{"id":"court_ctb_884_0","court":"CTB","case_no":"22-50073","doc_number":884,"sub_number":0,"doc_type":"ORDER","filed_date":"2022-09-27","title":"UNITED STATES BANKRUPTCY COURT **UPDATED** DISTRICT OF CONNECTICUT **7/20/22** BRIDGEPORT DIVISION In Re \\* Case No. 22-","summary_zh":null,"summary_en":null,"body_en":"Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 1 of 119\n\nUNITED STATES BANKRUPTCY COURT **UPDATED** DISTRICT OF CONNECTICUT **7/20/22** BRIDGEPORT DIVISION In Re \\* Case No. 22-50073(JAM) \\* HO WAN KWOK, \\* Bridgeport, Connecticut \\* May 25, 2022 Debtor. \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* \\* TRANSCRIPT OF MOTION FOR ORDER DIRECTING APPOINTMENT OF AN EXAMINER, OR IN THE ALTERNATIVE MOTION FOR ORDER DIRECTING THE APPOINTMENT OF A CHAPTER 11 TRUSTEE; MOTION TO DISMISS CHAPTER 11 CASE OR IN THE ALTERNATIVE, PARTIAL JOINDER TO U.S. TRUSTEE'S MOTION FOR AN ORDER DIRECTING THE APPOINTMENT OF A CHAPTER 11 TRUSTEE BEFORE THE HONORABLE JULIE A. MANNING UNITED STATES BANKRUPTCY JUDGE APPEARANCES: For the Debtor: BENNETT S. SILVERBERG, ESQ. JEFFREY L. JONAS, ESQ. Brown Rudnick, LLP Seven Times Square New York, NY 10036 For the Creditor, Pacific PETER FRIEDMAN, ESQ. Alliance Asia Opportunity LAURA ARONSSON, ESQ. Fund L.P.: O'Melveny & Myers LLP Times Square Tower 7 Times Square New York, NY 10036 PATRICK M. BIRNEY, ESQ. Robinson & Cole LLP 280 Trumbull Street Hartford, CT 06103 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 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 For the Official Committee IRVE GOLDMAN, ESQ. of Unsecured Creditors: Pullman & Comley 850 Main Street Bridgeport, CT 06601 For Rui Ma, Zheng Wu and KRISTIN MAYHEW, ESQ. Weican Meng, Creditors: McElroy, Deutsch, Mulvaney & Carpenter 30 Jeliff Lane Southport, CT 06890 CAROLLYNN H.G. CALLARI, ESQ. Law firm of Callari Partners One Rockefeller Plaza New York, NY 10020\n\n1\n\n (Proceedings commenced at 10:05 A.m.) THE COURTROOM DEPUTY: Case no. 22-50073, Ho Wan Kwok. THE COURT: Okay. Good morning. If we could have appearances for the record starting with the debtor's counsel, please? MR. JONAS: Good morning, Your Honor. Jeff Jonas from Brown Rudnick. With me is Ben Silverberg, and Bill Baldiga is sitting behind me for the debtor this morning. Thank you. THE COURT: Good morning. MR. FRIEDMAN: Good morning, Your Honor. Peter Friedman from O'Melveny & Myers, joined by Laura Aronsson on behalf of Pacific Alliance Group. THE COURT: Good morning. MR. BIRNEY: Good morning, Your Honor. Patrick Birney, also on behalf of PAX. THE COURT: Good morning. MR. GOLDMAN: Good morning, Your Honor. Irve Goldman, Pullman and Comley, representing the creditors committee. THE COURT: Good morning. MS. CLAIBORN: Good morning, Your Honor. Holley Claiborn for the U.S. Trustee. THE COURT: Good morning.\n\n MS. MAYHEW: Good morning, Your Honor. Kristin Mayhew, McElroy, Deutsch, Mulvaney & Carpenter, on behalf of creditors Rui Ma, Zheng Wu, and Weican Meng. And also with me is Carollynn Callari of Callari Partners. THE COURT: Good morning to both of you. Is there anyone else whose appearances we need to take this morning? Okay. All right. As we all know, this is the hearing today on a motion the dismiss, or in the alternative, for the appointment of a trustee. At our last hearing, heading up to today's hearing, I was told that all the parties have agreed. And you've confirmed this in your papers, that you consent to a finding that cause exists under 1112(b) to do something, to either dismiss the case, convert the case, or appoint a Chapter 11 trustee. I have looked at your list of witnesses and exhibits, and I have looked at your position papers with regard to dismissal, conversion, or the appointment of a Chapter 11 trustee. I don't know if there's anything further the parties want to inform the Court about before we start with evidence? Mr. Jonas? Mr. Friedman? MR. FRIEDMAN: No, Your Honor. I think Ms. Aronsson is going to address what we submit in terms of evidence. I believe Ms. Aronsson and\n\nFiore Reporting and Transcription Service, Inc.\n\n counsel for the committee have agreed on what will be admissible, and we've withdrawn some things, so I think I would turn it over to Ms. Aronsson, and then Mr. Goldman to walk through what they've -- each party wants admitted. And then I would ask leave to argue after that's concluded. THE COURT: Certainly. Okay. Ms. Aronsson, did you want to start, please? Do you want to proceed? MS. ARONSSON: Sure. Thank you, Your Honor. THE COURT: Before you proceed for one second, I have to ask the courtroom deputy, do we need any kind of issue on technology. You're going to -- are you going to introduce exhibits? MS. ARONSSON: Yes. THE COURT: Okay. MS. ARONSSON: Planning on offering -- THE COURT: Do I need to have this camera on, then, for that? THE COURTROOM DEPUTY: [Courtroom Deputy speaking] THE COURT: It's on, but do I need to have it actually -- this turned on and open? THE COURTROOM DEPUTY: [Courtroom Deputy speaking] THE COURT: Because I can't see anything here, so I assume, unfortunately, I have to have this open. THE COURTROOM DEPUTY: [Courtroom Deputy\n\n speaking]. THE COURT: No, but she will be. So I don't want to, you know, stop the process. MS. ARONSSON: Your Honor, I'm not sure we need to open any evidence right now. THE COURT: Okay. All right. So then we'll take -- when you're ready to do that, will you let me know so I can make sure our technology people -- I'm not doing something wrong, because I probably will be, but I'll try not to. Okay? MS. ARONSSON: Will do. THE COURT: All right. So, Attorney Aronsson, go right ahead. You may proceed. MS. ARONSSON: Thank you, Your Honor. PAX is offering into evidence the exhibits filed on the docket numbered PAX 1 through PAX 31, except for PAX 7, PAX 8, and PAX 30. THE COURT: 7, 8, and 30 are not being admitted? MS. ARONSSON: That's correct. THE COURT: Does anyone have -- have you talked about whether anyone has any oppositions to the introduction of these exhibits? MS. ARONSSON: So we met and conferred with Mr. Goldman yesterday, and I understand our withdrawal represents our good faith meet and confer. I understand\n\nFiore Reporting and Transcription Service, Inc.\n\n there might be one disagreement left -- THE COURT: Okay. MS. ARONSSON: -- based on our conversation this morning. MR. GOLDMAN: Yes. That's correct, Your Honor. We just -- I think I would expect brief argument on a set of -- a series of transcripts that they seek to introduce from the New York action. So that isolates the dispute. THE COURT: Okay. Now with regard to the -- so does anyone else wish to be heard on the admission of the exhibits? No one? Okay. So, Attorney Aronsson, you are introducing these exhibits in full, correct? MS. ARONSSON: That's correct. THE COURT: All right. Now, I think I may have said this in prior hearings. I have no problem with you moving for the admission in full of these exhibits. That doesn't mean I'm going to read every page of them, and so, you know, during this time, you may want to point me to certain things. But in any event, I've said this. This is something I say to all, counsel. This is not unique to this case. I have no problem and appreciate when the parties work cooperatively with regard to the admission of exhibits, but I'm not -- I just want everyone to know, that does not mean I'm going to read every page. Okay?\n\n MS. ARONSSON: Understood. THE COURT: Okay. Go right ahead. MS. ARONSSON: Would you like to hear argument on the -- THE COURT: Possibly. MS. ARONSSON: Okay. THE COURT: Hold on for one second. So I'm going to then announce on the record that Exhibit -- PAX Exhibit 1 through 31, with the exception of Exhibits -- PAX Exhibits 7, 8, and 30, are admitted as full exhibits. MR. GOLDMAN: May I make a qualification? THE COURT: Yes. MR. GOLDMAN: There are exhibits -- the exhibits that are in question that are in challenge are Exhibits 18 through 22. Those are the hearing transcripts that they're seeking to introduce from hearings in New York Supreme Court. So we -- you know, we would -- Your Honor would need to resolve -- THE COURT: All right. So what's your objection to those -- MR. GOLDMAN: Well, the objection is, they're pure hearsay. Just because they are from a court proceeding does not make them public records. THE COURT: Why are they hearsay? MR. GOLDMAN: Well, they're out-of-court\n\n statements. THE COURT: They're not statements. They're a record of a hearing, right? MR. GOLDMAN: Well, they're certainly statements in the record, made by various parties -- THE COURT: Right. MR. GOLDMAN: -- that counsel and -- THE COURT: And their weight will be given whatever I think is appropriate. But it's a transcript. Are you -- if you're objecting to the transcript itself, somehow saying it's not official or authenticated -- MR. GOLDMAN: No. No. THE COURT: -- then that's a different objection. MR. GOLDMAN: It's not my objection. THE COURT: Okay. MR. GOLDMAN: My objection is, they're clearly hearsay because they are out-of-court statements being submitted for the truth of what's asserted in the statements, and they are not -- they don't come within the public records exception. THE COURTROOM DEPUTY: I'm sorry, Your Honor. THE COURT: Hold on a second, Attorney Goldman. You can't hear? THE COURTROOM DEPUTY: I can't hear Attorney Goldman.\n\n THE COURT: We can't hear you very well. MR. GOLDMAN: I'm sorry. They are clearly out-of- court statements submitted for the truth of the matters asserted. THE COURT: Aren't they -- aren't they -- they're admissions of parties. They are the debtor and PAX at a hearing. MR. GOLDMAN: Well -- THE COURT: And they're being admitted for -- what -- anyway. Go ahead, Attorney Goldman. You keep going, but I'm not sure I'm convinced yet. MR. GOLDMAN: Okay. You know, to the extent they're seeking to introduce statements by -- from the debtor, the debtor is not opposing -- THE COURTROOM DEPUTY: I'm sorry, Your Honor. THE COURT: Hold on a second. We still can't hear you? THE COURTROOM DEPUTY: Yeah. I'm being told it would be better if Attorney Goldman could come to the lectern. THE COURT: There's something -- they're not picking you up, Attorney Goldman. MR. GOLDMAN: Can I go up there? THE COURT: Yes, please. THE COURTROOM DEPUTY: The microphone does not\n\n have a light on it. THE COURT: It's not working for whatever reason, that microphone. MR. GOLDMAN: Okay. Okay. THE COURTROOM DEPUTY: Something is wrong because -- THE COURT: Okay. All right. Yes, if you could come forward? MR. GOLDMAN: Yeah. THE COURT: Thank you. MR. GOLDMAN: Sure. Is this better, Your Honor? THE COURT: Yes. Now I -- I believe, right? Everyone can hear Attorney Goldman? MR. GOLDMAN: Yep. THE COURT: Okay. Go ahead. THE COURTROOM DEPUTY: Yes. MR. GOLDMAN: So to the extent they want to introduce statements from the debtor's counsel, I don't think the debtor was actually present at any of these hearings. Counsel was present. So the debtor is not an opposing party here. The debtor consents to the relief requested, so in order to be non-hearsay of a party opponent, the statement has to be offered -- it has to be a statement of the opposing party. The only opposing party here is the committee. So it doesn't work as non-hearsay of\n\n a party opponent. The public record exception does not cover court hearing transcripts. It states -- THE COURT: Why? MR. GOLDMAN: -- a record or statement of a public office, if it sets out the office's activities, a matter observed while under a legal duty to report. In a civil case, factual findings from a legally authorized investigation. A court hearing from another court simply doesn't fit within the elements of the public records exception. It's designed to admit into evidence reports of agencies of the state and federal government, or departments. THE COURT: So you're saying a transcript of any hearing ever held that is certified can never be admitted into evidence because every single transcript will be hearsay? MR. GOLDMAN: It's out of -- it's an out-of-court statement. It doesn't come within the public records exception, or any other exception that I am aware of, except to the -- THE COURT: So what's the point of a record, then? MR. GOLDMAN: -- except to the extent that the Court is making factual findings or conclusions of law. THE COURT: Well, maybe the judge did that in\n\n those -- during those hearings. MR. GOLDMAN: Well, then, you know, Your Honor -- THE COURT: I think he did, didn't he? MR. GOLDMAN: Well, they -- there are 300 pages of transcripts that -- THE COURT: I understand. MR. GOLDMAN: So I don't know what -- THE COURT: I'm not going to read all of them, but I know that -- MR. GOLDMAN: I don't know what -- THE COURT: -- there are -- there, in those transcripts, I believe I've seen prior in this case, findings by the court about the veracity of testimony, of certain witnesses, about the judge's findings, about the ownership of the boat. Things of those nature, which that was his finding. Those were his findings. MR. GOLDMAN: I concede that that would be admissible. I'm talking about, you know, they're seeking to admit the entire -- THE COURT: And as I said already, I'm not going to read the entire transcript. I -- if counsel wants me to focus on something in the transcript, I will do so. And then you could have the opportunity to object at that time if it's hearsay. But I'm not sure I'm persuaded at this point.\n\n I'll let you -- you know, I'll let you make that argument again if and when counsel points to specific portions of that transcript that she -- that they are asking me to look at. And if you, at that time, want to renew your hearsay objection, then you can renew that and then I'll rule accordingly. MR. GOLDMAN: Yeah. Just so Your Honor is -- so I'm clear, I don't have a problem if there are factual findings made, or conclusions of law made by the Court. It just -- I don't think observations of a court in a transcript would come within the public records exception. That's what I'm saying. THE COURT: Okay. All right. Thank you. MR. GOLDMAN: Okay. Thank you, Your Honor. THE COURT: Counsel, go ahead. MS. ARONSSON: Thank you. So just to clarify, in our conversations with Mr. Goldman yesterday, we do intend to use -- to offer these transcripts for Justice Ostrager's findings contained -- not any testimony about -- of witness that might fall within hearsay. So I think we're in agreement on that front. THE COURT: All right. So what I'm going to do, then, is I'm going to at this time -- again, we'll have to clarify the record. At this point, PAX Exhibits 1 through 6, 9 through 17, and 23 through 29, and 31 are admitted as\n\nFiore Reporting and Transcription Service, Inc.\n\n| 1 | full exhibits.
