{"id":"court_ctb_2479_0","court":"CTB","case_no":"22-50073","doc_number":2479,"sub_number":0,"doc_type":"UNKNOWN","filed_date":"2023-12-28","title":"| | UNITED STATES B","summary_zh":null,"summary_en":null,"body_en":"| | UNITED STATES BANKRUPTCY COURT
DISTRICT OF CONNECTICUT
BRIDGEPORT DIVISION |\n|------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------|\n| In Re | *
Case No. 22-50073 (JAM) |\n| HO WAN KWOK and GENEVER
HOLDINGS CORPORATION, | *
*
* |\n| Debtors. | *
* |\n| LUC A. DESPINS, CHAPTER 11
TRUSTEE, | *
Adv. Proc. No. 23-05008
*
* |\n| Plaintiff, | * |\n| v.
MEI GUO, | *
*
Bridgeport, Connecticut
*
December 19, 2023
* |\n| Defendant.
* * * * * * * * * * * * * * * * | *
* |\n| #2429 CONTINUED STATUS CONFERENCE
#
BEFORE THE HONORABLE JULIE A. MANNING
APPEARANCES: | 67 ORDER SETTING STATUS CONFERENCE
UNITED STATES BANKRUPTCY JUDGE |\n| For the Chapter 11 Trustee: | NICHOLAS A. BASSETT, ESQ.
AVI LUFT, ESQ.
Paul Hastings LLP
200 Park Avenue
New York, NY
10166
PATRICK R. LINSEY, ESQ. |\n| | Neubert Pepe and Monteith
195 Church Street,13th Floor
New Haven, CT
06510 |\n| Proceedings recorded by electronic sound recording,
transcript produced by transcription service. | |\n| | Fiore Reporting and Transcription Service, Inc.
Shelton, CT 06484 (203)732-6461 |\n\nAPPEARANCES: (Cont'd) For the Creditors Committee: KRISTIN B. MAYHEW, ESQ. Pullman & Comley 850 Main Street Bridgeport, CT 06601 For the Creditor, Pacific STUART M. SARNOFF, ESQ. Alliance Asia Opportunity O'Melveny & Myers LLP Fund L.P.: Times Square Tower 7 Times Square New York, NY 10036 ANNECCA H. SMITH, ESQ. Robinson & Cole LLP 280 Trumbull Street Hartford, CT 06103 For the Plaintiff, MELISSA F. WERNICK, ESQ. HK International Funds and Chiesa Shahinian & Mei Guo: Giantomasi, PC 105 Eisenhauer Pkwy Roseland, NJ 07068 For the debtor and JAMES M. MORIARTY, ESQ. the defendant, Mei Guo: Zeisler & Zeisler, P.C. 10 Middle Street, 15th FL Bridgeport, CT 06604\n\n2\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 3 of 26\n\nHo Wan Kwok - December 19, 2023 3 (Proceedings commenced at 2:12 p.m.) THE COURTROOM DEPUTY: Case no. 22-50073, Ho Wan Kwok and adversary no. 23-05008, Luc A. Despins, Chapter 11 Trustee vs. Guo. THE COURT: Good afternoon. If we could have appearances for the record, starting with counsel to the Chapter 11 Trustee, please. MR. BASSETT: Good afternoon, Your Honor. Nick Bassett, from Paul Hastings, on behalf of the Chapter 11 Trustee. I'm joined by my colleague Avi Luft, also from Paul Hastings. And Your Honor I wanted to note that the Chapter 11 trustee sends his apologies. He knows that the court tried to accommodate his schedule today by scheduling a status conference at 2 o'clock. He ended up getting stuck with a flight delay, so he's unable to join us but did send his apologies to the court. THE COURT: Okay. Thank you. MR. LINSEY: Good afternoon, Your Honor. Patrick Linsey, of Neubert Pepe and Monteith, Connecticut counsel for the trustee. THE COURT: Good afternoon. MR. SARNOFF: Good afternoon, Your Honor. I don't expect to be speaking, but it's Stuart Sarnoff, O'Melveny & Myers, on behalf of creditor PAX in the main case.\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 4 of 26\n\nHo Wan Kwok - December 19, 2023 4 THE COURT: Good afternoon. MS. SMITH: Good afternoon, Your Honor. Like Mr. Sarnoff I represent PAX and do not anticipate to be speaking today, but this is Annecca Smith, at Robinson and Cole, Connecticut counsel for PAX. THE COURT: Good afternoon. MS. MAYHEW: Good afternoon, Your Honor. Kristin Mayhew, Pullman and Comley, on behalf of the Official Committee of Unsecured Creditors. THE COURT: Good afternoon. MS. WERNICK: Good afternoon, Your Honor. Melissa Wernick, from CSG Law, on behalf of Mei Guo in the adversary proceeding. THE COURT: Good afternoon. MR. MORIARTY: And James Moriarty, from Zeisler and Zeisler, also on behalf of Ms. Guo. THE COURT: Aren't you appearing on behalf of the debtor in the main case, Mr. Moriarty, as well. MR. MORIARTY: My understanding, Your Honor, is that really all that we're talking about is a TRO that's pending in the adversary proceeding. THE COURT: Well, that's not the only thing we're talking about. We were talking about the TRO and the -- we're also talking about -- I thought we were talking about the issue about the evidence we were supposed to be