S LOr.2:9 ,BLOCI: SLOT 30, BLO<X s L01'31 .BLOCI: 5 LOT32, BLOCIE6I.OrI,BLOCK:61£1r2,BI 0CW:: 6LOI'3 ,:SUXX6LOl" 4 ,Bl O<X6LC:lr5, B10Cl:6I.Or6 J..Or7, .mnrs:, m.oa' wr a,ID..CCK.6101' g wr 10, BJ.()(% 6 LOT JI., BLO(X6U11' 12,BWCX6Wf 13 ,Bl.OCX 6IDrl4,BUXX6LOT JS. .BLOCS.' ,Rr(llXlllLOT 1111,BLOCXlllLOT 17, DU)C%610rll,Bl.CXX6U11' it.~6W'l'», Bl<JIX6Wl"21,BUXX6LOr22,N.(XX6Jm:S,BIOX6IDrM,BLOCX6LOT25, BlO'XlllU1J:J6.• Br..OCX610T2'7 ,JltOCX6IDr21,1VOCX61Dr29 ,BLOCIC: 6 LOT 30 • . BUXX6LOT31,BUX%6LOT32, mocr:1r.or1. Br.OCE 1 L0'1'2 .m.ocx 7L0'1'9,aroac1L01'4,BLOCE'. 7 LOT$.

BUX% 1W1"6,11'0CX1Tm 1, ~11.0T I ,BLOCl'. 7LOTt, BI.OCI: 71.0T 10.

BUXX 7LCir11 • BU)CX TI.Or U,llLC)(X 7I.Dr13 ,BIOIX nm 14,BIOCX1 I.Of IS •auxx 1wr1111,m.occ1IDr 11,mncr1:r.ar 11.woac1wr.,,:m:ncr1wr20.

BUXX 7L0'1'21,llL()(I 71Dl'22,Jl,()II 7W1'23,•orr?IDl'M,:etOX7ID.r2S, BIOCX 7lm26. BllJO[ 7lOl'27 .lll.()IX 7UJl'21,Bl.OCX7Lar 42, BLOCX7Im43, - 1531!5 , ... 1!547 3pgs

~------~------"---·· ·· ·····-· --·· · · · ·· ··---1.__E_x_H_IB-IT-3~r-- " BLOCIC7LOT 44,BLOCX1I.Or4S ,Bl.OCl:7LOT4'.BLQQ: 7Iln 47,Bl.OCI: 7 wr 41, · BLOCK: 7L()T49 ,BLOClt 7LOT,_, .aocx7LOI'Sl ,BLOCI: 7Wf "2, BLOCK 71.m .9, ml)IX 7 Im 54 .Bl£lCIC. 7L()T S.S, llLOC!t 7L01',_,111.oac 7 'Wr :r1 .JD.(XX.7LOT SI, .Bl.OCX71,0'f59 ,BLOCK: 7torli0 ,llU:XX 7J..Or61, m.ocs.: 7Wf Cii,BLOC:1K 7I..Or63, BUJCX. 7'Wr64 ,Bf..O(X 71.m: 6S, BLOCS. 7 I.Or &s, BLOCK I I.Or 1 , . .

BLOC.I: I I.Or:?, BLQCll; I LOT 3, DLOCE: S I.OT-4, Dl.OCl:I Lar 5, m oC.CILOI' 6~ BLOCXIWI'11,BLOC&ILOT19,BLOCXIIm20,Bl.QC%1101'21,l!l.o<XILQT22, BLOCICI WF:2', BOOCS:ILOJ'2t,BLOCIC II.Or 2S ,BLOCK:ILOT26, ~II.0'1'27, BLOC¥. llD1'21,Bloart.LOl'29. BUXXI. L01'30 .BLOC% I. Lal"31, BLQ(Xl,.LOT 32. ~ a. wr n .m.ocr.: a.x.or 34.

Bl.OCS:!HDI' 1 .BLOCK9 LOf 2 ,Bl.()CIC.9LOT3 ,BLOC&: 9 'Wr 4, BLOCXllLOT', B!.OCX9I.()T6, BLOCIC 9WC 7 ,.8l.OIX 9 WI" J, BWCE9LOl'9,BLOCZI>tar10, BLO<s:9x.oru,:m.ocs:9L()T12. BLCX:ra LOT 13. BLOCK 9WI 14,BLOCK9 LOT JS ,.:QUX%9L0Tl6, Bl.()Cl;.!I LOT 17~BIOCK!ILOT11., BI.<a9LOr19, BLQCX. 91.0T lO ,.,CO(:g,9LOr 21,m..<>CltSI LOJ.'22 ,DJ.0Cr9 LOT23, BUXX 9LO'l'24,Bl..(J(X9 Wf25 ,llUXX9 IDr26 ,BLC>Clt9I.Or'ZI ,BLOCK9LO'J'21, BtOCK9LOr29. BLOCK LOT JO ,m.oa::t LC1r 31,BLOC:lt 9I.Of 32,BLOCZ9Wf33. mocr !IJ.01' 34, KBYLAROOSIJBDMSl)NCB OSll6SJNBl!XAllOOUNTY,'l'BXAS AS PLATRl!C(J!I&> IN VOLUME9S73l'A.0Bl3Ptupid.Jlt1ca dl,BmKQaSJ, t.aa

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Wllmaileealll:d; .,,~ ••• _ _...µ. -~~,bli_·.- ..

This Deed Is fil

ACl<NOWU!OEMl!NT ThisinftlllAlt-a:laowlep ~.-()ctober ll,2013 by BudonKahn Praldem, ffelvedaAuet Rec:omy,luc.oa bemlf Mptnlioll

-- . ~--- ......... . -· .. --~- ... rI I i

OCT 112813 vA,,<(I!.~ COUNTY CLERK BexAR C0UHTY. TfXAS

.·.

1_ __,__-------'------:-~-=~===-:==::=-:- EXHIBIT 10 •• .. ,f) ' , CAUSE NO. 199M5534 COMMlSSION 110.R LAWYER DJSClpLJNE I I Petltloacr, I I v. I I HOWARD M. KAHN I I Rapoacleat. I t\GREEP FINDINGS or FACT AND CQNCYJSJQNS oF I.AW Petitioner, !he COMMISSION ¥0RLAWWRDISCJPLINE, by and throuah ill! attorney of record. JClllliti:r A. Haalcy, Allilt&nt Dill:iplilluy CoWllCl, Oflic:e of the Chief DillCiplinary Coumel,STATBBAROFTEXASandllelpoadclll.HOWARDM.KAHN~1efcuedtoas ..lbpondcnt">.by and throuah hisal!OnxWofrccord. Sam M. Cfrey) Yates. lll. lllllCCto enttY ofthe 0 following Findings of Fuct and Concbt.slom of Law in support of an Agrtttl Final .1udgtrttN of hbltc Re[Jl'/mand.

L lll'il>INGS OF FACT I. HOWARD M. KAHN is ID attoxncy licemed to pnctice law in !he Stete of Texas and is a """"""'" nf•"" S'rATF. HAR Of' TRxuc 2. Respondent'a STATE BAR OI' 'fexAS Bar Cani Number is 11072500.

3. lbspondent maintained his principal place of praclice in Hanis County, Tcxu, on the date this CUC 1Mlll first filc:d.

4. Sarah Keplinger, a licenaed n:al esbUe agent, rented aboUlle owned by her daughter and son- in·law. Sherry and Hc:rlicrt Lllncuter.

S. Keplinger and the Lancm1en executed a writf!:n i11$1IUmcnt. The Lan.:astcn tbQught the insuwni:nt reflected Kepli.ogcr's intent to purchase. the property in the fllnR. along with a l'llo I

i ! EXHIBIT .~§ --L----to . .- - .

m:itationofthc amount of rent Keplinger wu to pay CllCh month to satisfy lhc purchase price or one hlllllt!al rony lhOmlnd.lllld llOflOO <lollarll ($140.000.00) llJICI f!:Clted.a down payment of elcvi:a tho~ and no/I 00 dollmll (S ll,000.00). K.eplinpr believed that the insttumcnt wu a dc:cd af coowyance.

6. Keplinger found a pro1pective buyer of the property, intended to sell the property. lllCI planned Oii keeping the profits.

1. Keplinger hired Respondent to 1ep11:scnt her in the dispute with the Lancasten.

8. Respondent drafted a Special Wamnty Deed and Lis Pcndcna which indicated that the Lancasters wen: transfening title in the rental property to Keplinger. The Deed wu signed by .the. gnm'-. K"l'linger. n... need had lllt.rMohed tn it thl! writt'"" irudnunellt bet,_,,, Keplinger and the Lancaslers.

0. Rwpond•nt nlecl the .llp<l<!ial Wlln'lmt)' o..d and Lia Pendenll. with the County Clerk of Harris Collllly. Texas. despite the fact that there wu no litilJB!ion conccmins thc property pending at the time and Respondent contends none wu required.

I 0. Alt.boush Respondent knew no laW911it WllS pending. relying on Kepuogcr's representations lllld the executed written instrument, he filed the Lis Pcndcns to slander the title. and to 0 I"""""' iho; l.ai"""'I""' (ram Kllill~ the: pwpo::n7 •

11. Rcspondcntdidnot!Clld the Lancastcn a copy of the executed Special Warranty Deed and Lis f'ellden!.

IL CQNCWSIQNS OF LAW The acts llllCl/or omWi0111 ofRespondent delcribcd above constitute conduct in. violation of Ruic l.Ol{a) (for ~ or continuing employment in a legal matter which a lawyer knew or sbo1.1ld have known WU beyond his/her competence) of the TExAs DISCIPLINARY RULES OF PROFESSIONAL CONDUCT.

l'IFl •'

.. .. • .- - 1'\ l / AGREED:

Office.ofthcChicf'Dilciplinaly Coumel Law. Officeof Smn M. (TMY) Yata. Ill STAT!: BAJ(t OF Tl!:XAS 9j2 l:iCbo .i..ane, Suite 46j Ill l f'annin, Suite 1370 Houston. Texas 77024 Houston, Tcxu 77002 l'llODe: (713) 7j9-<19JI Pllone: (713) 932-7177 Fax: (713) 752-2158 Fax: (713) 932-7277 AtWme)' tor PCliUooer, nae Commla!oa for La")'er Dllldpltae EXHIBIT 3 .I '\ _, ~ :~ .. " -u ~I I LI '~ ,,- .... ''"~ • c:.n.-,ed\Otl7Z4/1115':2o:ur Main Docum-,...~ Fnof 15 UN!T£0 S'ti'•TYA~ RANKRlJPT<'Y <:rn,uT Westcro DistJict of Texas .

Street A<ldr~s~ of!k-btor (No. and Sire~, City. atid Slate}: 1?s·14 BUTTE HILL SAN ANTONIO, TX 7£238 t>'.IP CODE 78238 I

il.1'uiling Addr~~ Qf Dcbl1Jr_(if dlfli::rctn troin: Stred. 2ddrcss): M'i:iifffig Address nfJQini Debtur-(ifi:liffercnt tr01n s.tre~t :td<lre;;s): 14439 NW MILITARY HWY, SUITE 108-105 N/A SAN ANTONIO; TX 76231 izlPCODE 782311 tl:tPCODE I 11.!P CODE I Type of,Debtof" Nature ofJlllSinf..!i:!i Chapter-0f B;lnkniptcy Code tltid{'r \Vbid1 (Fonn cf (Jrg-..miza.ti-0.n) {Check oue bo;"!.:·, the Petition i!'i Filed (.Check rme hi):\.) (Check 011e bOx.)

I~ D Her.Ith Care Bm<in.;;,;:; Cliupu::r 7 0 Cl1:1prcr J '5- f'etiLJ(m Jnr 0 lndi\'idual (im.:.iwJes Join;: Oeb<..;;r~::l 0 Si!1.g!c AJ;.:..ct Real Est::ltc ll5 dtfincd-in Chapte;? Re1..--o;.;P.i-1ii.n1 afa Fureigri ~f:e i:.Xh1bi! Dun pa,;e 2 ofr!nsJOrm. ll U :\.C. ~ 101(5U3j ("lwpfur J l Mai11 Pr0cc~ing lo c Ci:rporntior:·{i11..::lutlc:> l.-1..C 2n~t LLP) Partr.c:r:>hir ()1her ;1f debtor is. not one of Lh~:ahovc cmiti<:s, ID f(a1!rnad Sto~kbrtJkcr Commodil)· llntker )§ Chapter 12 Chupt~• J:t D Clmplt'r 15 Petition l'Or R<!c~c;nfrkln <-•fa f.oroi_~n Nonmain Prnoccding_ check iliis bo..x ll.nd-_srittc l}pe:of_enti!..~' belr;µ,;.) 0 I (:Jearillg Bank D 01.!u...>r Nan1re of.Of!bt~ (Chci;fi one 00.x.} Tax~f.:Yhnpl Entirr (Check box, if:npplicable) I[,?] Debts a~ primarify: con.sur.rit"r 0 l)i;bts ~re orirnari!v debti;, defined. in I:! { ).~:C bu..;;incss debts. • D Debtor is a ta."\"--c;o::n:;pt <xgani7ariou § J!Jl(. 8)1H· "im.:urn-4 hyai1 mi.dcr 'Title 26nfih6-Uui!t:d Stale!' individ~a.I J}rlniarily !ur a

Filing Ftt (Che.;k 11ne OOx.)

Code (tl1e lntem.ul Ri!vcnuc Code).

Cbcd: 011c h4~x: I pC!'SOMI, family, or house· hold- l'lUr...•· s...:."

C&..!!ptcr I l Dt.bl-tn·s

II 0 0 \Jcbforisa~ma!lhi.1si;;;.;~dcb!ora!><lefined.iu lt U.S.C.§ {D1(5!D).

D

D l-"i!i11g P<;e w rn:: p<.iid in ir,:;13lh1)CJH.S (;;pp!it.-mMc 10 indi.vi<lnaL..: 0n.ly-1. Mll'if ;;-!1'3cfl :si;.";ried applicatfo11-t0r the court"s- consider<Ition ccrtifyfog that Uied;:bfll: h~ unable !fl P•'tY tee e.-;.cepl ir; in:.;t:>illrl"k.':l!l~. Ruic: J!X}()(b,i. S-i:e OtTicia! Fi:inn JA..

Filing Fe,.; w~ivJ;::r ri;;quc:>R.d {app!il:tih!c ~o .;liapt0r 7 ind1v1dtiafs oa!y;. !vfost Dd~ Dcbt11r h: no\ a M~w.I! busin~s d;:-bror as dt:Iint".<l in ! I l'..S.C. lcii{,5 !l))

LJ lJCbtti'r"s uggr-:-getc: noncoati~:g_e11t liquidared debts ms ider;; •)i ~ffili;.;:.e<~ . (exdudi11g ctchts owed ~e S

arc ltss ihi!~) $2,J43_){J(} ( '1mo:i1if suQ;.;::;; to .-u:tj-rn1m,'m 4_,{)f..-.IJ 1md ..::i•ery lhtee }'o?tlr.~ d11J.,-(:il/f1·r-/.

I I 11rt11ch. signed 1tppbcati~.m fur ;:111:; ..:uurC:-> t::Or<$!dcr.J.rio11. S:e-.:: Otttcial fo:m 3B. ----· -- --- . -- -- --- - - - -- . -- - -- - -- -- - r Chr:rtk all. 11,ppfkabl.e fm~es: i0 A r<lan -is. being. filed '1',it_h this pc~itiur.. ! 0 .l\c.:~iance5 of the plf.m wcr::: sc:Hcit~ prep...-..rill<"~': fto1n oue Qr mon::: classes 1 of o.'.fr!ditnr~ .. in a~ordar1ct with : ! U.S.C. § 112l'l{.bJ. nns :-;P,\CT. lS FOR COUR~' !.I.SE C1.l'i'1~ll

Esrirn11:.c(l. Numht:r nf !.:rc<!i:or:t 0 0 0 D 0 D 0 D i.49 5!J.-99 JO(i-199 l /!00~ 5/~l- l(JJ!O l~ 2.5.fJOl- ~.f)!JC '50J)D0 Estima:tt::d A;;S\'~s ".:<">.;<;'.°~ I?.! 0 0 [j 0 0 D '..,,,.,,,,, ~o tc S.'!O.frJI :,, $1.000.0f)l ~50.IX!O,fJOl '.b100.oor:=.001 itl j; Ji]t} milli,)n mii/i1;n mil!ivn ;nj]li(lf; mi!ikm: E~fimlltC~i ~.foOiiili(!s r-, '-' ~I (<; $S':U.l0l <v ;-; ~ :~ l O~l.(l{< I ~'.! l".I $~t;1i,H/l $1,:J()f;,UD !

C1 ~iU.IJ()tt_u-o: n"~ 'O.'\IJ.fl(iO.L~t c $/f;t\,(;(_l(J._(d_/1 0$'.iGD,nc..-,.1'.4.: 1 0:Vk'r~ tli<m SSO,(iOU ;~ I L•~UJl!r) $Sl)1J .OOt.~ it<5] (~' $]0 !C j;)(J tn ~~ l•j{i 10 $50H -1'.' Sl hiliiim Sl h~lii;m snHl\c.r, ,i;~Hi1~n mi-iii!'$~ ~-!i.tiic~ 1~tiH1o.,.,, (omcl1tlF.Jii2BQ-OhllaQ Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 2 of l)?,,. 0 ~ Voluntary Petitjon Nameofl.kb1.orlst (['his nae;>. musi &e comf)fet1'ri and i?l;:din ~1.'i."1)'-r:ase.i CRQFTi BRADLEY, L.

All Pl'ior Ban'knintcy Cast:s filed. "'.ithia r.a8t. 8 Years {'It' more lha."l twO. u.uaa:b. add-i1ional sh<X'L) l.r;c:i!ion I )ate 'fik:i1: \\.'lierc filed: N/A L~ication \.Vherc Filc<l: Peadiue. Baink.f't.iDfCY Case fiic1lhv .anv SllOUSt', Partner. or Affiliate of this Dtb1·or (lfmore fhl'ln one, sa.u:h additi<.1nal sfseel.·\ Na me or Ddl1or: Di~trict: Rdatiom;hip· Western District of Texas l.::thihit A E~:hibh D (1 ob°". ;..'1.)f/~plcted if deh!Clr i:> Rl> !ridi~·iduu! {Ttl be .::.oinpkLed if<lebror i:<i rt."ttuired w fik_peri\1dic r~;~tt..: {\:.g., forms I(H( and JOQ) whose d~~hl.~ are prilnarily \:C,n~1111'lt.r debb.j wilh the Sccmitk:s ;.u1t! Exchange C.Dmmi;;:..ifm pur.:>uant· !o Section 13 C\ _15(di of111~ Scce.riri..:~ J-:xchan_gt~ At:r ~1f i 93-~ aud is rc.qu...---:>thig_ re:lief ·under chaprcr 1 L) I, rhe ailom._:y for th~ pctitiont::r na1m.~d i11 the foregoing 11ctition. dedare rh:-ir f hll\'e informed rhe petirioncr thal-[ht) or~hcj nmy p1oceed 1111Jc1·ch~1pr..:r7, ·i I, 12, or 13 oftiUc J J. Unitt.'it Stares Codi;, and hav?: c·:q11ained lbt- ri:tlief~ ...-ailabk undt.>r euh snch .dmpt".r. I further ccrtjfj Thai l haw:.f dc!i'i'Cl't..._1 !O !he dehtor th1: 11ctici! :qu~dhy ll lLSC !7~~;.J/ (~ 1./ 0 Exhibit A rs-artad1cd an<l 111.adc a parl 0f'rhis pctitiot!. ~i~11t~ture of iVlorn~y f4r Dctltor{s) "l J Oaic\ v J:::'!iJlibitC

0 '{l::;, ant! (xhihit C's atffichu.i iind made a o.-i:r ofthfa petition. ~ N.i.

0 B~:hi&it D :iisll c<.J.rnplt::te><l' ruid ~.ignod by the joim. ..:h:bt..-;1 !~ aU;;dit:tl mid m;uk.· a p.mt ot tll!S peL'iJien.

l11fo1·matinn Ueg~rdirrA tbol' n~i)t•u· - ':'_.n-u.~ _ (Ch..-:ck any ~pµlicabk: b:}3.) .Dehtot ha:~ l){).)Tl do!nicih;-~i or has had u rc..<,:i!lcncc. pfindpa! place of busines;;, or princip-.,!'ru;..<;e(s in this l)i.>;rri,;t for /St; ..-Jays immedia.td!' precedi11g the date or"thi:; p.:liLit•n ;)r fin a kmg..::r p;:r! ofsnch 180 da}'.<. lh.Un i11 any olht'!r Oi!>1ric1.