18, 19, 20, 21, and 22 still remain possibly |\n|----|----------------------------------------------------------------|\n| 2 | subject to objection to the creditor's committee, which the |\n| 3 | Court will rule on when and if you direct me to some |\n| 4 | specific portions of the transcript.
Okay? |\n| 5 | MS. ARONSSON:
Thank you, Your Honor. |\n| 6 | THE COURT:
Okay.
Thank you. |\n| 7 | (PAX Exhibit Nos. 1-6, 9-17, 23-29, and 31 admitted in |\n| 8 | full) |\n| 9 | THE COURT:
Go ahead, Attorney Goldman. |\n| 10 | MR. GOLDMAN:
Yes.
If it -- Your Honor, for the |\n| 11 | committee, we would offer into evidence our Exhibits 1 |\n| 12 | through 14, and I believe there aren't any objections to |\n| 13 | that to be -- |\n| 14 | MR. FRIEDMAN:
There are no objections to that, |\n| 15 | Your Honor.
It's Peter Friedman.
And we actually also |\n| 16 | endorse the committee's suggestion that the Court take |\n| 17 | judicial notice of the record of this case.
I think that |\n| 18 | was a point that I think both the U.S. Trustee and committee |\n| 19 | counsel made, and we think that that's a fair point to make, |\n| 20 | and that the full record of these cases should be taken |\n| 21 | judicial notice of. |\n| 22 | THE COURT:
The -- okay.
Thank you.
Attorney |\n| 23 | Goldman, I haven't done a cross-reference, but are any of |\n| 24 | your exhibits the same as PAX's exhibits? |\n| 25 | MR. GOLDMAN:
I believe there is one, the debtor's |\n| | |\n\nFiore Reporting and Transcription Service, Inc.\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 16 of 119\n\n| | 16 |\n|----|--------------------------------------------------------------|\n| 1 | declaration.
I think we both have that.
That's our -- |\n| 2 | THE COURT:
Your Exhibit 2? |\n| 3 | MR. GOLDMAN:
Yes. |\n| 4 | THE COURT:
All right.
Hold on a second.
And |\n| 5 | PAX's Exhibit 2.
It's the same number, right? |\n| 6 | MR. GOLDMAN:
Yes. |\n| 7 | THE COURT:
Okay.
All right.
So you're asking |\n| 8 | the Court, Attorney Goldman, to admit as full exhibits, the |\n| 9 | unsecured creditor's committee Exhibits 1 through 14.
Is |\n| 10 | that correct? |\n| 11 | MR. GOLDMAN:
Yes, Your Honor. |\n| 12 | THE COURT:
Okay.
Anyone else wish to be heard on |\n| 13 | the admission of -- Creditor's Committee Exhibits 1 through |\n| 14 | 14? |\n| 15 | Okay.
Then those exhibits are all admitted as |\n| 16 | full exhibits.
And I say to you, Attorney Goldman, as I |\n| 17 | said to Attorney Aronsson, I'm not going to read every one |\n| 18 | of those pages.
If there are specific things in those |\n| 19 | exhibits you want me to focus on, you'll need to focus me on |\n| 20 | those.
Okay? |\n| 21 | I mean, it's possible I can read them all, but I'm |\n| 22 | not bound to read them all.
Okay? |\n| 23 | MR. GOLDMAN:
No, understood, Your Honor.
I will |\n| 24 | -- |\n| 25 | THE COURT:
Okay. |\n| | |\n\n MR. GOLDMAN: I will do that. THE COURT: Okay. (Creditor's Committee Exhibit Nos. 1-14 admitted in full) THE COURT: All right. The creditors', Rui Ma and Zheng Wu and Wiecan Meng joinder, so you have nothing further with regard to your -- any exhibits you're standing with the committee, correct? MS. MAYHEW: Correct, Your Honor. THE COURT: Okay. Thank you. And the office of the U.S. Trustee, I think the same is -- well, I think your statement said, Attorney Claiborn, but you should definitely correct me if I'm wrong, that you reserve the right to question about any exhibit and question any witness, but that you weren't introducing any evidence yourself. The office was not introducing any evidence, correct? MS. CLAIBORN: That's correct, Your Honor. THE COURT: Okay. Thank you. Attorney Jonas, I think the same is true of you, except that you basically asked for judicial notice of everything filed in the case, and then any exhibit identified or offered by another party, and any exhibit necessary for rebuttal after impeachment, correct? MR. JONAS: Correct, Your Honor. THE COURT: All right. So you're all set then as Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 17 of 119\n\n| | 18 |\n|----|-------------------------------------------------------------|\n| 1 | well. |\n| 2 | MR. JONAS:
Yes, Your Honor. |\n| 3 | THE COURT:
For now. |\n| 4 | MR. JONAS:
Yes, Your Honor. |\n| 5 | THE COURT:
Understanding your -- |\n| 6 | MR. JONAS:
Thank you. |\n| 7 | THE COURT:
-- your parameters. |\n| 8 | MR. JONAS:
Thank you, Your Honor. |\n| 9 | THE COURT:
Okay.
Thank you. |\n| 10 | I just need one second, please. |\n| 11 | (Pause) |\n| 12 | THE COURT:
Now we had another party file -- |\n| 13 | actually, I don't think they filed anything with regard to |\n| 14 | the list of witnesses and exhibits, so I think they just |\n| 15 | filed a statement; another creditor that basically joined |\n| 16 | the committee's -- yeah, they didn't file anything with |\n| 17 | listed witnesses and exhibits. |\n| 18 | So, Attorney Aronsson, you can go right ahead. |\n| 19 | You may proceed. |\n| 20 | MR. FRIEDMAN:
Your Honor, it's Peter Friedman. |\n| 21 | THE COURT:
Okay.
Attorney Friedman. |\n| 22 | MR. FRIEDMAN:
I'm going to -- |\n| 23 | THE COURT:
Go ahead. |\n| 24 | MR. FRIEDMAN:
So, Your Honor, it's Peter Friedman |\n| 25 | from O'Melveny and Myers on behalf of PAX, and I'm going to |\n| | |\n\n argue in favor of dismissal of the case. THE COURT: Okay. MR. FRIEDMAN: This case was filed in bad faith, specifically for the purpose of evading a contempt judgment that I know the Court has heard about a lot and we'll get back to. I believe in effect, in the UCC Exhibit 2, our Exhibit 2, Mr. Kwok's declaration in Paragraphs 3 and 24, he basically acknowledged that -- and in our view, contempt is the alpha of this case, and it should be the omega, because that was the purpose of this case, to evade that, and that's not a proper purpose for filing a bankruptcy. In his consent, the debtor refers to PAX's unrestrained legal warfare against him as being the reason he consents. I think this is ironic, given that, as we point out at Docket No. 50, it was Kwok who stated his intention to start an all-out war with PAX immediately before the bankruptcy. Next thing you know, Kwok files this case on the night before having to face enforcement of Justice Ostrager's contempt sanction. And so what kind of case do we get at that point? A case with no scheduled assets, no business, no employees, no executory contracts to assume, no income, other than a few checks from COVID stimulus. No real bankruptcy purpose, no change in the way Mr. Kwok lives his life. Just one more venue to access, and I think that leads to the conclusion\n\n that there's really double-barreled bad faith here to avoid a contempt judgment first, and relitigation of PAX's claims, which neither of which is a proper bankruptcy purpose, and the remedy for that should fit the motivations for filing this.\n\n Your Honor, I want to start by going back to taking the full breadth of Mr. Kwok's gamesmanship in terms of how -- of his efforts to frustrate PAX. And all of this comes from PAX Exhibit 23 at -- starting at Paragraph 2.\n\n PAX loaned Mr. Kwok's company \\$30,000 in 2008. Kwok personally guaranteed that loan. PAX and Kwok renegotiated the loan in 2011 to consolidate the remaining debt. And again, Kwok executed a personal guarantee.\n\n In April 2013, Kwok agreed to settle his debt by transferring PAX the title to certain apartments in Beijing. That settlement hinged on satisfaction of certain conditions precedent, including delivery of clean title. PAX extended the deadline for that settlement on many occasions, with a final deadline set for June 30, 2015.\n\n Kwok never filled -- fulfilled his conditions precedent. So Kwok gets sued by PAX in April of 2017 for breach of contract. A suit, by the way, totally unrelated to any other suit brought by any other plaintiff. No common nucleus of facts among the claim holders versus PAX. And I use the term claim holder specifically, because I don't\n\n think that these people are -- that a vast majority of people who have asserted proofs of claim are actually creditors. They hold claims, which is different than being a creditor. They don't have judgments. On September 15th, 2020, PAX wins summary judgment for its breach of contract case. The first warning shot that PAX was going to try to -- that was going to be so badly frustrated is when Genever New York filed for bankruptcy in SDNY shortly after that, part of Mr. Kwok's pattern of trying to frustrate Kwok. Shortly after that, the New York court restrains the Lady May and other -- and the Sherry Netherland. Exhibit 23, Docket 183.3, October 15th, Justice Ostrager order. The final judgment is entered in February 2021, a year before the bankruptcy case. At that point, the court enters a judgment of \\$116 million with the statutory interest rate in New York, making it grow to \\$127 million by the date of Mr. Kwok's filings. Then there are all of the antics that go on as PAX work -- PAX works to collect its judgment. As I noted, Justice Ostrager had to seek to -- expressly found, and this is Exhibit -- PAX 18 at page 21. At the October -- at an October 15th hearing, and if Mr. -- you know, if counsel for the committee wishes to object, I just highlight that this\n\n one of the things from the hearing transcript that we believe should be in evidence. The Court believes, as reflected in the September 15th, 2020 order, that Mr. Kwok has attempted to mislead the Court. The court believes that Mr. Kwok as the plaintiff -- is, as the plaintiff contends, playing a shell game. This is going to come to an end. We're not going to have any more shell games. Kwok is -- PAX is forced, as a result of these ongoing shell games, to move for contempt multiple times in the New York State action. On March 16th, 2021, as referenced in PAX Exhibit 24, the Court notes, it's clear there's been an intolerable amount of gamesmanship, dismembering, and deceit in proceedings before this Court. Court goes on to say that rather than catalog the many shell games defendant has engaged in, the Court grants the motion for contempt to the following extent. For every day the yacht is outside the jurisdiction of this Court after May 15th, 2021, defendant will be fined -- Kwok will be fined \\$500,000. This doesn't force Mr. Kwok to file bankruptcy, he just continues to thumb his nose, this time not just to the judgment, but an order of a state court. At a July 2021 hearing -- this is PAX Exhibit 21 -\n\nFiore Reporting and Transcription Service, Inc.\n\n - the Court notes that the Court issued an order directing the boat not be removed from the territorial waters of the United States. That order was disregarded by Mr. Kwok *and/or* entities that he controls. That is contempt of court. THE COURT: What page are you on, on Exhibit 21 there, counsel? MR. FRIEDMAN: 16 to 17. THE COURT: Thank you. MR. FRIEDMAN: And going further on Page 19, the Court talks about his -- Justice Ostrager talks about his defiance, Kwok's definance of court orders. Kwok appeals the fine. The first department affirms and directs the trial court to hold further evidentiary hearings. In the final evidentiary hearing, as this Court notes, that just -- that precipitated the bankruptcy, the Court talks about the 1,180 docket entries. This is in PAX 25. Almost all of which involve defendant's efforts to avoid and deceive. Talks about the -- PAX encountering difficulties through assets in a maze of corporate entities. And finally, as the Court notes, and I know this Court has heard it before, but if billionaire litigants can simultaneously seek to use the court process in New York and elsewhere, while knowingly and intentionally violating court\n\n orders, there is no rule of law. Mr. Kwok attempted to appeal that, sought an emergency stay of the orders, didn't get it. Justice Ostrager noted in his opinion -- an order, that there would be other consequences. I think we -- from what we know in testimony, what this Court has heard and I think what can be inferred, Mr. Kwok was obviously, not really worried about the money point. He was worried about going to jail for being in defiance of a court order, and that's what motivated him to file for bankruptcy. So what happens when the bankruptcy is filed? I think what the Court can observe from Mr. Kwok's declarations, from the debtor's response to examiner motions, from the debtor's motion to -- opposition to PAX's motion to lift the stay, from the debtor's effort to remove PAX's litigation from state court to federal court. All of them point to one thing. This case was then -- was commenced for the improper purpose of relitigation the PAX issue, right? You saw it in declarations that Mr. Kwok maintained that the PAX litigation was founded on forgery, right? That there was something improper about the judgment that had been obtained. There were efforts -- you know, that's in Docket No. 83 at Paragraph 12. Mr. Kwok argues,\n\nyou know, that the personal guarantee somehow was a forgery.