talking\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 5 of 26\n\nHo Wan Kwok - December 19, 2023 5 about today, and the issue -- I don't know where Mr. -- well, he's not here so maybe there's some agreement with Mr. Conway, who was here yesterday, with regard to the Mahwah mansion and the issues related to the storage units. MR. MORIARTY: I'll note my appearance for the debtor also, Your Honor. THE COURT: Okay. Thank you. So Mr. Bassett, I don't know if you are proceeding first but I'd like to know if you can report to the court where things stand on the issues that we discussed yesterday, to which there was no resolution because they have just come up. But it was the issue about the temporary restraining order that was filed and the issue -- well, anyway, I'll just let you talk. Why don't you go ahead and talk, Attorney Bassett. MR. BASSETT: Of course, Your Honor. Happy to address those issues. So first, the TRO related to the Mei Guo adversary proceedings, I'll actually let Attorney Linsey address that in a moment, but to sort of steal his thunder I do think we are in the process of reaching an agreement on language that would resolve that order on consent. But again, I'll let Attorney Linsey give the court a bit more detail in a moment.\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 6 of 26\n\nHo Wan Kwok - December 19, 2023 6 The other motion before the court today for the status conference, of course, is the motion we filed for the preservation of evidence located at certain storage facilities in New Jersey. As the court noted, I was not there in person yesterday, but I understand, based on my conversations with Attorney Linsey and the trustee that Mr. Conway, as the court pointed out, was in attendance. I had expected him to be here again today. What I can say is that based on our conversations with him our understanding is that his clients, the defendants, do not have an issue with the relief that the trustee is seeking in the preservation order, so long as Mr. Conway is able to attend the inspection of these storage units at the same time that the trustee undertakes his inspection, which we intend on being this Friday. The trustee has no objection to that request and, therefore, our understanding is that that would resolve any potential objection by the defendants to the relief that the trustee is seeking. That leaves Your Honor two other parties. So we have served -- there's the subpoenaed parties. So we have served subpoenas for the inspection of these storage units on both the storage unit itself. And the storage unit itself, the storage company, is a company by the name of\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 7 of 26\n\nHo Wan Kwok - December 19, 2023 7 Arredondo and Company, LLC, which is doing business as Westy Storage. There's that company on whom we served a subpoena and then we've also served a subpoena on the entity that we understand to be the tenant who is leasing these storage units. And that's an entity named HGA Property Operations. So we've endeavored to reach out to them and have discussions prior to today's status conference. I'll detail the efforts we undertook. The bottom line is we have not made contact with them, but I do think we have completed service on both the storage company and on HGA Property Operations. Specifically, just to go briefly through the details, and we will be prepared to filed the certificate of service on the docket, but we have served the motion papers on Arredondo and Company. Again, that's the company doing business as Westy Storage. We served them through their registered agent, which is Attorney by the name of John Scagnelli, of a law firm located in New York and New Jersey. We also sent by mail a copy of the motion to -- the actual storage -- the Westy Storage Center itself. Sort of -- that's belt and suspenders. I also followed up via email and a phone call to try to get a hold of Mr. Scagnelli to see if his client would consent to this relief. I have not been able to do\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 8 of 26\n\nHo Wan Kwok - December 19, 2023 8 that but the motion has been served. As to HGA Property Operations we also sent a copy of the motion by mail in accordance with Rule 8000 -- or Rule 7004(b)(3) to HGA Property Operations, registered agent and to its registered office. So we believe that