{"id":"court_ctb_1711_0","court":"CTB","case_no":"22-50073","doc_number":1711,"sub_number":0,"doc_type":"ORDER","filed_date":"2023-04-26","title":"UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION In Re \\* Case No. 22-50073 (JAM) \\* HO WAN KW","summary_zh":null,"summary_en":null,"body_en":"UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION In Re \\* Case No. 22-50073 (JAM) \\* HO WAN KWOK and GENEVER \\* HOLDINGS CORPORATION, \\* \\* Debtor. \\* LUC A. DESPINS, et al., \\* Adv. Proc. No. 22-05027 \\* Plaintiffs, \\* Bridgeport, Connecticut \\* April 18, 2023 v. \\* \\* BRAVO LUCK LIMITED, et al., \\* \\* Defendants. \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* TRANSCRIPT OF MOTION TO COMPEL COMPLIANCE WITH BK. RULE 2004 SUBPOENA BY UBS AG; ORDER TO SHOW CAUSE WHY THE COURT SHOULD NOT HOLD THE NON-RESPONDING PARTIES IN CONTEMPT OF COURT; CONTINUED PRETRIAL CONFERENCE RE #1 COMPLAINT BEFORE THE HONORABLE JULIE A. MANNING UNITED STATES BANKRUPTCY JUDGE APPEARANCES: For the Chapter 11 NICHOLAS BASSETT, ESQ. Trustee: Paul Hastings, LLP 200 Park Avenue New York, NY 10166 PATRICK R. LINSEY, ESQ. Neubert Pepe & Monteith, PC 195 Church Street New Haven, CT 06510 Proceedings recorded by electronic sound recording, transcript produced by transcription service. **Fiore Reporting and Transcription Service, Inc. 4 Research Drive, Suite 402 Shelton, Connecticut 06484 (203)929-9992**\n\nAPPEARANCES: (Cont'd) For the Defendant, Bravo DAVID M.S. SHAIKEN, ESQ. Luck Limited: Shipman, Shaiken & Schwefel, LLC 433 South Main Street Suite 319 West Hartford, CT 06510 JOANNA J. CLINE, ESQ. Troutman Pepper Hamilton Sanders, LLP Hercules Plaza 1313 N. Market Street Suite 5100 Wilmington, DE 19899 For UBS: LISA FRIED, ESQ. Herbert Smith Freehills New York LLP 450 Lexington Avenue New York, NY 10017 For the U.S. Trustee: HOLLEY L. CLAIBORN, ESQ. Office of the United States Trustee The Giaimo Federal Building 150 Court Street, Room 302 New Haven, CT 06510\n\n2\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 3 of 53\n\nHo Wan Kwok - April 18, 2023 3 (Proceedings commenced at 2:02 p.m.) THE COURTROOM DEPUTY: Case No. 22-50073, Ho Wan Kwok, Adversary No. 22-5027, Despins versus Bravo Luck, Limited. THE COURT: I am having difficulty with -- are we having -- isn't Mr. Despins going to be remote or is he going to be remote? MR. BASSETT: He's actually not going to be able to participate today. THE COURT: All right. MR. BASSETT: I think he's going to be remote on Thursday. THE COURT: So am I having anyone on camera or are we all set? THE COURTROOM DEPUTY: (Inaudible) THE COURT: Say that again? THE COURTROOM DEPUTY: (Inaudible) THE COURT: Okay. All right. Because I don't have any camera, so I couldn't see anybody anyway so I just wanted to make sure. All right. Then let's start with appearances with counsel for the Chapter 11 Trustee, please. MR. BASSETT: Good afternoon, Your Honor. Nick Bassett, from Paul Hastings, counsel for the Chapter 11 Trustee.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 4 of 53\n\n| | Ho Wan Kwok - April 18, 2023
4 |\n|----|--------------------------------------------------------------|\n| 1 | THE COURT:
Good afternoon. |\n| 2 | MR. LINSEY:
Good afternoon, Your Honor.
Patrick |\n| 3 | Linsey, Neubert, Pepe & Monteith, Connecticut counsel for |\n| 4 | the Trustee. |\n| 5 | THE COURT:
Good afternoon. |\n| 6 | MS. CLAIBORN:
Good afternoon.
Holley Claiborn |\n| 7 | for the U.S. Trustee. |\n| 8 | THE COURT:
Good afternoon. |\n| 9 | Counsel? |\n| 10 | MR. SHAIKEN:
Good afternoon, Your Honor.
David |\n| 11 | Shaiken from Shipman, Shaiken & Schwefel, representing Bravo |\n| 12 | Luck, Limited as local counsel. |\n| 13 | THE COURT:
Good afternoon. |\n| 14 | MS. CLINE:
Good afternoon, Your Honor.
Joanna |\n| 15 | Cline, Troutman Pepper, representing Bravo Luck. |\n| 16 | THE COURT:
Good afternoon. |\n| 17 | All right.
There are a few matters on the |\n| 18 | calendar today.
If you just bear with me for a moment, I |\n| 19 | just need to make sure that my computer is working, which it |\n| 20 | is, but I still need to get to the right place.
So I'm |\n| 21 | sorry.
Hold on, please. |\n| 22 | All right.
So we have the continued pretrial |\n| 23 | conference in the Despins versus Bravo Luck adversary |\n| 24 | proceeding, the motion to compel compliance with the Rule |\n| 25 | 2004 subpoena directed to UBS, and an order to show cause |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 5 of 53\n\nHo Wan Kwok - April 18, 2023 5 why non-responding parties to the subpoenas should not be held in contempt of court. So, Mr. Bassett, how are you intending to proceed this afternoon? MR. BASSETT: So, Your Honor, I'll let my colleague, Attorney Linsey, address the motion related to UBS, which I think has been consensually adjourned or that would be the ask I believe by the parties. Again, I'll let him speak to that. As to the -- as far as I am aware, the only two matters that are going forward today are the pretrial conference in the Bravo Luck adversary proceeding and then the order to show cause as to why Golden Spring and Lamp Capital should not be held in contempt of court although surveying the courtroom, I don't believe they have appeared today. THE COURT: Okay. With regard to the motion to compel compliance then are you saying that matter's going to be continued? MR. BASSETT: Well, Your Honor, I mean, I think we had -- we had moved to compel. Neither Lamp Capital nor Golden Spring responded in accordance with that, with the Court's order, compelling them to produce documents in response to our 2004 subpoenas and otherwise participate in 2004 discovery.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 6 of 53\n\nHo Wan Kwok - April 18, 2023 6 We then sought an order to show cause as to why they should not be held in contempt. And then the result of that was an order compelling them to appear here today. And we did, by the way, file a certificate of service on the docket indicating that we served both Golden Spring and Lamp Capital. So I guess it is a valid question of, you know, where do we go from here? And I think, frankly, we're finding ourselves in an untenable situation, and some of this will dovetail with a matter that the Court is going to hear on Thursday, which is a request by the debtor to stay his compliance with the Court's order on discovery, and I also think it dovetails in part actually with some of the issues related to Bravo Luck. We have a situation here where both Lamp Capital and Golden Spring, the two subjects of the order today, are critically important entities for discovery by the Trustee in his investigation. Both of these entities are entities that are purportedly owned and controlled ultimately by the debtor's son. Both entities have funded the debtor's expenses by admission of the debtor, including counsel fees in relation to this bankruptcy case, so we need documents and we need evidence from these two entities to complete our investigation and to administer this case.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 7 of 53\n\nHo Wan Kwok - April 18, 2023 7 And there's little doubt in our mind that the debtor does, in fact, control these entities. They are obviously in the family insofar as the son purportedly owns and controls them. The officers and directors of these entities are individuals that are known associates of the debtor. Yvette Wang, whom the Court knows, is Golden Springs' president. The Court already found in connection with Ace Decade that the debtor controls Ms. Wang. And Golden Spring also has shared the same business address that the debtor and many of his entities have shared. And it's our view that because the debtor controls these entities, he should be the one to produce their documents. What is now happening, of course, as the Court knows from the motions that have been filed and what's going to be heard on Thursday, is that the debtor is asserting the Fifth Amendment and saying he can't produce this information. He can't go out and get documents that are in their control. So that leaves us with one option which, of course, is to pursue the documents from these entities themselves. But of course these entities are nowhere to be found. They're not appearing before this court. They're not responding to anything we serve. They're not\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 8 of 53\n\n| | Ho Wan Kwok - April 18, 2023
8 |\n|----|----------------------------------------------------------------|\n| 1 | participating at all.