0 I [J De-Ot-t.1r i'i::; dcbtcr !n a {i)n:ign p:n:'\:e.'~ding and h.as irs prilldpa? place ofb11siJ?.;s.<; oc pnncij)fiJ i">ssr.:is in iho::- Cnit..:xi S~ates in rhi;; l.}i~,trict. or ha~ l~O prin.;:fp:iJ pllhX. i)f busillc.s~; irr as-;ci~ in lb~ United St.ales but i:> a detl'fl<lant ht art m:::iun o• procce<ti!!g_ i.1!1 u f~d~ml 0r sw.1e cnurtJ ·j}\ tltis.

I li!ltti~·. or _thu in\.:.r;;:.ts <'.'·rt):.: ~~1.rli'>:;.:> will 1)-.:. ~-1 ';';.;~ _in rt:i;iird w tilt'· relief .<;(ltlgflt In this !Jfatrict Ii Ceotificatw11 l:ly ;:i Deb!uo \\'ill) ~tside:i: &:1 a f emrnf of Rt!t.iilcntial Pro-µt!'ty ~C-hr,:ck ell 11T1pl!:-:;1~1l..: b 1;xcs.)

I D J;cbtm· d.:1ims lliai u.r.di::r a_pµ!iC<ib>:: uonba11kruprcy k1w, iherc_ii.n: 1;ircmnstanct>s uncli:r which ih.;: ddi\or '8f1Hld be r-c:rmin.:-J-ro.c1!rc !lJt: eil'.ir~ mrn~~"lai.1 •Jcf~nH Uw.~ µ:a;·c: 1·i:.->~ z, the.-judgn1~1Jt f,1r j:)\ISk,-;.S;:'.):-J .• aft<;;~ Ille- .iu<lgi-r~-r.11\~t 9.;:,<;sci,::;i~Jt\ -.v.a~ ¢.:1~-;t·(i:, ..;:r1,d I Oebti:i:-ha.." in.::iidcf. with thil;; p~ti.:.1c:n -:?)t~ :Jqxi.::fr 1-,.·it}i ilie cnt:rr of ;u:y rerit. thM -\,;!.)t!ld ht"C(\!111! tine rii.ii·i.1~g the .~fi-d.'ly f'ICfiod. :.lfler ih>: fHing ,,~-the p~~ liion.

11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 3 of 15 H! ((\fft(;illl Fumu l (4/l()',: Volunt.a11' t"etition rThis :"J/JF'I..' nnt.;;f bt· coml){efed •?1rd ,filed ffi ever;..' ·~a.w:.)

l det.-bLre und('.f pcualty l)f pt.7j11ry that tlK iu!"Otnmtinn prnvi.:kd in thi!": peii\i,10 i~ true f dedare under P'..:naii}' of perjuty that tl;t: itifonaaHon p.rnvidcd m this Dt:lilion is and eiJrrect true <injf correct., that l am ti's: fureign ref}f';~tnta1h·~- ()f a dcl":t1)r in ~ fow1;n. llf peti.ti.dr•.-ir ii; im !udividu:tl \vhns1'" ch:::hfa nr{; primi;_rffy cr-n~u111c,_ d.::bt:-; uuJ i1m, pr1M.:ccdiri(:!. ~r,d. thot l HTil iunh,)rizcd tc flk·-·ihi~ petition. c!10sc1l !1) file imder chaptc< 71 lam :iWare-tlFf!t I may pmt~_under c:hapt..:1 7, ! I, 12. i>r I J 11f tillc i I. !)nftcd States Codt:, undCP.'itaud fl:lt' tclit:-f~walli!hle undcr ea.;:b ~mch (Chtck :>nly on.e !'lox.] chap1cr. an<l chno~ ti~ pro~-c~d tmdcr L·h3pr_cr 7 flfn>.> :>.ttOl'iluy :.:pre:.~nT!l inc ?.nd fa\ bunkruptJ,;y p;;::titim; ;.."';1-Cpir.J<c;1 :.l;;.H:> iln; pt:tiJiuuJ D ! rcquest_relicfin acc1xdan~ \'lilh i.:ha_r-tcr 1" 11frirlr- 11 I in11Nt .~t('!tL~.- Code. Cer'l'il'icd 'upie:; ufthe document:; requln.'!J h,v l J U.S.C. § 15 l 5 ::.re ar.achcd.

J1:~vc 0bl:ained and rc.riJ 1hct?Otice !t!qtLired hy '! 1 U.~.C- § 342.(J:i).

0 Pi.1r:>.llil.nl to 11_ U._S,C. § J5 l ! , -\crequcst reli_ef in.ac:C(\rdancc with th.,;- ch';lPiel' of title t ! ::pccitied ~n dtis l'>Cti'titXl .t\ (:Crti1ic1I copy of th<: <:":rdcr gt"t!!ll[ng rcco)'?.JJilk)n ofrhe lbr~ign m:tiu pro::e¢dini; ir.. arwchcd.

x NIA (Sigr.uturc offcrdg.11 Repre.sc-ntatlvc') -------·····------- ---~---- "ttlf~§~~6¥11ber (if not rcprc:senl-:.'-11 by ::attor11cy-·J -------···--------·--·· .. ---------·--·--· Dare Date Signniture of Attornl':y:.t· Signann"f of~o:n-Att.orney B1n1kruplty Pr:titfon Prtpa,.er x l dec/11rc_ n11dcr penally of perjury thnt: 1. L} I -am u bitnkrup1cy petition pre.parer ?.S defim::Ll in 1-l lJ.S.C. § 110~ (2) I prcpar.xithis dtic11mcri1 for COHlptnsntiim ~tl)d have: f.'JfC"t'i.:idtd the deht<lf witll a C•)py of thi~ do;:;uuieot mii th~ notice<> iuid infur:natiori Printt:J Name l)f .<\.ttOr/11!).' n~r 'J)c:btor(S) ---------·-. ··------- required under J l ll.$.!.'. ~§I t!)(h), lJO(h), and 342\_h); r.n<l, (3} if n!les l•r guiddi:ltes Jt>ive Deen pro1m1fgated pursmml to Jl U.S.C. S rl(ith) se1ti11g a mu.x.imum fee fof services d1arg(~aJ)k b;,.. bankrupti.:y pcriti(Jll .Preparers, l h~vc giv . . . n the Jebtor norkc of the nia.xim~ amown bio:foril preparirig any di."1Cl.1rrient for filiT1g for a debtor (1r at:ci::pting any lt:e TI-om tht: r.leblor:· as ocqu.ircd iti that ~ei..:tirn-.. (lftic,f11 Form_[<) j,.;-atm-::_bcd ·-·--·-···- ··-·---------- Adi:lress

S0dal-Stcuri1y 1iumber i!f the hankniptc.y pi:tifion. _preparer i.~ net afi iudividual. ;,t:1k: the Sod~l-S.ecurity nt!mbcr nf !ltl' officer. principnt_ "In a '.A:l.SC i11 whk~b § 707(h-.l(4 t(D) ::tpp-liei>. thii; ~ignntur-t .<tl.iio .;01L~tiluf~~ t1. i·c~pbnsible persu11 rr. r;;rtttei" Q[ lh~ !mnkn,plr.:y petition preparer.) i Required ccr1ificatm11 tt.~t t!1\'.:' aHon1-cy ha,'>· no- kDC1.'!!kdg_e.aikr ar. .inq!iiry· that the i0forn~atirm hy l J U.S.C. § r HJ.} ii~ th.;; :><:hi.·... tlilc~ i~ ini_·on(;l.:l.

Sig:oatu1~ ofUi:bl<lr {C'orporatfon!Partn~r.sh!p)

:_~:~~~----------1' J' :j,..e!:i.r.,e. w1der penuiLy c,f fl"!:iur~.- Thttl the inf<1(r111.ition pi.\)'\·:itt\:J hi tlt~:ti pt:LiiiHll ~ .. (!:DC ~mJ .;.:;.1r.rect, and f!~( t Ji;ive hecn 8Uthori:t:¢d !'O fl.it: thif: pc-titfon 011 beh.u!.f t}f '1hC x t"lebtor.

Sigm.u:.ure (;f b<iakrup!cy p!:!!itioti pr~~pf:!Cr or offic.::r. princip:tL :espon:>~hi~-per.">on, or purtnt~r v.i1r;s.c Sor..:ial.~Security numfx:r i-J pn~.,.iUed !<~>\iC.

--~-- ........ -r;a e or Atltlloriud Inciividua~ -----~- - ~----·---------· I;., ; .

N<imcs ?.!id -Srid"1l·Si.'.curity 11flmbi~.!".> nf all otfo:r fndivid11-ah w-,.._,..1 rrepa;ed >1r assi;;tt:d in prepsri,1g-this ;Jor.:t11n!!flf o.u;k.~<; the l;::tnkropi..::y 1v..:ti!i<Ht p;t:~rrr ?s r.nt :tll_ idual.

I rf ~.w:irv ihmr 0!11; 1x:r-_;on pn::f)<u:::!l tlii-; ~k'ltlinteru. al!ach ~1ll<11!i\1!'1.i: ~l:<~i::le' cci;•f°O"l'.ll~i;;g lo th!! upproprfar~· 0fficial fi)ffil fi:1r c;1ch A f,i_1-r.t.r11pr.l:v fJ>.!fTlwn pi::r:ffj!l.

pri!pater ·8 .f{2ff;<.~e Hi compiy H"fT~I r11e pra1·i.~~r;n.~ r;f r.irfr. I I ,;fJJankrupi('_l' P-:-(xedr;rtl mttr re:;Ulf i11/in~·.1· or im1)r-i.mm 1ffnt and rhe l·'edera/1?.ul~.s urboih. ,:-: U S.C;; ilO; !-8 f.:.S.C. _.:: J-56.

11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 4 of 15

UNITED STATES BANKRUPTCY COlTRT

fn re_<:;R,OFT, BRAD!.,EY, L___ _ Case No. Debt<ir

EXHIBIT D - L~DIVJDUAI, DE:BTOR'S STATEM.ENT OF COMPLIANCE \-VlTH CREDIT COUNSELING J~EQUIREMENT Warni!ig: You must be able tq check truthfully· 11ne of the five statements regarding credit counseling listed below. If you cannot do so, you are not eligible to fife a bankruptcy Clise, and the c11urt can dismiss any case you do file. If that happens, you will lose whatever filing fee you paid, and your creditors -,,,in be able to resume collection activities against ym1. ff your case is dismissed and you file another bankruptcy case later, you may be required to pay a second filing fee and you may have to take extra steps to stop creditors' collectif.m activities.

Every individual debtor mustfife !his Exhibit D. Tfa joint pctiiion is filed each spouse mus/ complete and file a separate Exhibit D. Check one ofthefive statements below and arlach any documents as direcled I. Within the 180 days before the filing of my bankruptcy case, l received a briefing frorn a c-redit coun~,cJlng agenc~y approved by the. United -states trustee-. or bankruptcy admi.nistrator that ottt!ined the opportunities for available credit counseling and assi~ted me in performing a related budget analysis, and r have a certificate from the.agency describing the scr.·iccs p:rnvi<led tu me. Alluch a copy of fhe cenfjlcare and a copy ofany debr repayment plan developed ihrour;h the agency.

Cl 2. Within the 180 days before the filing of my bankruptcy case, I received a briefing from a crccli1 counseling agency approved by the United Staics tm>1ee or bankruptcy administrator tlmt outlined the opportunities for available credit counseling mid assisted me in _perfo1ming a refated budget ana1ysis7 but I do not have a _ccttificat.e frorn the agency <iescribing the. seivic_es provided to n1e. YOu tnttsf _file a copAv (~t- u cert(ficate jfom the 1ip:enc;) describing thi.! services )JrOi'ld.e-tl t<r _vou and tr cu1~v qfctn~v debt .rr::11a,,1.:'1nenf_()lr•n lleve/01-1(}1.-/'Jhrough the apen.c,,t-' no iatt:.r titan 14 tla}'S t~/ier J'our bctnlcrUf>t(V <.'.{J.re is_tlled 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 5 of 15

B !D(OOicfol t:{'!m1 t, E)~h. D)(Jl/091-Cont.

0 3. I certi l) that I requested credit counseling services from an approved agency hut was unable tQ obtain the services during the seven days from the time I made my request, and the foJJo,,.ing exigent circumstances merit a temporary waiver ofllie crcdir cotmseling requirement so I can file my hankruptey· c:.:t'"'?. no-..\;. [~un1n1ari:tl! e.:-<lgent cfrc1.11nstanr.:es here.}

If your certification is satisfactory to the court, you must still obtain the credit counseling briefing within the first 30 days after you file your bankrupky petition and promptly file a certificate from the agency that pr-0vided the counseling, together with a copy of any debt management plan developed through the agency. Failure to fulfill these requirements may result in dismissal of your case. Any extension of the 30-day deadline can be granted only for cause and ls limited to a maximum of 15 days. Your case may also be dismissed if the court is not satisfied with your reasons for filing your bankruptcy case without first rcceivin2 a credit counseling briefing.

CJ 4. l am nor required to receive a credit counseling briefing because of: [Check the n1-11-1/ir:ahle state;nent..l /~,\fusl be accom-.rl)anietf b;.: a rnotion.for dc:terrninct.Jion by the· court.]

CJ Incapaciiy. (Defined in l I lJ.S.C. § 109(h)(4) as imp:iired by reason of mental illness or n1cntuJ dcficicnc·y so as to- be incapable <.Jf n.::alizing and .n1aking. .ratio.na:l decisions >vith respect to financial responsibilities.); n Disability. (Defined in 11 U.S.C. § l09(h)(4) as physically impaired to the extent ofbe.ing unable. after reasonable effort. to participate in a credit counseling briefing in person, by telephone, or through the Internet.); ;'.1 Active military duty in a military combat zone.

CJ 5. The United Stales trustee or bankruptcy administrator has detennined that the credit counseling requirement of 11 U.S.C. § 109(11) docs not apply in this district.

I certify um:!er pcm!liy of perjury that the infnrm01tiM1 provided above is true and cmTect

Date: 08/2312011 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 6 of 15

ln re _G~F:_()f=T, Bf3ADlEY, L c·ast.No. Dcbl<>r {If known) SCHEDULED - CREDITORS HOLDING SECURED CLAIMS ~;t1ttc ihi::- uouw;c, u~ai!..iuis addn:~!i,,. irn.;'ludir~g 1.ip-••:otie, MI<l ·1asr four digits of any al:C:Outu nlnnbcr olaH ent1t1es-tsohhng c:-!<.um~ sccun:.~d m propt:rty tJf tht'. debtor a.:;. of the d:!te 11f filing of!he pdition. Tht ~ornpietc a.cc(nuu_-nurnbcr of any accou•lt. Jhc dt'btor hal:I \Yith the c.raiit(',r i:::, u~truf to thL~ in~rrcc 11nd the creditor an<l muy be provide--d if the dehtor choose~ lo dos~- List cr;:dit-0rs hof~~ing all typ.:-s of scc!!r..::d int~resiS st;ch :::~ jo.dgmcllt Eens. g~mishmcnts. sra1ulory lic-11;;;, mortg_<~£..e~, d~t'ds 0ftru~L and l:ther securit~ !nl~rc:::.t:s.

Li:,1. cr..:ditl)f'I;; i1t i1!phn~c!u;.zil order to the c:~tc-nt practti.::ah!t::. If n rninor chjld is the creditor, Slate ihc chiJd's initials: .and the :i~uu~ 11nd address 1~fthe child\ par~nt or guardian, such ai' "~\.ll.~ B 1ntnor child,, by John lJoc., guardian." Du nut di:-scloseo the c.hird's·narne. See. J ! U.S.C. §112 and .Fed. R. Ba.nkr. P. l.007(nt). tf all secured crcdi!or::; will not fit nn tbis pagt>~ use !ht: coritinuation she.et pro.'ltidcd.

If any entity nthcr than a spou:>i:'. in a joint ca<;e niay he jointly liabk on a dai1n. place an "x··~ in lhe colun111 labeled "CodC"bl'or," indudc rbc i.::::nri.i:y 1;n the apprupriati.:: schcduk. of credilnrs, nnd cornplet.c Schcdu!c J-r-... Cndi::htors. If ujoint petition is fifed, stat~ 1-vh~ther tht." husband. \VitC, holb ol' !h.:n1. or the n1arit.a! cGn1nn1ni1y ni:.iy be liable on each elairn lry pla,,,;ing an '·fl,'' ''\1i./,'' ;'1." <)r '·C"' In. the column .labeled "f lusband, V./ifc, J<1irrt or Cnnn11unitv." rr the c!ai~1 is .:.·.ontinge.nt. f)iace an ··x"" irl the t:nlurnn !ahded ··(:onrinzl".nt.''' rr lhe dairn j~ unliqui.1~1ed, pl~..:e ~m ~<x:•• u, the colun1n labeled "'lJn!lquidate:ct:- if lht: 1.Juirn i!i disputed, place an "X" iii the cohimn hibclcd "])ispur.¢d."' (You may need to p~acc nn ·'X" in rttL•re than <.>nc 11f the~- 'three co1trmns.J Total the ·co1wuns bbefed-'"A1noonl of Claim \Vithour l)eductiog 'V~lw~ of Collateral" and ''U1tsccliJ'~1J .P(1rtioo. if Any'" in the-box~s lnbc.k:d ·"'[\•ta!(_<::)" o-n tl'te. kist ~ht::.:t of the eompktcd scheduh:;. R-epoM thd totaJ f'rom the -ct\hitn;;:; h1b.;lcd -AmoUin of t;tai1n \V~thct:t- DeJuciing Val:.ic of Cc;U.at:;'.:ral" nbo on tbc. SufnnHl1}.--flf Schedules ~ind. if th_c debtor is an individusl wiLb prfr;:iariI:y con<>unler debts, report tl1c iota! from the. c11lunu1 labeled "l>nscc:.ired-Portion. if At1:/" on the-Statistic.al Sumn1ary t.i!"L:erLain Li.ahilitics anc.I Re.lrtted Dal<L 0 Check this !lox if CehtPr hru; no i:rt:ditors hf1ldi1lf', secured dailns to n::port on rhi!> Schcdnk J).

11:-~~~~r~._~5,;~~~~~~-.vAND l f.·~· ~"-;o :_.zf_· DA~~Zt~;~~D~A·:~I: ~ ~-· 9 AYto~i~·iii~~LAIM ~~~~?~~~-. i j INCLlllJING ZIP CODE ~ l1: . 1' NATl'RE OF LIEN. '-' 1,.

::: i:: DEDUCTING VALUE ANY -1,:

~II ~ ~ ~ I , .\N ACCOl'NT NLMBE!! , : ~ ~ ~ ,. AND . ~ 1 ;:;; ; OF COLL\TERAL ' t (.}E,'~' [JtStl"!.tCfftJJ'!S 4.!JOtt'-) z ! z ;:. :; OF.SCRIPTJO'N 1 I ~ ~ 8 A~~i;~:;:1:~w / C I ~ "' i 11..

I uf 1-.c-cotl\-. ,..o. -9509-- ----r I - +::~~::~0~ ;N j I 1 - .. ------·----+-----------1 1 I !