\n\n He talks about, I think, wanting to have a reevaluation of what's really his property, which is nothing more than an obvious effort to get the Court to relitigate Justice Ostrager's contempt order.\n\n The idea of removing one case -- one case was attempted to be removed, and it's the case that makes no -- the least sense to remove. It's one on which the central issues were already on appeal, but what other purpose would there have been, other than to try to relitigate, and the cases we cite note that that is not a proper purpose for filing a bankruptcy case.\n\n I would note, Your Honor, that the only other case that has even been referenced in these proceedings is the claim of creditor Rui Ma, which there is no effort to remove that here. To the contrary, I believe there was actually a consent stipulation filed to let that case move forward to be adjudicated back in New York State court system.\n\n So I think the Court can draw the inference from everything it's seen. The real purpose of this case was targeted at frustrating PAX and getting a second or third bite at the apple, specifically with respect to PAX.\n\n Your Honor, a moment about PAX, and the Court, I think has observed how unusual this case is given the lack of assets, given the lack of operating business, given the lack of a, you know, ongoing income, business, et cetera.\n\nFiore Reporting and Transcription Service, Inc.\n\n And the nature of this case being so honestly focused on fees for professionals and budgets for professionals as opposed to a traditional meaningful restructuring in any way, is that you have PAX that has a claim that is over 1,300 times larger than the next judgment claim. The second largest actual, I guess theoretically undisputed claim are claims of insiders, which I think the Court can, you know, not pay much attention to in this context.\n\n So given the size of our claim, we want to sort of focus on the aggressive role PAX played, and I think it's really important that it did, in dealing with what happened after this case was filed.\n\n The debtor comes in. The debtor files a plan. I think a plan that was dead on arrival. Seeks to borrow money, \\$8 million. And PAX opposed that. Other people didn't. Other people thought that maybe there was, you know, a pot of gold at the end of the rainbow. We said from the beginning that the DIP was a sham and the rug definitely got pulled out from under people when Golden Spring decided it wasn't going to fund the case anymore.\n\n But just the -- you know, the very nature of trying to pursue a debtor in possession financing, not for the benefit of anybody other than professionals, or to run an investigation, never made sense to us, and nothing about this case ever made sense to us. We thought that the status\n\nFiore Reporting and Transcription Service, Inc.\n\n quo, where creditors were entitled to pursue their rights under state law was really the appropriate mechanism for dealing with this kind of debtor.\n\n And we think the cases support that. For example, in *Sapphire Development Company v. McKay*, from the District of Connecticut, the debtor had no business, employees, and was being funded by an affiliate of the debtor's principle that had a history -- and there had been a history of state court judgments, finding the principle had diverted assets, misled courts, et cetera. And the court dismissed the case and specifically noted that unsecured creditors could go after anybody they wanted to in the state court, just like claim holders here can, and that that was an appropriate exercise of discretion. I want to emphasize, the Court does have a wider decree -- you know, the cases make very clear, this Court has tremendous discretion in deciding what to do today.\n\n The size of PAX's claim, I think is important as we cited in the *Acme Cake Company* case from 495 BR 212, that it's appropriate to dismiss a case where a single creditor with a sufficiently large claim takes the position that dismissal is the best outcome. Dismissal is in the best interest of creditors because the -- and the state is not affected by the probable result that the largest creditor will execute its judgment and reach the debtor's assets\n\nFiore Reporting and Transcription Service, Inc.\n\nbefore other unsecured creditors.\n\n So there's nothing wrong with PAX asserting the fact that it is the largest creditor and it perceives this is the correct outcome. Again, all we're doing here is returning the status quo. Whether we'll be able to exercise on our judgment or not, I can't say, but I think returning to the status quo is appropriate.\n\n *OptInRealBig.com*, 345 BR 277, from Colorado. The court granted a motion to dismiss where value recoverable for creditors as a whole could be greater outside of bankruptcy, which we think would be the case here, certainly for PAX, as I'll get into later. The Chapter 7 would impose tremendous costs on PAX if it could even be funded.\n\n But the court held there that a creditor -- and here, I would analogize who the court was talking about -- to the claim holders who have contingent unliquidated claims, or even the ones who have very small claims, should not be permitted to prolong or sustain a case merely to take advantage of benefits bankruptcy offers to creditors, and that a case could never be dismissed under the bankruptcy code if I think as our opponent suggests, if guaranteeing the bankruptcy code's priority scheme was a precondition of dismissal.\n\n So if you could only dismiss cases where it was 100 percent certainty that anybody who was at least\n\nFiore Reporting and Transcription Service, Inc.\n\n theoretically similarly situated, you could never dismiss a case. We don't think that any case law stands for that, and we think actually to the contrary, cases like *OptInRealBig* and *Acme Cake Company* say the contrary.\n\n Your Honor, I think in the *Regional Evangelical Alliance of Church's* bankruptcy from Kansas, you know, the court noted that notwithstanding the presence of other creditors, where bankruptcy was essentially an attempt to thwart a creditor's recovery in state court litigation, would be appropriate to let people seek the remedy to which they're entitled to under applicable non-bankruptcy law, without having to litigate the bankruptcy roadblocks that could be erected otherwise.\n\n Your Honor, I think we also cited in our opposition to -- I'm sorry. In our reply brief in support, three cases, *Wally Findlay*, which notes that it's an impermissible use to relitigate bankruptcy cases and where a debtor has taken that position, it is appropriate to dismiss a case. And the *Bridge to Life* case from the Eastern District of New York, a case is dismissed because the debtor was attempting to, you know, inject non-bankruptcy laws issued into a Chapter 11 case. In the *D&G Construction: Dean Gonzalez* case, the court held the use of bankruptcy process as a platform to delay the lawful exercise of state law rights and attack final orders of other courts, warrants\n\nFiore Reporting and Transcription Service, Inc.\n\n dismissal. Your Honor, there are like, you know, some of those cases are not extensively reasoned. I understand. I think that's true of some of the other cases on the other side, and I'm going to get to their cases, but I think that there's a through line, that there's nothing to prevent -- there's no reason to prevent -- not to return to the status quo and let people use whatever state court rights they have in a case like this. And let me say what this case is not. This is not a mass tort case. This is not a case where you can say, okay, a debtor did something bad five years ago, and sure some people were hurt before others, but we know -- we know that there will be people who get -- who necessarily are going to get verdicts in the future in their favor because of doctrines like offensive non-mutual collateral estoppel, and we can even come up with a matrix that says, okay, if you had mesothelioma and you're 45, you'll get X. If you suffered from an opioids injury, you will get Y. Everybody here has very, very different kinds of claims. So there's -- you know, to the extent that there's a race to the courthouse kind of issue, that's just what state law permits people to do, and PAX has been very, very, very, diligent and vigilant, and that's not improper. I want to talk about the cases that were cited by\n\n the other sides, and the first I think -- and there are a couple of through lines that come through them I think that show pretty meaningful differences. I think that -- you know, the first is obviously the *Julian* case. I think there were obviously powerful reasons for dismissal. I think, you know, severely differentiating factors are the debtor's conduct throughout that case.\n\n Here, this case has been mercifully short, and I think I probably understand this much less well than you do or Mr. Birney does or Mr. Goldman does, but I think that there were some sui generis facts as related to the debtor's counsel there that, you know, it was probably a pretty good thing that the court maintained supervision over that case ultimately. But I don't -- you know, I think the ultimate outcomes for creditor -- for creditors were not great, and I think whether or not that was an appropriate exercise of discretion there, I don't think informs this case.\n\n The *SWJ Management* case from District of Connecticut was one where creditors overwhelmingly sought conversion. And I want to make clear, as the *Acme Cake Company* says, you're not supposed to count noses. You're supposed to really count dollars, because imagine if 100 and -- you know, PAX has \\$260 million in judgments. Imagine if PAX had, you know, sliced it's loan up to \\$261 million affiliate funds and each filed their own creditor claims.\n\n And each could be running in here and say, 261 creditors favor dismissal. I don't think it's a counting of noses. I think it's a counting of dollars, and PAX's -- you know, the value of PAX's dollars are really what's important. *Premier Golf Properties* is a case heavily relied upon. That's 564 BR 710. The Court uses an interesting word there in deciding whether dismissal or conversion is right. It says the operative question -- it actually says the operative question of the case was whether the uncertain value of the underlying asset, which was a golf course, could be maximized through a going concern bankruptcy sale or foreclosure. That is nothing like this case. The court relied on the fact that the debtor maintained an operating business, had 60 employees, and \\$300,000 a month of revenue. And the dismissal of the case would have resulted in foreclosure and the financial and employment losses that brings. I might be out of a job if you dismiss this case, Your Honor, but I don't think anybody else is going to be. I think that, you know, *Premier Golf Properties* is very, very, very different. *1121 Pier Village, Team Systems International, West Hampton Coach Works, Speer, Babayoff*, all involve situations where no non-debtor party advocated for dismissal over conversion. And in most cases, dismissal wasn't even discussed unless the debtor preferred that option.\n\nFiore Reporting and Transcription Service, Inc.\n\n The court in *Team Systems,* which is a very thoughtful opinion by Judge Goldblatt, who is near the Delaware bench, specifically noted on multiple occasions that all participating creditors and the U.S. Trustee argue that conversion is better for creditors and the estate than dismissal. Under that circumstance, of course it wasn't an abuse of discretion for Judge Goldblatt to conclude that dismissal wouldn't make sense and conversion did. That's just simply not the situation here.\n\n *Fleetstar* is heavily relied upon by the Rui Ma creditors. I think it involves a very, very different situation. That was an effort to have a structured dismissal, which I think is, if not entire verboten, deeply problematic under *Jevic*. This is not a structured dismissal. No one is asking the Court to say, well, you can dismiss the case and get releases if you give some people something and other people nothing, and you know, tough luck.