And I think that's what leads also |\n| 2 | into the situation with Bravo Luck. |\n| 3 | As the Court knows, Bravo Luck is another entity |\n| 4 | that is purportedly owned and controlled by the debtor's |\n| 5 | son. |\n| 6 | And what the debtor's son is doing in connection |\n| 7 | with the Bravo Luck litigation, in connection with the claim |\n| 8 | he filed in this court, in connection with other things |\n| 9 | Bravo Luck is doing in this case, including filing an |\n| 10 | objection to the motion to limit notice that the Trustee |\n| 11 | filed over the last few days, is he's basically litigating |\n| 12 | in this court and availing himself of this court's resources |\n| 13 | and jurisdiction, when it's convenient for him to do so, |\n| 14 | through counsel from apparently the United Kingdom, without |\n| 15 | ever actually coming over and participating himself. |\n| 16 | But he's doing that selectively.
Because when it |\n| 17 | comes to the other entities that he owns and controls, or |\n| 18 | that he says he owns and controls, Lamp Capital, which is |\n| 19 | one of the debtor's cases, Golden Spring, which has done the |\n| 20 | same, he's not doing that.
We have no ability to find them. |\n| 21 | In fact, the debtor's son most recently has been |\n| 22 | evading service of documents we've tried to serve on him. |\n| 23 | We originally had a location of his apartment in the United |\n| 24 | Kingdom.
We served him documents there. |\n| 25 | When we went back to serve more documents after |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 9 of 53\n\n| | Ho Wan Kwok - April 18, 2023
9 |\n|---|----------------------------------------------------------------|\n| 1 | the debtor's indictment, all of a sudden the person at the |\n| 2 | desk said he no longer lived there and they'd never heard of |\n| 3 | him.
So we're in a situation where, you know, we're kind of |\n| 4 | at a loss. |\n| 5 | And obviously I don't have a proposal for the |\n\n Court, and I'm not prepared to tell the Court today exactly what relief we might be seeking to deal with this situation, but in the Trustee's view something needs to happen to prevent the situation where we have people, including the debtor, his relatives, and those who control these entities, who are orchestrating a scenario in which the debtor is -- in which the Trustee rather is simply unable to get the information that he needs to conduct his investigation.\n\n The debtor's taking the Fifth. The daughter is now taking the Fifth. The entities that would not have any ability to take the Fifth are not responding. But the person who controls those entities, the son, is participating when he wants to through counsel, through other entities.\n\n So something needs to happen to level the playing field to make sure that there's fair participation by the people who are ultimately making the decisions here to allow the Trustee to get the discovery that he needs. Again, some of this will come up again on Thursday.\n\nLike I said, I wish I had a creative proposal as\n\nHo Wan Kwok - April 18, 2023 10 to what exactly to do, but we are considering our options. On the order before the Court, obviously, the Court could impose costs on -- and we think it's -- I think there's a clear basis for a finding of contempt now as against Golden Spring and Lamp Capital. I think the Court could impose costs and do other things that the Court has at its disposal to address contempt of court and to try to force compliance with the Court's orders, but obviously from our perspective that type of relief is going to be of little value for entities that we cannot contact and have no means of enforcing any order against. 13 So that's the update and the Trustee's view on where we stand as it relates to discovery from those two entities, Your Honor. THE COURT: All right. Let's just step back a moment. Other than the pretrial conference, what is on the calendar today is the order to appear and show cause why the non-responding parties, Lamp Capital and Golden Spring, should not be held in contempt of court. That's today. Then also the motion to compel compliance with the Rule 2004 subpoena served on UBS. And I think I heard you Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 10 of 53\n\nsay that that's going to be continued, that UBS --\n\nMR. BASSETT: That's correct.\n\nMR. LINSEY: And I can speak to that at the\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 11 of 53\n\nHo Wan Kwok - April 18, 2023 11 appropriate time, Your Honor. THE COURT: I think right now is the appropriate time. MR. LINSEY: Okay. THE COURT: I'd like to understand. If we're continuing it, that's fine. I just want to know that so then we can focus on what we need to focus on this afternoon. MR. LINSEY: That's fine. And counsel from UBS is here in the courtroom -- THE COURT: Yes. MR. LINSEY: -- who may wish to appear. THE COURT: I see counsel has stood up. MS. FRIED: Good afternoon, Your Honor. THE COURT: Would you just come up so we can hear your name for the record, please. MS. FRIED: Certainly. THE COURT: If you could speak into a microphone. MS. FRIED: Thank you. THE COURT: Sorry. Everything is audio so if we can't pick you up on the microphone, we won't be able to hear you. MS. FRIED: Of course. Your Honor, I'm Lisa Fried, from Herbert Smith Freehills, for UBS. THE COURT: Thank you. Good afternoon.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 12 of 53\n\nHo Wan Kwok - April 18, 2023 12 MR. LINSEY: Thank you, Your Honor. Again, Patrick Linsey for the Trustee. My office has been handling UBS matters as conflicts counsel. Since the prior adjournment of the motion to compel, counsel for UBS and my office have had numerous email correspondence and also telephone conferences about compliance. There have been batches of document production. Based on what we've received and based on the Trustee's investigation, there are subjects and areas that the Trustee wants to drill down into. And I have been in touch with Mr. Fried, in fact, last week about that. And we are seeking to work together collaboratively to agree on discovery procedures that would include things like ESI searches, but it's involved and complicated given that we're talking about discovery in different jurisdictions, we're talking about obviously different technological platforms, and also different languages. So all of that poses challenges that are not insurmountable, but that require some effort and cooperation between counsel. And right now, it seems like that's coming. So what I would like to propose and the Trustee would like to propose, subject to the Court's consideration, is adjourning the motion to compel out something roughly two\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 13 of 53\n\nHo Wan Kwok - April 18, 2023 13 weeks. I saw that there was a court date where matters related to this Chapter 11 case or related adversary proceedings are scheduled on May 2nd. That would work for counsel or something following that. And hopefully by that point, I don't know that we'll have production completed given sort of the nature of what everybody is talking about right now, but I do think it's reasonable to think that we could have agreement on the four corners of a discovery and ESI plan that hopefully will allow for production to happen in an orderly way. And the Trustee has been pleased with the cooperation that we've seen in the last couple of months in that regard. THE COURT: Counsel? MS. FRIED: Thank you, Your Honor. I agree with everything Mr. Linsey said. I would just note that as Mr. Linsey suggested with a global financial institution of the size of UBS sometimes it takes us a little time to connect and liaise with various representatives from our client around the world. We have been working diligently to do that and have been updating Mr. Linsey regularly and are committed to working collaboratively to search for what the Trustee has asked us to search for following our initial productions and we'll continue to do so.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 14 of 53\n\nHo Wan Kwok - April 18, 2023 14 THE COURT: Okay. Thank you. Do you have any objection to continuing this hearing to May 2nd? MS. FRIED: Not at all, Your Honor. With the understanding that I think Mr. Linsey previewed, which is that we may not have completed production by then, but we certainly expect to have made progress agreeing on a protocol going forward by then. THE COURT: I think that's fair. And then I'll know where things stand. If there's additional time needed, additional issues that need to be addressed or resolved, I think that's fair. And as far as May 2nd is concerned, we have time at -- we have time -- we have something scheduled in this case at 1 p.m. and something scheduled at 2 p.m. I would schedule -- I would continue this to 1 p.m. because I think you'll -- whatever it is you have to tell the Court I believe won't be controversial. Although, who knows, it could be. But I'm going to continue it to 1 p.m. then. Okay. And then we'll see where things stand. And as you both have acknowledged, you know, you both have continuing duties to cooperate and comply with the Federal Rules of Civil Procedure and the Federal Rules of Bankruptcy Procedure, so I think it makes sense then to continue this matter, given what you've both stated as far\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 15 of 53\n\n| | Ho Wan Kwok - April 18, 2023
15 |\n|----|----------------------------------------------------------------|\n| 1 | as the cooperative nature that you've been proceeding under, |\n| 2 | and that there is some additional time necessary for both |\n| 3 | parties to take certain actions.