CHASE BANK p 0. BOX 94014 II I I i I H I LIFE ESTATE OR I 1' HOMESTEAD I ! x ,I 405.000.00 I I 25,000.00 I I1 PALANTINE, IL 60094 I 1. ~---- I J I \ I I -l,·-vo-~~-TU•O"B: -··· -+- 0 0 ·-·--i l ·.; ER 20°10°· ' -1,- --I---\- I l I I . ACCOli:-..:T?\10. ··---··- .. 1 I i SECURITY SERVICE FCU .1 16211 LA CANTERA PKY i H lI MDX 2007 ACUP.A j X / i. i 19,000.00 -0- I I II SAN ANTONIO. TX 78256 ! I I I , 1 j

L....... ·---+.:1 ~ v.\f.un s J~.9Q.Q..ool j,-- ..... ·-···---·---+----- _ _ ___ j! j ACC0{fN"¥. !\'f). l, ·- .. .. --- -1 , HONDA ODESSY i i 1 I FIRSTMARK 1 ! ! P.O. BOX 701650 \ \ H . \ X 6,800.00 -0- SAN ANTONIO. TX 78270 1 .. J_ i ii.-~ir£$ _j_Q_OO.O•.QQJ,_ _,__'---+-~ . ../ eonrinuation sh¢:::\.<; ~uhh~mt i> j$ !$ 1 (Tola.! of!hi:; page; j j stti1t:hcd 70l3.l ~ (ti~C-1.)Jl})' O!! ;i:.!;.,t pa;.!.t::) i_;s_·____ 4 ii.oaa:oo·-r ~ ---2-s-.o-_0-9-:0-01 (~e.v011 l:'J':iG rn;. Su11?mar_.· ,,f (If <:ipf1fi.:11hl:::. n.:p:in S.:::heduk;..) u!S.{< ;Jn S1a!i~:u:::1.i ~u!<tth~!\· 1;f(:cnain i ,)ahilit1~$ and l~..~b!r:<l lJ1.itl=:.; 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 7 of 15

fore CROFT. BRADLEY, L [)Cbtor

SCHEDULE E - CREDITORS HOLDING UNSECURED PRIORITV CLAIMS A ro1npicte li~t nf ,:lai.rns ~ntlti..:d to pril)Jity, listed s.epa.n1tdy by l~-·pc t1f pri~lrity, is 10 b,; :>el forth dn th_t: 5heets prcvi<le-d. Only holders of rm.::;i:':;~nred 1.:klim.s t•ntitlcd to priority shL)ul<l b.:. list~d in ~hi~: r.e;bedule. !J1 th~ boXC'.i provided m; the uti<:lchcd ~hc<:~s, :<.t.t:.c ihc n•·nu<.:_. iua~li;1g aJU1i.-:~:.:. including zip codei an<l last four digit<:. qf tlle «Ccount number, if any, of aH ~ntitie:; holding. priorit:;·· cl:f.in.1:s against rhc dch1or or the- property of thi.:. deb< or; as: of the date of !be liiilig ef the petition. Us.e asepa111l;p continuation shc:et iOr e-aCh type of prio1ity and label r;:{<Ch '""·ith tbc type of pdoril:··.

fhc: {;L)inpleti:- w.:i.:ounl nurnbl'.r of any HCC-t"lUnl ihC debtor ha) \.ViTh the cretiitur is useful rn ti1e i:ru~tet Hn,) !he t.Tcditor a1td inay he inc,vld~ if rhc l]tb:or ehoos.;_.'°"' ct1 do ~o. JI' a minur child is a credtl:or. stat;: lhc chHd's initiab and tht: 11amc" an<l add.ri.."SS. Hf the chilJ''s par;..~nt or guardian, such as ".A.Ir, t; min.or i.;hild_. hy John l)oe, guardian." Do not (li.~do:-e th~ i.::h.ild's nalnc. s~e, I J U.S.C. ~l.12 and F;;,.·.d. R. Bank:r. P. !007(1n.l.

Jf any ~ntity ot11er than a :;pousi.: in ajo1nt ca<Je rr11\y be j(1intiy Hable on a dafrn, place an "X'' in the colu1un Jribeled t\CoJcbtor," include the entity on !he appn>priati: 0cheduk: orcri:<.filors, and cornplcte SChetlulc H-Codebtors. lfajoi.t1I pt::litiori is tiled. m:.:.te \.Vhelher the husband. \>t·itC~ both ofthcui, tir lhe i1Jarital conHnnnity ff«1Y b~ liable on each clairn by placing an ''H,'' "\V ," "J," tlr "C" i[l tb<.'.. colu1'an lnhek~cJ "Husband. \Vifc, Soint_. or Co1nn1unity." 1( thf: dalln is contingent~ pJsce an "X'· in the cnlnrnn l~hdt!d "Cernti11_~;ent_" lffh~ cfaitn. is ;.1nJi,1uidatt'd, pla<,;e n.n "'X" In th.: C{)n.mn Jab..:;l..;d 11 lJnliqlddt1ted" l l'tb..:o clain1 is dispute~i~ pine~ ;111 ''X" .in the colu1nn labded "Dispuhxl.'' (You m:iy !Jt'."t::d lQ p!aet: an "X" in 1norc than one of lh~:;~ three colu111n.'i.)

REporL the tot::>! ~)fctaim~ li.c!ed on ~lit-h. sh~ct in the bo:t. lubcl . .xI "Subtoto.I s" nn c<ich shccL. R..::pt~J:t the tnii:i.i l.Jf ;.1f ! th1W:c. liHC<l ttfl lhi.'\ Scht.'dule E in the ho.x l<tbel.ed "Total~· on the !a.sr: sh~et of the C(11nplcrcd si.::hcdult. Report this total also on i.he Sumn1i!J')" ofSchednie.;:.

Rep1)r1. rhc total ·of liflh11n1i.s entitled to priority listed on eat:h sheet in rhc box lsbefi::d "S~il:itotafs" on cacl1 sheet RepDrt the·!:ola! ()f ~H anH:-un{s cn'titft-d h: privrily H.1:1ieJ un d1i'.~ Stll~iult E in thl'. box labe:led ··TnL'l.i.s" lm the Ja:,.;· sheer cf the cou1pk1.t:d schedule. Jndivid1Ja.! do::.btur:; witb primarily c.m1.'.1m11e;::r debts report this total afso on the Statistical Sun1mary of<.:ertain Liabilities and Rel.ut.ed i)a1a.

Heport !he tolaJ ofarnounts n11t.entit!e<l 1u pr:iurit)' li~te...1 t)/"l each ~heel in th\.~ bu:.: lahett!d "Subtotal.!>" un each sheet RcrL.nt 1hi.:- fo!af of ail amount..:; nor cnth.led to priority li&icd on lhb Schedule E in rhc box labeled "Totals" on the Ja.."1: s.he~1. ofthr; cotnpI~tcd .sclt:'.duic. lnJi-..-ftlt1a.i dc-btur~ i.\'hh primarily cOnsuiner debts,report thjs total aiso on 1he Stal.i:st.ica1 Summary nfCenain Liabilities and .Related Dal.it

0 Domestic Suppnrc OblJgatJuns (:lairn.) for Jom..::stk support ;J1a1 an: (I Wed t~) or r.:-cnverahle by il :-i.puusc. foimcr Sj)nuse, or child of the debtor. nl' t'le. psrenl: lt~gal guardb-'..il~ t)f rcsponsihfe l'eia.:·ive of such a child, cir a g_;Jvern.rnental un.it ro \Vhon1 Sl!Ch a tlo~ne~tk .s.upporc ciaiin has teen <::.'lSi:;ncd tt) tl\i': C\"t:eJ?t f>r«1\"'• !t~d fri i I ti.S.C. § 507(a)fl). o· ti:x1cnsiOas lif credit in Dll invofunt.ary ease Claims aris:ing ie the or<lin'-'fy cours<.:: r)f the. debt1..1r's: bu:>in~s~ or financial ::i.iT'1ir:...: at1.:r tI1,,;: c~immence:rnenl of the 1;~:isc but hef1';rc tht t.'arlicr of the ai1pointmi;;nt of a trustee or th~ o:rder for relief I 1 U}l.C'. § 50?(aJ{3 ).

\V;.iges, salarie.. ,,.. a-nd cnnVA'li·.:;sioris.. !1H.·ludir1g vacar.lon, .scvei<irJCt:.: !:!.nJ:siek !ea.•,:e p:iy oV.:ing ttl ~n1ploy~Cs 11nd :_0!1unis:ion.s ~w~ing :n 1~u:,,Hf/in~ indepen~k-11t .s.8 1cs rcprt:~er1tativ~s 1.;p to$! .I. 725* per JIBrs<:tn e.;lf'n.ed \Vithin £80 da)'·~ in1mediaie'.Y pr!·'Ci~ihnr.'. fhc ti!tng l,i· t:h1..· {;nginal p..:tit~an, ,or ti}e ec$:.<>atin;1 of t1.1sin;:;ss, \vhicf::lcycr 01.::~u:rred firi>L lt} th;.: cxt(:.1ir prnvidtd 11\ J l C. S.C. § 507\a.)(4.J.

0 Cfl;n!r-ibutions t~ employee h~~n~i'h p·!;;n,; fVl<)!JL'.V 1.;W~d (\~ ·.-.!npk,\.t:C ilcn:;;fi1 p.hiJ~!> f\,!J .~<,;t 1,·i.:..;...::-; t°(:'.jl'.Jcft:Li n'ilf!i~l j 30 d~)'S i1nn1ediari:Jy lJNCt'dlng th<: f1J.:!1Q. t)f· t!JC Oftglii~d p-;..'tltiOtL ()f \!\l: C~:i~i.Ui~n of tw~iH~~s. \rhh:h-:ver (~CJ;i.:ff"ed nrsL lo 1.hc extent provided in l .! U.S. C. s507(i!.)(5 ).

11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 8 of 15

In re CROFT,B.~R~A~D'-L=E~Y'-'''-"l~"------­ C'asO?- No. _____________ Ochtor (ij"knor.,1'ij

0 Certajn farmers -=tnd fishtr1nen {]ain1~ of Certain fam1crs and fishcsrrttt:~n. up-kl $5, 775* ~r"fittmcr or fish.:nnan, a.gainsl th~.dcbto.r~ as provit.fod in } I U.S.C. § 501(~)(6).

0 Deposit$ by in:dt\·iduals Claims of !ndivitiuaf~ up to $2~600~ fOr depo::.:ils iiJr th..: jJllrchase. .l~sse,.t.ir rental (1f property vr .scrvicts tbr pcr::;onat fa;nily, o:· bous~h0ki w-=i.:-. thal 'Nen: 1101 d('Jivi'.'n::d or provfUW. 1 J U.S.C. S 507UL)(7}.

0 Taxes and c:ert~in 0th.er. Debts ()n1~d tn Go\.·ernmenfri.l Unitl: Taxes, cus1on1s-dutlcs, and penaaies O\.\'ing to fc-dcraL .<:;t""Jte, and local gov..:-rn1rrc11ta! unils as sCt f<i1th in I I. l!.S.C. § :507(a)(8).

0 Commitments to l\hrint.ain the Capital of Rn .Insured Depository lt1J1ti1:tEtion Claints bas.:d. on conm1~111i.e111.~: to th<.: FDIC, RT(~, l}in.~ctor ;;fthc {):ffice of Thrift Sup.::r·v~sion. Con1ptr0Hcr dfthe: (~urrcnc_y·. or Board of CToi..:etnrirs. of1he F~d-cral R~se1·ve Syst.eu1. or tht'tr predecc.S$ors t)r .successor.;, to m<~intain the capital of.an insured deposjtory in~~itution. 11 U,3.C. *507 (~)(9).

0 Claims for Death or PeN.oual bijury WBHe 'Debtor \\':ts Intoxicated (.'!ain1s iOr d(.-ath or personal injury n:::.s:uhing frc.n1 the uperatiun of a 1noto·r vehick· or \'Ci'se! H"hile !he <lrblor \•:as intoxicaii;!d fron1 using ;ih:oho1. a drug, o~ a.nf"1thi::1 ~ulJ;:;laHct:. ! 1 U.S.C. § .507\;:lj( tO},

* A.nu1un1:; are f;id"ljl;-c:/' to at{j~rsunenr on 4dll.-''!3, ur.d L.'V:::·r:~' ihref! ~w:.:11:> :fwreqfii•r li'ilh re:-::pect r.o 1...'ases·cnmr1u'1u.·ed on e;·r af!f.rr tht: dr.tte aj· a<(ius(trl.f'ni

c{,11tin11ati.on shctts ;tltci.che<l 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 9 of 15 "'---=~-- ·~.,~~\.,. ... ~: -::::--·--, ,-·.·.i..... - .:.:..-, ;./'iW;...i.:. '( -------·- ------- SCHEilULJ<: .F - CREDITORS HOLDING lJNSECURED NONPRlORITY CLAll\1S Slate th<' nan1c, Jllai!ing r.-dctress. inciud.ing 7ip _code, .:.ind last tbur digits ofany account nun1bt:r, ofell enliti.;;s holdjn[: un~t.c.ured c.l'1in"IB ivitl1out priori{)· ;:igain.':it the dehtor or the property t)f fhe d.:-IJ.!or1 a:; uf ihc dutc t)ffili1)g (>f thc:. p...:-tition. 'l1;_c ci:in1pJi:l~ ;:u.x;t.n:ut nuinho..:1· of ~illy accounr rlli.3 11el)lur tws vrith the crcdfrnt is w;eii.1i to the tr:.1~1:ee aud the creditor and 1nay be proviC~rl if the dehto; choo.ses to do so. !f 11 n2i11or child is.a l..'.:redi'ior, ~!~le th\:. child's initia3s and \be na1nc and nddri::ss oftht: child':\ parer11: Or-guardifm, such as "...\.B .. ~ 1ninor.chUd. b.Y io}1n Dot~ gua.rdian.'1 l)o not d:is<:1osc-thc <:hild',s name:. Sec, l l U.S.C. ~ l 12 und F\:d.

R. Bankr. P. J OO?(n1). Do m.1"! lne-ludt>. tlc.im~~ lisre.d. ln Sd1edu!~s D ~•nd E. If ail cn.."(l_ilors will nol fit on this p.<tgt•. tts"~ r.hc continu:1tk111 ::;beet pr<"J'-'idcd.

1f any entity (!ther rh;ui-<t S"po~se in ajo-int CdS•::. tnay bi::-jolntly ti-ablt:: on a daim,-pTace an '·X"' iii lb;;: coJunu1 lahelcd '"Co<lehtor,·• include Ul~ t:nf~ty on the appropriate schedule of creditor<..;, anti cotnpJctc Schedule H- CL1~k:btohi. Jf njoinl petili011 h fik--d, Stlte \\'ht!ther th1.· hu ..;;hand, wifC. bulh of th~rn, or :ht n1:trit;il cun1IT'.uriity t)tay be li•~h1~ on en.ch c.l•:.iiu b; pJuciog an. ''ff«" '•\\i,~ •·-J," or·"C" ifj thc-tolurn11 l.,!bclcd ··Hushanct. \~'ife. Ju3n1. or Comn111n\f:y.'· tfthc claim is crj11tir.g:~nt. place an ..X,. in the cc;fn_rnn labeled '·Ctn~tingt.·nt." lfH1e clairn ~::.; u11fiq~:i<line<l. r~ac1...' an c.X'' in fne i.:olurna labeled ··c:nliq11ld;ltc-r:t·' If1hi.: c!al1n i:; d.lspi.:1e\.i. pllli..·t an ''X" in lht" l.!ohn11n labeled "Disputed." (Yt)u 1nay tltl~d tn pfa..;;c an '-x- in n1nro:: th:m one ofth..:.se three ct1lumn$.J Report lh;:, rot:t! of al! c!ain1s. !isled 1.1n this schedule in lht: bux la.hc!eG '"Tola!" on the !aitt $;he-et ~Jf tht: completed ~chectuie. Rep(in rhis total al$O on Oic Swnrnary Qf Sclu:.dul~s-an.d. if the d~h!ur i£: ~tn individual with pri.rn;.ir!Jy consunH!-r debts-, report th_js totnJ nlso 0.11 the Statistical Su!nmar;- oC CcrutinL.iabi!itk·~; and .Rt:f::tt..:-d !)at.a..

.: eek i"h"1s bo x. 1"f'uc btor has uc' cr~<l 1tors ho!d.rn£> m1securOO cJauns to re.oorr on this Sch~ dnIc,.

0 Ch " t!]

CRPDfTOR'S NAME, ~ ~ o: r > DA TE CLAIM WAS 0 AMOlJNTO!' r MAILING ADDRESS INCLLiD!NG 7.!P CODE, "'rc ;r'"~o ~ c ;z .:....:·;.::i z ~ lNCUR1UoD AND CONSIDERATION FOR z CD \:) f: «: Cl 8. f:: CLAIM AND ACCOUNT NUMBER "' '1.) <-.;::; co 0 ""'=.

CLAIM. z s ~S°t'•' trr:strr1t.:fion.> at~·1v,o.: Q 0 ~...., 9. JF CLA[M IS SlJBJECTTO "'u z~ ?l: <>:: :!!

I r_; I ~ ~ :t: SETOFF, 80 STATE. ~ Cl

ACCOUNT T>:(.J. 4006 :.:.i ----·I CREDIT CARD DEBT I I I AMERICAN EXPRESS H x I 50.000.00 p_Q. BOX 650440 , DALLAS, TX !' I ACCOUNT KO.

CHASE BANK 19 I H CREDIT CARD DEBT x I l j 40,000.00 I P .0. BOX 94014 P.~LANTiNE. JL 60094 I l ,..\C('OUNf NO. 6402 CREDIT CARD DEBT I !

BANK OF AMERICA P,0 BOX 851001 DALLAS, TX 75285 ;\CCOUNT NO. 5086 I I I H II ! i I x ,._l_ _ I I 25.000,00' Ii , dA CARD SERv ICEti ~

r.o. oox 10222 ...

S.4N Af'JTONIO, TX 73247 ~

II l I I CRED!T Cf.-..RO DEBT ! I I x I l' 25,000.DO t I SubtctiJ> 140.000.00 I T('tl.!> t'Uilt' unly (•n !......;;r p3ge of th~ ~·omplei~ ):c.111..-duk: F.)

O<:i:;rr.n ~is<: cii S.1mlmary or;.:dM~dulc~.. ~J1d. i! i;ppficehJe, nn th::: Siati~;liot! · :}LlJr>!WlrJ< vrcen.;it11l:fabilt.K:?.1mo J~d-~.~ect D~M.> I BoH(>tlrci!,k,~9.!?-z,\;ff9o,goc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 10 of In r~ _J::_ROFT, BRADLEY, L Case N o . - - - - - - - - - - - Debtor (if known) SCHEDULE F - CREDITORS HOLDING UNSECURED NONPRJORITY CLAlJ\lS (Conlinuation Sheet)

CREDITOR'S NMvlF., DATE CLAIM WAS r- Cl AMDUNTOF z c JvlAfLING A DD RESS !NCUJDING ZIP CODE, fNCURRED AND CONSIDERAlfON FOR l 0"' <r.: f- ~ CLAIM ~ c :;:, AND ACCOUNT NUMBER rSt:t: instrw.:tim1s !l:hovc.J CLAIM. lF CLAIM rs SUBJECT TO f- z s "- :!; SETOFF_ SO STA TE. '._) ~ c, ;z ::0 !-----------+--+~--+-----------······- ·------ -- ____ __,________, 1\C.C< >UNT NO. LEGAL FEES MYST! MURPHY 5625 BROADWAY, #2 SAN ANTONIO, TX H I x I 10,000.00

ACCOlrl'tf NO. CLAIMS !

BARBARA LOWRY 1600 NE LOOP 410, #202 SAN ANTONIO, TX 78209 ! H ! x i00,000.00

ACCOU~f NO. LEGAL FEES CHARLES GORHAM 1250 NE LOOP 410,#830 ! H 10.000.00 II SAN ANTONIO, TX 78209 -Ac-_C_'C_>1-!N_T_N-'0--------1,f---~._..----1f-LE_G_A_L_F_E_E_S________ ··--, 1-_

JONA THAN YEDOR l H x 5.000_00 NE LOOP 4-iG, #1075 SANANTONIO, TX 78209 l ACCf.Jl.r}.'T NO. I LEGAi l=EES CHARLES RILEY x I 15,000.00 LEX!NGTON AVE SAN ANTONIO, TX 78215 ~hect no. of .. :;on~inillitin11 shccrs Cittachtd lo S.:.hedt;k t)fCrcd~t~;.; Holding i.\nsccur.co N,~>10prk\rity C!:1.i.t1.r:-; n 6 r,omc.lkJ?.~~91tm~JJ:,.m~oc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 11 of Jn re CROFT, BRADLEY, L.

Case N o . - - - - - Debtor --------~ (if known) SCHEDULE F - CREDITORS HOLDING UNSECURED NONPRIORJTY CLAIMS (Continuaiion Shcc-t}

~ CREDITOR ·s NAME.