\n\n This is a clean dismissal request. There are some efforts to have people pay fees. I think we've always said, we don't have problems if other people get paid fees. We're not going to insist our own fees get paid, but this is really not a structured dismissal kind of case at all.\n\n The court explained in *Fleetstar*, even if the debtor's proposed dismissal scheme could pass a practicality\n\nFiore Reporting and Transcription Service, Inc.\n\n test, and the court had some real concerns about the way the structured dismissal was intended to take place, it must be denied because it seeks to alter parties' rights without their consent and lacks many of the code's most important safeguards.\n\n Here, we're asking to go back to a status quo. Nobody is losing a right they have. You know, the debtor's prepetition creditors aren't being asked to sacrifice anything. We simply seek a return to status quo.\n\n The committee also cites to the *Capra* case. *Capra* is an interesting matter. I actually think if you sort of give some deep thought to *Capra*, it helps us rather than hurts us. The big factor in *Capra* the court said a bunch of times, was the egregious misconduct that favored conversion, because the debtor had come to the judge's court and sought bankruptcy protection. And what did he do? He failed to -- you know, he -- it's really what he -- some of what he didn't do. He didn't participate meaningfully on the bankruptcy process, and you know, this case hasn't progressed that long, but there certainly have been MORs filed and the debtor has made retention applications. Didn't find -- you know, we don't think what he did made sense, but he did participate in this process. But the key issue there is, the debtor sold both a\n\nBentley and a Rolls Royce while in bankruptcy without\n\nFiore Reporting and Transcription Service, Inc.\n\n complying with Section 363 of the Bankruptcy Code. That's one of the -- like, on the list of really bad things to do, that's a really bad thing to do. Right? You can't simultaneously say, I want to go into bankruptcy, but then not abide by one of the most important protections. Obviously, it wasn't ordinary course. He wasn't an auto dealership. He was an individual. And so he violates 363, and the court, on numerous times, talk about how bad that is, and goes on to say, I think like the gestalt of that case is, the court didn't want to permit dismissal because the debtor wouldn't basically face any consequences for what he did. And so I think the way to think about that case is, if you do something bad before a judge, the judge is going to retain supervision over you. So send this case back to Justice Ostrager. Right? The really bad things that Kwok did were in front of Justice Ostrager. So I think if -- if *Capra* -- you know, the teaching of *Capra* is, when people do bad things, judges have the right to supervise them. The really bad things done here were done in front of Justice Ostrager. So when this case gets dismissed, you know, we're going to continue to pursue our rights in front of Justice Ostrager, and he can -- he can hold Mr. Kwok accountable for his conduct. Your Honor, the *Rolick* case is cited. It's a very short opinion. I think one way to look at *Rolick* is the\n\nFiore Reporting and Transcription Service, Inc.\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 36 of 119\n\n people who have the largest claim should be paid attention to. The other critical differentiation is that *Rolick*, which went for conversion over dismissal, is about a group of creditors that had received prepetition judgment liens who were seeking to dismiss the case to avoid potential avoidance actions against them. It's just not a factor here. We don't have any -- there's no preference claim that could be asserted against us because we haven't received debtor property.\n\n Your Honor, I just want to take a minute to discuss a couple of other cases that are cited. *Steve and Barry's*, which is also, I think colloquially known as *Steve and Barry's*, that's *BH S & B Holdings LLC* case. Committee cites that to say that, you know, if you have an administrative lien in a solvent case, that should weigh in the favor of conversion.\n\n A, I think the Court was focused on that because of cause. B, that case had been running for years. There was inventory to deal with, there were, you know, liquidated stores. And C, I think if you read the opinion there's no suggestion that anybody even wanted conversion. So I guess the could have -- you know, had to evaluate whether it was appropriate, but nobody wanted it, much less the largest creditor.\n\nYou know, *Mitan v. Duval*, you know, it's a Sixth\n\n Circuit case. There, the largest creditor didn't favor dismissal, only the debtor did. Those creditors were -- and so, you know, the court wanted to appoint a Chapter 7 trustee in order to conduct investigations. Here, we think every creditor can go forth and do whatever discovery is important and they believe is necessary.\n\n A few other things I wanted to just note about the cases, Your Honor. Your Honor, one other point about the *Capra* case, which is heavily relied upon, is that the parties favoring dismissal, you know, were secured creditors, and the court noted those two creditors are being treated favorably by the debtor and can reasonably expect to keep receiving favorable treatment if the case is dismissed.\n\n I don't know what's going to happen between us and the debtor in the future. And the debtor says in his pleadings, they intend on paying creditors. I don't know if that will happen. I assume we'll have to litigate more. I don't know, but there's certainly no -- you know, there's no history of favorable treatment by the parties who are supporting dismissal here. Far from it. We are, to put it lightly, somewhat uncomfortable bedfellows with Kwok in supporting this motion. So I think that's another differentiation point.\n\n Your Honor, I want to make a few points about Exhibit 27, which are the -- you know, the -- it's our --\n\nFiore Reporting and Transcription Service, Inc.\n\n it's the summary of other litigation. THE COURT: And that's been admitted as a full exhibit with no objections, so go right ahead. I'm just making a note -- MR. FRIEDMAN: Okay. THE COURT: -- about that exhibit, because we still have to -- we still at some point are going to have to address the transcript exhibits. But go right ahead. MR. FRIEDMAN: Your Honor, you know, that talks about the claims that were listed on Schedule F. Now, there -- let me first say, there have been some proofs of claim that have been filed, and I suspect that we might hear, well, if a proof of claim is filed, it's automatically treated as valid until there are an objection. I think the Court can note, in part from the Exhibit 27, but generally, that that -- it's sort of true that there's been no objection, but all those cases are in active litigation, and so it's a little -- it's not quite right to say that the proof of claim is prima facie valid until there's no -- until there's an objection, when you know that those claims have been actively contested in litigation over the years. In any event, one of the things I think is really important about these claim -- litigation claims is, there's one liquidated claim for I think 300 and maybe \\$96,000. As you go through the chart, there's \\$35,648,868 of claims that\n\n have been dismissed. There are \\$37 million in claims that have been idle for two plus years. Or thereabout. I don't want to -- I think it's two plus years. It's certainly -- and you can tell, it's a substantial amount of time. And so, you know, you're really talking a much smaller potential pool of claims. There's no evidence that any of them have trial dates or had trial dates set, and, you know, we just don't know much about when any of those claims will be heard, and its, we submit, appropriate for the Court to take into account both the qualitative difference, which is we have a judgment and these are all potential future claims that don't have a common nucleus of\n\n And additionally, Your Honor, I would -- you know, a few other points to note. Many of the claims are -- at least eight of the claims, as far as we can identify involve securities violations, which you know, subject to either subordination or disallowance, but you know, I just note that as an issue. And I think what that leads to is both that PAX's views, I think are entitled to a substantial amount of weight here. But also, looking at those claims and noting how many of them are defamation claims, and the Rui Ma claim, which is obviously a personal injury type claim, go to point out some of the reasons why this case is spectacularly unsuited to bankruptcy.\n\nfacts as it relates to our claim.\n\n This Court, I don't think, is necessarily the right forum to have to oversee a dozen plus personal -- defamation claims that have no factual relationship in common, that have advanced to some stage in the state court. If the stay is going to be lifted to let them all be liquidated, that defeats the purpose of a centralization of forum, or a singular -- single fact finder.\n\n There are frankly open questions, as we've cited, as to whether under 28 USC 157(b)(5), this Court can even hear them, or whether those claims have to be heard in the district court. The Connecticut court has, in *Ice Cream Liquidation*, has taken a broader injury of personal injury tort claims that includes any injury which is an invasion of personal rights. I don't think the Court has to reach a conclusion on any of those, it's not before it, but I think I'm trying to give the Court a taste of why it's problematic and doesn't really serve core bankruptcy functions to have those claims liquidated when there are other options like letting people go back to state court.\n\n Obviously, in Chapter 7 -- and to be clear, Your Honor, I understand there's a broader view. We cited the *Gawker Media* case, because I think it's always incumbent on us to recognize when there are cases that say something different than the view we have. But I do think District of Connecticut's *Ice Cream Liquidation, Inc.* case is a helpful\n\nFiore Reporting and Transcription Service, Inc.\n\n one to think about in this context. You know, Your Honor, then you get to what's going to happen with all those cases. Plaintiffs are still going to have -- if they're here. Plaintiffs are still going to have the costs -- THE COURT: What's going to happen with those cases if the case -- if this case is converted? Is that your -- MR. FRIEDMAN: Yes, Your Honor. THE COURT: Yes. Keep going. MR. FRIEDMAN: So a trustee is going to have to defend them. I don't know what the trustee's -- the trustee can't just say, okay, everybody, you know, I'm going to allow your claims. That's obviously deeply prejudicial to creditors with valid claims. Trustee is going to have to get paid to do that somehow. I don't know -- you know, I'll get to that in a moment. But that requires real cash on the barrel head, not -- you know, not necessarily a creed of litigation funding or contingency fees, right? That's going to be somebody who has to really dig into the merits of each of those cases. It may impose a burden on PAX to have to do the same as a party in interest, as the Court knows. Any creditor, particularly in a 7 can object to the claim of any other creditor. You know, if you don't have a trustee that's\n\n| | 42 |\n|----|----------------------------------------------------------------|\n| 1 | really able to defend, that burden will unfairly fall on |\n| 2 | PAX.
You may also have the debtor participating in the case |\n| 3 | at that aspect.
I think it -- you know, you really get |\n| 4 | something that's not well suited to the bankruptcy court, |\n| 5 | but is appropriate to let these people go -- you know, these |\n| 6 | claimants go back to their state court remedies and continue |\n| 7 | to pursue whatever cases they've already brought to this |\n| 8 | point. |\n| 9 | THE COURT:
Well, in addition to your argument |\n| 10 | about 157(b)(5), what about 157 -- 28 USC 157(b)(2)(B), |\n| 11 | which says that personal injury claims and wrongful death |\n| 12 | claims cannot be estimated -- |\n| 13 | MR. FRIEDMAN:
Yes. |\n| 14 | THE COURT:
-- or liquidated -- |\n| 15 | MR. FRIEDMAN:
Yes, Your Honor.
Against the |\n| 16 | compendium. |\n| 17 | THE COURT:
-- for purposes of distribution in a |\n| 18 | case under Title 11? |\n| 19 | MR. FRIEDMAN:
That is the parallel point that I |\n| 20 | anticipated that somebody might argue, oh, well you can |\n| 21 | estimate these, and, you know, people's distributions won't |\n| 22 | be held up for ever.