I think it's fair and have |\n| 4 | no issue with continuing this hearing to May 2nd at 1 p.m. |\n| 5 | Okay? |\n| 6 | MS. FRIED:
Thank you, Your Honor. |\n| 7 | MR. LINSEY:
Thank you, Your Honor. |\n| 8 | THE COURT:
All right.
Thank you both. |\n| 9 | MS. FRIED:
Your Honor, may I be excused? |\n| 10 | THE COURT:
Yes, you may.
Thank you. |\n| 11 | MS. FRIED:
Thank you very much. |\n| 12 | All right.
Now, Mr. Bassett, I understand what |\n| 13 | you've said about the order to show cause with regard to |\n| 14 | Lamp Capital and Golden Spring. |\n| 15 | Is there anybody in the courtroom representing |\n| 16 | Lamp Capital or Golden Spring in connection with the Chapter |\n| 17 | 11 jointly administered cases of Ho Wan Kwok's 22-50073? |\n| 18 | (No response) |\n| 19 | THE COURT:
All right.
I'm hearing nothing and |\n| 20 | I'm not seeing any individuals in the courtroom that are not |\n| 21 | here on other matters or that I am aware of the parties that |\n| 22 | they represent. |\n| 23 | So, Mr. Bassett, you're asking the Court to enter |\n| 24 | an order finding these two parties in contempt, is that |\n| 25 | correct? |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 16 of 53\n\nHo Wan Kwok - April 18, 2023 16 MR. BASSETT: That's correct, Your Honor. And, you know, one other -- one other thought that I had is the debtor's son has filed a proof of claim in this case so I think there's no question that the Court has jurisdiction over him. To the extent that he claims to own and control both of these entities, I think the Court could order that he be required to accept service of the Rule 2004 subpoenas on behalf of those entities and be required to facilitate the responsive documents, the provision of documents in response to those subpoenas. Short of that, the question also becomes, or in addition to that the question becomes, you know, what else, what would be the consequences of finding both Lamp Capital and Golden Spring in contempt of court? Like I said, I certainly think costs and expenses that have been incurred in pursuing discovery from them would be appropriate, as well as any other sanctions that the Court thinks would be appropriate to try to force them to comply. But, again, when you're dealing with parties who have not shown up and we're not able to, you know, readily contact, it's not clear how effective those types of sanctions would be, but I guess on balance it would be better to have them than not have them.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 17 of 53\n\nHo Wan Kwok - April 18, 2023 17 THE COURT: Well, Golden Spring had an appearance in this case for a while, didn't it? MR. BASSETT: They did, Your Honor. And I believe that that appearance was subsequently withdrawn. THE COURT: I agree. Did Lamp Capital ever have an appearance in this case? MR. BASSETT: I don't -- I don't believe so, Your Honor. THE COURT: But they were the -- were they the source of the \\$8.8 million loan that was supposed to be made to the debtor or was that Golden Spring? MR. BASSETT: Lamp Capital -- off the top of my head, I don't recall the \\$8.8 million, the source, but Lamp Capital was an entity that had provided a retainer originally to Brown Rudnick as part of its representation of the debtor in the case. And then Golden Spring has also funded the debtor's expenses. THE COURT: And you've obtained discovery from Brown Rudnick? MR. BASSETT: We have obtained Rule 2004 discovery from Brown Rudnick, correct. But we have obviously not obtained that discovery from Lamp or from Golden Spring themselves. THE COURT: All right. Give me just a moment, please. I just want to look back at --\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 18 of 53\n\nHo Wan Kwok - April 18, 2023 18 MR. BASSETT: Sure. THE COURT: -- early filings in the case. (Pause) THE COURT: Okay. There's a document filed on March 22nd, 2022, so more than a year ago, in which the debtor sought approval of an \\$8 million post-petition financing transaction in which Golden Spring, LTD, the DIP lender, is an entity controlled and owned by the debtor's son according to documents filed by the debtor in this case. (Pause) THE COURT: And you're saying, Attorney Bassett, that the million dollar retainer paid to Brown Rudnick at or about the time of the commencement of the case was funded by Lamp Capital? MR. BASSETT: Yeah. That's correct, Your Honor. And I don't know, maybe the U.S. Trustee has an actual reference to something on the docket, but I -- THE COURT: I'm sure there is somewhere. MS. CLAIBORN: Your Honor, my recollection is that it's in the application to employ Brown Rudnick, but it's also in the 2060(b) disclosure filed by Brown Rudnick. THE COURT: Okay. With regard to -- I'm going to take a look at that in a second. With regard to the DIP financing motion that was filed by the debtor seeking a loan of \\$8 million for the\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 19 of 53\n\nHo Wan Kwok - April 18, 2023 19 estate from Golden Spring, an entity that the debtor asserts in its pleadings was controlled by the debtor's son -- (Pause) MS. CLAIBORN: Your Honor, we also had a hearing at which the debtor testified in connection with that loan and my recollection is he gave testimony as to how he went about arranging the loan with Golden Spring. THE COURT: I agree. I'm looking -- I was just looking for that hearing, which was I think in April, late March or April. MS. CLAIBORN: I will take a look at the docket as well. I don't remember the date off the top of my head. THE COURT: Well, there's 1,700 docket entries, so I wouldn't expect that you would remember the date of the hearing off the top of your head. But I think we can find it pretty easily if we just take a moment. (Pause) THE COURT: There was a hearing on April 28th, 2022, but I believe there was a hearing in March too. April 27, excuse me, 2022, that was continued to May 4th, 2022. There was also a hearing on April 13th, 2022 on the DIP motion. So the first hearing was April 13. Then it was continued to April 27. And then again to May 4th, 2022. And then on May, I think, 11th, but I'll triple check that\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 20 of 53\n\nHo Wan Kwok - April 18, 2023 20 before -- the motion for DIP financing was withdrawn by the debtor. May 11th, ECF No. 345, the debtor filed a notice of withdrawal of motion for entry of interim and DIP final orders without indicating in the document why the motion was being withdrawn and while the Court had that motion under advisement, after an evidentiary hearing, to rule on what relief would be granted, if any, on that motion. With regard to Lamp Capital, on March 16th an application was filed by the debtor for an entry of an order authorizing the employment and retention of Brown Rudnick as counsel for the debtor. In that document, ECF 86, Brown Rudnick indicates that immediately preceding the commencement of this Chapter 11 case Brown Rudnick received payments in the amount of \\$500,000 U.S. on February 14, 2022, and an additional deposit of \\$500,000 U.S. on the morning of February 15, 2022. To fund the retainer, this is in paragraph 17, Lamp Capital, LLC made a \\$1 million loan to Mr. Kwok and Mr. Kwok directed Lamp Capital, LLC to remit the proceeds directly to Brown Rudnick. Lamp Capital is an entity owned by Mr. Kwok's son. That is in a document, as I said, dated March 16, 2022, ECF No. 86, filed by Mr. Kwok -- signed by Mr. Kwok.