MAILING ADDRESS "" f'? ~- .v S'i E ~ DATC CLAIM INCURRED AND wAS :fj ~ ;- AMOUNT OF CLAIM INCLUD ING ZIP CODE, ro w 2;: ~::;: :z0 C.: CONS_ !DE_RAT!_ON FOR 2; '" < AND ACCOUNT NUMBER O <0 ::;: CLAIM. t; ;::o 1&emstruct1om>t1bu"tl 0 ~....., IF CLAb\1 IS SLlBJE.(;f'f() ,,.~ Q' I r"'. '-' u R 1~ - ~ ;: SETOFF. SO STA TR. -~ g ~=~~ ,;o; - -· I CRCm CARO ~;,. ,_x·--l--~--l--+---2--0::-0.-00 __ P O. BOX 182564 COLOMB US, OH 43218 ACCOL"NTNO 7218 CREDIT CARD DEBT HSABANK c x 25.000 00 N. 8TH ST., SUITE 320 SHEBOYGAN, WI 53081 -.\Ct::OUNT NO. 0893 REVOLVING SEARS P.O. BOX 183081 c x 3,000.00 ! ' I I DAViD MCLANE H x 8,000.00 1924 N. M.l\IN ST. SAN ANTONIO, TX 78212 ACCOUNT NO. SPOUSAL SUPPORT CHERIE JEFFCOAT H x 6,000.00 5625 BROADWAY, #2 I SAN ANTONIO, Tl< 70209 S11c~~t ni:t ·------ {!( ____ c-;:mti.nuntion sheets.: ;.n:.ached Snomml> l_S------1 ~ 62,000.00 I

IU~ or1iy on last page .)fth<! curnpld'cl S.d1e<l,1ie.f' .f Total> I i> i ~port ah<l ~·n Sunmm::,· .:;.f S<.'"he\!ui~,;: unJ, if :tPt>li 1::;ble- 1Jn _1he Si:.1i:i~o_<:-:d t $iJmmary nfC~rtain Lia.hi!itie~ and Relat~d 1.>lita.i l-.1----~-' I'6fi/}fficJk~~R~.s:ff!b,Q_oc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 12 of lnre ______ Case-No.---·------------~- Debtor (ifkMwn) SCHEDULE F - CREDITORS HOLDING UNSECURED NONPRIORITY CLAIM:S (Contiot1~ui.un Sheet)

r CRCOITOR"·S NAM£, Ml\ILING ADDRESS INCLUDING ZIP COIJE, AND ACCOUNT NUMBER <So:::e instn1ctk•ns alxrn;:J s"' cc ""8 u u.f "- 3~= g'.:-s 'z ::;, .-,; -.- ~c "'~ 0 C;J ?-

- ::;; u DATU CLAIM WAS INCURRED AND CONSIDFRA TION FOR CLAIM.

IF CLAIM JS SUBJECT TO SETOff, SO STATE. i \'..l.;.l z p z r_; c t= < - Cl ::i "'~ ~

"" <.Ti AMOUNT Of' CLAIM '

:z ;:::) --------··--.------ - - ··-----.

1\CCO-UNT "NO. LEGAL FEES JOHN CAVE H x 20.000,00 CONVENT, #1080 SAN ANTONIO, TX 78205 I I ACCO{JNT NO. !

PROMISSORY NOTE WebBank H x j 15,000.00 SUTTERS, 22 FLOOR I I SAN FRANSICO, CA 94104 !

ACCOUNT !\'.O. LOAN US BANK e.o "°""'"" ST. LOUIS, MO ACCOUNT NO. ==t 63179 H --·---~---·---- x 210.000.00

I ' I I i f.CCOI, ;NT N<) '

$beet no or cqntinu:;ti<ln sllects attrtchcd Sub1or-.1.:)- $ to Sehcticl~-;fCredHor·~ HO kiln; Un&x:nr{'.d I 245,000.00 Nonpri1~ri~:-· ciai1111.:: I {U:;c '<.mly on last pag·c ofl!l.-.•..:c,rnpkt~rl SGh~d11k F ! rnt:•l> (Rf:rin•! ,d..;e 1 1111 ~H~i·n~;:.-- .;:-,fSelv~drJ,,..~ 11nd. :r :1.p~li!..'~01.,, 011 th:,, l::t:ltisti.:;il Ii $ 58, ,00 0.00 I l S1!r!E.'"11'vJ ofCe11ai1~ L\ahi!ilie1' ,'rnd Related D;:..t.:..) ,_1 ------J 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 13 of

IN THE UNITED STATES BANKRUPTCY COUKf FOR THE WESTERN DISTRfCT OF TEXAS SAN ANTONIO DIVISION

JN RE: CROF"I', BRADLEY L CASE NO. Debtor

VERIFICATION OF CREDITOR MATRIX

The above named Debtor hereby verify that the attached list of creditors is true and correct to the best of his knowledge and that it cooresponds to the creditors listed in my schedules.

Dated: August 23, 2011 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 14 of

Chase Bank P.O. Box 04014 Palantine, IL 60094 Security Service FCU 1621 i La C;mtern Pky Sau Antonio, TX 78256 First Mark P.O. Box 701650 San Antonio, TX 78270 Mysti Murphy 5625 Broadway #2 Sai1 Antqnio, TX 78209 Barbara Lo\v1)' 1600 NE Loop 410 San Antonio, TX 78209 Ci!iBank P.O. Box 182564 Colombus, OH 43218 Sears P.O. Box 183081 Colornbus, OH 43218 Cherie Jeffcoat c/o Mysti Murphy 5625 Broadway,#2 San Antonio. TX 78209 American Express P.O. Box 65044ll Dallas, TX 75285 Chase Ba.'1k P.O. Box 94014 Palantine, lL 60094 Bank of _i.\;n_erlca P.O. Box 851001 Dallas, TX 75285 11-52905-cag Doc#2 Filed 08/23/11 Entered 08/24/1115:26:16 Main Document Pg 15 of

US Bank P.O. Rox 790179 SL Luuis, MO 63179 Charles B. Gorham 1250 NE Loop 410, Suite 830 San Antoniu, TX 78209 Jonathan Yedor N.E. Loop 410. Suite 1075 San Antonio, TX 78216 John Cave :ioo Convent #1080 San Antonio, TX 78205 EXHIBIT 4

1 IN THE UNITED STATES BANKRUPTCY COURT 2 FOR THE WESTERN DISTRICT OF TEXAS 3 SAN ANTONIO DIVISION IN RE: * Case No. 14-50980-cag 5 * BURTON M. KAHN, * 6 * Debtor. * October 15, 2014

9 ---------------------------------------------------- 10 BEFORE THE HONORABLE CRAIG A. GARGOTTA 11 BANKRUPTCY JUDGE ----------------------------------------------------

14 #59 - Trustee's Motion to Sell All Non-Exempt Assets, Claims and Causes of Action. **********

ORIGINAL Proceedings recorded by electronic sound recording, transcript produced by transcription service.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 A P P E A R A N C E S

3 HAYNES and BOONE, LLP By: Ms. Lisa S. Barkley 112 East Pecan Street, Suite 1200 San Antonio, Texas 78205 Appearing for Helvetia Asset Recovery, Inc.;

7 PRO SE DEBTOR By: Mr. Burton Kahn 1706 Alpine Circle San Antonio, Texas 78248 Appearing pro se as the Debtor;

11 HAYNES and BOONE By: Mr. Werner A. Powers 2323 Victory Avenue, Suite 700 Dallas, Texas 75219 __ ". / Appearing for Helvetia Asset Recovery, Inc.;

15 CHAPTER 7 TRUSTEE By: Mr. Johnny Thomas St. Paul square 1153 E. Commerce San Antonio, Texas 78205 Appearing as the Chapter 7 Trustee.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 INDEX

3 WITNESSES Direct Cross Redirect Recross Gary Mowrey 83

6 EXHIBITS: Offered Received (No exhibits offered in this hearing.)

9 RULING OF THE COURT: 91 ************

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

''-__..-' 1 THE COURT: We have one 9:00 o'clock matter on our docket this morning. This is on Page 1. Case Number 14-50980, Burton M. Kahn. This is on ECF Number 59, the Trustee's Motion to Sell All Nonexempt Assets, Claims and Causes of Action.

6 May I please have announcements.

7 MR. POWERS: Your Honor, Werner Powers and Ms. Lisa Barkley for Helvetia, which is -- who is the purchaser.

10 MR. KAHN: Burton Kahn, who's the Debtor, your Honor.

12 THE COURT: Thank you.

13 We are missing the Trustee.

14 Did you see Mr. Thomas this morning?

15 MR. POWERS: We did not, your Honor.

16 THE COURT: All right. We obviously can't proceed on this without the Trustee being here, so. 18 MR. POWERS: Should we go call him real quickly, your Honor?

20 THE COURT: We'll take care of that. We'll find out. And I ' l l ask my law clerk in -- 22 (Sotto voce exchange.)

23 THE COURT: I'm sorry for the delay, but we have to have him here.

25 I assume -- I've read the moving papers. You

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 contest the motion to sell; is that correct, Mr. Kahn?

2 MR. KAHN: Correct, your Honor.

3 THE COURT: All right. And I certainly want to hear 5 And you all support the motion to sell.

6 So, very good. I do have a 9:30 matter. Once we get Mr. Thomas here, we'll proceed, ladies and gentlemen. But, obviously, I can't go forward until Mr. Thomas gets here. So, we'll find out where he is.

10 Are there any witnesses, or anything like that, or is it just argument?

12 MR. KAHN: Yes, Your Honor, there's one witness.

14 THE COURT: Who would that be, Mr. Kahn?

15 MR. KAHN: That would be Mr. Mowrey. He's an appraiser, and he made the -- the appraisal of the Joabert property.

18 THE COURT: Okay. Were you all aware that Mr. Mowrey was going to be called as a witness?

20 MR. POWERS: We -- We sort of suspected he might, your Honor, but we don't think that he has test- -- 23 MR. KAHN: Your Honor, I sent them a copy of the -- the subpoena that I served Mr. Mowrey.

25 THE COURT: Okay. We'll take that up. '---/

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 Because I need to have Mr. Thomas here. He needs to be a participant in this discussion. So, we're going to I apologize, but we -- we've got to have him here, so ... Maybe he was delayed in traffic, maybe he got his times ... But he's very punctual. This is highly unusual for him.

7 So, if you don't mind, please, what I'm going to do is step away, and then we'll start as soon as he gets here. All right?

10 MR. POWERS: Very good, Judge.

11 THE COURT: So, if you'll -- you'll just stand down for a minute. '-____/ 13 Do you have exhibits to present?

14 MR. KAHN: Yes, your Honor.

15 THE COURT: Okay. And do you have exhibits to present?

17 MR. POWERS: We have impeachment exhibits, your Honor.

19 THE COURT: All right.

20 MR. POWERS: And if he And if he's allowed to put this witness on, I'm sure we will call, as an adverse witness, the Debtor.

23 THE COURT: All right. Well, we•ll deal with that when Mr. Thomas gets here.

25 Mr. Kahn, do you have the -- do you have copies

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 of your exhibits for the Court and also for opposing counsel?

3 MR. KAHN: Yes.

4 THE COURT: All right. Very -- 5 Ah. There's Mr. Thomas.

6 MR. THOMAS: I'm sorry, Judge. It was a bad morning.

8 THE COURT: Mr. Thomas, do you need just a minute, and then we can start? Would that help you?

10 MR. THOMAS: That'll be fine, Judge.

11 THE COURT: All right. So I ' l l -- Mr. Thomas is here. And I ' l l -- I ' l l come out in, like, five minutes. I do have a 9:30 matter. I'll probably ask the parties how long that's going to take, because this, I think, is going to take longer, if I'm just going to make an educated guess.

17 Mr. Ayers, good morning.

18 MR. AYERS: Your Honor, we think about 20 minutes. I mean, it's very straightforward.

20 (Another matter taken up briefly.)

21 THE COURT: So, you think about 20 minutes.

22 I assume that your matter may take a little bit longer; is that correct, Mr. Thomas?

24 MR. THOMAS: I think so, Judge.

25 THE COURT: All right. Let me step away.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 If you all want to talk for a minute, get situated, and then we'll start the matter. I might -- To be fair to you all -- or, I'm sorry, I might break to take up the other matter. All right?

5 MR. POWERS: Yes, sir.

6 THE COURT: So, just to let you know.

7 All right, ladies and gentlemen. We'll take a five-minute recess. Okay? Thank you.

9 COURTROOM DEPUTY: All rise.

10 (Recess.)

11 THE COURT: Mr. Thomas, could you -- could you come to the podium, please?

13 MR. THOMAS: Good morning, Judge.

14 THE COURT: Good morning. This is on your motion to sell. We have two interested parties. We have the Debtor, Mr. Kahn, and also we have -- Is it Helvetia, is how you pronounce it?

18 MR. THOMAS: Yes, your Honor.

19 THE COURT: And they're the purchaser of the -- of the cause of action, and, I ' l l just say, generically, the nonexempt assets, claims -- 22 MR. THOMAS: That's correct, Judge.

23 THE COURT: -- and causes of action.

24 I think this is going to take a little bit of time. Were you aware of that?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

,'--._./, 1 MR. THOMAS: Yes, sir. I had seen the exhibits, and the objections, of course.

3 THE COURT: I would We could go for about two minutes, then I'd have I'd call the 9:30 matter. I don't think the 9:30 matter, as Mr. Ayers has described on the record, is going to take more than 20 minutes. So, what I'd like to do -- Do you have 9 Does anyone have other engagements later on this morning? Because I would take you all next.

11 MR. POWERS: No, your Honor.

12 THE COURT: Mr. 13 MR. KAHN: Your Honor, I do have a witness that is an expert witness, and -- and I have to pay him, you know, his fee, which is kind of blood money at this particular time, so ... And this delay is costing me money.

18 THE COURT: I understand that, sir.

19 MR. KAHN: If I -- If -- If If I could, in our few minutes, just put him on. The only thing he's going to do is submit this -- this appraisal, and that he made the appraisal, and just a question, "Did you make it," et cetera, and that's it.

24 THE COURT: I -- Mr. Kahn, I certainly ,___,, 25 appreciate, from your perspective, it may take a

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 couple of minutes, but based upon my years of both being a lawyer and a judge, I suspect it will take longer. So, while I am sympathetic to the cost involved, the fact we're in court, there's an inherent cost to it. I'm going to ask -- ask you to stand down.

7 Mr. Thomas, I ' l l come back to your matter in just a minute. I'm going to deal with the Valence 9 MR. THOMAS: That would be fine.

10 THE COURT: matter.

11 So, if you all want to step out for a minute, you may do so. You can leave your stuff here. ,_____, 13 But, Mr. Kahn, you're just going to have to wait, so Certainly, I am sensitive to that, but I don't think this matter is going to take, necessarily, all that long.

17 MR. POWERS: Thank you, your Honor. We'll be outside.

19 MR. KAHN: (Inaudible; too far from microphone.)

21 THE COURT: Well, I've excused the -- Go to the podium, please. What's your question, Mr. Kahn?

23 MR. KAHN: I did not submit -- bring with me five copies of the appraisal, I had three, so that I'm going to -- in this time period I'm going to run over '--._/

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 to the Clerk's office and get a couple of -- of exhibits that I want to put in, then I will have five.

3 But the appraisal is -- was -- was submitted in the -- in the filing of my motion -- my objection.

5 Also, I have a chart that was also filed in the objection, and which I have a large scale of it, so that you could easily see it. And I don't have five copies of that.

9 THE COURT: I ' l l take that up when we come back. The local rules are pretty clear on the requirements in terms of number of exhibits, why we need the number of exhibits for purposes of conducting \ ....___./ 13 the hearing. While I'm sympathetic to your situation, as a pro se debtor, you're not excused in those requirements.

16 MR. KAHN: I'm not asking -- It -- The one thing that I'm going to do, if I ever get this this -- this whole situation squared away, is I am going to go to law school, and not be a -- and -- and not go to -- I should have gone to law school, instead of engineering school. But, anyway, I will do that when I -- when this is over.

23 Thank you, your Honor.

24 THE COURT: All right. So, I ' l l come back to the matter, and we'll -- we'll deal with all of

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 that.

2 (Sotto voce exchange.)

3 (Other matter taken up.)

4 THE COURT: I'm going to take, like, a three-minute recess, and then we're going to start, Mr. Kahn.

7 MR. KAHN: Thank you, your Honor.

8 THE COURT: Thank you, sir.

9 All right. So, just a very short recess, and then we'll begin with the Kahn matter.

11 COURTROOM DEPUTY: All rise.

12 (Recess.)

13 THE COURT: All right, Mr. Thomas. This is your motion. We're going to start with you first, then I ' l l hear from the other interested parties.

16 MR. THOMAS: Mr. Johnny Thomas, Trustee and Movant.

18 This is an application to sell the nonexempt property of the estate. It mainly involves some shares in Helvetia, a thousand shares; a hundred shares in another corporation called Joabert; and, then, numerous lawsuits that he -- that Mr. Kahn, the Debtor, claims are valued at $1,470,940.

24 THE COURT: A million or a hundred million?

25 MR. THOMAS: One million. '~

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: Okay.

2 MR. THOMAS: And the -- the shares, he's valued at 3,734,309.

4 THE COURT: So, may we break it down, just -- I know I asked you to go through a recitation, but help me out. So, we -- You want to sell a hundred shares of stock in Helvetia?

8 MR. THOMAS: Yes -- Oh, Helvetia, 1,000 shares.

10 THE COURT: One thousand. Then a hundred shares in what?

12 MR. THOMAS: Joabert, J-0-A-B-E-R-T.

13 THE COURT: Do you know what Joabert is?

14 MR. THOMAS: Where it is?

15 THE COURT: No, what it is, what kind of entity it is.

17 MR. THOMAS: Oh, these are development companies. They - - 19 THE COURT: Development companies?

20 MR. THOMAS: Yes, sir.

21 THE COURT: All right. Then you said some causes of action, the rest are causes of action?

23 MR. THOMAS: Yes, sir. Item 21 on Schedule B outlines those lawsuits involving 25 THE COURT: How many are there, please?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

'-.__./ 1 MR. THOMAS: Seven.

2 THE COURT: All right. Can we -- Just for purposes of the record, and I appreciate you -- you trying to get to the point, but let's break these down. Go -- Go through them one-by-one so I have a record of what -- what these causes of action are.

7 MR. THOMAS: Yes, sir. There's one lawsuit against Haynes and Boone, 9 THE COURT: Okay.

10 MR. THOMAS: -- 1,400,000.

11 There's a lawsuit against the City of San Antonio for 70,000.

13 There's a lawsuit against -- Burton Kahn versus Helvetia. He doesn't value that lawsuit.

15 THE COURT: Okay.

16 MR. THOMAS: There's another lawsuit. If I can give you the case number, Judge: The last four digits 0014, Burton Kahn versus Helvetia; the last four 0258, Burton Kahn versus Helvetia; 0319, Burton Kahn versus Helvetia; 21 These are all state court cases. I'm sorry.

22 These are all, yeah, state court cases that are now on appeal.

24 0357, Burton Kahn versus Helvetia.

25 The cases now still in district court, 2013

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

~- 1 cases: Last four 8355, Helvetia Recovery versus Kahn; and then, 2013, 8394, Helvetia Recovery.

3 Those are the lawsuits, as I understand them, Judge.

5 THE COURT: Very -- If I may interrupt you again, because I'm trying to get some context.

7 Have -- You mentioned appeals. Have there been a number of determinations on these causes of action?

9 MR. THOMAS: Yes, Judge. I believe they were all against Mr. Kahn, but he appealed them.

11 THE COURT: Okay. So, we -- For purposes of the record, on the causes of action, even though it appears that Mr. Kahn was the plaintiff in all of these, there was a determination at the trial level in favor of the collectively, of the defendants, 16 You'll get your turn, Mr. Kahn.

17 and those matters are up on appeal; is that correct?

19 MR. THOMAS: That's my -- According to his schedules.

21 THE COURT: All right.

22 MR. THOMAS: That's what he's indicated.

23 THE COURT: Okay. So, what other assets are you trying to sell?

25 MR. THOMAS: Then there were some other '._/

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 small businesses that Some are operating and some are not. In addition to Joabert and Helvetia, there was something called Trail Construction Company; Puerto Verde, Ltd.; Key Largo Homeowners Association; Royal Crest Homeowners Association; Contour Construction; Ideal Travel Company; Paradiv, P-A-R-A-D-I-V, Corporation; and Terob, T-E-R-0-B, Corporation.

9 And some of these, he says they're presently operating, some he says are not operating. We're not clear on all of them. But we want to 12 THE COURT: Does he ascribe a value to them?

13 MR. THOMAS: He did not, to these corporations, Judge.

15 THE COURT: Is there Is it listed as unknown, or just no value listed?

17 MR. THOMAS: No bank account, unknown. Some are unknown and some say no bank account.

19 THE COURT: All right. Please continue. Is there -- Are there any other assets?

21 MR. THOMAS: These are the assets, as I understand them, Judge. And I think these are the assets that the buyer was mainly interested in recovering, your Honor.

25 THE COURT: All right. so , 1 et me - - 1 et me

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 just stop you right there. And there's a reason why I'm going through this.