service is complete. We have a separate issue of trying to serve the subpoenas, which we were trying to do personally, which is separate from the motion. There we are still in the process of trying to reach a person, a human who can be served with the subpoena. But we have not yet completed that effort. However, I think -- and I'm happy to answer any questions, but I do think for present purposes, you know, we have completed service of the motion on all parties. We confirmed that the defendants have no objection to the relief that the trustee is seeking and, therefore, I think the trustee is prepared to move forward on the schedule we proposed to have a hearing at which parties who want to be heard and object, if they want, can attend on Thursday, subject to the court's availability, and then we would move forward, hopefully, with executing on the subpoenas on Friday. THE COURT: Okay. Does anyone else wish to be heard on the issues related to the preservation of evidence and the request for a hearing being held on Thursday?\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 9 of 26\n\nHo Wan Kwok - December 19, 2023 9 (No response.) Okay. Attorney Bassett, are you then going to be submitting a revised proposed order that states what you just stated on the record? MR. BASSETT: Yes, Your Honor. We're happy to submit a revised proposed order that details the efforts that the trustee has undertaken to effect service. Also happy to simply file on the docket, which we intend to do, certificates of service, or whatever the court would like. THE COURT: Well, let's think about this. You need an order setting a hearing on Thursday. And then you have to serve that order on the parties that are the subject of the subpoenas. So you need that order sooner as opposed to later, correct? MR. BASSETT: I suppose that is correct. In the motion that we filed we had indicated that we were requesting a hearing on Thursday, but I guess Your Honor's correct. The motion to expedite has not been granted and, therefore, we would need an order memorializing that, which we would serve on the parties. So yes, Your Honor, we will get that to you as soon as we can today. THE COURT: Well, let me look at the -- maybe we can -- let's just stop for one second.\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 10 of 26\n\nHo Wan Kwok - December 19, 2023 10 Maybe the way to handle it is to look at the order granting the motion to expedite the hearing first and then you file your certificates of service indicating everything you just said on the record, because you've got to give these parties some meaningful time to figure out whether they want to oppose or attend the hearing, although I actually think that -- well, I don't know. I have to look. So let's look at the motion to expedite the -- everything was filed yesterday. So we're still in the process of looking at it. And we had hearings today too, so give me a moment, please. (Pause.) All right. So I'm looking at the proposed order that scheduled and expedited hearing regarding emergency motion of Chapter 11 trustee to order preservation of evidence. (Pause.) Mr. Bassett, how -- let me ask you a question. We're having -- if we have this hearing on Thursday, are you able to tell the court with any kind of estimation as to what amount of time you think you need for this hearing? I'm asking because I need -- there are other things scheduled that day not on the calendar, but other things scheduled that day I have to attend to. So I need to\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 11 of 26\n\n| | Ho Wan Kwok - December 19, 2023 | 11 |\n|----|----------------------------------------------------------------|----|\n| 1 | know how much time you need. | |\n| 2 | MR. BASSETT:
Understood, Your Honor. | |\n| 3 | Naturally, it would depend on whether anyone | |\n| 4 | appears in the hearing to contest the motion, but I think | |\n| 5 | the relief that we're seeking is relatively straight | |\n| 6 | forward. | |\n| 7 | So even in the scenario where we had two parties | |\n| 8 | appear in opposition to the motion, I wouldn't expect we | |\n| 9 | would need more than a half hour at most to deal with it. | |\n| 10 | But, again, obviously it depends on what actually happens. | |\n| 11 | THE COURT:
Then what I'll do is I'll enter the | |\n| 12 | order granting the motion to expedite.