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 21 of 53\n\nHo Wan Kwok - April 18, 2023 21 And in the affidavit of Attorney Baldiga attached to the application, he recites in paragraph 7 that Brown Rudnick received payments totaling \\$1,000,000 U.S. on account of services to be performed, and expenses incurred in connection with its advice to Mr. Kwok as follows. \\$500,000 U.S. on February 14 and \\$500,000 U.S. on February 15, each by wire from Lamp Capital, LLC as a retainer for services to be performed in preparation of this Chapter 11 case. To fund the retainer, Lamp Capital made a \\$1,000,000 U.S. loan to Mr. Kwok and Mr. Kwok directed Lamp Capital, LLC to remit the proceeds directly to Brown Rudnick. That's also in Mr. Baldiga's affidavit, which appears at page 14 of 30 on ECF 36, I'm sorry, 86, 86. So, Mr. Bassett, let's go through how you served Golden Spring and Lamp Capital with regard to the original discovery requests. And then the order to appear and show cause, why they should not be held in contempt of court? MR. BASSETT: So, Your Honor, I don't -- I don't have it at my immediate fingertips. I'm sure I could find it, if I was given a short break, as to how we served them with the original discovery requests. THE COURT: We could probably pull it up, I mean. MR. BASSETT: Yeah. I'm sure. I'm sure we could pull it up, Your Honor.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 22 of 53\n\nHo Wan Kwok - April 18, 2023 22 MR. LINSEY: Your Honor, I'll look for it while Mr. Bassett's speaking. MR. BASSETT: Okay. THE COURT: Okay. MR. BASSETT: But as to the most recent order to show cause, the Court -- I think this was ECF 1546 -- was the order to show cause which required the Trustee to serve the document on Golden Spring and Lamp Capital. That was served on March 20th. And I'm looking at our certificate of service is at ECF 1593. THE COURT: Okay. Hold on. Let me -- MR. BASSETT: Sure. THE COURT: I just want to make sure I'm looking at everything. Okay? MR. BASSETT: Sure. (Pause) THE COURT: So what was the original order to appear and show cause, 14 what? MR. BASSETT: Well, the operative order for today's hearing I believe is 1546. Because I believe what happened, Your Honor, is there was an initial order -- THE COURT: That wasn't served? MR. BASSETT: Exactly. And then we adjourned to today. And that order I believe is 1546. THE COURT: Okay. All right. Then ECF 1546 is an\n\nHo Wan Kwok - April 18, 2023 23 order to appear at continued hearing and show cause why the Court should not hold the non-responding parties in contempt of court. And it says in the order the Court has found that Golden Spring New York, Limited and Lamp Capital, LLC, together with Golden Spring, the non-responding parties, neither responded to nor complied with Rule 2004 subpoenas authorized by the Court. And there's a reference to ECF Nos. 1353 and 758. The Court issued a first order to show cause on January 27, 2023, set a hearing for March 7, 2023, at which the non-responding parties were to show cause why this court should not hold them in civil contempt of court for failing to respond or comply with subpoenas. During the show cause hearing, the Chapter 11 Trustee informed the Court he had been unable to serve Lamp Capital with the first show cause order and had not served Golden Spring because the Trustee wished to serve both of the non-responding parties simultaneously. So on the record, the Court continued the show cause hearing to April 18 and set a new service deadline of March 24th. Service was to be made on or before March 24th with a certificate of service filed on or before March 27. And you're saying the certificate of service is 1593? Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 23 of 53\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 24 of 53\n\nHo Wan Kwok - April 18, 2023 24 MR. BASSETT: That's correct, Your Honor. And I was also able to find the information about how we served them with the original subpoenas if we want to go back to that later. THE COURT: Okay. So the certificate of service filed on March 24th, 2023, ECF No. 1593, certifies that on March 16, 2023, the Court's order to appear at continued hearing and show cause why the Court should not hold the non-responding parties in contempt of court was filed electronically. And on and May [sic] 20, 2023, the undersigned caused copies of the order to show cause to be served on Golden Spring New York, Limited and Lamp Capital by FedEx overnight delivery and by first class mail at the following addresses:, Golden Spring New York, Limited, care of the Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware, and Lamp Capital, LLC, Attention Bernardo Enriquez, 667 Madison Avenue, New York, New York 10065. On March 21st, the undersigned caused a copy of the order to show cause to be served on Lamp Capital, LLC by UPS overnight delivery and First Class mail at the following address, Lamp Capital, LLC, care of CT Corporation System, 820 Bear Tavern Road, West Trenton, New Jersey 068 -- 08628, excuse me.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 25 of 53\n\nHo Wan Kwok - April 18, 2023 25 And what else did you want to note for the record, Attorney Bassett, with regard to service of the subpoenas? MR. BASSETT: Yes. So to the extent the Court was interested in having that information as well, I was able to pull up original motion to compel, which is at ECF 1046. And if you were to scroll to page 16, or paragraph 30 of that document, there's a detailed discussion of the Trustee's efforts to serve and contact both Lamp Capital and Golden Spring. THE COURT: I'm looking at paragraph 30 on page 16 of ECF No. 1046 filed on October 28th, 2022, and it says the defaulting respondents are Lamp Capital and Golden Spring. The Trustee has served each with a subpoena but none has responded. Specifically the Trustee served Lamp Capital via process server on August 23rd, 2022, at a Delaware address for its registered agent. Trustee sent two letters to the registered agent of Lamp Capital to follow up on the subpoena. The first on September 13 and the second on October 19. Counsel for the Trustee has received no response to either correspondence. Trustee served Golden Spring via process server on August 22nd, 2022, at a Delaware address for its registered agent. Golden Spring's deadline to serve objections was September 6th and its deadline for production of documents\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 26 of 53\n\n| | Ho Wan Kwok - April 18, 2023
26 |\n|----|--------------------------------------------------------------|\n| 1 | was September 21st, 2022.
Trustee has not received any |\n| 2 | objections or document productions from Golden Spring. |\n| 3 | Trustee sent two letters to the registered agent |\n| 4 | of Golden Spring to follow up on the subpoena, the first on |\n| 5 | September 13, 2022, and the second on September 30, 2022. |\n| 6 | Counsel for the Trustee received no response to either |\n| 7 | correspondence. |\n| 8 | Okay.
So then when we look at 1593, which is your |\n| 9 | certificate of service on the continued hearing on the order |\n| 10 | to show cause, Golden Spring was served at care of the |\n| 11 | Corporation Trust Company, Corporation Trust Center, 1209 |\n| 12 | Orange Street, Wilmington, Delaware, and Lamp Capital was |\n| 13 | served at an address on Madison Avenue, as I've already |\n| 14 | recited, and then again at a -- what appears to be a |\n| 15 | registered agent address care of CT Corporation, 829 Bear |\n| 16 | Tavern Road, West Trenton, New Jersey.