3 So, we have shares of stock in two entities. we have, I believe you indicated, seven causes of action.

5 Then we have these businesses that may or may not be operating.

7 You've conducted -- Have you concluded the 341 meeting?

9 MR. THOMAS: Yes, Judge. We -- I think there were at least four resets. The last one was completed in July.

12 I did have an attorney assist me at the beginning. we made a determination that it'd be hard to litigate all these lawsuits. And we just -- I just didn't feel -- or the attorney didn't feel it was marketable. It would take several thousands of dollars to litigate the claims, and so forth. And even the ownership interest, it would take some -- some litigation to resolve the actual -- whether or not he owns that interest.

21 The clearest might be that he owns one/third of Joabert, but then it doesn't appear that Joabert has any equity.

24 THE COURT: Okay.

25 MR. THOMAS: And so, with that, I

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 toward -- I guess in August, after we concluded the 341 meetings, the Helvetia offered $10,000 to buy all of these properties, 4 THE COURT: When you say "properties,• 5 MR. THOMAS: which would amount -- 6 THE COURT: May I -- May I interrupt you again? Everything?

8 MR. THOMAS: Everything. Yes, sir.

9 THE COURT: Stock, causes of action, interest in whatever these -- these entities are.

11 Is that correct?

12 MR. THOMAS: Yes, sir. That's correct.

13 THE COURT: All right.

14 MR. THOMAS: And for about $10,000, I think we would get somewhere between two and three percent interest for the unsecured.

17 THE COURT: Okay.

18 MR. THOMAS: And, so, i t ' s above one percent. If i t ' s above one percent and -- I've always considered that incon- -- more than inconsequential.

21 So, I think there's some value, and something for creditors, as opposed to nothing.

23 THE COURT: In your capacity as the Trustee -- And how long have you been a Panel Trustee?

25 MR. THOMAS: Since '96. 1996.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: So, you have -- And I genuinely mean this. You have considerable experience in this regard.

4 MR. THOMAS: Yes, sir.

5 THE COURT: Obviously, you conducted the 341 meeting. Did you -- Based upon -- As you understand the facts of this case, and you've analyzed this case both for its own facts and based upon your experience as a trustee, do you think -- I mean, did you think it was appropriate to market these assets, or simply seek I mean, how did you go about the $10,000 number with Helvetia?

13 MR. THOMAS: Judge, I was in the process of probably no-asseting the case, or at least holding on to see what would happen to the litigation as it was proceeding. And, in the middle of that, I was offered the $10,000. It was initially five, but at least ten five would have -- $5,000 would have been less than one percent, which I didn't think would have -- have much value to the estate. Ten thousand would get at least -- get me to at least two or three thousand, and that was the offer on the table.

23 And part of my concern was that something like this sometimes needs to be brought to the attention of the Court, and that's what I wanted to do, also.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: No, you did exactly right, because essentially--I mean, let's be honest, we're all adults here--they're buying peace.

4 MR. THOMAS: That's correct.

5 THE COURT: If I If I approve the sale to them, it cuts off Mr. Kahn's ability to pursue these cases as the Debtor.

8 MR. THOMAS: That's correct.

9 THE COURT: I think you would agree with this statement. First of all, these are all prepetition causes of action, so they enure to the Chapter 7 estate, of which you're the Panel Trustee. '-----"' Would you agree with that statement?

14 MR. THOMAS: I agree. And that's -- I think Mr. Kahn agrees with that, also.

16 THE COURT: All right. From the perspective, if you have a position, does Mr. Kahn, as the Debtor, have any standing to object to this based upon the fact that they're You know, a lot of times when we look at objections to claim, the analogy where I'm going is, is if a debtor wants to intervene in a trustee's claims objection, one of the things I have to evaluate is whether or not there's any -- there's going to be any return to the debtor. If there isn't, the debtor doesn't have standing to object to the

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 claim.

2 Does Mr. Kahn have any standing to object to the sale, given that there's only going to be a, we'll say, three percent distribution to unsecureds?

5 MR. THOMAS: Judge, if everything went right, I don't think there'd be money back to Mr. Kahn.

7 If most of -- You know, if -- if even fifty percent, ten percent of the values come out right, I don't see any money going back to Mr. Kahn.

10 THE COURT: All right.

11 MR. THOMAS: And, so, I certainly don't see $10,000 giving any benefit to Mr. Kahn.

13 THE COURT: So, let's '---../ 14 MR. THOMAS: And, so, I do question it.

15 THE COURT: So, you agree with me that there may -- Is there or is there not a standing issue?

17 MR. THOMAS: I think there's a standing issue, Judge. If you look at his value, he thinks that these have some equity down the road. I just think i t ' s totally unreasonable.

21 THE COURT: All right. So, let's -- let's focus back on one other thing for a minute, and then I ' l l hear anything else you have to say, is, let's assume that you got no tender from Helvetia of any ,__./ 25 monies, you know, the case proceeded along. How long

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1 would you keep this case open, given the administrative costs versus what might happen with regard to the lawsuits, and the value of the business entities, and the value of the shares? What would you do? would you -- Would you file a no-asset report?

6 MR. THOMAS: Yes, sir. A lot of times, when a lot of litigation is going on like this, I would hold off on the no-asset report and at least let some of the cases resolve. So, hopefully, within a year I'd be able to let it -- go ahead and file the no-asset case, and the creditors would get nothing.

12 THE COURT: All right. So, you would delay closing the case to see what would unfold with regard to these causes of action?

15 MR. THOMAS: That's correct, Judge.

16 THE COURT: All right. What else do you wish to tell me?

18 MR. THOMAS: Judge, that was the -- those were all the issues I had in mind. And, also, I would add that the estate has no money to pursue a lot of the litigation.

22 THE COURT: Thank you. That was the last point. Let's talk briefly about that.

24 Now, what's your commission on a case like this?

25 MR. THOMAS: Twenty-five the first 5,000.

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1 It's the standard statutory. Twenty-five percent the first 5,000, ten percent up to 45,000, and three percent up to 100,000, something like that.

4 THE COURT: So, let's assume you didn't have an offer on the table for the $10,000--I'll come back to that--what would be your fee in this case?

7 MR. THOMAS: Probably about 3,000.

8 THE COURT: $3,000 is all you get. And there's no money on hand; correct?

10 MR. THOMAS: There's no money on hand. This would be the -- Well, but they did prepay the $10,000.

12 I did ask for them to do that.

13 THE COURT: All right. So, you'll get -- you'll get a component of -- a portion of that, and then the rest, the balance of the proceeds will be remitted to the benefit of the creditors; correct?

17 MR. THOMAS: That's correct. That's correct, Judge.

19 THE COURT: All right. Do you -- Is there anything else you wish to tell me?

21 MR. THOMAS: I think that would be all I'd have right now, Judge.

23 THE COURT: All right. Mr. Kahn, I'm going to hear from you last. I want to hear from Helvetia, because I think you're going to take the longest.

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1 All right. Sir, if you'll come to the podium.

2 And, again, state your name for the record.

3 MR. POWERS: Your Honor, Werner Powers, and Ms. Barkely, Haynes and Boone, for Helvetia Asset Recovery, Inc. 6 By way of explanation of who we represent -- 7 THE COURT: Yes, please.

8 MR. POWERS: Helvetia Asset Recovery, Inc., is by far and away the largest creditor of the estate.

10 Helvetia has two judgments against Mr. Kahn, both final, one judgment by -- 12 Let me get my notes here.

13 THE COURT: Yeah. Let's be -- Let's have an accurate record, because this will inform my ruling.

15 MR. POWERS: Judge, one finding by a judgment for sanctions by Judge Tanner, a state court judgment, for approximately $253,000, where the court found that Mr. Kahn committed a fraud on the court, and made false filings, and claimed to be an owner of Helvetia Asset Recovery, Inc., when he was not, in order to cloud title to real estate that Helvetia Asset Recovery, Inc., owned here in Bexar County.

23 THE COURT: Is that order final?

24 MR. POWERS: It is a final judgment, your Honor. I -- I He has prosecuted an appeal

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',______/ 1 from it, so that appeal, I think, is pending.

2 THE COURT: okay.

3 MR. POWERS: There's a question as to whether it will -- well, as to whether he can appeal, given some orders of the appellate court, which I ' l l talk about in a minute.

7 In addition to that, there is a judgment for over $2 million, a unanimous verdict returned against Mr. Kahn in Judge Bery's (sic) court, for breach of fiduciary duty -- 11 THE COURT: Which Judge Biery -- 12 MR. POWERS: B-E-R- -- 13 MS. BARKLEY: Michael Mery.

14 MR. POWERS: Michael Bery (sic) okay.

15 THE COURT: Okay. I thought you said Biery.

16 That's why I asked.

17 MR. POWERS: oh, no. The state -- 18 THE COURT: I'm thinking of -- So, state court?

20 MR. POWERS: Yes.

21 THE COURT: Michael Bery (sic). Go ahead, sir.

23 MR. POWERS: Yeah, Bery (sic) Michael - -

24 MS. BARKLEY: Mery, M-E- 25 MR. POWERS: B-E-R- '-.__/

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1 MS. BARKLEY: M-E-R-Y.

2 MR. POWERS: Oh, Mery. I said Bery. Excuse me. Mery. And -- 4 THE COURT: Thank you.

5 MR. POWERS: Thank you. And -- I tried the case for two weeks. I should know that. But, anyway.

7 So, it's about approximately $2 million, findings of breach of fiduciary duty, embezzlement of funds belonging to Helvetia, punitive damages of about a million dollars, as I recall. I think that judgment is, in all things, final. Mr. 12 THE COURT: No further appeals? '---./ 13 MR. POWERS: Well, let me explain my position. Mr. Mr. Kahn filed a notice of appeal.

15 He then dismissed his appeal. Okay? He now has filed a second appeal of that judgment -- not of the judgment, but of an order that refused to grant him a new trial.

19 THE COURT: Okay.

20 MR. POWERS: The appellate court recently issued an order, I think last week, saying explaining why we should not dismiss this because you can't appeal that type of an order. The time to appeal the final judgment's over. You only get one appeal. He dismissed his appeal. I think it's final.

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1 But he -- he would probably disagree with me on that.

2 But that's what the status is. And I think the court of appeals now has clearly indicated that it's having a hard time seeing why it has any jurisdiction over this.

6 There -- I want to -- When the assets were being listed off, just to be clear, Mr. Kahn put There's -- There's two companies, two corporations that own real estate here in Bexar County. One is Helvetia, and they own a subdivision called Key Largo.

11 The -- The other is Joabert, which owns the Royal Crest Subdivision. '.___/ 13 THE COURT: Royal Crest?

14 MR. POWERS: Royal Crest Subdivision.

15 THE COURT: Go ahead.

16 MR. POWERS: As to Key Largo and -- and -- and Helvetia, Mr. Kahn was fired as an officer, and that was the subject of the judgment in Judge Mery•s court. And And what he did is, he issued himself stock after he was fired. He claims that he owned the company. And then -- And that was the subject of the sanction order that was entered against him.

23 So, he -- he doesn't own any stock in Helvetia.

24 That's not one of his assets. The court's adjudicated that and that's over.

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As to the Joabert and the Royal Crest Subdivision, Mr. Kahn claims to own a minority one/third interest in the stock of that company. And that's going to be important in a moment because the appraisal that we're going to be -- if you want to call it an appraisal, doesn't even attempt to appraise his minority interest in -- in Joabert.

THE COURT: And Joabert is a development company that owns raw land that they're going to develop for residential?

MR. POWERS: Exactly.

THE COURT: All right.

MR. POWERS: And -- And while your Honor touched that point, the -- the appraisal that is done is rather unusual. It purports to be an appraisal that speaks to the future, and it's -- it has a future date. And it assumes that, somehow, this land is all finished-out and ready for sale and fully developed.

And it doesn't even purport to opine as to how much it would cost to do that.

THE COURT: You'll get your shot, Mr. Kahn.

Just be patient.

MR. KAHN: I can't object while he's saying something?

THE COURT: I'm -- This is only just

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

',._, 1 argument. So, you -- I ' l l I ' l l hear what you have to say in just a minute. This is not evidence at this point. You're just telling me what your position is.

4 MR. POWERS: Our position 5 THE COURT: And I understand you disagree with it. Believe me, I recognize that.

7 Go ahead, sir.

8 MR. POWERS: Anyway, your Honor, I don't think it's I don't even think it sustains a Daubert 10 challenge, would -- would withstand a Daubert 11 challenge, because it's so speculative.

12 But it's also irrelevant, because he doesn't own 13 any of the real estate. He owns, or purports to own, 14 a minority interest in -- in stock in the -- in the 15 company. He has no rights to put the stock. He has 16 no rights to, you know, require it be purchased. It's 17 just ...

18 And And his ownership of that stock is in 19 real doubt. He -- He was supposed to -- He -- He was 20 supposed to earn that stock through sweat equity in 21 doing engineering work on the project. He was fired 22 because he was not -- allegedly incompetent. And, so, 23 there's real questions as to whether he ever performed 24 the services to get that one/third minority interest. ;i 5 In addition to that -- And the appraisal -- or -~,.

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1 another reason the appraisal is just totally irrelevant, there's approximately four -- four-and-a-half million dollars of debt on the property. The appraisal didn't even take into account the debt on the property. And Mr. As Mr. Kahn knows, his arrangement was never that he would get paid before the debt, you know, if that company were liquidated. So, that's our position on that.

9 The lawsuits -- Your Honor is right. Part of this is to buy peace. I mean, we -- 11 THE COURT: I mean, let's be candid.

12 MR. POWERS: We'll be candid. That's what ,____, 13 it is. I mean, we -- Every time we turn around, there's some new lawsuit that gets filed, a speculative lawsuit. You know, they -- they -- they sue my law firm. They file motions for sanctions.

17 And whatever they want to do, I gather -- he wants to do, he just sits with his typewriter and does this.

19 And it's expensive. It's expensive to continue to keep coming down and having to argue these silly -- these silly lawsuits. And we want to just kind of buy peace and get rid of this. And that's what the $10,000 is for, because he doesn't have any assets.

24 I -- Again, I can't emphasize enough, the major creditor here is Helvetia. I mean, we're the one -- '-,

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 we're the ones who -- who stand to gain whatever assets there may be in this estate.

3 I also want to point out one other thing, your Honor. We filed a complaint with the Court to declare the judgments nondischargeable. And 6 THE COURT: The judgments that you took 7 against Mr. Kahn?

8 MR. POWERS: Yes.

9 THE COURT: Under what provisions of the 10 Bankruptcy Code?

11 MS. BARKLEY: Your Honor, Section 523 (a) (4) 12 and (a) (6).

13 THE COURT: So, breach of fiduciary duty -- 14 MR. POWERS: Right.

15 THE COURT: or defalcation, and (a) (6), 16 malicious -- willful and malicious injury?

17 MR. POWERS: Yes.

18 THE COURT: All right. What's the status of 19 that lawsuit? Do you know, Ms. Barkely?

20 MS. BARKLEY: We are drafting a summary 21 judgment based on collateral estoppel. And it should 22 be filed very shortly.

23 MR. POWERS: Hopefully -- Hopefully, today.

24 THE COURT: So, you A complaint was ~~ 25 filed. Mr. Kahn answered?

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~ 1 MR. POWERS: Yes.

2 MS. BARKLEY: Yes, your Honor.

3 THE COURT: All right. So, a scheduling order has been issued?

5 MS. BARKLEY: Yes. I believe so, your Honor. I think we have a deadline to amend pleadings within the next few days.

8 THE COURT: All right. So, this is the only complaint that you filed in the context of this bankruptcy case, is a dischargeability action against him?

12 MR. POWERS: That is correct.

13 THE COURT: And the relevance, it's just informational for me, or what?

15 MR. POWERS: Well, the relevance is that not only are we the -- by far and away the largest creditor, we have nondischargeable indebtedness here.

18 So ...

19 THE COURT: So you assert. I haven't made that determination.

21 MR. POWERS: So we assert. And we understand you have not made that determination. But we also think that the law in this district is pretty clear on collateral estoppel; that is that, when you have a final adjudication of this type of misconduct, '----../

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1 that it is, as a matter of law, going to be nondischargeable, which should 3 THE COURT: So, if I make the determination down the road that it is a nondischargeable debt--and I haven't looked at the complaint or the answer to that; I'm letting the process unfold--what does that do to any of this?

8 MR. POWERS: Well, in in a sense, I don't know that it does all -- Because, either way, we've got over $2 million worth of debt, whether it's dischargeable or nondischargeable, and by far and away the largest creditor of the estate.

13 THE COURT: Okay.

14 MR. POWERS: So, that's the -- That's, I guess, the major point there.

16 A few points about procedural points. The local rules, as your Honor knows, require that there be a witness list and an exhibit list exchanged five days before, and I think it's five business days before a hearing. That did not happen here. There was no witness list, there was no exhibit list.

22 We did get notice that he served a subpoena on his expert witness. And I think that notice was given to us sometime late Thursday, which is hard -- which I think is -- Let me see. Monday was a -- was a

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1 holiday.

2 THE COURT: Right.

3 MR. POWERS: So, I don't think that's five days. And, on top of that, no witness list was ever served. Okay? Just the subpoena. And, of course, no exhibit list was served, though he did attach that appraisal to his objections.

8 I want to make my objection that he has not complied with the local rules, because he has not.

10 THE COURT: On the exhibit list and the witness?

12 MR. POWERS: And the witness list.

13 THE COURT: All right. That's fine.

14 MR. POWERS: And I want to preserve that objection, your Honor. I know your Honor will probably want to hear from the expert. And, quite frankly, I don't want to give him another appellate point, you know. But I want to make this objection, nonetheless, because I do want to - - I don't want to give up that issue.

21 THE COURT: Okay.

22 MR. POWERS: Again, thank you, your Honor.

23 THE COURT: All right. Now, Mr. Kahn.

24 MR. KAHN: Thank you, your Honor.

25 I would like to start off saying that a lot of

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1 this information that Mr. Powers just said is '--' incorrect. Number one, 3 THE COURT: Is it -- Let's -- If I may, sir.

4 MR. KAHN: And I will go through it in 5 THE COURT: Wait. Just wait. No, no. The way this works is, when I ask a question, you stop talking and you answer my question.

8 MR. KAHN: Sorry, your Honor.

9 THE COURT: So. And you'll learn this if you go to law school. By the way, I teach at law school, too.

12 For your information, I want to know, you -- you should -- I hope you noted that I I sort of examined Mr. -- the Trustee in this case, Mr. Thomas, about a number of things. Do you disagree or contest anything that he told me?

17 MR. KAHN: Practically everything, your Honor.

19 THE COURT: Practically everything. Okay.

20 So, we'll need to deal with that, as well.

21 So, I just want to get that -- I know you disagree with Mr. Powers. You -- Basically, everything that Mr. Thomas said you disagree with, as well; is that correct?

25 MR. KAHN: well, there's a lot of things

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1 that Mr. -- what Mr. Thomas said that I can clarify, 2 THE COURT: Okay.

3 MR. KAHN: I would like to clarify.

4 To start off with, is that the many different companies and -- are not -- there is no more companies. They've all been shut down, so ... And there's no assets in any of them, so ...

8 THE COURT: There's nothing to sell?

9 MR. KAHN: There's nothing there.

10 THE COURT: All right.

11 MR. KAHN: Okay. The -- I have a chart which I submitted which I submitted to the -- in in my pleading.

14 THE COURT: Okay.

15 MR. KAHN: And if I may -- 16 THE COURT: Do you all have a copy of this chart?

18 MR. KAHN: They have a -- They have a copy.

19 MR. POWERS: Your Honor, no exhibits were exchanged.

21 THE COURT: Well, this is -- I view this as demonstrative evidence. So, do you have a copy of this chart?

24 MR. KAHN: In In the supplemental -- 25 MS. BARKLEY: No objection, your Honor. Let

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 me -- 2 THE COURT: Okay. So, we want to make sure -- I appreciate you putting this together. This is a chart of issues as of October 9th, 2014.

5 Do you have a copy of this, Mr. Thomas?

6 MR. KAHN: Yes. He -- He -- 7 MR. THOMAS: I got the same email that he -- 8 MR. KAHN: It's in the -- in the -- in the motion, itself.

10 MR. THOMAS: Supplemental motion.

11 THE COURT: All right. So, you all have this. So, I'm not treating this as an exhibit. I'm '--../ treating this as a demonstrative. ' 14 You're going to tell me about the assets in your case?