I'll set the hearing | |\n| 13 | for Thursday, the 21st, at 1:00 p.m.
And then I will set | |\n| 14 | the objection deadline to tomorrow. I'm not going to set a | |\n| 15 | specific date because you've still got to try to serve these | |\n| 16 | two other people and anybody else that you're going to | |\n| 17 | serve. | |\n| 18 | I know that the defendants don't oppose it and | |\n| 19 | that's good to know, but I think you have to give the other | |\n| 20 | people some ability to file something, if they want to. | |\n| 21 | So anyway that's what I propose to do.
Okay? | |\n| 22 | MR. BASSETT:
Understood, Your Honor.
And we'll | |\n| 23 | detail all of this in the certificates of service that we | |\n| 24 | file as well, to repeat what I said on the record today and | |\n| 25 | also even beyond what I said, we've taken even further steps | |\n| | | |\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 12 of 26\n\nHo Wan Kwok - December 19, 2023 12 to try to give these parties notice. In particular, for the HGA property operations entity, we have the name of the registered agent for that company and for a woman by the name of Kim Lee. We sent an email to an email address we have for that person. We also even called her. And my colleague, Ms. Song, got a hold of her and had a conversation and eventually the individual hung up the phone. But she was able to talk to her and relay what we were trying to convey about the hearing. So we'll put all of that out in the affidavit that we will in support of service and we'll get that filed as soon as we can. THE COURT: I can enter the order that you're already submitted. You don't need to submit another order. So I'm turning to courtroom deputy. The proposed order for ECF 85 in adversary 23- 5017. (Pause.) THE COURTROOM DEPUTY: Okay. THE COURT: Do you have it in front of you? I just want to tell you what -- it's minor changes that we might be able to make now and have the issue -- the order issued as soon as we can when we're done so that it can be served by the plaintiff.\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 13 of 26\n\n| | Ho Wan Kwok - December 19, 2023
13 |\n|----|--------------------------------------------------------------|\n| 1 | THE COURTROOM DEPUTY:
Yes. |\n| 2 | THE COURT:
So on the second page, the third |\n| 3 | paragraph, but the second ordered paragraph on that page, it |\n| 4 | says \"Shall be held on December 21st.\"
Say 1:00 p.m., |\n| 5 | please.
Do you see where I am? |\n| 6 | THE COURTROOM DEPUTY:
Yes. |\n| 7 | THE COURT:
Okay.
Great.
And then in the |\n| 8 | paragraph below it -- tell me when you're ready.
I don't |\n| 9 | mean to rush you. |\n| 10 | THE COURTROOM DEPUTY:
Okay. |\n| 11 | THE COURT:
In the ordered paragraph below it it |\n| 12 | says that \"The deadline to object to the emergency motion |\n| 13 | shall be December 20 at 12:00 p.m.,\" but please delete at |\n| 14 | 12:00 p.m. |\n| 15 | THE COURTROOM DEPUTY:
Okay.
