{"id":"court_ctb_3083_0","court":"CTB","case_no":"22-50073","doc_number":3083,"sub_number":0,"doc_type":"ORDER","filed_date":null,"title":"UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION In re:","summary_zh":null,"summary_en":null,"body_en":"## UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION\n\nIn re:\n\nCHAPTER 11\n\nHO WAN KWOK, *et al.*,\n\nDebtors.\n\nCase No. 22-50073 (JAM)\n\n(Jointly Administered)\n\n# **LIMITED OBJECTION OF ART WOLFE, INC. TO CHAPTER 11 TRUSTEE'S MOTION, PURSUANT TO 11 U.S.C. §§ 105(a) AND 363, FEDERAL RULES OF BANKRUPTCY PROCEDURE 7016, 7026, AND 9006, AND DISTRICT OF CONNECTICUT LOCAL BANKRUPTCY RULE 7016-1, TO MODIFY PROCEDURES APPLICABLE TO AVOIDANCE CLAIM ADVERSARY PROCEEDINGS TO INCLUDE PROCEDURES FOR MEDIATION OF AVOIDANCE ACTIONS**\n\nArt Wolfe, Inc. (\"Art Wolfe\") respectfully submits this limited objection (the \"Objection\") to the *Chapter 11 Trustee's Motion, Pursuant to 11 U.S.C. §§ 105(a) and 363, Federal Rules of Bankruptcy Procedure 7016, 7026, And 9006, and District of Connecticut Local Bankruptcy Rule 7016-1, to Modify Procedures Applicable to Avoidance Claim Adversary Proceedings to Include Procedures for Mediation of Avoidance Actions* [Docket No. 3003] (the \"Motion\"), filed by Luc A. Despins, chapter 11 trustee (the \"Trustee\") appointed for the chapter 11 debtors (collectively, the \"Debtors\") in the above-captioned chapter 11 cases. In support of this Objection, Art Wolfe respectfully states as follows:\n\n## **I. BACKGROUND**\n\n1. On January 29, 2024, the Trustee filed the *Motion for Order Approving Procedures Applicable to Avoidance Claim Adversary Proceedings* [Docket No. 2532] (the \"Avoidance Procedures Motion\"), requesting that the Court approve Avoidance Action Procedures (as defined in the Avoidance Procedures Motion) to govern numerous Avoidance Actions (as defined in the Avoidance Procedures Motion) contemplated by the Trustee.\n\n2. On February 7, 2024, the Court entered its *Order Approving Procedures Applicable to Avoidance Claim Adversary Proceedings* [Docket No. 2578] (the \"Avoidance Procedures Order\") granting the Avoidance Procedures Motion.\n\n3. On February 10, 2024, the Trustee filed the *Complaint of Chapter 11 Trustee Seeking Avoidance and Recovery of Fraudulent Transfers and Related Relief Pursuant to Bankruptcy Code Sections 544, 548, and 550 and New York Debtor & Creditor Law Sections 273, 274, and 276* [Adv. Pro. No. 24-05033 (\"Adv. Pro.\") Docket No. 1] (the \"Complaint\"), naming Art Wolfe as the Defendant.\n\n4. On March 15, 2024, the Trustee filed the Motion, requesting that the Court revisit the Avoidance Action Procedures to provide for mandatory mediation. (*See* Docket No. 3003, ¶¶ 10–12.)\n\n5. On March 22, 2024, the Trustee filed the *[Revised Proposed] Amended Order Approving Procedures Applicable to Avoidance Claim Adversary Proceedings* [Docket No. 3035] in which the Trustee sought to provide that the Mediation Proceedings (as defined in the Motion) would commence upon a defendant appearing in an avoidance action on or before such defendant's deadline to respond to the Trustee's avoidance complaint, rather than requiring the defendant to file a substantive response to an avoidance complaint prior to mediation, among other requested changes.