16 MR. KAHN: I'm going to tell you about -- 17 THE COURT: Are we picking him up, by the way?

19 ERO: Yes, sir.

20 THE COURT: All right. Go ahead, sir.

21 MR. KAHN: One of the -- They keep on talking about all these different cases, and I'm I'm going to -- to go over them slightly, and -- and also on the appeals process. Because, you know, if you recall, your Honor, I also filed an adver- --

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1 there was an adversary proceeding, of which, to start off with this guy here, who -- who only knows -- doesn't know to tell the truth, claimed that I stole over a million dollars out of Helvetia's funds.

5 THE COURT: Okay.

6 MR. KAHN: And, to answer that, in the answer of the adversary proceeding, I submitted every check, every for every bank account. And they -- So -- And an analysis of it, which I I will show which I which is also there, and it's also -- so that to show that this -- this is -- you know, this is being prosecuted.

13 One of the things that's in their -- in their -- in their motion is they claim I stole $60,000. And one This is one section. They have different ones.

16 THE COURT: Which motion are you referring to, Mr. Kahn?

18 MR. KAHN: In the adversary -- adversary proceeding.

20 THE COURT: If I may, the adversary proceeding's not before the Court. What's before the Court is this issue. The issue is whether or not the Trustee can sell these assets. You've objected.

24 MR. KAHN: Well, I have also I have also a -- a hearing for sanctions against him for a million

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1 dollars that's scheduled to be heard Tuesday, sir, on the 29th of this month.

3 THE COURT: Okay. And I don't think -- Mr. Thomas, is that part of what you're selling?

5 MR. THOMAS: I don't -- 6 THE COURT: I don't -- I didn't think so. 7 MR. THOMAS: I don't -- I don't think so, Judge. I was going by the schedules, the schedules that were filed in the case. And I think this sanction came up after it, as part of the adversary.

11 THE COURT: Is that correct, Mr. Kahn?

12 MR. KAHN: This -- This -- This came up The adversary proceeding -- 14 MR. THOMAS: Right.

15 MR. KAHN: -- you're involved in. And you've gotten -- You were noticed -- 17 MR. THOMAS: That's postpetition. Those 18 MR. KAHN: You were noticed about the adversary proceeding, and you were also noticed also noticed -- 21 I'm sorry, your Honor. And I'm also sorry about, sometimes I'm closing my eyes. I -- I've had some surgery. So ...

24 THE COURT: Well, that's all right.

25 So, but this -- this is -- this is a lawsuit you

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

·-~ filed after you filed bankruptcy; right?

2 MR. KAHN: No. No, no. No, wait a minute.

3 They filed an adversary proceeding.

4 THE COURT: 11 They," who is?

5 MR. KAHN: Helvetia.

6 THE COURT: Right. And that's the dischargeablity action against you?

8 MR. KAHN: Right. Then I came back, in my answer -- in my answer, I answered them. And then I made I also filed a motion for sanctions, let 21 days go by so that they could change it, or anything.

12 And I filed a motion for sanctions.

13 THE COURT: In the adversary proceeding?

14 MR. KAHN: In the adversary.

15 THE COURT: Okay.

16 MR. KAHN: But this is -- this -- this is a giant asset. Because in the adversary, I have, essentially, a thousand pages, over a thousand pages, you know, the checks, you know, the checks of each one of the people that I sent to, you know. So, the complete explanation of all the funds that I've sent, so that.I didn't steal any of the money.

23 The -- The -- With this -- As I was saying in that $60,000 example of one of the -- This is one of the examples. I needed -- I wrote a check out for -- '-__/

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1 for Mr. Ripley to get their -- their -- their 2 THE COURT: Okay. We're not trying the case. You've actually answered my question, which is, this is -- this is a pleading that you filed against Helvetia or Haynes and Boone asking for sanctions of a million dollars.

7 MR. KAHN: Right.

8 THE COURT: Mr. Thomas, does the Chapter 7 estate have an interest in that -- in that motion for sanctions?

11 MR. THOMAS: We do not, Judge, have an interest in the sanction motion filed in the adversary.

14 THE COURT: So, it's not an asset he's trying to sell, nor he's claimed any interest in.

16 So, it's -- it's not part of the motion today. If If you prevail on that, that's -- that's -- whatever accrues as a result of that, that's your money, it's not the estate's money.

20 MR. KAHN: Okay.

21 THE COURT: So, we don't need to get into that. I understand you filed the motion, but that's not part of what's before the Court today.

24 MR. KAHN: Well, one of the things, your Honor, that they -- they mentioned is -- was --

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 Let's go into the -- the sanction -- the sanction case.

3 THE COURT: The one that they -- that Haynes that Helvetia filed against you; correct, sir?

6 MR. KAHN: Helvetia filed against me. 7 THE COURT: Right.

8 MR. KAHN: I -- I am charged, under -- In Texas Civil -- Civil Remedies, Chapter 10, sanctions cannot be charged against a party who is represented.

11 I didn't sign that -- that -- that pleading, an -- an attorney signed the pleading. So, that is that is just, basically, major in that I -- I am not responsible for it.

15 Then, this is -- this is almost the same thing with the $60,000 that they played games with. Let me just clarify that, your Honor, because it's -- it's a typical situation that I have been plagued with throughout -- throughout these proceedings, which have gone on for over a year now.

21 I -- And -- But I hit the -- the button for $20,000 so I could pay so I can pay Mr. Ripley, Mr. Ripley's credit card. Okay? But I made a mistake and I -- it didn't come up to twenty, I hit it again and I hit it again. So, I hit three times.

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1 So, I took $60,000 out of Helvetia and put it into I believe I put it into Joabert because Joabert is the one who put spent the money. I don't know.

4 Then -- 5 THE COURT: But is this part of the lawsuit that's pending in state court?

7 MR. KAHN: Yes.

8 THE COURT: Stop. Stop. You're missing the essential point. I'm not going to make a determination on any of that. That's -- Don't Don't 12 MR. KAHN: Well, I'm not asking you to -- 13 THE COURT: Focus. Focus on what I'm trying to ask you.

15 So, the merits of those lawsuits will be determined by a state court. Do you disagree Listen to my question. Do you disagree that what Mr. Powers said about all of the lawsuits that you filed, that judgment has been entered against you?

20 MR. KAHN: Judgment has been entered against me, and it is on appeal, your Honor.

22 THE COURT: All right. So, i t ' s on appeal.

23 But right now, right now, as it stands right now, those -- those lawsuits are worth nothing, because you -.__/ lost. Would you agree with that?

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1 MR. KAHN: That's correct.

2 THE COURT: All right. So, your point is what on going through this rendition on the lawsuits?

4 They're on appeal. I understand that. You might get them reversed. But the value of the lawsuits right now is nothing.

7 MR. KAHN: Well, it's -- Well, that's that's because i t ' s in the negative -- negative amount.

10 Now, one of the things is, what they did on the same -- on the sanction motion hearing, which which I was unsuccessful on, the -- But it was -- Number one, it -- it was -- It's got all to do with this man named Daggett (phonetic).

15 THE COURT: You're arguing the merits again.

16 MR. KAHN: I I I I know. I'm just trying to 18 THE COURT: You're missing the point.

19 You're -- With all due respect to you, you're missing the point. My job, as it stands right now, is the Trustee's filed a motion before this Court, and says, Judge, I need to administer this estate, and here are the assets I need to administer.

24 He's described -- You've already agreed as to, ,_____,, 25 I have three categories of assets. I have interest in

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 small businesses. You've conceded that they have no value.

3 MR. KAHN: Right.

4 THE COURT: Then I have shares of stock, which we'll come to in a minute, in Helvetia and Joabert or Joabert. And then I've got all these causes of action, which we're talking about right now.

8 You've conceded that you've lost all of these cases.

9 You filed them and you lost. They may or may not -- 10 MR. KAHN: But But 11 THE COURT: Don't interrupt me. 12 They may or may not be on appeal. Their value as to -- What you need to understand, their value right now is zero. Despite the fact they're on appeal, they're final determinations. They're not worth anything.

17 So, what is it that -- What's the value to the estate?

19 MR. KAHN: The value to the estate is to Joabert, the shares in Joabert, which is worth $3 million.

22 THE COURT: Well, let's -- let's -- But I'm asking you about the causes of action. So, we've You've already said on the record -- 25 MR. KAHN: That's a -- That's a cause of

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'---/ action ending in 17012.

2 THE COURT: Okay.

3 MR. KAHN: And -- And that's where -- That -- That cause of action is is pending. And it -- In fact, it -- it is in this court, because the state court sent it over here. So, I don't know if we're going to get that heard in this -- in this court.

9 THE COURT: And state -- I can tell you this much. State courts don't send me anything. I send stuff to the state court.

12 So, what -- All we have right now is, we've got a dischargeability action pending against you. In the context of the dischargeability action, you've got a motion for sanctions against the plaintiff. If you prevail 17 You need to back away from that. You're a little close.

19 MR. KAHN: I'm sorry, your Honor.

20 THE COURT: If you prevail on the motion for sanctions, and you win any monetary relief, that's yours. I've already asked the Trustee. He says, I agree with you, Judge. That's yours.

24 So, again, we need to focus on what's before the Court. What's before the Court is a motion to sell

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

nonexempt assets. And, as best I can tell right now, you have no value in these businesses you've listed.

And all the causes of action, judgment has been rendered against you, they're final, they have no value, and you've moved to appeal them.

MR. KAHN: Not -- There's no cause of action -- nothing in 1701. The Joabert one has not -- has not been -- has not been adjudicated at all. And that's the -- That's where I might -- where I have the value of -- of at least $3 million, in round numbers.

THE COURT: All right. So, you -- you've sued Joabert, or Joabert sued you?

MR. KAHN: I sued Joabert.

THE COURT: Okay.

MR. KAHN: I sued Joabert, as a minority stockholder.

THE COURT: Go ahead.

MR. KAHN: ' And Based on that I was -- I was taken advantage of, THE COURT: Okay.

MR. KAHN: -- as a minority stockholder.

And that I had one/third -- There's -- There's three hundred shares; I own a hundred and Mr. Ripley owns two hundred. Now, that is the THE COURT: Where is that case pending?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

·.--._../ 1 MR. KAHN: It's dead. In other words, it -- it isn't pending at all. I wish I -- I'd like it to get pending. And -- And 4 THE COURT: What do you mean by •dead," sir?

5 MR. KAHN: I mean, it's -- it's here. It -- It's been stayed.

7 THE COURT: Okay. So, you're saying that you filed a cause of action against Joabert in this court?

10 MR. KAHN: No, not in this court, in the state court.

12 THE COURT: Okay. And are you the plaintiff or the defendant?

14 MR. KAHN: The plaintiff.

15 THE COURT: And what -- When you say "dead," what do you mean by •dead''?

17 MR. KAHN: It -- It was -- It was put into bankruptcy, and the -- the state court said it's now in -- into the bankruptcy court.

20 THE COURT: So, that's what the state court said?

22 MR. KAHN: That's what the state court said.

23 THE COURT: All right.

24 MR. KAHN: But they -- they -- If I can get a -- a lift stay and -- and have that heard, because

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 the -- the assets of the -- of the -- of the -- of the company, my assets, are -- are -- are related to Joabert.

4 THE COURT: Okay.

5 MR. KAHN: Now, I -- Also, there's a claim of action against the City of San Antonio that's been also stayed. And that one was something that the City raised the road -- raised their road up, and, because of that, there was some CP- -- some some pipes in the ground down below, and they had to be raised up.

11 And because of that -- Of course -- Of course, I don't want to plead the -- the litigation. But that's '-._/ Because Because of that, they -- they made a claim against me in -- for three thousand some-odd dollars for -- for the pipes that -- that were underground.

16 And I counter-claimed them for for all the fill and all the work that I had to do.

18 However, on my chart, I've reduced it because it's -- the -- the value -- the value on that lawsuit, one/third goes to me, one -- and two/thirds goes to Joabert. It belongs to Joabert, which would -- Joabert is -- Even though I'm the -- the -- the the defendant in that case, and the counter-plaintiff, the -- the actual benefit or cost was -- was Joabert's not Bert Kahn.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: Is the Trustee selling this cause of action to Helvetia?

3 MR. KAHN: Yes.

4 THE COURT: Which one is that?

5 MR. KAHN: That -- That is Counter- Counter-Claim 389092.

7 THE COURT: Okay. And you maintain that case is pending in our court, in bankruptcy court?

9 MR. KAHN: It -- It When -- When I filed bankruptcy, at the advice of my son, which was wrong, I shouldn't have done that, but at the -- at the 12 THE COURT: You can dismiss your case. Have you thought about that?

14 MR. KAHN: Pardon?

15 THE COURT: You can dismiss your case, ask the Court to dismiss your case.

17 MR. KAHN: I even -- I even said that to -- I sent, even, a memo Mr. Thomas at one point to dismiss this -- dismiss -- to dismiss the -- the the case, and he said no. 21 THE COURT: Okay. Well, I mean, if 22 MR. KAHN: I should have just filed it.

23 I -- I might seem to be trying to be an adversary, but I'm not, your Honor.

25 THE COURT: All right. So, let -- let's --

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 let me stop you -- 2 MR. KAHN: I'm just defensive.

3 THE COURT: Let me -- Let me stop you right here. We've checked. There's only The only The only related lawsuit that's pending in the United States Bankruptcy Court is the dischargeability action. No case has been removed here. So, there aren't any pending cases. If they're in state court, they're in state court, they're not here. So, I can't deal with those. They -- They're pending in another court.

12 So, back to my point. If they're "dead" right now, and they're not progressing, they have no value.

14 MR. KAHN: Well, how do I get them out of state court -- out of -- Can I file a motion right now to -- to 17 THE COURT: I can't give you legal advice.

18 You filed this case.

19 MR. KAHN: Well, 20 THE COURT: If you think -- If you need to take some remedy, that's something you'll have to decide. Is your son a lawyer?

23 MR. KAHN: Yes.

24 THE COURT: Then maybe you can talk to him.

25 MR. KAHN: But he doesn't know anything

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 about bankruptcy, except he told me to go to bankruptcy.

3 THE COURT: Okay.

4 MR. KAHN: So, 5 THE COURT: So, let me help you out.

6 We're - - With all due respect, we're moving on from the causes of action, because I can tell you right now, you notwithstanding your dispute as to the value of or legitimacy of these causes of action, they have no value right now.

11 Now, you've subpoenaed a gentleman to be here.

12 Who is this individual you've subpoenaed?

13 MR. KAHN: The man is a -- an appraiser who has appraised the property.

15 THE COURT: Which property?

16 MR. KAHN: The Royal Crest Subdivision.

17 THE COURT: Okay.

18 MR. KAHN: And he has - - he's recently appraised it. He has appraised this property previously, for Falcon Bank. That's why I chose him to appraise this property.

22 THE COURT: And why do I need to hear testimony from this gentleman?

24 MR. KAHN: Because he said the value of the property is nominally $12 million.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: So you say? Or he says?

2 MR. KAHN: He says.

3 THE COURT: All right.

4 MR. KAHN: Anc, also, in my lawsuit, where I worked out a cost analysis, it also comes out that the value at the -- at the present time is worth $12 million 7 THE COURT: Okay. And the point of this is what? Let's assume he's correct, just for discussion purposes. Why -- Why is that relevant to today's proceedings?

11 MR. KAHN: Well, then, that means I have an asset of $3 million. Actually, it's four million, but there's -- there's set-offs. So, let's say I have an asset of $3 million, which I show right here. It'd be three million one hundred and -- you know.

16 THE COURT: But you realize your ownership interest is contested, as to -- as it relates to that, first of all, and that the value is also contested?

19 You would recognize that?

20 MR. KAHN: The value is not contested.

21 THE COURT: It's not?

22 MR. KAHN: Who contests it?

23 THE COURT: Well, I mean, we have a -- You say it's part of the lawsuit, and the lawsuit has basically been -- you've lost.

FEDERAL COURT REPORTERE OF SAN ANTONIO (210) 340-6464

1 MR. KAHN: The lawsuit hasn't -- hasn't -- hasn't -- The Joabert lawsuit has not -- The Joabert lawsuit has not -- is not doing anything at the present time.

5 THE COURT: Okay. So, why do I need to hear testimony from this gentleman, who's sat patiently -- 7 MR. KAHN: Well, i t ' l l show that my assets are -- are are beyond -- a lot -- a lot more than $10,000.

10 THE COURT: Okay. So, this -- Does this relate to the lawsuit, sir, or your shares of stock in Joabert? '--/ 13 MR. KAHN: It relates to my shares of stock in Joabert.

15 THE COURT: Now, how much of a value did you place on the -- the shares of stock in Joabert on your schedules?

18 MR. KAHN: It's three million -- I have -- In the schedules, I had it a little -- it was a little bit different because I refined it down. It's three million -- Right now, it's $3,103,000.

22 I adjusted it because Mr. Ripley had taken $160,000 out of out of the -- out of the funds, and that would reduce -- reduce his -- his loan, which would -- you know, which -- which would make the

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 profit of -- of the -- Joabert a little bit more. So, I -- I adjusted that.

3 THE COURT: All right.

4 MR. KAHN: So, 5 THE COURT: So, I need to hear testimony from this gentleman because he's going to tell me that the value of this development is -- is $12 million, of which your share would be a little over $3 million; is that correct?

10 MR. KAHN: That's correct.

11 THE COURT: All right. So -- And how do And that relates to your shares of stock, and also maybe the lawsuit that you filed that you lost on; is that correct?

15 MR. KAHN: No. I didn't lose on it.

16 THE COURT: You didn't lose?

17 MR. KAHN: No. 18 THE COURT: What happened?

19 MR. KAHN: We lost on -- We -- We lost on -- on -- on Helvetia, or the Key Largo Subdivision, I've lost on. But I didn't -- Royal Crest, I have not lost on it. It has not -- has not been adjudicated.

23 THE COURT: Okay. So, what is it Let's -- Let's get to the essential point. Do you want me to deny the Trustee's motion?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. KAHN: Yes, your Honor.

2 THE COURT: Why?

3 MR. KAHN: Because I have -- Because the value is a lot -- worth a lot more than -- than $10,000, and the Trustee did not -- one, didn't didn't get any -- any other bids. And according according to some case law that I -- I found, Merry-Go-Round (phonetic) and Rose versus Logan (phonetic), it's supposed to be that the Trustee, to sell, has to do some due diligence, and to show that -- that there's -- that this is the highest and best price.

13 I can -- I can grab the -- the words on that, your Honor.

15 THE COURT: That's fine.

16 MR. KAHN: But it basically says that in two district court cases, Rose versus Logan and in Merry-Go-Round. So -- And that's in my 19 THE COURT: So, who else is going to buy these assets, if not Helvetia? Who's going to buy them?

22 MR. KAHN: You -- You mean, in in Joabert?

24 THE COURT: All of this stuff. Whether it's the causes of action, the interest in the business, or

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 the shares of stock, who else is in a position to buy these assets? You raised the question, well, he should have exposed it to a bid. So, my question to you is, who else would buy these assets?

5 MR. KAHN: Anybody -- Any developer would want to buy the assets to -- for -- for -- for Joabert.

8 THE COURT: Okay. What's the status of Joabert right now, in terms of development?

10 MR. KAHN: Pardon?

11 THE COURT: What's the status of Joabert right now, in terms of development?

13 MR. KAHN: It's in the - - They were not - -

14 Excuse me. I would - - Let me show you another picture here.

16 THE COURT: Okay.

17 MR. KAHN: This is Joabert, your Honor, or the Royal Crest Subdivision.

19 THE COURT: You can come around, Ms. Barkley, and watch. That's not a problem.

21 So, this is the development otherwise known as Royal Crest; is that correct?

23 MR. KAHN: That's correct. And this is the approved master plan that I did, that's getting approved by the city.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: Okay. And has it been approved by the city?

3 MR. KAHN: Yes, it has.

4 THE COURT: Have there been any lots that have been developed? I mean, have -- 6 MR. KAHN: There -- There are lots of -- The first section has got about $250,000 more work to be done to be complete.

9 THE COURT: And when you say "complete," what do you mean?

11 MR. KAHN: That -- That -- To be able to get final inspection and to sell lots. '--./ 13 THE COURT: All right. So, the -- Have all the entitlements been done?

15 MR. KAHN: What do you mean, "the entitlements"?

17 THE COURT: Well, the improvements. Do we have sewer lines in, electricity?

19 MR. KAHN: We have sewer lines, we have electric lines, we have 21 THE COURT: Have the roads been paved, curbs put in?

23 MR. KAHN: The roads have not been. That's the work that has to be done, the final. The road hasn't been paved and -- and the curbs haven't put

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 on -- been put on.