Okay. |\n| 16 | THE COURT:
Okay? |\n| 17 | THE COURTROOM DEPUTY:
Okay. |\n| 18 | THE COURT:
And then that order can enter. |\n| 19 | THE COURTROOM DEPUTY:
Okay. |\n| 20 | THE COURT:
All right? |\n| 21 | THE COURTROOM DEPUTY:
Yes. |\n| 22 | THE COURT:
All right. |\n| 23 | So Mr. Bassett, that takes care of the first issue |\n| 24 | that we were to address during this continued status |\n| 25 | conference, unless there's something else I'm missing with |\n| | |\n\nHo Wan Kwok - December 19, 2023 14 regard to that matter. MR. BASSETT: I don't think so, Your Honor. Thank you very much. And for the second matter, as I indicated previously, I'll let Attorney Linsey give the court more of an update. THE COURT: Okay. Great. Thank you. MR. LINSEY: Good afternoon, Your Honor. Since the status conference yesterday counsel for the trustee has conferenced several times with counsel for the defendant. I understand, and I'll let Mr. Moriarty and Ms. Wernick confirm, that there is generally agreement by the defendant that an order may enter granting injunctive relief sought by the motion. We are currently conferencing regarding the form of that order. The Trustee's counsel received a revised form of order this afternoon from defendant's counsel. The trustee has some further revisions that we're in the process of preparing. One of the issues that we want to be -- that we want to be sure we've solved for here is that -- making sure that the remaining funds are removed from this JNFX account where they're diminishing. Our understanding right now is that there are\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 14 of 26\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 15 of 26\n\nHo Wan Kwok - December 19, 2023 15 approximately \\$10 million in the account in some form of currency. The purchase price for the Bombardier was 13 and a half million. JNFX received a bid over 12 million in February of his year. The best information the trustee has right now is that in about ten months more than \\$1.9 million of value has diminished, whether from the assessment of fees, costs or other transactions, or market fluctuations, or whatever that have occurred, that that is the value -- you know, that's what happened to the value of whatever JNFX is holding and it's very important to the trustee to ensure that that stops and that the actual value here is preserved. So as I said, we're discussing a proposed form of order. What the trustee proposes is that the court schedule a further hearing. Trustee's counsel is available tomorrow. We're also obviously available Thursday. That in advance of -- in advance of that continued to hearing date either the parties, and by that I mean the trustee and the defendant, will submit a one form -- a consent order that the court may enter, in which case there wouldn't need to be a hearing, or there are disagreements about the form of order, then each side will file some form of order and the court can look at those and discuss with the parties at the hearing which is more appropriate, or whatever order should be entered.\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 16 of 26\n\nHo Wan Kwok - December 19, 2023 16 THE COURT: Okay. Attorney Wernick or Attorney Moriarty? MR. MORIARTY: Your Honor, James Moriarty for the defendant, Ms. Guo. I think Attorney Linsey accurately summed up where we are. The defendant is not opposing the motion for the temporary restraining order at this point in time. It's really just trying to work out a consensual order. And if it can't do that, then move to submit competing orders to the court. I don't know that it's necessary for the court to hold a hearing to determine which order the court will enter, but if the court orders a hearing, then somebody on behalf of Ms. Guo will attend. THE COURT: Well, Ms. Guo isn't the only defendant, is she, in this adversary -- oh, in this one she is. Okay. All right. Sorry. MR. MORIARTY: Yes. THE COURT: All right. So we're talking about 23- 5008. MR. MORIARTY: Yes. THE COURT: Okay. So say -- Attorney Moriarty, I apologize. I was confused for a moment. But you said at the end if there's a hearing Ms. Guo will attend. Is that what you said?\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 17 of 26\n\nHo Wan Kwok - December 19, 2023 17 MR. MORIARTY: No. THE COURT: Okay. What did you say? MS. MORALES: What I said was the parties will either submit a consent order or the parties will each submit a proposed order. Attorney Linsey had suggested that the court would hold a hearing, to the extent the court has questions on those competing orders, before entering an order. I said I don't know that such a hearing is necessary for the court to determine which order to enter. But if the court schedules a hearing, somebody on behalf of Ms. Guo, meaning her counsel, will appear. THE COURT: I see. Okay. Thank you. So have you exchanged language at this point or not? MR. MORIARTY: On behalf of Ms. Guo, her counsel took the proposed order that the trustee had filed yesterday, provided some comments on that proposed order to the trustee and Attorney Linsey has told me that the trustee will be providing comments to Ms. Guo's counsel's comments. THE COURT: When you say Ms. Guo's counsel, who are you talking about? It doesn't sound like you're talking about you. MR. MORIARTY: I'm talking about myself and Attorney Wernick and Attorney Vartan and Attorney Romney.