Okay. |\n| 17 | The non-responding parties, Lamp Capital and |\n| 18 | Golden Spring were to personally appear through an officer, |\n| 19 | director, manager, or member, at 2 p.m. on April 18, 2023. |\n| 20 | There's no one in the court that's responding to the inquiry |\n| 21 | of whether Lamp Capital and/or Golden Spring are in the |\n| 22 | courtroom. |\n| 23 | Those registered agent addresses, Attorney |\n| 24 | Bassett, are what anyone could find if they were looking for |\n| 25 | a registered agent address to serve these two entities, is |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 27 of 53\n\nHo Wan Kwok - April 18, 2023 27 that accurate? MR. BASSETT: That's correct, Your Honor. Those registered agent addresses are the ones that we found on the relevant Secretary of State websites I believe for purposes of serving these entities. THE COURT: And you've had no further discussions with -- I mean, you haven't had any discussions with anyone, is that correct? MR. BASSETT: We've never had any discussions with any representatives of either entity, that's correct. (Pause) THE COURT: I'm just looking at one other thing here. So I'm just trying to -- there isn't anything I can see in the record other than what you've put in your certificate of service that indicates who the registered agent is, which I'm not saying there should be. I'm just looking to see whether I see anything. MR. BASSETT: I'm not aware of anything either, Your Honor. I suspect that if we had submitted that documentation, that would have been part of the original motion to compel. And I'm not seeing in that motion any attached documentation containing documents from the Secretary of State websites or otherwise. Obviously, I can go back and take another look to see if there is something, and/or we're happy to find\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 28 of 53\n\nHo Wan Kwok - April 18, 2023 28 something that we could submit to the Court if you would like. THE COURT: I'm just trying to, you know, just -- because there's nothing in this record yet other than -- I'm not saying what you said is incorrect, I just -- for me to determine that those are the registered agents, right, there is -- I don't think there's -- I'm just -- I just -- I think I need to see that. MR. BASSETT: Sure. THE COURT: Because if I'm going to say that they should be held in contempt of court, I have to -- it has to -- I have to establish that, or it has to be established that they were served at those -- and those have to be the addresses. MR. BASSETT: And we can -- and, Your Honor, we can either -- I think we'll do two things. Obviously, we'll look back and check to see if it is somewhere in what we've already submitted. If not, we can certainly submit by declaration or otherwise copies of the documents we relied upon in serving at these addresses. THE COURT: I think you can do it by declaration after today. I just -- because there is nothing in the record that establishes that those are the proper addresses, other than your certificate of service, I think I need to -- if\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 29 of 53\n\n| | Ho Wan Kwok - April 18, 2023
29 |\n|----|----------------------------------------------------------------|\n| 1 | I'm going to hold them in contempt, I need to be able to say |\n| 2 | that you served them at their proper, registered agent |\n| 3 | addresses.
And, you know, I'm not saying you didn't.
I'm |\n| 4 | just saying it's not in the record.
Right? |\n| 5 | MR. BASSETT:
Understood.
Understood, Your Honor. |\n| 6 | THE COURT:
It's just not in the record. |\n| 7 | And, you know, there's no -- obviously, as you |\n| 8 | know, in order for contempt to be found, you have to also |\n| 9 | find that the parties' due process rights were met, so I |\n| 10 | need to be able to do that. |\n| 11 | So I think, you know, you can do that.
How much |\n| 12 | time would you like to do that? |\n| 13 | MR. BASSETT:
A day or two tops, I'm sure we can |\n| 14 | do that. |\n| 15 | THE COURT:
Okay.
I do find though that the |\n| 16 | record does establish that the debtor's son, according to |\n| 17 | the debtor in documents filed by the debtor and the debtor's |\n| 18 | counsel, controls the two entities -- because it's an |\n| 19 | admission of a party. |\n| 20 | It's an admission of the debtor and his counsel |\n| 21 | that Lamp Capital, LLC and Golden Spring New York, Limited |\n| 22 | are controlled by the debtor's son.
And as I've already |\n| 23 | stated before -- |\n| 24 | MR. BASSETT:
And just to make perfectly clear, |\n| 25 | just so the record is clear, I think the Trustee's position |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 30 of 53\n\n| | Ho Wan Kwok - April 18, 2023
30 |\n|----|------------------------------------------------------------------|\n| 1 | is that that's what the debtor has said.
I think our |\n| 2 | objective and our intent in this case would be to prove that |\n| 3 | is, in fact, the debtor who controls these entities. |\n| 4 | THE COURT:
I understand.
But there's no question |\n| 5 | that the debtor has already admitted on the docket of this |\n| 6 | case in pleadings filed by -- that he signed and his counsel |\n| 7 | signed while he was a debtor in possession that he was |\n| 8 | asserting that Golden Spring New York, Limited and Lamp |\n| 9 | Capital, LLC were controlled by his son, and he directed his |\n| 10 | son to have Golden Spring make a loan to the estate of \\$8 |\n| 11 | million, which was later withdrawn, and that he directed |\n| 12 | Lamp Capital to pay the million dollar retainer to Brown |\n| 13 | Rudnick.
When I say he, I'm talking about Mr. Kwok.
That's |\n| 14 | what these documents say.
So I just want to make that clear |\n| 15 | for the record. |\n| 16 | So I need you to submit a further declaration, or |\n| 17 | maybe just submit a declaration in further support of the |\n| 18 | order to appear and show cause demonstrating -- giving me |\n| 19 | the information from the respective or relevant Secretary of |\n| 20 | States Office to establish that the addresses that you used |\n| 21 | in service -- in serving the order to appear and show cause |\n| 22 | are the registered agents for service of these two entities. |\n| 23 | And you can do that by this Friday, which is I |\n| 24 | think the 21st.
Okay? |\n| 25 | MR. BASSETT:
And the last -- we will do that, |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 31 of 53\n\nHo Wan Kwok - April 18, 2023 31 Your Honor. The last thing I would note is that if the Court were inclined to enter an order in light of the admissions that we just discussed that the debtor's son purportedly owns and controls these entities, if the Court were to order that, something to the effect of that these two subpoenas on these entities could be served on the son, I'm just looking forward to the next issue which of course then we'll still have a problem with serving the son. And I think a potential solution to that would be if the son is going to continue to prosecute through Bravo Luck this adversary proceeding, including obviously appearing for and attending a deposition by the Trustee, that he could be served through Bravo Luck's counsel in connection with any such litigation in a Bravo Luck adversary proceeding, which obviously is before this court, that would be a submission by the son to the jurisdiction of this court, because obviously if we just have an order saying we can serve the son as I said before, unfortunately, he's hard to find I think on purpose based on our recent efforts to contact him and serve him with documents. MS. CLINE: May I be heard on that, Your Honor. THE COURT: Sure. MS. CLINE: Yeah. So Joanna Cline on behalf of Bravo Luck.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 32 of 53\n\nHo Wan Kwok - April 18, 2023 32 I mean, we understand that the Trustee's position is that all of these entities can be disregarded and that the distinct members of the debtor's family can be disregarded and that they're all the same, one in the same, but we're here to represent Bravo Luck. And sort of the logical leap that these two entities, Golden Spring and Lamp Capital, can somehow be served by -- by service upon counsel for Bravo Luck has no basis in the law. There's no veil that's been pierced and we just think it's improper. So it may be putting the cart before the horse, because I don't know that Your Honor is addressing that issue today, but since counsel for the Trustee put it out there, we just wanted to record our objection. THE COURT: Understood. Thank you. All right, Attorney Bassett. I understand your position. And I will look at a declaration with regard to the registered agents of Lamp Capital and Golden Spring and I will act accordingly. Okay? MR. BASSETT: Thank you, Your Honor. THE COURT: Thank you. Now, the final matter on the calendar is the continued pretrial conference in Despins versus Bravo Luck, Limited, et al. And I did see, although I didn't study, that there Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 33 of 53\n\n| | Ho Wan Kwok - April 18, 2023
33 |\n|----|---------------------------------------------------------------|\n| 1 | was a request for entry of a pretrial order, but it appeared |\n| 2 | to me there was a lot of -- there weren't really a lot of |\n| 3 | agreements on any dates in that pretrial order.
So I'm |\n| 4 | going to have to just pick those dates then if there isn't |\n| 5 | an agreement. |\n| 6 | So do the parties want to be heard on that or do |\n| 7 | you want me to just -- I will just enter whatever dates I |\n| 8 | think are appropriate? |\n| 9 | MR. BASSETT:
Your Honor, I think it may be |\n| 10 | helpful for us to be heard briefly. |\n| 11 | THE COURT:
Sure.
Go right ahead. |\n| 12 | MR. BASSETT:
Thank you. |\n| 13 | So we did submit the proposed pretrial order |\n| 14 | that's at ECF 73 in the adversary proceeding.