\n\n6. On March 22, 2024, the Court entered the *Scheduling Order Regarding Chapter 11 Trustee's Motion, Pursuant to 11 U.S.C. §§ 105(a) and 363, Federal Rules of Bankruptcy Procedure 7016, 7026, and 9006, and District of Connecticut Local Bankruptcy Rule 7016-1, to Modify Procedures Applicable to Avoidance Claim Adversary Proceedings to Include Procedures for Mediation of Avoidance Actions* [Docket No. 3037] (the \"Scheduling Order\"), setting April 12, 2024, as the deadline to file any response to the Motion and scheduling a hearing on the Motion for April 23, 2024.\n\n#### **II. LIMITED OBJECTION**\n\n7. Art Wolfe like numerous other similarly situated defendants has found itself subjected to litigation in this bankruptcy case as a result of receiving a transfer in the ordinary course of business from legal entities that the Trustee now says are \"alter egos\" of the Debtor. Putting aside the merits of these claims, Art Wolfe has concerns with a few discrete aspects of the mediation procedures sought in the Motion because they unduly impose additional costs on the defendants in the Avoidance Actions.\n\n8. In the Motion, the Trustee seeks to compel Art Wolfe to mediate the claims the Trustee brought in the Complaint pursuant to the mediation procedures (the \"Mediation Procedures\") detailed in the Motion. Art Wolfe does not object to the Motion in its entirety or even engaging in some form of mediation. However, Art Wolfe does object to the following: (i) paragraph 12(u), which seeks to compel the parties to split equally the Mediation Fee, as defined in the Motion, (ii) paragraph 12(s), which leaves whether a representative of Art Wolfe (the \"Representative\") need be present in person, rather than virtually, for a mediation to the discretion of the mediator, and (iii) paragraph 12(v), which provides that if a party to the mediation is not attempting to schedule or resolve the mediation in good faith, an opposing party may file a motion for sanctions. Each concern is addressed in turn.\n\n9. First, the Motion requires that the Trustee and the defendants split equally the Mediation Fees, and the Motion does not provide a sense of the hourly rate or cap for such fees. While the Motion offers that defendants can by motion make a showing of hardship to perhaps obtain a Court order (or order from Judge Tancredi) that could alter this arrangement, such a motion would require the defendant to further expend resources to obtain relief, in part or in full, from the obligation to pay for a mediation that the Trustee is compelling.\n\n10. Simply put, the estate should pay for the costs of any mediation. The Trustee—not Art Wolfe—initiated this adversary proceeding. Further, the Trustee is the party that wishes to stay the adversary proceeding and compel Art Wolfe to mediate the issues underlying the Complaint. The Trustee should therefore be required to cover the entirety of the Mediation Fee. Suing a party, compelling that party to mandatory mediation, and then forcing that party to foot half the bill associated with that mediation is unfair and contrary to common practice. *See, e.g.*, *In re Verasun Energy Corporation, et al.*, Case No. 08-12606 (BLS) (D. Del. Dec 21, 2010) (requiring the party that compelled mediation to cover the entire cost of the mediation); *In re Taylor, Bean & Whitaker Mortgage Corp., et al.*, Case No. 3:09-bk-07047-JAF (Bankr. M.D. Fla. Aug 25, 2011) (same); *In re Red Rose, Inc.*, Case No. BK-S-20-12814-MKN (D. Nev. Aug 12, 2021) (same); *In re TOUSA, Inc., et al.*, Case No. 08-10928-BKC-JKO (Bankr. S.D. Fla. July 14, 2009) (same).