\n\nHo Wan Kwok - December 19, 2023 18 So it's not just me, Your Honor but, yes, I am talking about myself. THE COURT: I just wanted to make sure that we're talking -- okay. That's fine. (Pause.) I'm thinking about what you've all just said, okay. So Attorney Linsey, what's your time frame on getting back to the lawyers; Attorney Moriarty, Attorney Wernick, Attorney Vartan and who else did you say? Oh, Attorney Romney. MR. MORIARTY: Yes. MR. LINSEY: We received their comments and their form of order this afternoon. We will send a further version back to them later this afternoon and then if we had a continued to hearing tomorrow, I'm confident that we could either -- you know, either establish that we have a consented to form of order or have two competing forms of order. I understand that counsel for the defendant will be speaking with JNFX tomorrow as well. They may have more information at that point about whatever is logistically required in order to get the funds somewhere that they're not subject to transactions that are diminishing them. (Pause.)\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 18 of 26\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 19 of 26\n\n| | Ho Wan Kwok - December 19, 2023
19 |\n|----|--------------------------------------------------------------|\n| 1 | THE COURT:
I'm thinking about what you're saying. |\n| 2 | So you still need to give comments back is what you're |\n| 3 | telling me, Attorney Linsey? |\n| 4 | MR. LINSEY:
Yes, Your Honor. |\n| 5 | THE COURT:
So Attorney Moriarty, Attorney |\n| 6 | Wernick, when are you going to be speaking with counsel for |\n| 7 | JFNX.
At what time tomorrow? |\n| 8 | MS. WERNICK:
My understanding is that the call's |\n| 9 | been scheduled for 9:30 a.m. |\n| 10 | THE COURT:
Thank you. |\n| 11 | So I'm just envisioning the potential |\n| 12 | possibilities, right?
If you don't agree completely to an |\n| 13 | order, then I don't know what you're going to agree to |\n| 14 | except that you're agreeing to some form of restraint.
A |\n| 15 | temporary restraining order. |\n| 16 | But I don't know.
That might not necessarily be |\n| 17 | helpful. |\n| 18 | MR. LINSEY:
Your Honor, the conversations that we |\n| 19 | had today were productive.
There's still issues that need |\n| 20 | to be addressed. |\n| 21 | I'm hopeful that we'll be able to resolve those, |\n| 22 | but I think that it would be helpful to have a continued to |\n| 23 | hearing date, one to the extent that whatever happens |\n| 24 | tomorrow identifies any issues as to which the parties have |\n| 25 | disagreement and two, to ensure that this issue is resolved |\n| | |\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 20 of 26\n\n| | Ho Wan Kwok - December 19, 2023
20 |\n|----|--------------------------------------------------------------|\n| 1 | sooner rather than later because the trustee, given |\n| 2 | transactions that have apparently occurred with respect to |\n| 3 | these funds, including just in the last several weeks, this |\n| 4 | is a very urgent issue and wants to make sure that this |\n| 5 | relief enters (indiscernible)
these funds. |\n| 6 | So that's why we're imposing on the court and |\n| 7 | asking for the further date, but the parties are seeking -- |\n| 8 | certainly the trustee is seeking to get this done by consent |\n| 9 | and doesn't want to take the court's time unless it's |\n| 10 | necessary. |\n| 11 | MR. BASSETT:
Your Honor, if I may. |\n| 12 | THE COURT:
Go right ahead. |\n| 13 | MR. BASSETT:
Thank you, Your Honor. |\n| 14 | To be a little bit more precise, you know, I, |\n| 15 | along with Attorney Linsey, have reviewed the draft of the |\n| 16 | proposed order that we received from Attorney Moriarty and I |\n| 17 | think, as Attorney Linsey said, generally speaking, it does |\n| 18 | give the trustee the relief that he's seeking insofar as -- |\n| 19 | with the one, you know, open issue, insofar as the order |\n| 20 | would subject Ms. Guo to an injunction that requires her to |\n| 21 | freeze and maintain \\$25 million in assets which could be |\n| 22 | used to satisfy a judgment in the adversary proceeding. |\n| 23 | It further would restrain any transfer of the |\n| 24 | funds in the JNFX account that we all are aware of.