As the Court |\n| 15 | correctly noted, there is really not agreement at all. |\n| 16 | Actually with one exception.
I think we've agreed on a |\n| 17 | deadline for initial disclosures. |\n| 18 | Outside of that, there is agreement on a form |\n| 19 | generally of an order that sets forth a schedule in this |\n| 20 | case. |\n| 21 | I don't think there are any major disagreements |\n| 22 | about kind of what an orderly sequence of events would look |\n| 23 | like and what types of disclosures and discovery deadlines |\n| 24 | are necessary. |\n| 25 | But within that generally agreed upon framework, |\n| | |\n\nHo Wan Kwok - April 18, 2023 34 there's a lot of disagreement about how long this case should take. Our schedule, and I won't belabor all the interim deadlines in going over that, but the bottom line is that we think it is imminently reasonable to have a trial in this case, if necessary, if the course of litigation is not resolved by other means prior to that time, by approximately the end of July. The position of Bravo Luck is that this litigation should take six months longer than that and we should have a trial in December. The position that we've heard from Bravo Luck is that the time table that we've proposed is just way too fast, it's not workable. They may need a bunch of discovery. And I think I would respond to that in a few ways. First of all, we've all been at this case for, at least as the Trustee is concerned, you know, coming up on the one-year anniversary here before we know it. And Bravo Luck is not new to it either. So the events and the circumstances underlying the allegations in the adversary proceeding with the Sherry- Netherland, all of that, has been out there for a very long time with the parties to think about the positions and arguments for a very long time. That's point number one. Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 34 of 53\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 35 of 53\n\nHo Wan Kwok - April 18, 2023 35 Point number two is that obviously the reasonableness of any schedule depends upon the complexity of a particular litigation, the amount of discovery that it requires, and other related issues. From my experience, while a federal district court civil litigation may typically take longer than what we proposed, the time table that we proposed here is not at all uncommon. As the Court well knows, in bankruptcy, you know, there are many contested matters that are far more complex than adversary proceedings and often those are heard in a matter of weeks. So I think this schedule is imminently doable. The last point I would make is that there's really no reason why the type of complicated and drawn-out discovery proposed by Bravo Luck would even conceivably be necessary here. And this is an adversary proceeding about Bravo Luck's alleged ownership of the Sherry-Netherland apartment through a trust agreement. And if it doesn't own the Sherry-Netherland apartment through a trust agreement, we have alternative fraudulent transfer claims where the debtor fraudulently transferred beneficial ownership of the Sherry-Netherland to his son through Genever without consideration and for the\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 36 of 53\n\n| | Ho Wan Kwok - April 18, 2023
36 |\n|----|------------------------------------------------------------------|\n| 1 | purpose of hindering or delaying his creditors. |\n| 2 | All the facts that Bravo Luck would need to |\n| 3 | respond, to make its case in response to that complaint, are |\n| 4 | necessarily entirely, or at a minimum almost entirely, |\n| 5 | within its control and those of its purported owner and |\n| 6 | controller, the debtor's son, or possibly the debtor. |\n| 7 | Bravo Luck is going to have to show to defeat the |\n| 8 | Trustee's claims that it owns and controls the Sherry |\n| 9 | Netherland.
Those facts, whether that's true, they're |\n| 10 | necessarily within its control.
It wouldn't need discovery |\n| 11 | from third parties to demonstrate that it owns an asset. |\n| 12 | To the extent anybody would have information, it |\n| 13 | may be the debtor.
Obviously, I don't think -- I could be |\n| 14 | wrong, but I would imagine that the debtor's son is not |\n| 15 | going to seek formal discovery from his father, so that |\n| 16 | should not elongate the schedule. |\n| 17 | And then, you know, there may be some discovery |\n| 18 | needed from parties like the Sherry-Netherland, et cetera, |\n| 19 | but that's not -- this is not the type of case where we need |\n| 20 | several months for fact discovery. |\n| 21 | Bravo Luck has indicated that it may have an |\n| 22 | expert.
They haven't told us what expert that would be.
We |\n| 23 | expanded the original schedule we sent them by a few weeks |\n| 24 | to accommodate expert discovery.
We do not at this time |\n| 25 | intend to have an expert, although we reserve the right to |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 37 of 53\n\nHo Wan Kwok - April 18, 2023 37 have an rebuttal expert. So, Your Honor, we just don't think this is a case that needs to take that long, particularly where the Trustee has a real need to move, not just this adversary proceeding forward, but this case forward, and this adversary proceeding is a critical component of this overall case. So I think it would be unfair to everybody involved, most notably the debtor's creditors, to let this drag out until December. So, Your Honor, subject to any response to what counsel may raise, you know, for those reasons, we think the schedule that we've submitted is a reasonable one. Thank you. THE COURT: Thank you. MS. CLINE: So, Your Honor, the Trustee says there's no reason that we need to go through a discovery process in this case. And from Bravo's perspective, there is a reason that it's called due process. By contrast, we've not heard articulated a reason for any urgency to attend to the schedule set forth by the Trustee in this case. We heard Your Honor loud and clear that you wanted this case tried by December, you wanted it tried in this year, and we put forth a schedule that does that. This is a dispute over a \\$70 million apartment.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 38 of 53\n\nHo Wan Kwok - April 18, 2023 38 The parties are still amid briefing as the Court knows on a motion to dismiss that finishes up I guess in a week or so. And due process requires that we get a fair shot, assuming our motions to dismiss are not granted, to defend the case that the Trustee has the burden to put on. Yes, counsel is right that there is some evidence in our control, but not all of it, and we're talking about a transaction that happened eight years ago. In terms of, you know, we've all been going at this a long time, I mean, yes, we've been involved for a bit, but we've not been taking the 2000 and -- we don't have the advantage of being the ones driving the aggressive 2004 campaign that the Trustee's been involved in. We don't know the extent of the documents they've collected. We don't know what they have. We're going to ask for it. Presumably then we'll need some time to review it, decide upon whether we need to follow up with our own supplemental subpoenas or anything like that, and it's simply infeasible to assume that this is all going to take place within the next 45 days. Just by way of specific example, there are subpoenas that presumably have resulted in relevant information with respect to the following custodians, UBS, Paul Weiss, Williams & Connolly, Brown Harris Stevens, the Sherry, maybe Stevenson, Wong.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 39 of 53\n\nHo Wan Kwok - April 18, 2023 39 It's Bravo Luck's right to get this information that presumably is already in the Trustee's possession, examine it, and see whether we need it to defend Bravo's rights. So if that's not the case and we're not able to take our discovery, our rights will be severely prejudiced. By contrast, as I said, we haven't heard the Trustee articulate what's going to happen to it. What is the harm that the Trustee faces if our -- if the Court were to go with our schedule rather than the Trustee's schedule? The only thing we heard in the course of meet and confer, and, Your Honor, I can submit that the parties engaged in a few meet and confer calls on this to try to get some agreement here, the only thing that we heard was that the Trustee was anxious to sell the property. But there's already an agreement, a settlement agreement, on a sales process and a sales agent. And we think if that's what the Trustee wants, it can go ahead and do that and any money can be put in escrow until this is all taken care of. But bottom line, there's no reason for any urgency. There's every reason to give Bravo Luck some due process and at least an abbreviated schedule as we've set forth to complete discovery here so we can get this to trial and can get it taken care of. THE COURT: Okay. I just have a question or two.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 40 of 53\n\n| | Ho Wan Kwok - April 18, 2023
40 |\n|----|----------------------------------------------------------------|\n| 1 | I noticed that you filed your appearance the other |\n| 2 | day.