\n\n11. Second, in a similar vein, leaving it to the discretion of the mediator whether the Representative must attend a mediation in person that s/he is being compelled to participate in rather than virtually—is unjust. In a time where individuals, law firms, and courts have adapted to conducting business virtually, there is no compelling reason why such efficiencies and cost saving measures should not be utilized here too where there would be no impact to the outcome. Art Wolfe's Representative lives and works in Seattle, Washington. If forced to attend in person, Art Wolfe's Representative will incur significant travel, lodging, and loss of time costs. Requiring defendants, like Art Wolfe, to incur these wholly unnecessary travel related costs to attend a mediation that the Trustee is compelling is again unfair and unjust. Such burdensome costs could\n\nbe avoided—across hundreds of adversary proceedings—if the decision of whether the Representative attends the mediation in person or virtually is not left to the sole discretion of the mediator.\n\n12. Lastly, Art Wolfe understands that sanctions may be an appropriate remedy for a party working to stall and stymie a mediation. However, it should be clarified that a party's decision to offer or not offer any particular amount of money, or the inability to reach a settlement through mediation due to zealous advocacy or because a defendant and the Trustee simply cannot reach a resolution due to differing views of the law and facts should not be permitted as a basis for sanctions. In short, the requirement that parties mediate in good faith does not mean that a resolution must be reached through such means.\n\n#### **III. CONCLUSION**\n\nWHEREFORE, Art Wolfe respectfully requests that the Court take notice of this Objection, modify the Motion's Mediation Procedures as detailed herein, and grant such other relief as the Court deems just, proper, and equitable.\n\nDated: April 11, 2024 DEFENDANT\n\nART WOLFE, INC.\n\nBy: /s/ *Jessica M. Signor*\n\n### SHIPMAN & GOODWIN LLP\n\nEric S. Goldstein (CT27195) One Constitution Plaza Hartford, CT 06103-1919 Telephone: (860) 251-5000 Facsimile: (860) 251-5218 egoldstein@goodwin.com\n\nJessica M. Signor (CT30066) 300 Atlantic Street, 3rd Floor Stamford, CT 06901 Telephone: (203) 324-8100 Facsimile: (203) 324-8199 jsignor@goodwin.com\n\n*Attorneys for Defendant*\n\n#### **CERTIFICATE OF SERVICE**\n\nI hereby certify that on April 11, 2024, a copy of the foregoing Limited Objection was filed electronically and served by mail on anyone unable to accept electronic filing. Notice of this filing will be sent by e-mail to all parties by operation of the Court's electronic filing system or by First Class mail to anyone unable to accept electronic filing as indicated on the Notice of Electronic Filing. Parties may access this filing through the Court's CM/ECF System.\n\n> /s/ *Jessica M. Signor* . Jessica M. Signor, Esq.","body_zh":"UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION（美国康涅狄格区破产法院布里奇波特分院）\n\n关于：\n\n第11章\n\nHO WAN KWOK（郭文贵）等，\n\n债务人。\n\n案号：22-50073 (JAM)\n\n（合并审理）\n\nART WOLFE, INC. 对第11章受托人依据 11 U.S.C. §§ 105(a) 及 363、《联邦破产诉讼规则》第 7016、7026 及 9006 条以及《康涅狄格区本地破产规则》第 7016-1 条提出的修改适用于撤销权主张对席诉讼程序以纳入撤销诉讼调解程序的动议的有限异议\n\nArt Wolfe, Inc.（“Art Wolfe”）谨对上述第11章案件中为第11章各债务人（统称“债务人”）指定的第11章受托人（“受托人”）Luc A. Despins 提交的《第11章受托人依据 11 U.S.C. §§ 105(a) 及 363、《联邦破产诉讼规则》第 7016、7026 及 9006 条以及《康涅狄格区本地破产规则》第 7016-1 条提出的修改适用于撤销权主张对席诉讼程序以纳入撤销诉讼调解程序的动议》[案卷号 3003]（“动议”）提交本有限异议（“异议”）。