But again, you're then going outside |\n| 23 | of this Court to have that done and, you know, you're |\n| 24 | imposing a substantial burden on the federal court system in |\n| 25 | Connecticut, when these could be dealt with in the state |\n\n court system. Your Honor, I think -- so I think that -- that's a pretty critical point.\n\n So then we get to, you know, the other features of what this case looks like, absent -- given its current posture. There's no funding for this case, and we were always concerned that there was never going to be the kind of funding that you'd need for this case. Right? The only funding was to conduct an investigation, which was, we said from the beginning, was a bridge to nowhere, because what you -- if you were going to do anything, what you needed was a kind of action. And we -- you know, the kinds of actions we were taking outside of bankruptcy court, and that were helpful.\n\n You have here a debtor with no liquid assets, and protracted future disputes. We know that there's a lawsuit, an adversary proceeding initiated in this court already about setting aside what rights Mr. Kwok has, whether somebody else has rights to the yacht.\n\n We know that there is extensive litigation over the Sherry Netherland apartment, which would require a debtor -- the debtor -- the Chapter 7 trustee to participate in a New York bankruptcy. Just to deal with plan issues, et cetera, not even just to get the asset, but objecting to other people's claims that that case is valid that also has British Virgin Island components. You have to pay counsel\n\nFiore Reporting and Transcription Service, Inc.\n\n in the British Virgin Islands, and there's no money for that. Right? There would also be litigation presumably, because this is a 7, that you would have fights over discharging claims. You know, a trustee would have to deal with that, or individual creditors would have to pick up the burden. And then, you know -- so what do you wind up with? You wind up with a situation that there are no available funds for a trustee. There's no property you can liquidate in short order. There's a couple suits and a dog, but that's it. There's stuff people could go after, but how do you go after that? Well, you could have litigation funding. We haven't seen any evidence of litigation funding available. I think it would come at a steep cost. That cost would be borne largely by PAX, would eat into whatever recoveries PAX was able to obtain. You know -- THE COURT: Any recoveries any creditor is able to retain. MR. FRIEDMAN: Absolutely, Your Honor, and I think that would disproportionately fall on us, as would a contingency counsel. This Court can take, you know, notice from her own experience, contingency counsel is expensive. We know that the committee, prior to dismissal, not only -- you know, the dismissal hearing, filed motions to retain\n\n fraud examiners and asset tracers, right? All of which would be, you know, expensive if people are going to take those on the come. I don't even know if they would. Usually, those kind of people I think submit hourly rates, but there's nothing to pay them. And you know, I think there are certainly cases -- you know, the *Babayoff* case the committee cites, that dismissal is preferred where there are insufficient funds and a trustee would simply add more costs and burden to the estate. THE COURT: What case was that, counsel? MR. FRIEDMAN: The *Babayoff*, 445 BR 640 -- 64 at Page 82. THE COURT: I just don't recognize that name. The other cases that you cited, I recognize, but it's in the committee's brief, you're saying? MR. FRIEDMAN: I believe so. And that cites in turn, *Midwest Properties of Shawano*. And so, you know, look, we think a trustee would add substantial burdens expense wise, and I'm not sure what -- you know, what the benefit is because in particular, we know state law remedies can be pursued, or can pursue veil piercing if appropriate. People can pursue state law fraudulent transfer claims on their own if they want to. People can seek restraining orders. PAX certainly did. And\n\n there's nothing preventing people from using what state law remedies they have.\n\n You know, the Rui Ma creditor group says that Non PAX creditors will not receive equality in distributions if the case is dismissed. I don't know if that's true or not. I don't -- maybe they'll settle their claims. I don't know. Right? There's no guarantees what anybody will get outside of a bankruptcy, but parties should be able to pursue Kwok to their heart's content to recover what they want to.\n\n If there's no there there -- and this is just a sort of a frolic and detour -- if there is a there there, nobody's put a cap on how much there might be. There could well be, potentially, plenty for other people. We don't -- you know, concededly, we don't know, but PAX, I think in particular, given the size of its claim and the effort it's taken so far, shouldn't have been -- shouldn't be prejudiced by this filing, and I don't think other creditors should be permitted to essentially take advantage of a debtor's bad faith filing.\n\n The other parties sort of say, you know, there is a gamesmanship aspect to Kwok's quality -- Kwok's behavior here, and he shouldn't be rewarded for that. I don't think he is being rewarded. If this case is dismissed, he's gotten no real benefit from this case other than avoiding a couple of months in front of Justice Ostrager, which he's\n\nFiore Reporting and Transcription Service, Inc.\n\n going to have to go right back to. He hasn't gotten a benefit. The only people who have gotten benefits are people who don't have liquidated claims who are stretching PAX out, which has already been stretched out for almost 14 years. I don't think that's equity or fairness, and I don't think that's in the interest of the \\$261 million of creditor claims that PAX has.\n\n You know, we think it's actually the other parties, the other claim holders, pushing for remaining in bankruptcy that are advocating for unequal treatment. They basically want to use the bankruptcy as a collection device, something that the *In Re: Murray* case says, you know, bankruptcy shouldn't be used as a debt collection remedy that's more potent -- a debt collection remedy that's more potent in bankruptcy than the equivalent right under non- bankruptcy law is not something that we should be doing. The court denounced a creditor's use of bankruptcy as a debt collection remedy more potent than the equivalent right under state -- under non-bankruptcy law.\n\n It would be other people jumping to the front of the line, given where they stand now, to force PAX to share recoveries while imposing millions of dollars in unnecessary costs.\n\n I would note that the debtor makes the point that other creditors are basically hijacking a Chapter 11 case\n\nFiore Reporting and Transcription Service, Inc.\n\n for a pseudo involuntary. I suspect that they amplify it. It would otherwise be unavailable to them as an avenue for relief. I will defer to the committee to further develop that argument. I think it has merit, Your Honor.\n\n Your Honor, the committee cites, and I think we note that there are factors that *Collier* talks about. Courts are sort of -- some courts really rely on them, some courts just notice them in passing. I think what I've discussed today really goes over those factors. You know, whether creditors receive preferential payments is a factor. Now there's certainly no reason to believe that PAX received any preferential payment. Would there be a loss of rights granted in the case if it were dismissed rather than converted?\n\n The Rui Ma group suggests that the rights to the \\$37 million escrow would be lost upon dismissal, but the order expressly contemplated what would happen if there is dismissal. That wasn't a mystery. Creditors -- you know, the creditors didn't have any particular right to that, and it was expressly bargained for, what might happen in the context of dismissal. So I don't think anybody is losing a right that they otherwise would have had.\n\n Whether the debtor would simply file a further case upon dismissal. I mean, I guess Kwok could try, having consented to this one and, you know, I don't think that\n\nFiore Reporting and Transcription Service, Inc.\n\n weighs in favor. The ability of a trustee to reach assets for the benefit of creditors. I think, you know, maybe, but the trustee doesn't have any money to support its efforts right now. What's deemed low hanging fruit -- first of all, it was Kwok that -- you know, it was PAX that built the tree, but more importantly, there's still a lot of wood to chop to get there on that tree. And even assuming if funding was available, it would do so at a great cost to creditors, including, I think, specifically PAX. You know, maximizing the estate's value as an economic enterprise, you know, who really knows what the economic enterprise value of this is. We know it -- I think that mostly comes up in the context of cases like the *Premier Golf* one, where there -- liquidation causes a clear loss -- a crushing loss of value and jobs. Whether the remaining issues would be resolved outside the bankruptcy forum, I think the Court might have already had a colloquy on that issue, and I think the debtor in Rui Ma, for example, we've already said, hey, you've got a case, go back and try to get it dealt with somewhere else. Whether the debtor is engaged in misconduct. I think here the debtor's misconduct is almost entirely prebankruptcy. There are some things around the edges that we obviously -- you know, we don't love about the way the\n\nFiore Reporting and Transcription Service, Inc.\n\n debtors conducted the case, but I think they fall within the bounds of bad ideas, not corruption. And you know, I don't think creditors need a Chapter 7 case to protect their interest. People have their state law remedies fully available to them. And then, you know, other factors, single asset plan already confirmed, environmental concerns, I think as we learned from the DIP when we went over the proposed order, there are no circular concerns in this case. There's no environmental issues. This isn't a *Midlantic* type of situation. So, Your Honor, those are the reasons we believe dismissal is appropriate, that the case laws support PAX's rationale, and the cases relied upon by other parties really don't get them where they need to be in order for this Court to exercise discretion to convert rather than dismiss. Thank you, Your Honor. THE COURT: Thank you. Attorney Jonas? MR. JONAS: Good morning, Your Honor. Jeff Jonas, Brown Rudnick on behalf of the debtor, Miles Kwok. Before addressing dismissal of the Chapter 11 case particularly, or alternatives, I think it's important to just step back for a minute and review how we got here, to put it in context, because I do think it's important for the Court today to put things in context and focus on the facts,\n\n| | 51 |\n|----|---------------------------------------------------------------|\n| 1 | not the many unsupported allegations, innuendo and argument |\n| 2 | that will be made, have been made, and will be made by |\n| 3 | lawyers, so you won't hear any rhetoric or vitriol from me |\n| 4 | this morning. |\n| 5 | In this case, you've heard live testimony from two |\n| 6 | witnesses, Craig Jalbert of Verdolino & Lowey, and from |\n| 7 | Miles Kwok, the debtor. |\n| 8 | As Mr. Kwok testified, and as set forth in the |\n| 9 | declaration he filed, he's an outspoken critic of the |\n| 10 | Chinese Communist Party or CCP.
Hundreds of millions of |\n| 11 | people watch his broadcasts in connection with his criticism |\n| 12 | of the CCP.
He and family members were jailed and tortured |\n| 13 | in China.
He endured watching his brother being shot and |\n| 14 | killed.
He continues to be pursued and persecuted by the |\n| 15 | CCP. |\n| 16 | This is not fantastical make believe.
Senior U.S. |\n| 17 | Government officials and business leaders have been |\n| 18 | criminally charged and pled guilty, including with acting as |\n| 19 | foreign agents for the CCP in connection with illegally |\n| 20 | seeking to have Mr. Kwok deported to China so he could be |\n| 21 | jailed or killed.
These persons include Elliot Broidy and |\n| 22 | George Higginbotham. |\n| 23 | Your Honor, last week -- I think we mentioned this |\n| 24 | in our papers, but to make sure you're aware -- last week, |\n| 25 | the Department of Justice filed suit against Steve Wynn, a |\n| | |\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 51 of 119\n\n billionaire fund-raiser and former finance chair for the Republican National Committee, based on his acting as an unregistered Chinese agent in seeking Mr. Kwok's extradition. The Justice Department references President Xi Jinping, Chinese -- China's supreme leader -- raising the U.S. returning Mr. Kwok to China directly with then President Trump. Mr. Wynn, in an effort to gain support from the Chinese government for his casinos in Macao, had contact with senior officials on the National Security Counsel at the White House, the White House Chief of Staff, and then President Trump seeking to have Mr. Kwok placed on the no- fly list, to have Mr. Kwok's U.S. visa not renewed, and have Mr. Kwok returned to China, again likely to face jail or death. Mr. Kwok believes that some, if not all, of the creditor -- the alleged creditor claims against him are part of the CCP's continuing effort to discredit and silence him. Against that backdrop, Mr. Kwok perseveres. Although he has little to no assets and income, he is supported by the largesse of his family. While his alleged creditors may not like this, there's nothing illegal, improper or wrong about this. In February, facing a New York State Court\n\n| | 53 |\n|----|----------------------------------------------------------------|\n| 1 | judgment and order, which he could not pay, Mr. Kwok filed |\n| 2 | this bankruptcy case.
As he testified, and as set forth in |\n| 3 | his declaration, he hoped Chapter 11 would help him reach a |\n| 4 | fair and equitable resolution of alleged creditor claims. |\n| 5 | His bankruptcy filing and the administration of |\n| 6 | this case since it has -- since it was filed, has been |\n| 7 | nothing but in good faith and completely transparent.
There |\n| 8 | is no evidence to the contrary.
I think even Mr. Friedman |\n| 9 | admitted substantially that. |\n| 10 | While there may be allegations that Mr. Kwok owns |\n| 11 | certain assets, whether that be a yacht or a New York City |\n| 12 | apartment, these allegations remain unproven and |\n| 13 | undetermined. |\n| 14 | Since filing this case, Mr. Kwok has filed |\n| 15 | complete and accurate schedules and statement of affairs. |\n| 16 | He sat for almost two full days of 341 meetings.
He came |\n| 17 | before the Court and provided live testimony. |\n| 18 | He arranged and assisted with the return of the |\n| 19 | yacht, subject of the New York State Court order, the return |\n| 20 | of which is presently secured by \\$37 million in cash.