And |\n| 25 | that's sort of on a basic level the relief that we're |\n| | |\n\nHo Wan Kwok - December 19, 2023 21 seeking in the motion and we understand there is no opposition to that. So I think we are sort of 90 percent of the way there. The sole remaining issue, which I think the court may end up needing to address at a subsequent hearing is the issue of what actually physically is going to happen to the funds that are in the JNFX account. The issue that we have is that based on the account statements that we've seen over time that balance has been -- being depleted by transaction fees, or other charges which we're not fully aware of but we need to understand better. But the bottom line from the trustee's perspective is this injunction that we have is not going to be sufficient. The agreed order that I'm presented with is not going to be sufficient if it does not ensure that as we move forward there will be no such further transaction costs, fees or other deductions from the balance in that account because obviously every time that happens, it's reducing the value of potential property of the estate. So one solution that we had proposed, it's a very simple one, which is if Ms. Guo has control over that account, which we understand she does, all the funds that are there could be transferred to an escrow account. Maybe Case 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 21 of 26\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 22 of 26\n\nHo Wan Kwok - December 19, 2023 22 that's an escrow account with Mr. Moriarty's firm. Maybe it's an escrow account with the trustee. But there has to be a way to resolve that from our perspective. We're still working out the details of that with Attorney Moriarty and the rest of his team but, again, that really is the only -- from my perspective, the only sort of sticking point that we may need the court to weigh in on. We just hadn't had the chance to continue resolving that issue prior to day's status conference. THE COURT: Okay. MR. MORIARTY: Your Honor, on behalf of Ms. Guo, a couple of things in response to Attorney Bassett. I think there will be an ability to make a more intelligent decision and have a more intelligent discussion vis-a-vis fees and things of that nature. After the discussion with JNFX tomorrow, as far as moving the funds, it's certainly a conversation that we can have with our client, but I'm not going to represent to the court at this point in time what the outcome of that conversation will be. It may wind up that that is a sticking point. The comments that we sent back I don't expect -- and I think Attorney Bassett, he just kind of said that, but they're probably not controversial. So it may just be the one sticking point is are the funds going to stay at JNFX or are\n\nHo Wan Kwok - December 19, 2023 23 they going to move somewhere else. And we should be able to give the trustee more information on that tomorrow, as far as fees and those types of things, tomorrow morning. THE COURT: Okay. So the only issue is whether I'm continuing the hearing right now. That's the only issue for me to address at the moment. Is that correct? MR. BASSETT: And obviously we wanted to give Your Honor this update as to where we were. THE COURT: Well, no. I needed that, obviously. But I'm saying what is it, if anything, I can accomplish this afternoon, other than what we've already done, which is in the Taurus Fund adversary proceeding, enter that order scheduling the expedited hearing, which the courtroom deputy's already taken care of while we've been here in court, which is much appreciated. And then whether or not we're going to continue this hearing in 5008 with regard to the temporary restraining order. And I'm going to do that. I'm going to continue the hearing till noon on Thursday. If you have an order all buttoned up before then, then you can submit it and there may not be a hearing. But if you don't, then we'll have the hearing at noon on Thursday. And we're not issuing any kind of notice or anything. Everyone that's involved is on this call, is Case 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 23 of 26\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 24 of 26\n\n| | Ho Wan Kwok - December 19, 2023
24 |\n|----|-------------------------------------------------------------|\n| 1 | participating in this hearing and you have notice. |\n| 2 | So there's need to issue anything with regard to |\n| 3 | the continuation of the pretrial conference in this |\n| 4 | adversary proceeding to address whether or not there's a |\n| 5 | fully consensual temporary restraining order. So noon on |\n| 6 | Thursday. |\n| 7 | Does anyone have any questions or is there |\n| 8 | anything else that needs to be addressed this afternoon? |\n| 9 | MR. LINSEY:
I have one more thing with the |\n| 10 | court's indulgence.