2 THE COURT: All right. And who's going to put that money in to have that done?

4 MR. KAHN: Well, we had that money. We had that money reserved, and that money was put into the registry of the court at one point.

7 Which court?

8 In the state court.

10 And then they claimed that

12 Who's "they"?

13 Helvetia.

14 Okay.

15 Which I object to Helvetia because it -- Helvetia is the -- the corporation, and it shouldn't even be here, and it shouldn't even be in -- in -- 19 THE COURT: They're a creditor, though.

20 They're a creditor of your case. They have two judgments against you.

22 MR. KAHN: Well, helvetia has that, but Helvetia doesn't really have standing. And we've You even ruled about that, I -- when I complained about, they're a foreign corporation.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: Oh, I remember this discussion. 2 So, 3 MR. KAHN: But I'm -- I'm not -- I don't want to relit- -- I'm not trying to relitigate anything, your Honor.

6 THE COURT: Okay.

7 MR. KAHN: But that that -- that issue, that particular issue, is in the Supreme Court right now, in regards to standing, and -- and -- and this whole process.

11 THE COURT: Okay. Well, let's put that aside.

13 So, what we have right now is, how many lots are ready to be developed?

15 MR. KAHN: Forty-seven.

16 THE COURT: And you've indicated that some entitlement work's been done, you've had 18 MR. KAHN: Not -- Most of it. Practically all of it.

20 THE COURT: Well, you'd recognize you've got to have paved roads. That's kind of a prerequisite to selling lots.

23 So, have the lots been platted?

24 MR. KAHN: Oh, yes. They're all platted.

25 THE COURT: All right. So, the question

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 then is, you just need the city's final approval before you could sell?

3 MR. KAHN: And -- And to put the I have to put the roads in, and the curbs in, and and then a couple of, you know, minor things. I've got to put the road signs in, which we own the road signs.

7 There's just a couple of little things I have to do.

8 THE COURT: So, but you mentioned there was $250,000 set aside for this. The money is tied up in the registry of the state court; is that correct?

11 MR. KAHN: It was, but but Helvetia took the money.

13 THE COURT: So, they have the money now.

14 So, there is not money, unless you have it, to do the development; is that correct?

16 MR. KAHN: If I get it, I can get the money.

17 I can go and borrow the money.

18 THE COURT: How are you going to borrow money? You're in Chapter 7 bankruptcy right now.

20 MR. KAHN: I'm going to -- From what -- I'm going to -- going to get out of that.

22 THE COURT: How are you going to do that?

23 MR. KAHN: I I wish I knew. I'm -- I'm going to file a motion to get out.

25 THE COURT: Okay. So, we -- Who -- Is

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 this -- Is this property being actively marketed? Is there -- I mean, is there a broker selling the lots?

3 MR. KAHN: What has happened -- What happened is that, when we were just about a month away, and I'm working on the final grades with the with the men in the field, they decided that they didn't want to pay me my -- my share, after working eight years on this thing. I did everything right.

9 It's been I'm the one getting -- We didn't hire anything. I did all the engineering work, all -- and all the -- all the "dog" work. And I never -- I never took any money, because I wanted to just leave any '~ money, and I put -- invested money. I invested over a hundred thousand dollars I had. And I didn't And I didn't take any money. And I'm working -- I'm working there at -- at 6:00 o'clock in the morning and -- and -- 18 THE COURT: So, are you working for Joabert, still? Are you an employee?

20 MR. KAHN: I -- 21 THE COURT: Are you an employee of Joabert?

22 MR. KAHN: Not at the present time, no. I don't - - I I was -- I I was a -- Was I an employee? I never collected any money, so ...

25 THE COURT: All right. So, you're not an ' .....__./

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 employee. Are you an investor in Joabert?

2 You need to back away from it. You're a little too close. Back away. Thank you.

4 MR. KAHN: Sorry.

5 THE COURT: That's all right. Go ahead.

6 So, you're not an employee of Joabert. Do you have -- Do you have some sort of -- You've got shares in Joabert; is that correct?

9 MR. KAHN: I -- We had a contract with Mr. Ripley, which is -- Joabert turned into a corporation because we thought that the corporation was the -- was -- the -- the format was 13 THE COURT: Are you an officer, or were you an officer of Joabert?

15 MR. KAHN: Absolutely. I was the vice-president.

17 THE COURT: Are you still the vice-president?

19 MR. KAHN: They -- They changed -- They changed it. They -- No. 21 THE COURT: All right. So, you're not an officer, you're not an employee. You 23 MR. KAHN: That's today.

24 THE COURT: Today. Listen to my -- I understand that.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 So, you have shares in Joabert. But as Joabert stands right now, all Joabert -- Joabert has is raw land and partially developed land; is that correct?

5 MR. KAHN: And an approved plat. We have an approved plat here, for this one, and an approved master plan. And practically all of this, the development has been substan- -- a good part of it is substantially done.

10 THE COURT: So, your only interest in Joabert, based upon what you've told me, is your hundred shares of stock?

13 MR. KAHN: Right.

14 THE COURT: And the only way that you're going to get anything out of that after -- There's debt in the case; correct? I mean, they -- they -- Joabert 18 MR. KAHN: Well, debt to - - debt to - - to Ripley and myself, who were the two owners.

20 THE COURT: All right. So, but there's there's debt. Didn't you Didn't Joabert borrow money to acquire this land?

23 MR. KAHN: No. 24 THE COURT: So, they bought the land outright?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. KAHN: Yes.

2 THE COURT: Not -- Not one bit of debt, at all?

4 MR. KAHN: Wait a minute. There is one debt, one -- one debt to Mr. Gatsby. If we sell When, and only when, we sell these -- some -- a few of those lots, there's -- there's a debt of -- of $250,000.

9 THE COURT: All right. So, you're representing to the Court that Joabert has no debt.

11 And you have shares -- You have a stock share interest in -- in Joabert; is that correct, sir?

13 MR. KAHN: That's correct.

14 THE COURT: All right. Now, you recognize that you're not going to -- Is it -- Or do you agree that you're not going to get paid anything on your shares until these lots are developed? I mean, there's no money to get out of the entity right now because nothing•s been built.

20 MR. KAHN: Well, no. It -- It's -- No. It There's electric. There's -- There's -- 22 THE COURT: No, I mean, homes. No homes 23 MR. KAHN: There's impact (indiscernible; simultaneous speakers) dollars, your Honor.

25 THE COURT: There's no homes that have been

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 built.

2 MR. KAHN: No homes -- There's -- No, no homes have been built.

4 THE COURT: Okay.

5 MR. KAHN: But there's -- there's -- there's the roads. There's -- There's impact fees of -- of at least $2 million that have been paid to the sanitary and water systems. So, the value of this is -- And all these -- all these roads -- all these roads have been carved in and graded -- and substantially graded out. A couple of roads over in here haven't -- The main road coming in is all graded up. It's -- It needs -- What it needs to do is, you know, we need to -- The plan was, is to sell this section, take the money and then -- you know, and -- 16 THE COURT: I understand.

17 MR. KAHN: and -- and forward it.

18 THE COURT: What's the name of the gentleman that you brought in as the appraiser?

20 MR. KAHN: Mr. Gary Mowrey.

21 THE COURT: Mr. Mowrey, could you come to the podium, please.

23 MR. MOWREY: Yes, sir.

24 THE COURT: Mr. Mowrey, are you here of your own volition this morning?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. MOWREY: I was subpoenaed.

2 THE COURT: All right. So, you're answering a subpoena.

4 What's -- What's your relationship -- First of all, give me your background. What kind of appraiser are you, sir?

7 MR. MOWREY: I'm a commercial real estate appraiser, I've been doing it for 25 years, with Stouffer & Associates.

10 THE COURT: All right.

11 MR. MOWREY: I appraise subdivisions, is one of my specialties. I've done it -- hundreds and hundreds of subdivisions.

14 THE COURT: Thank you. Did you appraise this property?

16 MR. MOWREY: Yes, I did.

17 THE COURT: When?

18 MR. MOWREY: April of this year.

19 THE COURT: All right. And who did you do the appraisal for?

21 MR. MOWREY: Mr. Kahn.

22 THE COURT: All right. So, he - - he engaged you to do an appraisal. And, so, you have -- you have an opinion as to value on this? ,_ 25 MR. MOWREY: Yes, sir.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: All right. So, you understand that you're here this morning. You've sat, and I appreciate it, very patiently through these proceedings. And you understand that the reason you've been If I let you testify--! haven't decided whether I'm not going to, or I'm going to allow you to do it--you're going to give an opinion as to value of the subdivision.

9 Now, the one thing I will let you answer right now is, you noticed I've asked Mr. Kahn lots of questions about the status of the development. Is his rendition accurate, that there has been -- that it's been platted, there's been some utilities in, but the roads still need to be constructed, curbs need to be put in? Is that accurate?

16 MR. MOWREY: I'm not an engineer, but I believe that's accurate.

18 THE COURT: All right. There -- There are -- Are -- There are not any lots for sale right now; is that correct?

21 MR. MOWREY: Correct.

22 THE COURT: All right. Thank you.

23 Could you step away for a moment, please?

24 Thank you.

25 So, do you want to -- Do you want to put -- You

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 said he's costing you money. Do you want to put his testimony on?

3 MR. KAHN: Yes, your Honor.

4 THE COURT: All right. And he's going to give testimony as to what?

6 MR. KAHN: As to the value of -- of -- The as-is as-is value of the -- of the -- of the property right now.

9 THE COURT: Okay. And you're -- Let's be clear. Your interest in -- in the property is derived from your stock -- ownership of shares of stock in Joabert? -...___/ 13 MR. KAHN: That's -- That's correct.

14 THE COURT: All right. Yield the podium.

15 I want to hear from the other parties, please. If you'll step away. Take your -- Take your drawings, if you could, please.

18 All right. Mr. Powers.

19 MR. POWERS: Yes, your Honor.

20 THE COURT: So, you've raised the objection that that Mr. Kahn is not in compliance with the local rules, that he -- he did not provide you a witness list nor an exhibit list five days in advance, as prescribed under the local rules, as to the gentleman testifying and also his appraisal; is that ~--

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 correct?

2 MR. POWERS: That is correct, your Honor.

3 No witness list or exhibit list was exchanged.

4 THE COURT: All right. So, I ' l l deal with that in just a minute. So, let's back up.

6 What is your understanding, I'm asking for your opinion, of Mr. Kahn's interest in Joabert?

8 MR. POWERS: He claims to have a one/third interest in the equity of Joabert.

10 THE COURT: Okay.

11 MR. POWERS: Okay? Not in the land.

12 THE COURT: I understood that distinction.

__ '-- / 13 MR. POWERS: Okay. And, your Honor, I -- I don't know if he was under oath just now when he was saying about 16 THE COURT: I didn't swear him in, I just asked him some questions. You're right.

18 MR. POWERS: When -- About the property -- 19 MR. KAHN: I tell the truth.

20 THE COURT: Don't interrupt. You'll get your chance, Mr. Kahn.

22 Go ahead, Mr. Powers.

23 MR. POWERS: You asked questions, I think, about the debt on the property.

25 THE COURT: Right.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. POWERS: I have, in my hand, Mr. Kahn's state court action, which has been dormant in state court for some time, against Joabert Development Corporation, because nobody will prosecute it. And 5 THE COURT: Is he the plaintiff in that case?

7 MR. POWERS: He's the plaintiff in that case.

9 THE COURT: Is there a reason why the case isn't going forward?

11 MR. POWERS: None that I know of, because it's not stayed by this Court.

13 THE COURT: Correct.

14 MR. POWERS: And the Trustee, if he -- if he thought it had value, would have intervened as the plaintiff, and I don't hear him 17 THE COURT: Let me -- Maintain your thought. I want to acknowledge on the record that your -- your recitation of the law is correct. The stay does not preclude the Debtor from bringing causes of action against other parties. Further, to the extent that this is a cause of action that belongs to the estate, the Trustee has the right to intervene and take over control of the lawsuit, and he has not done that.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 So, please continue.

2 MR. POWERS: That is correct, your Honor.

3 And, for the record, that is Cause Number 2013, Prepetition Lawsuit Cll7012.

5 But in this pleading filed by Mr. Kahn, he says, the outstanding debt, which is understated, but he admits the outstanding debt, he says, the property is encumbered, total outstanding, $3,377,000.

9 THE COURT: Is there a lien on the property, to your knowledge?

11 MR. POWERS: Your Honor, I don't know if there -- if it's actually -- I don't know. I don't know if there's a deed of trust on it. But I know that the debt on the property -- The property had to be acquired, it had to be developed, it had to be 16 THE COURT: That's why I ask the question.

17 MR. POWERS: Yeah. So, that's why that -- that -- So, there's indebtedness, and there's loans on the property. And even the document through which he claims a one/third interest in the equity acknowledges that all debt has to be paid before he gets a dime.

22 So, that's -- that's point one.

23 With respect to this opinion, I again, I don't understand the relevance of it because, one, it's not an opinion as to the value of his shares, which is the

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 only thing relevant in this case, and that is, what is the value of a minority interest in an undeveloped real estate project. And that -- And, so, his opinion does not -- does not go to any germane issue here.

5 Number two is that the property, itself, he doesn't appraise the property as it is, in its current condition, he appraises it as a completed project.

8 Nor does he opine as to how much it would cost to get the project to be completed. And, as he admitted to the Court, he's not an engineer, he doesn't know how much it would cost to get the thing completed.

12 So, what he has given is a speculative opinion about what the property might be worth, if it were developed, which it is not, and he has no opinion as to the cost of the development.

16 He also gives no opinion as to the debt that's on the property or the indebtedness that has to be paid with respect to the corporate obligations to repay that debt with respect to the improvements to the property.

21 So, I I -- Also, your Honor, I for what it's worth, we do have an offer that was made on the property for -- as- as-is, which, for whatever reason, was not done. It was like, I think, four million dollars.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: I'm sorry. Say that again?

2 MR. POWERS: Four million -- Four million dollars as-is.

4 THE COURT: The statement before, that you said something prior to your statement about the four million dollars.

7 MR. POWERS: Well, I don't know why it wasn't taken into account, into the opinion but -- of the property -- real estate. But there was an offer for the property, and we have a written offer from -- 11 K.B. Homes, is that who it is?

12 K.B. Homes, which is 13 THE COURT: Who has a written offer?

14 MR. POWERS: We do, for -- for -- Joabert does, for $4.5 million, as-is.

16 THE COURT: Is -- Is -- Is Joabert your client?

18 MR. POWERS: Joabert's a client, yes.

19 THE COURT: Okay. And how -- how do you represent them? How did you come to represent them?

21 MR. POWERS: I represent the -- John -- John Ripley and Bob Ripley are brothers. Bob Ripley owned the Helvetia project, John Ripley owned the other project.

25 THE COURT: The Joabert project? ·-~

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. POWERS: The Joabert project.

2 THE COURT: So, that's how you came to represent both of them?

4 MR. POWERS: Yeah. Both of them.

5 THE COURT: Okay. Now I understand.

6 MR. POWERS: And -- And, so, the point of all this is, your Honor, that you've got all this debt on the property, it's not complete, i t ' s not has to be finished out, nobody's offering to finish it out to get it into final form.

11 He doesn't have rights in the property, to begin with. His claim to stock ownership is -- is nebulous, and in dispute. There's been a lawsuit to try to establish his interest, that's been pending for some time. Nobody -- The estate doesn't have the assets to prosecute that frivolous piece of litigation. Nobody has stepped up to take it. They can't find a lawyer who would do it.

19 And I guess that's all I have to say about that, your Honor.

21 THE COURT: All right. What's -- Mr. Hang on.

23 Mr. Thomas, do you have any position on this?

24 MR. THOMAS: Judge, I wouldn't have anything to add.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: What is the total debt in this case; do you all know?

3 MR. POWERS: our debt is 2,300,000. And the -- And the rest is, kind of, credit card debt, isn't it?

6 (Sotto voce exchange.)

7 MR. THOMAS: Judge, he's -- he's listed 304,000 unsecured debt.

9 THE COURT: Okay.

10 MR. THOMAS: He didn't take into account -- And that's where I came up with my percentage. So, he didn't take into account a lot of the corporate debt.

13 THE COURT: Okay. And what's the amount of the assets in the case?

15 MR. THOMAS: He's stating the value of the lawsuits and the interest in the corporations at $5,470,729.

18 THE COURT: All right. Thank you. Thank you.

20 So, I need to hear -- Go ahead. Did you want to say anything else, Mr. Powers?

22 MR. POWERS: I just wondered, am I through?

23 THE COURT: Yes, you're through.

24 So, Mr. Kahn, you want me to hear from this gentleman. He's going to give an opinion of value?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210} 340-6464

1 MR. KAHN: Well, I'd like to get something straight in regards to the -- in regards to the debt -- 4 THE COURT: Okay.

5 MR. KAHN: -- that I listed and that we had, is Mr. Ripley Ripley's -- in -- in the contract that we had that was -- which turned into the -- to the -- basically, a partnership agreement that turned into a stock corporation, was that Mr. Ripley would supply all the money and I would -- I would do all the work, in very simple terms.

12 Mr. Mr. Ripley's put in something like '-.

13 $2 million, over $2 million in properties. And that's what -- That's the money we used to -- that I used to buy all this property up, buy the property and -- and and then start to develop it, and pay all the people that were there.

18 The So, this -- this grand There was no other -- The only other debt, as I stated, was that, in one section of the -- of the property, it went -- it -- when that sold, there was a debt of the $250,000 to Mr. Harold Gatsby. But, otherwise, the -- 23 There's also a debt owed to me of a hundred -- a hundred thousand dollars, because I put that money in to -- to -- to get this thing started, so... But

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 there is no nobody else.

2 As far as K.B. Homes, K.B. Homes was trying to buy this property before we even -- even had the the master plan. And -- And they -- they had a bid of five -- They were going to pay something like, I think it was five or six million, five million dollars. It was -- It was even more than that. It was -- It was somewhere -- Oh, for a certain section. It was somewhere around $5 million before we did too much an awful lot more work.

11 There's now -- A bid of 4.5 is another one of the baloney that this man is always -- 13 THE COURT: You didn't accept the offer of five to six million dollars, did you?

15 MR. KAHN: No. 16 THE COURT: So, i t was -- That's all it was, was an offer.

18 MR. KAHN: Okay. And now he's saying that after after we did that, and -- and the impact fees changed from -- from, like, five -- a million dollars to two million dollars, that we're going to take 4.5 million.

23 THE COURT: All right. So, let's 24 MR. KAHN: There -- There is 25 THE COURT: Let's get to the matter at

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 hand. I've -- Did you, in advance of the hearing today, one, provide a copy of the appraisal to counsel for Helvetia and the Trustee?

4 And, two, did you identify -- What's the gentleman's name again? I'm sorry?

6 MR. KAHN: Mr. Mowrey.

7 THE COURT: Did you identify Mr. Mowrey as a potential witness for the hearing today?

9 MR. KAHN: Yes, I did.

10 THE COURT: When?

11 MR. KAHN: I -- I sent -- When I -- When I -- When When I got the subpoena, and when the subpoena was issued, which was -- I believe it was last last Thursday. So, it's six days that that that he's had it. He doesn't want to -- 16 So, 17 THE COURT: Well, let's -- let's look.

18 We have -- With the Court, we have your supplemental objection. I don't see -- The motion to sell was filed on August 29th, so that's some time ago. Then you filed an objection on September 17th.

22 Then the Court, on September 22nd, set the hearing for today. You moved to continue; I denied that at the hearing. Then you filed a supplemental objection.

25 Where is your exhibit list or designation of

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 witnesses, because it's not of record with the Court?

2 MR. KAHN: I didn't supply one, your Honor.

3 THE COURT: All right. So, how -- What proof do you have that you -- you sent to opposing counsel and the Trustee a designation of exhibits and witnesses?

7 MR. KAHN: I -- I sent -- I sent them in the -- In my motion, I attached the exhibits.

9 THE COURT: Okay. And did that include Did that include the appraisal?

11 MR. KAHN: The appraisal and -- Yes. I The appraisal, it included the appraisal, and the chart that I just showed you.

14 THE COURT: Right. What about designating Mr. Mowrey as a witness?

16 MR. KAHN: I -- My designation was that -- that, I sent them a copy of the subpoena before -- I sent a -- the copy of the subpoena not on Thursday, on Wednesday, a day before.