He |\n| 21 | obtained \\$9 million of DIP financing which would have been |\n| 22 | unsecured and subordinated and included a million dollar |\n| 23 | gift to the estate.
And he filed a plan of reorganization. |\n| 24 | The hope was that bankruptcy would afford a forum |\n| 25 | and opportunity to have a dialog with creditors and alleged |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 54 of 119\n\n creditors in order to reach a consensual resolution, the exact purpose and point of bankruptcy. This bankruptcy filing was not in bad faith and there has been no bad faith since it has been filed. So, Your Honor, turning to dismissal, cause for dismissal under Bankruptcy Code Section 1112(b)(1), exists, specifically 1121(b)(4)(A), provides that cause includes substantial or continuing loss to or diminution of the estate and the absence of a reasonable likelihood of rehabilitation. That is the only existing cause that exists. If you do look at -- I appreciate it's not absolutely exhaustive, but if you look at 1112(b)(4) -- and obviously I've referred to (A) as the cause we think is relevant in this case -- if you look at (B), we don't think any of the other causes are applicable, Your Honor. (B) gross mismanagement of the estate, I've addressed that; (C) failure to maintain appropriate insurance; (D) unauthorized use of cash collateral; (E) failure to comply with an order of the Court; (F) unexcused failure to satisfy timely any filing or reporting requirement; (G) failure to attend the meeting of creditors; (H) failure timely to provide information or\n\n attend meetings requested by the United States Trustee; (I) failure timely to pay taxes; (J) failure to file a disclosure statement; (K) failure to pay any fees or charges under certain -- chapter 123 of title 28; (L) revocation of an order of confirmation; (M) inability to effectuate substantial consummation of a confirmed plan; (N) material default by the debtor with respect to a confirmed plan; (O) termination of a confirmed plan; And lastly, (P) failure of the debtor to pay any domestic support obligations. So, Your Honor, as I've mentioned, we believe that there is cause. The relevant and applicable cause is 1121(b)(4)(A). THE COURT: May I just ask you a question on that? MR. JONAS: Certainly, Your Honor. THE COURT: I understand -- I understand your recitation of the list, and I understand that you assert that only (4) applies, but are you -- are you contesting the case law that interprets cause includes mean -- does not mean that the list -- it can only fit into the list? MR. JONAS: No, Your Honor. THE COURT: Okay.\n\n MR. JONAS: Not at all. THE COURT: That's all I'm asking. MR. JONAS: Yes. THE COURT: Okay. MR. JONAS: And I think I mentioned, Your Honor, that our view is it's -- I appreciate it's not exhaustive. THE COURT: I thought you said that -- MR. JONAS: Yeah. THE COURT: -- but I just wanted to make sure for the record. MR. JONAS: No. No. No. Absolutely, Your Honor. THE COURT: Okay. MR. JONAS: But I do think there's a reason that there's specified items there -- THE COURT: I understand. MR. JONAS: -- and I thought it was important to review that. THE COURT: No. I think that's helpful. Thank you. MR. JONAS: You're welcome. Your Honor, as for dismissal versus conversion or appointment of a trustee, while a debtor's preference is not dispositive, it should be given some weight. Here, the debtor and its largest creditor support dismissal. Eleven-twelve (b)(1) provides for the Court to\n\n| | 57 |\n|----|--------------------------------------------------------------|\n| 1 | examine which of dismissal, conversion or appointment of a |\n| 2 | trustee is in the best interest of creditors and the estate. |\n| 3 | In SWJ Management, 551 B.R. 93, 2015 case from the |\n| 4 | district court here in Connecticut, it was described -- this |\n| 5 | analysis was described as whether dismissal would, |\n| 6 | quote/unquote, \"Prejudice creditors.\" |\n| 7 | In the Hull case, 339 B.R. 304, 2006 case from the |\n| 8 | -- a bankruptcy court case from the Eastern District of New |\n| 9 | York, the Court addressed what -- in this context what is |\n| 10 | prejudice to creditors. |\n| 11 | And it said, quote, \"Creditors are not generally |\n| 12 | prejudiced by dismissal since they will no longer be stayed |\n| 13 | from resorting to the state courts to enforce and realize |\n| 14 | upon their claims.
That is, it is the reasonable pre |\n| 15 | petition legal expectations and entitlements of a debtor's |\n| 16 | creditors that should be considered in the context of a |\n| 17 | debtor's timely motion to dismiss, not the loss of an |\n| 18 | opportunity to receive a distribution through the bankruptcy |\n| 19 | process.\" |\n| 20 | THE COURT:
Could you just tell me that case |\n| 21 | again, Counsel. |\n| 22 | MR. JONAS:
Certainly. |\n| 23 | THE COURT:
I'm sorry. |\n| 24 | MR. JONAS:
It's the Hull case.
H-U -- |\n| 25 | THE COURT:
Hull, H-U-L-L? |\n| | |\n\n MR. JONAS: Yes. And it's 339 B.R. 304. It's a 2006 case, Eastern District of New York. A bankruptcy court case. THE COURT: Thank you. Thank you. MR. JONAS: Yes. THE COURT: I just didn't hear what you had said at the beginning. I apologize. MR. JONAS: Of course, Your Honor. Your Honor, I'll just, for the record, state we don't believe that 1112(b)(2), which would arguably prohibit conversion or dismissal, is applicable for a number of reasons. We don't believe there are unusual circumstances establishing that conversion or dismissal is not in the best interest of creditors and the estate. Another requirement there, which we don't believe is applicable, is that we don't think there's a reasonable likelihood that a plan will be confirmed with a reasonable period of time, which is another requirement to -- under 1112(b)(2). And 1112(b)(2) is not applicable if the grounds for conversion are dismissal is 1112(b)(4)(A), which, again, I'm taking you through our position that the loss or diminution and the no reasonable likelihood of rehabilitation under 1112(b)(4)(A) is the basis for dismissal.\n\n Your Honor, I won't further review PAX's allegations of bad faith. I think I've addressed those. I mean, they -- again, just briefly, they've referred I believe in an unsupported manner to -- to misrepresentations in the schedules, to a, quote/unquote, \"Bogus DIP loan,\" to the debtor, quote/unquote, \"Pulling the plug on the case.\" I don't think any of those are what happened here. I can tell you the debtor came into this court -- as I mentioned earlier -- with the hope that ultimately there would be a reorganization. That didn't happen. But nevertheless I think Mr. Friedman said it, he may not have liked it, but he didn't really take issue with the fact that there was bad faith in the case since the case has commenced. And lastly, Your Honor, I'll say, as to the -- somehow the bankruptcy filing being improper because the debtor didn't have an ongoing business, I think you said it best in the *Lucarelli* case, Your Honor, 517 B.R. 42, where you said or we've heard quoted, \"The plain language of the bankruptcy code permits individual debtors not engaged in business to file for relief under Chapter 11.\" THE COURT: I think I cited from the supreme court though for that. MR. JONAS: You cited a number of cases, Your Honor.\n\n THE COURT: I think it was the -- MR. JONAS: I'm giving you credit for it. THE COURT: I think it was the supreme court. MR. JONAS: I think you're right. Your Honor, I just -- I do think it should be noted briefly that the alleged claims of the creditors committee members that are here today are, in fact, unliquidated and disputed. Those claims as -- again, Mr. Friedman went through this and I'm not repeating a lot of what I might otherwise have said because I think Mr. Friedman covered it -- those claims would be -- would need to be litigated. Continuation of this bankruptcy case in any form will be in the context of an administratively insolvent case with no funding to support what likely could be years of litigation. Your Honor, in closing, Mr. Kwok has asked me to thank you and your staff for the time and the consideration you've given this case. Although it may not have been as successful as he would have liked, it has, at least in part, restored his confidence in the judicial system. And that said, Your Honor, respectfully, it is time to move on. This bankruptcy case should be dismissed. Thank you. THE COURT: Thank you, Attorney Jonas. Attorney Goldman.\n\n MR. GOLDMAN: Thank you, Your Honor. Good morning. Irve Goldman representing the creditors committee. Your Honor, I'd like to start with the observation that whether or not this case was filed in bad faith or other cause exists, as we've stipulated, the question before the Court -- the question before the Court -- is not whether the case was filed in bad faith, but is whether conversion, dismissal, or the appointment of a Chapter 11 trustee is in the best interests of creditors. So whether the case was filed in bad faith or other cause exists does not change the standard of what is in the best interests of creditors in this case. And although it would be quite ironic that if the debtor's own bad faith is used to justify a dismissal of this case, it would allow him to avoid the scrutiny of the Chapter 7 process, which would entail a thorough investigation of what PAX claims were his hidden assets, that they were on the cusp of reaching before this case was filed, and he will be rewarded because what will be left will be various creditors that are scattered about in different courts that will be left to their own devices to chase down whatever assets this debtor has after PAX gets done with them as the only judgment creditor in this case. So they certainly do need the protection of the Chapter 11 -- 7 process.\n\n In terms of what the standard is under 1112, I'd like to start with the plain language of the statute, which the Supreme Court in the Second Circuit have repeatedly instructed lower courts to focus on in interpreting the bankruptcy code. Section 1112(b)(1) provides that once cause is established, the Court is required to convert or dismiss a case, whichever is in the best interest of creditors and the estate, unless the Court determines that the appointment of a Chapter 7 trustee or an examiner is in the best interest of creditors and the estate. THE COURT: I think you mean a Chapter 11 trustee, but that's fine. MR. GOLDMAN: Yes. Yes. Thank you, Your Honor. THE COURT: That's fine. I understand. I understood what you meant. MR. GOLDMAN: What PAX -- the way PAX wants the Court to read that statute is as the best interest of creditors according to the amount -- amounts of their claims. Of course it simply doesn't say that. And I'd like to emphasize that in considering the best interest, the statute uses the plural, creditors, so that the interest of the entire creditor body as a whole have to be considered, not just the interests of a single creditor that has a large claim, and that prior to\n\n bankruptcy was on the cusp of reaching -- where all creditors in this case seem to agree are the debtor's known assets right now, and that is the Lady May and the debtor's interest in the Sherry-Netherland apartment. And the term in determining the creditor body, the Court can take judicial notice of the proofs of claim that were on file right now as well as the debtor's schedule F. The proofs of claim, as of today, even though there is no bar date, total \\$71 million, and in some cases are based on allegations of grievous personal harm. For example, the claim of Rui Ma, which is close to the trial stage in the New York Supreme Court, alleges claims of sexual assault, false imprisonment, and intentional affliction of emotion distress over a period of several years. The claim of Bob Fu, based on an action in federal court in Texas, is based on allegations that the debtor promoted acts of violence against Dr. Fu, indeed, encouraged his, quote, \"Comrades,\" end quote, to kill Dr. Fu, and incited harassing protests in front of his house for weeks. The claim of Bruno Wu and Yang Lan is based on a New York Supreme Court action alleging that the debtor used his pervasive social media accounts to personally attack them by claiming, among other things, that Yang Lan had extramarital affairs and used sexual favors to obtain her\n\nFiore Reporting and Transcription Service, Inc.\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 64 of 119\n\n prominent cultural status in China and was, quote, \"Full of sexually transmitted diseases,\" end quote. Accused Bruno Wu on repeated occasions of attempted murder and bribery and has threatened violence on social media against both of those creditors.\n\n To say that these aren't actual creditors that are deserving of the same consideration of their interests, as PAX is, really an offense to those creditors.\n\n And as I mentioned, the proof of claim deadline has not even been set. It is likely based on what was listed on schedule F that we will receive a flood of additional claims so that that \\$71 million will certainly escalate.\n\n Getting back to the plain meaning of the statute, in determining the creditors whose interests must be taken into account, under Section 1112(b)(1), I would refer the Court to Section 101(10A) of the bankruptcy code which defines creditor as, quote, \"An entity that has a claim against the debtor,\" end quote, as of the petition date.\n\n And the definition of claim under Section 101(5A), which defines a claim to include a right to payment whether or not it is reduced to judgment unliquidated or disputed.\n\n So PAX's contention that these creditors aren't actual creditors is contrary to the plain language of the bankruptcy code, because a creditor is one who holds a claim\n\nFiore Reporting and Transcription Service, Inc.