I think you still need to file a corporate ownership |\n| 3 | statement under Rule 7007.1
Okay? |\n| 4 | MS. CLINE:
Understood. |\n| 5 | THE COURT:
And that needs to happen. |\n| 6 | With regard to the initial disclosures, it does |\n| 7 | appear that you have an agreed-upon date for the initial |\n| 8 | disclosures.
I don't want to see that date change without |\n| 9 | good cause being shown.
And so if either party changes that |\n| 10 | date, someone's going to have to come in and explain to me |\n| 11 | why, because you could make an argument that the initial |\n| 12 | disclosures should have already happened under the Federal |\n| 13 | Rules of Civil Procedure. |\n| 14 | But if you have it, you do agree on that date, I |\n| 15 | did see that, whatever, I'm ordering that date on the record |\n| 16 | right now regardless of what I do with the rest of the |\n| 17 | dates.
Okay?
Because I think that that -- as I said, |\n| 18 | someone could come in and argue that the initial disclosures |\n| 19 | should have already occurred. |\n| 20 | With regard to the other issues that you raise, |\n| 21 | I'm going to take it all under consideration.
I'm not going |\n| 22 | to determine dates right now as we sit here.
Will I |\n| 23 | determine dates by -- we have other hearings on Thursday.
I |\n| 24 | don't recall whether you will be here on Thursday.
I have |\n| 25 | to always look because there are so many things each day |\n\nHo Wan Kwok - April 18, 2023 41 it's hard to remember. Could I make that ruling by Thursday? It's possible. I just don't know. I have to go back and look at it. As I said, I saw the document that was filed yesterday. I saw it this morning, that was filed yesterday afternoon, and I noticed -- I think the initial belief was, just because of the docket entry, that it might be an agreed upon order, but I quickly learned, saw that it was not. And that's fine. It's fine. So I don't -- I have to take a look at it and see what we're going to do. I do agree with you though that I did say that this is going to move ahead. So we'll see where we end up at the end of the day. Is there anything else you'd like to add for the record? MS. CLINE: Yes, Your Honor. I just wanted to put one thing on the record with respect to a comment that Mr. Bassett had made with respect to the motion to limit notice. I just wanted to make a record on that if I may? THE COURT: Yes. MS. CLINE: So we saw Your Honor's ruling on the motion and I guess I just wanted to articulate -- THE COURT: On which motion are you talking about? MS. CLINE: Sorry. The motion to limit notice Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 41 of 53\n\nHo Wan Kwok - April 18, 2023 42 with respect to a motion to abandon property. THE COURT: Oh, yes, yes, yes. Okay. Sorry. I just -- MS. CLINE: I understand. THE COURT: -- want to be as clear as we can be. So thank you. MS. CLINE: Yes. Apologies. And so we just wanted to put our position on the record, which is that, as the Court's painfully aware I think, the definition of what is property of the estate is very much at issue here. And as a result of the Court's granting that motion to limit notice, Bravo really has no idea what the property is that the Trustee may seek to abandon. And it may well have nothing to do with us. On the other hand, it may in our view have everything to do with property that we believe to be owned by Bravo. So from our perspective, Bravo is being denied due process and the right to object to whatever it is the Trustee might do with respect to whatever it is, the property that's at issue. And from our perspective, the Trustee has not articulated a specific concern. There's been a general argument about confidentiality. And if that were a problem, we could take it on a asset by asset basis, and I'm sure we Case 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 42 of 53\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 43 of 53\n\nHo Wan Kwok - April 18, 2023 43 could figure out some kind of a, you know, attorney's eyes only or some kind of a way to deal with that. But as it stands, we're sort of hamstrung and not able to even stand up and object as to what we may think may be Bravo's property. So we just wanted to sort of put on the record that we think that there's a due process issue with respect to that motion to limit notice. We would ask under Rules 59 and 60 for the Court to reconsider and just include Bravo in the notice provision. THE COURT: All right. I'll take a look at that. I have to say, sitting here right now without looking at it, I don't recall everything it says. But even though it's limiting notice and shortening time, I think you still have an ability to object. But I could be wrong about that. Attorney Linsey? MR. LINSEY: One of the things that the motion to limit notice does is it defines the noticed parties. And with respect to the notice parties, they are the U.S. Trustee, PAX, and the Creditors Committee as a representative of creditors at large. THE COURT: Well, that's the noticed parties. If someone become aware of a motion and they want to object to it, I don't think they're precluded from doing\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 44 of 53\n\nHo Wan Kwok - April 18, 2023 44 that. MR. SHAIKEN: If I may, Your Honor, the motion and the order say that the motion will be sealed. So even someone with access to the docket -- THE COURT: I understand. But there's -- MR. SHAIKEN: -- won't know what it's about, and the courtroom will be sealed. THE COURT: But there's -- we have mechanisms in this case with regard to confidential information, so you need to talk to the Trustee's counsel about that and see if there can be some kind of agreement. There's been a mechanism in place for almost a year with regard to confidential information in the case as a whole. And whether that applies to this issue, I don't know sitting here. But what I'm saying to you is you're all, and you know this, so I really don't -- you're all lawyers, you have the conversations and try to figure it out. If Bravo Luck wants to file an objection to something that they don't know what it is and they think their due process rights haven't been met, then they can file that. Whatever happens with it, I can't say as we sit here right now. They have a right to do that. Whether or not any relief will be given to Bravo Luck, is not before the Court today. Okay?\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 45 of 53\n\nHo Wan Kwok - April 18, 2023 45 But I understand your oral request. I will look at it. And then I might say, okay, you made an -- I don't know what I'm going to say. But I might say you made an oral request during a pretrial conference, which you're absolutely entitled to do, and I might say, okay, I agree with you. I might say I disagree with you. Or I might say I'd like the Trustee to file something or respond to that. I just have to think about it having not -- you know, it's not something I was prepared to address at the moment, but I'm fine -- it's fine that you raised it and we'll see where we go. But with regard to the confidential information and the issues that you raised, and Attorney Shaiken raises, with regard to you don't know what you don't know, there are mechanisms in this case. Parties can be -- there is a confidentiality agreement that parties can decide to be bound by, and they - - you know, there is a process. Whether or not you decide to be bound by that, I have no -- your clients, I have no idea, but there is a process. And, unfortunately, it's been a case in which -- it's not unfortunate, it is -- it's the facts, there's a case in which there's been a lot of need for confidentiality agreements.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 46 of 53\n\n| | Ho Wan Kwok - April 18, 2023
46 |\n|----|--------------------------------------------------------------|\n| 1 | You know, the District Court in Connecticut has |\n| 2 | standing confidentiality agreements the minute you file a |\n| 3 | case.
The minute it gets filed, it gets spit out as an |\n| 4 | automatic confidentiality agreement. |\n| 5 | So this isn't anything, from this court's |\n| 6 | perspective anyway, that's a novel issue.
It's just an |\n| 7 | issue of how the lawyers handle it.
And so I will let you |\n| 8 | all have that discussion and we'll see where we go. |\n| 9 | MS. CLINE:
Understood. |\n| 10 | THE COURT:
Okay? |\n| 11 | MS. CLINE:
Thank you, Your Honor. |\n| 12 | THE COURT:
All right.
Thank you. |\n| 13 | MR. BASSETT:
And, Your Honor, if I may, I just |\n| 14 | wanted to add one very brief point in response to a comment |\n| 15 | that counsel made as to the discovery schedule? |\n| 16 | THE COURT:
Yes. |\n| 17 | MR. BASSETT:
And it's simply that counsel had |\n| 18 | emphasized the Trustee has been conducting 2004 discovery, |\n| 19 | and has discovery from other parties that may be relevant to |\n| 20 | the adversary proceeding, and they need all that, and that's |\n| 21 | something that from their point of view they have been |\n| 22 | saying to us at least, and to the Court, is the reason why |\n| 23 | this litigation is going to take a significant amount of |\n| 24 | time.