20 THE COURT: Wednesday of when? Last week, sir?

22 MR. KAHN: Last week. Yes, sir.

23 THE COURT: Do you have proof of that?

24 MR. KAHN: I -- I -- I have it in an email. '..._...___...,-- 25 THE COURT: Okay. Do you all dispute that,

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 that he, one, attached a copy of the appraisal with his motion; and, two, sent you a copy of the subpoena last Wednesday?

4 Ms. Barkley?

5 MS. BARKLEY: Your Honor, we did get a copy of the Stouffer appraisal. But I believe--and I can show you in an email from my secretary--that we got the subpoena on Thursday.

9 MR. KAHN: Oh, then it got There's 10 THE COURT: Of last week, Ms. Barkley? Is that correct?

12 MS. BARKLEY: Yes, your Honor.

13 MR. KAHN: Oh. Then that's when I got it served. So, it was last Thursday, they got the copy of the subpoena, sir.

16 THE COURT: Okay. So, what I ' l l do is, for purposes of the record, I under- -- your objection is noted. I'm going to rule the over objection (sic).

19 I'm going to take testimony from Mr. Mowrey.

20 Now, let -- let me caution you. If the -- the testimony that you're eliciting is not focused and relevant, I will cut you off. And i t ' l l -- i t ' l l be real short. So, I want you to focus on what it is.

24 Now, you're going to have to demonstrate to the Court -- Because you have a standing problem in this

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 case. And -- And the law, frankly, is pretty clear.

2 I had one of my law clerks look because, you know, they -- they're smart. And there's a case on point that talks about as follows: The Chapter 7 debtor is a party in interest and has standing to object to a sale of assets or otherwise participate in litigation surrounding assets of the estate only if there could be a surplus after all creditors' claims are paid.

9 This is a Second Circuit opinion, In re: 60 East 80th Street Equities, Inc., 218 F.3d. 109, Second Circuit, 2000.

12 I don't know if there's a case on point in the Fifth Circuit, but you are not the first Chapter 7 pro se debtor I've had where there's been an objection raised to a sale of property.

16 So, you need to establish that your interest in Joabert exceeds the amount of the claims in this case. And if you can't do that pretty quickly, I'm cutting you off and the hearing will be over.

20 So, we're going to take a five-minute recess, and then I'm going to hear from your witness.

22 MR. KAHN: Thank you, your Honor.

23 THE COURT: All right. Short recess.

24 COURTROOM DEPUTY: All rise.

25 (Recess.)

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowre - Direct

1 THE COURT: All right, Mr. Kahn. You can call your witness.

3 MR. KAHN: Mr. Mowrey, please take the -- take the witness -- 5 THE COURT: Mr. Mowrey, will you come forward please and appear in front of Ms. Gutierrez?

7 She's going to administer the oath, sir.

8 (Witness sworn by the Courtroom Deputy.)

9 COURTROOM DEPUTY: Would you please state your first and last name, spelling your last?

11 THE WITNESS: Gary Mowrey, M-0-W-R-E-Y.

12 THE COURT: M-0-W ...

13 THE WITNESS: ... R-E-Y.

14 THE COURT: Thank you.

15 You may proceed, Mr. Kahn.

16 MR. KAHN: Thank you, your Honor.

17 DIRECT EXAMINATION BY MR. KAHN: Q. Good morning, Mr. Mowrey.

20 I had -- Did you make an appraisal of the Royal Crest Subdivision in and around April of this year?

22 A. Yes, sir.

23 Q. What did you ~- What did you consider as, as-is, the the value of that property?

25 MR. POWERS: Objection; no predicate.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrey - Direct

1 THE COURT: Sustained.

2 You're going to have to develop, sir, how he reached his conclusion as to the value. You simply can't ask him that. You've got to go through and ask Mr. Mowrey how he reached his conclusion on value.

6 MR. KAHN: Okay.

7 Q. (By Mr. Kahn) Mr. Mr. Mowrey, do you have a standard procedure in your -- when you appraise real estate subdivisions?

10 A. Yes, sir.

11 Q. Could you please state what the -- that procedure is?

13 A. We estimate the current as-is value of the lots, as if they were developed. Then we estimate the absorption period that it would take to sell these lots to builders. We do a discounted cash flow over the estimated absorption period, come up to a net present value after subtracting expenses to develop the property. And the conclusion is prospective value upon completion of construction.

21 Q. And did - - 22 THE COURT: Is that of all the lots, sir?

23 THE WITNESS: Yes. That's 444 lots.

24 THE COURT: Thank you.

25 Go ahead, sir.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrev - Direct

1 Q. (By Mr. Kahn) And did you follow those rules when you made the appraisal of the property?

3 A. They're not really rules, but procedures, yes.

4 Q. Procedures. Yes.

5 And I see in the -- the appraisal that there's the location and similar lots and a -- and a copy of the master plan in it. Did you -- Did you -- With your calculations, did you arrive at a -- an as-is A. Under prospective value upon completion of construction, of eleven million eight fifty.

11 MR. POWERS: Objection, your Honor; nonresponsive. The question was as-is.

13 THE COURT: All right. Can you -- Can . __, you Sustained.

15 Q. (By Mr. Kahn) What is the as-is value of that property?

17 A. We didn't do an as-is value of that property. We did a prospective value upon completion of construction.

20 Q. Well, it says here a prospective value of -- 21 THE COURT: When you say "here," what page are you referring to?

23 Do you have an objection, sir 24 MR. POWERS: I was just -- I was waiting for him to finish his question. "-__;'

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrey - Direct

1 THE COURT: All right.

2 THE WITNESS: It's on the third page, prospective value, market value opinion, September 1.

4 We did the appraisal as -- in April. We assumed a six month construction period, and a completion date in September to start the construction -- or to finish the construction of Phase One, and each phase would roll after that.

9 THE COURT: All right. So, Phase One is how many lots, roughly?

11 THE WITNESS: I don't remember.

12 THE COURT: All right. That's fine, if you don't.

14 Q. (By Mr. Kahn) I show you this -- 15 THE COURT: Okay. You can't go to -- Can you put it right there, sir?

17 MR. KAHN: Yes, sir.

18 THE COURT: can you see it from there, Mr. Mowrey?

20 THE WITNESS: I've got an exhibit of that in my appraisal.

22 THE COURT: All right. Go ahead, sir.

23 Q. (By Mr. Kahn) Yeah. The phase one, A. Yes.

25 Q. -- it says how many lots -- Well, does the phase

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrev - Direct

1 that -- Pardon me. The phase that we did was not " ._, Phase Three. We did Phase Three first.

3 A. That's 49 lots in Phase Three.

4 MR. POWERS: Objection; leading.

5 THE COURT: All right. I ' l l overrule that.

6 That's fine. Please continue.

7 Q. (By Mr. Kahn) Now, when you -- I'm -- I'm a little confused on the point of -- If the -- If you sold the property -- If -- If the market value that you -- What is the market value of that property to sell right now?

12 A. Prospective value upon completion of construction is eleven million eight fifty.

14 MR. POWERS: Objection; nonresponsive.

15 THE COURT: Sustained.

16 May -- If I may intervene.

17 Mr. Mowrey, is it accurate to say that you do not have an opinion as to the present value of the property as-is today?

20 THE WITNESS: The net present value upon completion of construction is what I conclude. I don't have an opinion of the as-is value today.

23 THE COURT: Right. And the reason that you can't give an opinion as to the as-is value is why?

25 THE WITNESS: It was beyond the scope of my ·~~

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrey - Direct

1 appraisal.

2 THE COURT: Thank you.

3 THE WITNESS: I wasn't -- I wasn't asked to do that.

5 THE COURT: All right. So, you can't ask him -- He -- What -- Let me just intervene. I've heard probably a couple hundred appraisals since I've been on the Bench.

9 Which governs -- What set of standards governs, sir, how you may conduct an appraisal?

11 THE WITNESS: The Uniform Standards of Professional Practice.

13 THE COURT: Right. And USPAP is, I think, how we refer to it?

15 THE WITNESS: USPAP.

16 THE COURT: USPAP, as I understand it in listening to many appraisals, will not allow you to testify as to an opinion on which you didn't base your appraisal. Is that correct? I stated that wrong.

20 You can't give an opinion on value if you didn't give an appraisal to that effect?

22 THE WITNESS: Correct.

23 THE COURT: Is that correct?

24 THE WITNESS: That's correct.

25 THE COURT: So, you can't ask him about what

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464 Mowrey - Direct

1 the value is today. The only thing that Mr. Mowrey can give an opinion on is what the value is of the property fully developed. Is that correct, sir?

4 THE WITNESS: Yes, sir.

5 THE COURT: So, you have -- He's not -- It's not he's not qualified, that he doesn't have the requisite training or skill. But he -- he can't give you an -- He can't give an opinion as to value as to the property as it exists today. He's governed by certain ethical I ' l l use -- 11 May I use the word ethical? Would that be correct, sir?

13 THE WITNESS: Standards.

14 THE COURT: standards. And he can't violate those standards as an appraiser.

16 MR. KAHN: I -- I wouldn't -- I wouldn't ask him to.

18 THE COURT: I know you wouldn't. But you -- you understand the point of why I've intervened. You can't -- He can't give an opinion of value as it exists today.

22 MR. KAHN: Well ...

23 Q. (By Mr. Kahn) Now, you -- you -- 24 MR. KAHN: Well, that's all the questions I have for him, your Honor.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: All right. Thank you.

2 One moment, sir.

3 Do you have any questions of the Witness?

4 MR. POWERS: Your Honor, just -- a lawyer always has to ask a few questions, just for appearance 6 THE COURT: Think about that.

7 MR. POWERS: Okay.

8 THE COURT: Think carefully about that.

9 You -- You can ask questions.

10 MR. POWERS: I have no questions, your Honor.

12 THE COURT: Mr. Thomas, do you have any questions?

14 MR. THOMAS: No, Judge.

15 THE COURT: All right. Then -- With no further questions, then you don't get a chance to Redirect.

18 May I excuse Mr. Mowrey?

19 MR. POWERS: Yes, your Honor.

20 MR. THOMAS: Yes, your Honor.

21 THE COURT: Mr. Kahn?

22 MR. KAHN: (Inaudible.)

23 THE COURT: Mr. Mowrey, I appreciate your patience, and thank you for being here.

25 THE WI'l'NESS: 'I'hank you.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 THE COURT: All right. So, Mr. Mowrey was unable to give an opinion because he wasn't asked to give an opinion of the as-is value of the property.

4 He can only give a prospective opinion.

5 As a result, Mr. Kahn, you have not established what the value of Joabert is -- or -- or Royal Crest is today. So, you do not have a pecuniary interest in this case. And as a result, you don't have standing to object to the motion to sell.

10 So, for purposes of the record, I'm going to make the finding that, given that the Debtor has not established that there is a value that exceeds the debts in this case, let alone the debt against Royal Crest property, that he does not have a pecuniary interest in this motion to sell.

16 So, I'm going to overrule your objection and grant the motion to sell.

18 MR. KAHN: Your Honor? Your Honor?

19 THE COURT: We're done. We're done. I gave you your chance. You can't establish 21 MR. KAHN: (Indiscernible.)

22 THE COURT: Don't interrupt me. Do not interrupt me. Let me Let me -- Let me help you out and just tell you this.

25 I have been exceedingly patient this morning.

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 I've afforded you the opportunity to present your case. Once you were unable to present that there was any value that could be established as to the as-is value of the Royal Crest property today, you don't have standing to object to the motion to sell. So, 6 MR. KAHN: Do I -- Do I have an opportunity to take the stand myself?

8 THE COURT: No. Because you -- you offered expert opinion, and you can't establish the value.

10 I'm not going to let you testify as to what you think the value is because, while a debtor can do that, the reality is, I find that your testimony won't be credible on that point because you have an inflated opinion about what value is that's contradicted by the fact that the appraiser couldn't give any value.

16 MR. KAHN: Well, in in -- in the pleadings, 17012, that the it goes -- it is outlined exactly what -- what the -- the cost -- the value is, which was approximately $12 million.

20 THE COURT: I understand that. And -- And let me -- let me be as precise as I can.

22 There were three categories of assets the Trustee is seeking to sell this morning: Shares in Helvetia, 25 Is it Joabert?

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 MR. KAHN: Joabert 2 THE COURT: -- Joabert; causes of action that you have filed as the plaintiff, Mr. Kahn; and then your interest in several business entities.

5 You acknowledged on the record that, as to business entities, they've either closed, ceased operations or have no value.

8 MR. KAHN: Right.

9 THE COURT: As As to the causes of action, all those causes of action, you've lost, as the plaintiff, several matters on appeal. There is Fifth Circuit precedent that recites, notwithstanding the pendency of an appeal, a ruling by a trial court is a final judgment. So, I can ascribe a value to those causes of action, and I ascribe a value of zero.

17 That leaves only the shares of stock in Helvetia and Joabert -- or Joabert. Forgive me. As to Helvetia, accepting as true your listing of value of your share -- a thousand shares of stock of $685,000, you would still have to demonstrate to the Court that your interest in the other entities, the Royal Crest property, when added to that value, exceeds the amount of debts in this case. It doesn't.

25 So, for purposes of the record, I'm first going

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 to find that you don't have standing based upon my conclusion about value. And I'm also going to find that your objections are not well taken.

4 So, Mr. Thomas, the motion is approved.

5 MR. THOMAS: Thank you, Judge.

6 THE COURT: All right. We're done.

7 COURTROOM DEPUTY: Order in the file?

8 THE COURT: Order -- May I sign the order in the file?

10 (Sotto voce exchange.)

11 MR. KAHN: Your Honor, I -- 12 (Sotto voce exchange.)

13 MR. THOMAS: I'll let them look at it first, ~ - -- your Honor, you know, and then ..

15 THE COURT: All right.

16 MR. KAHN: I -- I do object, and I will appeal it.

18 THE COURT: Your appeal -- You may -- You certainly, as a litigant, have the right to appeal.

20 And I've explained my reasoning on the record. You can certainly, if you want, have the District Court consider the Court's ruling. But for purposes of this morning, I've made my decision.

24 MR. KAHN: Now, whether "-.....,_.....

25 THE COURT; We're -- We're done. When I

FEDERAL COURT REPORTERS OF SAN ANTONIO (210) 340-6464

1 make a ruling, we're done, sir. You're excused.

2 Ma'am?

3 COURTROOM DEPUTY: (Indiscernible?)

4 THE COURT: No. He didn't ask for them to be admitted. You may return them to him.

6 All right. Thank you.

7 MR. POWERS: Thank you, your Honor.

8 COURTROOM DEPUTY: All rise.

9 MR. POWERS: Thank you for your time.

10 (Recess.)

11 ************ I, Court approved transcriber, certify that the foregoing is a correct transcript from the official ~- electronic sound recording of the proceedings in the abo¥e-entitled matter.

L / /- .J-/5 ," Signatl:J,re of Approved Transcriber Date '-._____./ Darla Messina Typed or Printed Name

----

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41111.· ~'.4) ·Sp.()nsored v Everything you hive ever w,:i,ntedto know_about P5ciriatic Ar:thriti-s. All on... ~·~t 5"""1 ciisil D Robert Wa:hsmutl Burt· Kahn's Banb'"uptcy Dear Bob: Thanks. for your pron-ipt respon.se. Yes 800AM Trash (4661 Yesterday :~,smart Vlews·- R~•rt.V~~.1~;;,}~J~;~;:);\ :::r,,~~~t:;~~~..i:°'d~i~hi~ l.;;'.f~~:~r.i;~~·<;e,iit~:'.i:~;~~:_,;~,·.!»'.:: 'Ahct.:;:ii;: :!y llll!i0 i:tanl Burt Kahn B•nkruptcy (2) [ Pecple [ ~Or¢~d 1 "'' '." ,J!ijij,,j!i'iif!!llm!ll!f!lh!f!!!!iilihf!/il,lil!i!!Fi!!iE'-!ILFllL!l\H!ljlli!L·Pi.i!l!hii!ll!1-).l ,IL 1.11!.!U!,liil I 1.11 ,J!!(i!i!!J!IUlliH!llftlll!!!l!!!d!!fllll!!!ilil!liiii!!f!!!Jl!i.!*iiiJ!!iip!fi!,!il!!iiiil lllllLl!ll\i!l!iliHl.\/ii!lill!!.!!!H!f l~'r''T..,_ Starred Dear Bob: !>~9pl~ Did you ever get notice of this sale_ Jfoqal Thanks for your prompt response_ traVel· Burt

TRUSTEE MOWN•.•. pdf Viei,, Download v Print https://us-mg204.mail. yahoo. com/neo/launch? .rand=cotaptl 2ekb8g

Subject: RE: Burt Kahn Bankruptcy From: [email protected] ([email protected]) To: [email protected]; Date: Monday, August 31, 2015 0:00 PM

I had notseen this. Is the Trustee selling your cause of action against Robert on the Southside(?) development?

Robert W. Wachsmuth Robert Wachsmuth & Associates S\VBC Tower; Suite 707 9311 San Pedro Ave. SanAntonio, Texas 78216 Telephone: (210) 342-2707 Facsimile: (210) 342-2701 Email: [email protected]

CONFIDENTIALITY NOTICE: This e-mail and any attachments are for the exclusive and confidential use of the intended recipient. If you are not the intended recipient, please do not read, distribute, or take action in reliance upon this message. If you h:::i.ve: rf':~e:lve:d this in e:.rrnr, plP.~SP. notify 11s imme:di:::s.tP.ly hy rehirn f':-m~il ::lnd prnmptly rie:lP.tP. this mess~ge: :::i.nrf its ::ltt.::u:hmf':nt~ frnm your computer system. We do not waive client-attorney or work product privilege by the transmission of this message.

From: Burt Kahn [mailto:[email protected]] Sent: Monday, August 31, 2015 3:32 PM To: [email protected] Subject: Burt Kahn Banlauptcy

Dear Bob: Did you ever get notice of this sale.

Thanks for your prompt response.

I of 2 91112015 8:01 AM Print https://us-mg204.mail. yahoo.com/neollaunch? .rand=cotaptl 2ekb8g

Burt

2 of2 9/112015 8:01 AN EXHIBIT 6 Print https://Us-mg204.mail. yahoo.com/neo/launch?.rand~cotaptl 2ekb8g#424 ...

Subject: RE: case 14-50980 GAG From: Johnny Thomas ([email protected]) To: [email protected]; Cc: [email protected]; Date: Thursday, March 19, 2015 1:54 PM

No money can be distributed until your appeal is finished.

Johnny W. Thomas Johnny W. Thomas, Law Offices, P.C.

1153 East Commerce San Antonio, Texas 78205 210/226-5888 210/226-608 5 facsimile THOMAS LAW OFFICE E-MAIL NOTICE - This transmission may be: (I) subject to the Attorney-Client Privilege, (2) an Attorney Work Product, or (3) strictly confidential.If you are not the intended recipient of this message, you may not disclose, print, copy or disseminate this information. If you have received this message in error, pleooe reply and notify the oender (only) ond delete the message. Unauthorized interceptionofthis e-mail is a violation of federal criminal law.

210/226-5888

From: Burt Kahn [mailto:[email protected]] Sent: Thursday, March 19, 20151:42PM To: Johnny Thomas Subject: case 14-50980 CAG

Dear Mr. Thomas: Please send me a copy of the canceled checks you distributed to all my creditors due to the $10,000 sale of all my worldly goods and life.

Thank you Burton Kahn

1 of I 8/31/2015 3:02 AM EXHIBIT 7 14-50980-cag Doc#47 Filed 04/29/14 Entered 04/29/14 16:01:59 Main Document Pg 1 of 2

IT IS HEREBY ADJUDGED and DECREED that the below described is SO ORDERED.

Dated: April 29, 2014.

CRAIG A. GARGOTTA UNITED STATES BANKRUPTCY JUDGE

IN THE UNITED STATES BANKRUPTCY COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION INRE: § Chapter 7 § BURTON M KAHN § Case No. 14-50980-cag § '~ Debtor. § ORDER DENYING DEBTOR'S MOTION TO DISQUALIFY PUERTO VERDE LTD TO MAINTAIN A LAWSUIT IN TEXAS [relates to Dkt. No. 30) Came on for hearing on April 24, 2014, the Motion To Disqualify Puerto Verde Ltd. to Maintain a Lawsuit in Texas [Dkt, No. 30] (the "Motion") filed by Durton Kahn ("Debtor"). The Court heard evidence and considered the arguments of counsel for Helvetia, the Chapter 7 trustee, and the Debtor, who appeared pro se. The Court finds that good cause exists to deny the Motion; accordingly, it is hereby ORDERED that the Motion is DENIED.

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