It's in the form of a housekeeping |\n| 11 | matter relating to an order that the court entered |\n| 12 | yesterday. |\n| 13 | I was contacted by counsel for UBS.
The court |\n| 14 | granted a motion adjourning a hearing on the Chapter 11 |\n| 15 | trustee's motion to compel UBS to comply with the trustee's |\n| 16 | subpoena. |\n| 17 | The court granted the motion and adjourned the |\n| 18 | hearing to January 30, 2024.
Counsel for UBS, Ms. Freed, |\n| 19 | advised that she is traveling out of the country for |\n| 20 | business that week and -- |\n| 21 | THE COURT:
Well, then you both file a motion |\n| 22 | about a date that works for both of you so we don't have to |\n| 23 | keep doing this.
Okay?
So file a motion. |\n| 24 | MR. LINSEY:
All right.
We'll file a motion. |\n| 25 | Thank you, you |\n| | |\n\nCase 22-50073 Doc 2479 Filed 12/28/23 Entered 12/28/23 20:57:06 Page 25 of 26\n\nHo Wan Kwok - December 19, 2023 25 THE COURT: Thank you. Anything further from anyone this afternoon? MR. BASSETT: No, Your Honor. THE COURT: Okay. That concludes today's continued hearing. However, we are continuing the conference in the adversary to discuss the TRO to the 21st at noon. Thank you. MR. LINSEY: One question, Your Honor. The continued to hearing, is that in person or is that on Zoom. THE COURT: That is in person. MR. LINSEY: Thank you. THE COURT: Unless you all resolve it before then and then there won't be a need for a hearing. So there's your incentive. Make sure you finish it first and then you won't have to come. But if you don't, then you do. Okay? MR. LINSEY: Understood. Thank you, Your Honor. THE COURT: All right. Thank you. (Proceedings concluded at 2:47 p.m.)\n\n| | Ho Wan Kwok - December 19, 2023
26 |\n|----|-------------------------------------------------------------|\n| 1 | |\n| 2 | I, CHRISTINE FIORE, court-approved transcriber and |\n| 3 | certified electronic reporter and transcriber, certify that |\n| 4 | the foregoing is a correct transcript from the official |\n| 5 | electronic sound recording of the proceedings in the above |\n| 6 | entitled matter. |\n| 7 | |\n| 8 | |\n| 9 | December 28, 2023 |\n| 10 | Christine Fiore, CERT |\n| 11 | |\n| 12 | |\n| 13 | |\n| 14 | |\n| 15 | |\n| 16 | |\n| 17 | |\n| 18 | |\n| 19 | |\n| 20 | |\n| 21 | |\n| | |\n| 22 | |\n| 23 | |\n| 24 | |\n| | |\n| | |","body_zh":null,"key_entities":["Kwok","Ho Wan Kwok","Guo","Je","Paul Hastings","Despins","CIPA"],"ecf_references":[{"doc_number":85,"court":"CTB"}],"word_count":6129,"status":"published","published_at":"2023-12-28 00:00:00","created_at":"2023-12-28","updated_at":"2026-07-07 08:04:17"}