为支持本异议，Art Wolfe 谨陈述如下：\n第一部分 背景\n\n1. 2024年1月29日，受托人提交了《关于批准适用于撤销权主张对席诉讼程序之命令的动议》[案卷号 2532]（“撤销程序动议”），请求法院批准撤销诉讼程序（定义见撤销程序动议），以规范受托人拟提起的众多撤销诉讼（定义见撤销程序动议）。\n\n2. 2024年2月7日，法院作出了《关于批准适用于撤销权主张对席诉讼程序之命令》[案卷号 2578]（“撤销程序命令”），批准了撤销程序动议。\n\n3. 2024年2月10日，受托人提交了《第11章受托人依据破产法典第 544、548 及 550 条以及纽约州债务人与债权人法第 273、274 及 276 条寻求撤销和追回欺诈性转让及相关救济的起诉书》[对席诉讼案号 24-05033（“Adv. Pro.”）案卷号 1]（“起诉书”），将 Art Wolfe 列为被告。\n\n4. 2024年3月15日，受托人提交了动议，请求法院重新审视撤销诉讼程序以规定强制调解。（见案卷号 3003，¶¶ 10–12。）\n\n5. 2024年3月22日，受托人提交了《[修改后的拟议] 关于批准适用于撤销权主张对席诉讼程序之修改命令》[案卷号 3035]，除其他请求的修改外，受托人在其中试图规定调解程序（定义见动议）应在被告于撤销诉讼中出庭之日或该被告对受托人撤销起诉书作出回应的截止日期当日或之前开始，而不是要求被告在调解前对撤销起诉书提交实质性答辩。\n\n6. 2024年3月22日，法院作出了《关于第11章受托人依据 11 U.S.C. §§ 105(a) 及 363、《联邦破产诉讼规则》第 7016、7026 及 9006 条以及《康涅狄格区本地破产规则》第 7016-1 条提出的修改适用于撤销权主张对席诉讼程序以纳入撤销诉讼调解程序的动议的排期命令》[案卷号 3037]（“排期命令”），设定2024年4月12日为对动议提交任何回应的截止日期，并排定于2024年4月23日就动议举行听证会。\n第二部分 有限异议\n\n7. 与众多处于类似境地的其他被告一样，Art Wolfe 由于在正常业务过程中从受托人目前称之为债务人“另类自我（alter egos）”的法律实体处收到了转让款项，从而发现自己在该破产案件中卷入了诉讼。撇开这些主张的实体是非曲直不谈，Art Wolfe 对动议中寻求的调解程序的几个具体方面存有疑虑，因为这些程序给撤销诉讼中的被告带来了不合理且额外的成本。\n\n8. 在动议中，受托人试图根据动议中详述的调解程序（“调解程序”），强迫 Art Wolfe 就受托人在起诉书中提出的诉求进行调解。Art Wolfe 并非完全反对该动议，甚至不反对参与某种形式的调解。然而，Art Wolfe 确实反对以下各项：(i) 第 12(u) 段，该段试图强迫各方平摊动议中所定义的调解费；(ii) 第 12(s) 段，该段将 Art Wolfe 的代表（“代表”）参加调解是否必须亲自到场而非以线上方式出席交由调解员自由裁量；以及 (iii) 第 12(v) 段，该段规定如果调解的一方未善意尝试排定或解决调解，相对方可以提交制裁动议。以下依次阐述各项关切。\n\n9. 首先，动议要求受托人与各被告平摊调解费，且动议并未就该等费用的每小时费率或上限提供任何参考。虽然动议提出被告可以通过动议提出困难证明，以期可能获得法院命令（或 Tancredi 法官作出的命令）从而改变该安排，但此类动议将要求被告进一步耗费资源，以就受托人强行要求的调解免除其全部或部分支付义务。\n\n10. 简而言之，调解费用应由破产财产承担。本对席诉讼是由受托人——而非 Art Wolfe——发起的。此外，希望中止对席诉讼并强迫 Art Wolfe 就起诉书所涉及的事项进行调解的一方也是受托人。因此，应当要求受托人承担全部调解费。起诉一方当事人、强迫该当事人进行强制调解、继而又强迫该当事人为与该调解相关的账单支付一半费用，这是不公平的，且与通常惯例背道而驰。参见例如 In re Verasun Energy Corporation, et al., 案号 08-12606 (BLS) (D. Del. 2010年12月21日)（要求强推调解的一方承担调解的全部费用）；In re Taylor, Bean & Whitaker Mortgage Corp., et al., 案号 3:09-bk-07047-JAF (Bankr. M.D. Fla. 2011年8月25日)（同上）；In re Red Rose, Inc., 案号 BK-S-20-12814-MKN (D. Nev. 2021年8月12日)（同上）；In re TOUSA, Inc., et al., 案号 08-10928-BKC-JKO (Bankr. S.D. Fla. 2009年7月14日)（同上）。\n\n11. 其次，依此类推，将代表是被强迫参加调解的前提下是否必须亲自到场——而非以线上方式——出席调解交由调解员自由裁量，是不公正的。在个人、律师事务所和法院都已适应在线开展业务的时代，在对结果没有任何影响的情况下，没有任何令人信服的理由不在本案中同样利用此类提高效率和节约成本的措施。Art Wolfe 的代表在华盛顿州西雅图（Seattle, Washington）生活和工作。如果被强迫亲自到场，Art Wolfe 的代表将承担高昂的差旅、住宿和时间损失成本。要求像 Art Wolfe 这样的被告承担这些为参加受托人强推的调解而产生的完全不必要的差旅相关费用，同样是不公平和不公正的。如果不把代表是亲自到场还是以线上方式出席调解的决定权完全交由调解员自行裁量，那么在数百起对席诉讼中，此类繁重的成本本可以避免。\n\n12. 最后，Art Wolfe 理解对于企图拖延和阻挠调解的一方，制裁可能是一种适当的救济手段。但是，应当明确的是，一方当事人决定提供或不提供任何特定金额的款项，或者由于激烈的抗辩而无法通过调解达成和解，或者因为被告与受托人因对法律和事实的不同看法而根本无法达成解决方案，都不应被允许作为予以制裁的依据。简而言之，要求各方善意调解并不意味着必须通过该等手段达成解决方案。\n第三部分 结论\n\n综上所述，Art Wolfe 谨请求法院注意到本异议，按照本文详述修改动议中的调解程序，并给予法院认为公正、正当和衡平的其他救济。\n\n日期：2024年4月11日 被告\n\nART WOLFE, INC.\n\n签署人：/s/ Jessica M. Signor\nSHIPMAN & GOODWIN LLP\n\nEric S. Goldstein (CT27195)\nOne Constitution Plaza\nHartford, CT 06103-1919\n电话：(860) 251-5000\n传真：(860) 251-5218\negoldstein@goodwin.com\n\nJessica M. Signor (CT30066)\n300 Atlantic Street, 3rd Floor\nStamford, CT 06901\n电话：(203) 324-8100\n传真：(203) 324-8199\njsignor@goodwin.com\n\n被告代理律师\n送达证明书\n\n我在此证明，2024年4月11日，前述有限异议的副本已通过电子方式提交，并已通过邮寄方式送达给无法接受电子提交的任何人。本提交的通知将通过法院电子提交系统的运行通过电子邮件发送给所有当事方，或者如电子提交通知所示通过第一类邮件（First Class mail）发送给无法接受电子提交的任何人。各当事方可通过法院的 CM/ECF 系统查阅本提交文件。\n\n/s/ Jessica M. Signor . Jessica M. Signor, Esq.","key_entities":["Je","Kwok","Ho Wan Kwok","Despins","CIPA"],"ecf_references":[],"word_count":1497,"status":"published","published_at":null,"created_at":null,"updated_at":"2026-08-23 12:53:58"}