\n\n and a claim could be undisputed, unliquidated and contingent. So there are creditors, actual creditors, here. And how could a creditors committee been even appointed by the U.S. Trustee if these weren't actual creditors? And what creditors are they supposed to be representing if there are no other actual creditors? PAX certainly didn't object to the retention of committee professionals based on the fact that there were no actual creditors to defend. So under a plain statutory analysis, creditors such as those who have filed proofs of claim in this case, but have not yet received judgments, are just as much creditors of this estate as is PAX for purposes of evaluating the best interest test under Section 1112(b). If anything, the interests of those creditors who allege grievous personal harm are entitled to equal, if not greater, consideration under the best interest test than is PAX whose actual money judgment -- which is attached to Mr. Friedman's declaration on the motion to dismiss as exhibit 1 -- is in the principal amount of just \\$46 million. They have \\$70 million of interest at their contractual rate of 15 percent and a \\$134 million contempt fine is not in compensation of any pecuniary loss. The test that many courts, indeed, most, have applied in determining what is in the best interest of\n\nFiore Reporting and Transcription Service, Inc.\n\n creditors under Section 1112(b)(1), is the course of action that provides the best chance for the largest number of creditors to be paid the largest amount of money in the shortest period of time.\n\n Here, that is either conversion or the appointment of a Chapter 11 trustee. Because in the event of a dismissal, the largest number of creditors will suffer at the hands of one single judgment creditor who will be paid the largest amount of money, in the event of dismissal, while all the other creditors will remain mired in litigation with the debtor.\n\n As for the boat, we know that under Judge Ostrager's February 9th, 2022 decision and order, which is our exhibit 1, the debtor has already been found by clear and convincing evidence to beneficially own and control the boat. That's at page 4 of his decision.\n\n When the boat is back, PAX will simply levy on that beneficial interest and ultimately receive a distribution when it is liquidated.\n\n As for the Sherry-Netherland apartment -- of course they're poised to do that on the day of dismissal as they have that proceeding before Judge Ostrager.\n\n As for the Sherry-Netherland apartment, they're equally poised to realize on that asset in the event of dismissal.\n\nFiore Reporting and Transcription Service, Inc.\n\n In the debtor's declaration, which is UCC exhibit 2, he acknowledges owning 100 percent of the membership interest in Genever Holdings Corp., which is the sole member of the title holder of the Sherry-Netherland apartment, Genever Holdings, LLC. Genever Holdings, LLC is a debtor under Chapter 11 in the Southern District of New York and the debtor claims his interests are held in trust or his son's company, Bravo Luck. That's at his declaration at paragraph 33(B). By order entered on October 8th, 2021, which is UCC exhibit 3, Judge Garrity approved a settlement agreement between Genever Holdings, PAX and Bravo Luck. That settlement agreement, which will appear at UCC exhibit 4, marked ECF 131-1, which is dated September 24th, 2021, granted PAX relief from the automatic stay to continue to prosecute the New York Supreme Court action. That's at paragraph 7(A) of the settlement agreement, page 7 of 12 of the settlement agreement. Since PAX had already received its money judgment on February 3rd, 2021, the only thing left to try in the New York Supreme Court action are PAX's veil-piercing claims against the Genever entities. And they are found in count 2 of its first amended complaint, which is UCC exhibit 10.\n\nIt's page 17 of the complaint.\n\nIn addition, PAX is the beneficiary of an order\n\n requiring Mr. Kwok to turn over his 100 percent ownership interest in Genever -- the Genever -- 100 percent owner of Genever Holdings to PAX. That's UCC exhibit 6. The order was entered on September 22nd, 2021. And PAX had filed a motion for contempt in a New York dated January 7th, 2022 for Kwok's failure to turn the shares over. That I believe is exhibit 7 of our exhibits.\n\n It's expected that that motion will be refiled or resumed on dismissal.\n\n PAX has similar veil-piercing type claims relief pending in the courts of the British Virgin Islands. UCC exhibit 11 is PAX's amended statement of claim in that court. In that amended claim, they allege, among other things, that Mr. Kwok used \\$70 million of his own assets to transfer to Bravo Luck -- that's paragraph 29 of exhibit 11 -- that the declaration of trust that Mr. Kwok claims to have with Bravo Luck was a fraud, quote, \"Devised to hold his shares in Genever BVI in trust for Bravo Bravo.\"\n\n Bravo Luck was a fraud -- excuse me -- it was a fraud, quote, \"Devised for the sole purpose of concealing an asset of Mr. Kwok from his creditors.\" That the trust document should be set aside as a, quote, \"Document intended to defraud creditors of Mr. Kwok.\" Creditors, plural. That's paragraph 35. And that Mr. Kwok is the beneficial owner of Bravo Luck and his son is his mere nominee.\n\nFiore Reporting and Transcription Service, Inc.\n\n Under the settlement agreement that Judge Garrity approved, the parties, that is, PAX and Bravo Luck, were also permitted to proceed with the British Virgin Island litigation. So they are very poised to also realize on the Sherry-Netherland apartment based on those claims that will be resolved in the British Virgin Islands or in the New York State Court. In terms of what's happening with the apartment in the Genever Holdings case, Melanie Cyganowski was appointed the sales officer to market and sell the property. That's at UCC exhibit 8. And Sotheby's was approved as the broker for the property, UCC exhibit 9, and the property is currently listed on Sotheby's website for \\$38,500,000. So they are -- PAX is very well positioned to realized on the assets on dismissal ahead of other creditors, who, again, will be left with litigating against Mr. Kwok, and thereafter getting judgments, chasing down whatever assets are left. The additional potential assets we contend would be -- potential assets to recover in a Chapter 7 -- are two Greenwich properties that are owned by Greenwich Land, LLC. UCC exhibits 13 and 14. The properties are described in those exhibits. In paragraph 17, in Mr. Kwok's declaration, he\n\n claims his Greenwich residence, quote, \"Is owned by my wife through Greenwich Land, LLC.\" That remains to be seen whether that's another one of his concealed assets. Which of course could be investigated in a Chapter 7, which we were in the process of trying to investigate when the debtor filed his consent to dismissal on May 11th. I'd like to turn now to PAX's argument that the touchstone of what is in the best interest of the estate is the preference of creditors, and that the best interest of creditors must reflect PAX's view as the single largest creditor. The touchstone of the best interest of creditors test is not what the creditors prefer. It is the course of action that provides the best hope of recovery for the largest number of creditors, and not the course that will afford the most recovery for the most vocal or the largest creditor. Preliminarily, the case authority that PAX cites for that proposition that a single creditor can -- with a large enough claim can suffice for purposes of the best interest test is completely in opposite I think to this case and otherwise doesn't support PAX's theory. In the *Acme Cake* case, which is the case it's relying on, not a single creditor or even the creditors committee itself objected to a dismissal of the case.\n\n It was counsel for the creditors committee that had objected to dismissal on the basis that it should not be granted because administrative expenses, including its fees, were not being paid, and a dismissal would violate the priority scheme of the bankruptcy code by allowing the creditor requesting dismissal to be paid ahead of administrative claimants.\n\n Of course here that is not what the argument is. The creditors committee who represents the interests of all unsecured creditors is objecting to dismissal. We are not making this argument, although I do believe the case should be, if Your Honor was inclined to dismiss, it should be conditioned on payment over the fees.\n\n The reason we are objecting is because dismissal is not in the best interest of creditors, and that simply was not an argument that was made in the *Acme Cake* case. And in fact --\n\n THE COURT: Can I just ask you a question about that?\n\nMR. GOLDMAN: Yes.\n\n THE COURT: You just said that -- obviously I understand that the committee's position is dismissal is not appropriate but conversion or appointment of trustee is, but you also just said that if the Court was to dismiss you'd want it to be conditioned on the payment of the committee's\n\nFiore Reporting and Transcription Service, Inc.\n\n| | 72 |\n|----|------------------------------------------------------------|\n| 1 | fees.
And I just want to understand how that would work |\n| 2 | from your perspective? |\n| 3 | How would a court condition dismissal on payment |\n| 4 | of fees in an estate where there's no money? |\n| 5 | MR. GOLDMAN:
If Mr. Kwok wants a dismissal of the |\n| 6 | case so that he does not have to go through the Chapter 7 |\n| 7 | process and face potential 523 non-dischargeability claims |\n| 8 | as well as 727 denial of discharge claims, as well as the |\n| 9 | process of hunting down his hidden assets and collecting |\n| 10 | them, then just as he found the money to put up to secure |\n| 11 | the return of the boat, and just as he found the money to |\n| 12 | propose to fund the case with an \\$8 million DIP loan, he |\n| 13 | will find the money if the Court conditions dismissal on |\n| 14 | payment of the fees. |\n| 15 | THE COURT:
Have you -- I haven't seen -- but I |\n| 16 | may have missed this, okay, so just understand -- have you |\n| 17 | cited any cases that support the authority of the Court to |\n| 18 | do that, to do what you're suggesting? |\n| 19 | MR. GOLDMAN:
There's no direct case that I found, |\n| 20 | Your Honor. |\n| 21 | THE COURT:
Okay.
Okay.
I'm just asking the |\n| 22 | question -- |\n| 23 | MR. GOLDMAN:
No. |\n| 24 | THE COURT:
-- and so I make sure that I've read |\n| 25 | your papers properly. |\n| | |\n\n Go ahead. I'm sorry. I just wanted to ask that when you brought that up. MR. GOLDMAN: Thank you, Your Honor. Another critical distinguishing feature of *Acme Cake* case is that in that case the Court found that converting the case or appointing a Chapter 11 trustee, quote, \"Would result in the unsecured creditors receiving little distribution, if any.\" And that certainly cannot be -- cannot be said here. They did make the -- they actually quoted a decision in a California bankruptcy case -- from a California bankruptcy case -- in saying that, quote, \"It is not necessary that the interest of every creditor actually favor conversion. There is no specific numerosity requirement inherent in section 1112(b). The interest of a single creditor with a large enough claim will suffice.\" That is a direct quote from a case called *In re Staff Investment*, a California bankruptcy case 146 B.R. 256. If you take a look at that case, it's completely distinguishable from this case. The single largest unsecured creditor in that case held a deficiency claim of \\$600,000 on a mortgage against the single asset of the estate. That was the deficiency component of the claim. It totaled 95 percent of all unsecured creditors. And there were only other unsecured claims totaling \\$21,000.\n\n So this single quote from a California bankruptcy case, which really is dicta because no one was making the argument that, you know, the dismissing -- the creditor wanted dismissal would run away with all the assets ahead of the other creditors is really much too thin a read upon which to overcome the overwhelming authority that holds that the best interest of creditors under 1112(b) is supposed to consider the interests of the entire creditor body, not a single creditor's parochial interest.\n\n And that means considering whether creditors as a whole will do better in Chapter 7. And that certainly is the case here based on how posed PAX is to recover on what I would call the low-hanging fruit of assets that now exist, that we know at least there are legitimate and very weighty claims to for the estate.\n\n PAX is so emboldened by the amount and status of its claim that it proclaims that, quote, \"Given the size of Pax's already adjudicated judgments, PAX is entitled to recover first.\" That's at its memorandum of Y at 4. This turns the fundamental policy of equality of distribution among creditors on its head and instead adopts the every creditor for itself rule that exists outside of bankruptcy. But that's not the standard for the best interest\n\nof the creditors.\n\n#### We are in a bankruptcy case. And inherent in that\n\n| | 75 |\n|----|----------------------------------------------------------------|\n| 1 | standard is considering what will serve the equality -- what |\n| 2 | will serve the overriding bankruptcy policy of equality of |\n| 3 | distribution. |\n| 4 | Finally, comparing the committee's preference for |\n| 5 | conversion to an involuntary bankruptcy because the debtor |\n| 6 | wants a dismissal is a red herring. |\n| 7 | First, courts have held that a debtor's preference |\n| 8 | for dismissal is irrelevant under 1112(b) unless it happens |\n| 9 | to coincide with the creditors' interests. |\n| 10 | And section 1112(b)(1) mentions only the best |\n| 11 | interests of creditors and the estate and does not mention |\n| 12 | the interests of the debtor, such as is mentioned in section |\n| 13 | 305 of the bankruptcy code.