I just wanted to point out to the Court that we |\n| 25 | looked at that in advance of today's hearing. |\n| | |\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 47 of 53\n\nHo Wan Kwok - April 18, 2023 47 And the parties that they mentioned, Paul Weiss, we have 715 documents, we have not taken a deposition. UBS, we have 124 documents, we have not taken a deposition. We have something like 4,000 documents from Williams & Connolly, but most of those are unrelated to this adversary proceeding. We also did a search in our entire database across the hundreds of thousands of documents, if not more than that, that we've received, and I think there is something like 2500 total documents related to Bravo Luck or the Sherry-Netherland. So the bottom line is it's not -- it's not the case that we're sitting on some just vast volume of information that's relevant to this adversary proceeding and it's going to take Bravo Luck months to go through it. For a variety of reasons, as the Court well knows, we've, you know, struggled to get a lot of information in this case, so it's not like we have so much that it's going to really impact the discovery schedule here. That's all I wanted to say. Thank you. THE COURT: Okay. Thank you. And I will say that, you know, as I say quite often, not just in this case, but in every case, as you all know, you all have duties as lawyers to act in good faith and to continue to try to resolve issues, specifically\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 48 of 53\n\nHo Wan Kwok - April 18, 2023 48 discovery issues. And if there are discovery disputes regarding the scope or what is requested by one party from another, then if it's not worked out, then the Court will have to rule. And that's what we'll do. Okay? But this adversary proceeding is about -- the complaint as I read it has two counts. One is -- I think the first count talks about saying that the trust agreement is void or at the very least voidable. And the second is that it's a fraudulent transfer, that the whole transaction was a fraudulent transfer under state law. That's it. Those are the causes of action. Not that those don't -- aren't -- do not require discovery necessarily, but with regard to the information that the Trustee's obtained through 2004 examination processes, which the Trustee is entitled to do, and the Bankruptcy Code provides that ability in a bankruptcy case, I'm not sure all of whatever the Trustee has obtained through 2004 discovery would be relevant in this adversary proceeding, but you'll let me know. Okay? MS. CLINE: Yes, Your Honor. If I may? Understood. And I'm sure there are reams of paper that are not relevant to these particular proceedings. And just wanted to note that there's actually three proceedings that have been consolidated.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 49 of 53\n\nHo Wan Kwok - April 18, 2023 49 THE COURT: Yes. I'm glad you raised that actually. We've got to figure out a different way than filing three motions to dismiss and three answers and all those other things, right?\n\n So what I -- I understand the argument that there could be some specific issues in each one, but then I want you to talk, figure out a way to have a complaint and an answer both, that, you know, have different -- have the count either apply to all three, two of the three, one of the three, however you want to do it, but I don't think it makes sense to be filing three pleadings. These are consolidated for a reason, right? Otherwise they wouldn't be consolidated. So the pleadings should be consolidated. All right?\n\n And I think you, both of you, can agree on that without -- you should be able to come to an agreement without impacting any substantive rights that either -- either the plaintiffs -- plaintiff or the defendants have with regard to the ultimate relief sought in the complaint. Okay? But it doesn't' make sense to have three different pleadings in the -- in these jointly administered adversary proceedings. Okay? MS. CLINE: Understood. THE COURT: Attorney Bassett, I'm sure you can -- you can all figure out a way to deal with that, right?\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 50 of 53\n\nHo Wan Kwok - April 18, 2023 50 MR. BASSETT: We will, Your Honor. THE COURT: Okay. I've raised that before, so I would like that to be addressed. Is there any other matter that we need to address in this adversary proceeding today? (No response) THE COURT: No? What about -- all right. What other matters are not on the calendar that you want to bring to the Court's attention? MR. LINSEY: It's one we've already discussed if that helps, Your Honor. The motion to limit notice with respect to the motion to abandon. The Court entered an order yesterday granting that motion. And I believe that the Court's order that the schedule in the order would seem to anticipate the immediate filing of a motion to abandon. There is some information that my office is compiling from third-party sources to go into that motion and we may not have the motion finalized until the end of the week. The reason I report that to Your Honor is because the motion to limit notice contemplates a 14-day objection period between the filing of the motion to abandon and the hearing on the motion to abandon which has been scheduled for May 2nd.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 51 of 53\n\nHo Wan Kwok - April 18, 2023 51 So here's what the Trustee contemplates. The Trustee contemplates that none of the noticed parties are going to object to the motion to abandon and that no one is going to have a problem with having the hearing go forward as scheduled on less than 14-day's notice. I've spoken with debtor's counsel about this earlier today. And what I suggest that we do is the Trustee will file the motion to abandon later this week, will reach out to counsel for the various noticed parties. If anyone takes issue with the less than 14-day notice period, then we will reach out to the Court and request to continue the hearing date on the motion to abandon. And if, as the Trustee anticipates, no one has an issue, then we'll continue with the hearing as scheduled. And I realize I'm technically bringing up something that's not on the docket, but we just wanted to make sure the Court wasn't looking at the docket saying where is this motion that I thought was going to be immediately filed? So that's why I bring it up. THE COURT: Okay. Thank you. I heard what you just said, but you also heard what Bravo Luck said. You may have an objection to your motion, even if you claim that they're not entitled to\n\nHo Wan Kwok - April 18, 2023 52 object to it. So I'm going to look back at the -- at the whole issue and revisit it. I don't know if I'm going to do anything, but there's -- I need to look back at it and see whether or not we have to think about that a little bit more. MR. LINSEY: And if Your Honor wants a written submission from the Trustee on the reason that the Trustee did not include Bravo Luck as a noticed party, we're happy to do that. The Trustee -- I have discussed that issue with the Trustee as recently as last Friday and that was an intelligently made decision, so he'd probably want to be heard on that as well. THE COURT: All right. Well, I'm going to think about it. And if I'm going to do anything, you'll all know because it will be on the docket. Okay? MR. LINSEY: Thank you, Your Honor. THE COURT: All right. Thank you. Anything further we need to address this afternoon? MS. CLINE: Not from Bravo, Your Honor. THE COURT: Thank you. MR. BASSETT: No, Your Honor. THE COURT: Okay. All right. Thank you.\n\nCase 22-50073 Doc 1711 Filed 04/26/23 Entered 04/26/23 14:55:58 Page 53 of 53\n\n| | Ho Wan Kwok - April 18, 2023
53 |\n|----|------------------------------------------------------------|\n| 1 | Then this is the last hearing on the Court's |\n| 2 | calendar today, so court is adjourned. |\n| 3 | (Proceedings concluded 3:24 p.m.) |\n| 4 | I, CHRISTINE FIORE, court-approved |\n| 5 | transcriber and certified electronic reporter and |\n| 6 | transcriber, certify that the foregoing is a correct |\n| 7 | transcript from the official electronic sound recording of |\n| 8 | the proceedings in the above-entitled matter. |\n| 9 | |\n| 10 | |\n| 11 | April 26, 2023 |\n| 12 | Christine Fiore, CERT |\n| 13 | |\n| 14 | |\n| 15 | |\n| 16 | |\n| 17 | |\n| 18 | |\n| 19 | |\n| 20 | |\n| 21 | |\n| 22 | |\n| 23 | |\n| 24 | |\n| 25 | |\n| | |","body_zh":null,"key_entities":["Kwok","Ho Wan Kwok","Je","CIPA","Despins","Paul Hastings"],"ecf_references":[{"doc_number":36,"court":"CTB"},{"doc_number":73,"court":"CTB"},{"doc_number":86,"court":"CTB"},{"doc_number":345,"court":"CTB"},{"doc_number":1046,"court":"CTB"},{"doc_number":1546,"court":"CTB"},{"doc_number":1593,"court":"CTB"}],"word_count":13174,"status":"published","published_at":"2023-04-26 00:00:00","created_at":"2023-04-26","updated_at":"2026-07-07 07:54:33"}