So the omission of the debtor's |\n| 14 | interest is intentional in 1112(b)(1). |\n| 15 | Second, the conversion of the case here is |\n| 16 | authorized, specifically authorized, under section |\n| 17 | 1112(b)(1) if it is in the best interest of creditors.
This |\n| 18 | standard has nothing to do with the commencement of an |\n| 19 | involuntary petition under section 303.
They are two |\n| 20 | completely different standards under entirely different |\n| 21 | situations, so you cannot analogize what is specifically |\n| 22 | authorized under 1112(b) with the commencement of an |\n| 23 | involuntary bankruptcy. |\n| 24 | The final additional points I'd like to make is |\n| 25 | that this debtor should not be able to escape the scrutiny |\n\n of the Chapter 7 process with the prospect of a denial of discharge, particularly under section 727(a)(2), which will provide or which provides grounds for denial of discharge if there is a concealment of assets within the one year of bankruptcy. And there are many cases that hold that even though an asset might have been transferred outside the one- year period, if the debtor continues to conceal that interest into the one-year period, that concealment will serve as a ground for denial of discharge under section 727(a)(2). If the Court does decide to dismiss the case without conditioning dismissal on the payment of professional fees of the committee, the committee would like to reserve the right to seek a motion to review and disgorge fees of the retainer that was paid to debtor's counsel in the amount of a million dollars. So I would leave the Court with that, with that request. I would like to respond briefly to some points that both Mr. Friedman and Mr. Jonas made at various times during their arguments, and then I'll sit down. Mr. Friedman mentioned the *Sapphire* case in support of dismissal. If Your Honor looks at that case, there were very few unsecured creditors in that case. And, in addition, they had other sources of recovery in the form\n\n of a guarantor and other joint -- and/or other joint obligors. We obviously do not have that here. Mr. Friedman stated that all they were really doing here was returning to the status quo. But returning to the status quo means that they will be first in line to realize on all the assets, and that's why these creditors need the protection of a Chapter 7 case. Mr. Friedman called into question the personal injury tort claims that exist in this estate. What would happen in a Chapter 7 case is that a trustee would first look and seek to recover assets of the estate. And once that process is concluded, a trustee would then turn to the process of reviewing claims and objecting to them if necessary. So you would first have a marshaling of assets to determine what assets exist. Then there would be a review of the claims. Which is the trustee's duty to do under section 704(5). The trustee wouldn't be retaining special counsel to review those claims, so there would be no costs associated with that review. And parties can object to those claims if the claims are thought better off to be resolved in other courts. A relief from stay could be granted, and the\n\nIt would have no impact on the bankruptcy process itself.\n\ndebtor, if the debtor so wished, could defend those claims.\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 78 of 119\n\n It would simply be a process of liquidating those claims in other courts, which is commonly done. If a claim, for example, is on the verge of trial or close to trial, it's not uncommon for the creditor to seek relief from stay in order to liquidate the claim in another court and then come back to the bankruptcy court with the amount of their claim. So that is -- that is a routine process in Chapter 11 -- Chapter 7 cases. As far as funding to litigate the assets that we know do exist, the boat and the apartment, we -- I'm confident that a trustee could get litigation funding. Now, yes, there's no evidence that litigation funding is available today, but this debtor just filed its consent to dismissal on May 11th. You cannot possibly expect the committee or a trustee to chase down litigation funding in a matter of a couple of weeks, which is -- which is all we've had, and present evidence that there's some, you know, binding commitment to provide litigation funding to a party that doesn't even exist yet because the funding would have to be provided to either a Chapter 7 or Chapter 11 trustee. So I think, you know, a trustee should be given an opportunity to do that or to retain special counsel to at least take the litigation on a contingency-fee basis. And, yes, that will involve collecting a percentage of any\n\n recovery, but that's the -- that's common in Chapter 7 cases, and it's a negotiable fee. Yes, the boat is worth a lot of money and that will come out of the recovery if special counsel does take it on a contingency-fee basis, but that is no basis to conclude that the best interests of every other single creditor, other than PAX, would be served by that process, because they would be served by that process. The only creditor that would not be served would be PAX. In terms of using bankruptcy as a debt collection device, I mean, bankruptcy is a collective proceeding where a debtor files for bankruptcy and surrenders his non-exempt assets to creditors in exchange for seeking a discharge. That is what bankruptcy is all about, so it very much is a collective proceeding that is used to marshal and liquidate the assets of the estate for the benefit of all creditors equally, and that I submit is what the Court should do here. And that's all I have, Your Honor, unless you have any questions. THE COURT: I don't have any other questions. Thank you. Attorney Claiborn, do you wish to be heard? I'm sorry. Go ahead, Attorney Callari. She can come up first. And then Attorney Claiborn can if you'd like to be\n\n heard after. MS. CALLARI: Good afternoon, Your Honor. Carollynn Callari on behalf of certain of the creditors. Your Honor, I'm just really here to support what Attorney Goldman stated. I think he did a really good job. It makes my job easier. But I do want to highlight a couple of points. One, just to go to debtor's comments before we get to the actual issue, they tell a very nice story, but they don't complete the story when they give the backdrop that, you know, there's news articles about him, people being investigated for wanting to have him sent back to China. That's not disputed. What's disputed in the back story is why? And he is wanted back in China to face allegations of corruption, rape, kidnaping and bribery. That's why he doesn't want to go back there. So I just wanted to clarify that. With respect to what's really before the Court, it really is, what is in the best interests of the creditors and the estate. And we hear a lot of different stories, but really, when you look at that specific issue, first, on the claims, 101 speaks for itself on the definition of creditors and claims. We have a lot of creditors here. A lot of claims here.\n\n| | 81 |\n|----|-----------------------------------------------------------------|\n| 1 | The case here is not like the claims -- cases |\n| 2 | cited by PAX, Your Honor.
In those cases, when you're |\n| 3 | dealing with a large creditor, if you look at them, often |\n| 4 | it's a secured creditor having 95 to 98 percent of the |\n| 5 | claims, in a -- you know, in a deficiency type of claim. |\n| 6 | Here, if you break it down, Your Honor, PAX's |\n| 7 | original claim -- let's bring the Court back -- is \\$46 |\n| 8 | million.
My client, Rui Ma's claim, is asserted at 20 |\n| 9 | million.
Not much of a difference.
They just got a |\n| 10 | judgment first.
She shouldn't be prejudiced by that. |\n| 11 | If you look at the schedule claims, the debtor's |\n| 12 | scheduled -- although he disputes virtually every claim -- |\n| 13 | he scheduled over approximately \\$120 million in claims.
And |\n| 14 | then he also lists dozens of other creditors in unknown |\n| 15 | amounts. |\n| 16 | So if you take PAX's 46 million, he's by far -- |\n| 17 | they are by far not a very large creditor compared to |\n| 18 | others.
If you add in the interest, it's 116 million.
One |\n| 19 | hundred and sixteen million versus the scheduled -- even |\n| 20 | though disputed, just because it's disputed doesn't make it |\n| 21 | a bonafide dispute -- but having said that, 125 to 116 |\n| 22 | million.
We're about 50/50.
It's only when you add in all |\n| 23 | the contempt charges that their claim really balloons to |\n| 24 | over 250 million. |\n| 25 | So, first of all, the size that they keep trying |\n| | |\n\n to say that they are this large creditor that should have a say and run this case is just not the same as those other cases that they cite. And we are creditors even if we're not liquidated at this time, Your Honor. Second, PAX can't have it both ways when they say Your Honor there's no assets in this case. It should be dismissed. What kind of case is it? There's no creditors, no assets, no operation. This is an individual Chapter 11. We know there's no operations. But I don't think any creditor sitting on this side of the table genuinely thinks there are no assets in this case even though they only listed *de minimis* assets on their schedules. And that's why we are here. This case, as Mr. Goldman said, is to marshal those assets. And how could it be more efficient than for one fiduciary to marshal the assets for all creditors, rather than each creditor, dozens of them, having to go and undertake what admittedly PAX's counsel has had undertaken for years. But each of us having to undertake veil-piercing and all of these other, you know, litigations and loops we have to go through to get those assets when one fiduciary could marshal the assets. That is a purpose of bankruptcy. That's an appropriate purpose. And that's why it should be converted to a 7 to allow that to happen.\n\n As far as funding, what Mr. Goldman alluded to is the issue we would have in the two weeks that we've had to try to find the initial funding is we don't have a counter- party yet. You need to have the Chapter 7 trustee or the Chapter 11 trustee be the counter-party to a funding. And if you just look at the facts here, when you have a low- hanging fruit of a yacht, this is ripe for a contingency type of arrangement. So I don't think the fact that we don't have evidence here today of actual commitment for funding should prevent Your Honor from acknowledging and inferring that funding could be available to a Chapter 7 or a Chapter 11 trustee in this situation. And I know that Mr. Friedman's a much better negotiator than his papers when he's talking about a 20 to 30 percent contingency fee in this case. I think you could do milestones -- which is the conversations I've been having -- which is you have a certain percentage for the yacht. And if it takes longer, the percentage goes up. And then once you get the yacht, maybe that's your funding. Maybe you don't need to have more. You know. You can use those proceeds. So there's ways to have the Chapter 11 -- or in\n\n our case we even say a Chapter 7 trustee -- to fund these cases. And we think that the Chapter -- a Chapter 7 should\n\n| | 84 |\n|----|--------------------------------------------------------------|\n| 1 | be given a chance for a fiduciary to look at this, try to |\n| 2 | marshal all the assets for all the benefit of all the |\n| 3 | creditors. |\n| 4 | If in a short period of time it couldn't have |\n| 5 | funding, there's -- without prejudice to having it dismissed |\n| 6 | then. |\n| 7 | But to say that our clients should all be |\n| 8 | prejudiced by the fact that the case should be dismissed now |\n| 9 | and basically reward the debtor -- he got what he wanted -- |\n| 10 | he filed this go get a breathing spell -- he got a short |\n| 11 | breathing spell -- and now he doesn't want to have to face |\n| 12 | all of the burdens of a Chapter -- of a bankruptcy and he |\n| 13 | shouldn't be rewarded with that. |\n| 14 | We should be able to have an investigation, which |\n| 15 | can be funded, and allow all the creditors to share equally |\n| 16 | in the distributions, Your Honor, because we are real |\n| 17 | creditors. |\n| 18 | If, however, Your Honor, by the way finds that she |\n| 19 | cannot condition dismissal to make sure that parties are not |\n| 20 | further prejudiced by the egregious conduct of this debtor, |\n| 21 | I think that weighs even more in favor of conversion.
I |\n| 22 | think Your Honor probably can condition it.
But if she |\n| 23 | couldn't, it weighs more in favor of a conversion to 7 |\n| 24 | rather than dismissal. |\n| 25 | Creditors have expended a significant amount of |\n\n| | 85 |\n|----|----------------------------------------------------------------|\n| 1 | time and expense in this case.
And now for it to be pulled |\n| 2 | out -- the rug pulled out from under us because they pulled |\n| 3 | the funding, that is very inequitable -- as well as the |\n| 4 | administrative fees, they should be paid if this case is |\n| 5 | dismissed -- and we would ask Your Honor to retain |\n| 6 | jurisdiction regardless to deal with certain issues as far |\n| 7 | as -- as Mr. Goldman said -- with respect to retainers and |\n| 8 | things of that nature if Your Honor does dismiss it. |\n| 9 | But we do think that conversion to a 7 is viable |\n| 10 | and it is the -- in the best interest of all the creditors |\n| 11 | to do that, Your Honor. |\n| 12 | And we don't think it's prejudicial to PAX |\n| 13 | because, frankly, if they wanted a say in who the trustee is |\n| 14 | appointed, they can I think under 702.
They can see who the |\n| 15 | -- you know, have a say in -- |\n| 16 | THE COURT:
They can all elect the trustee, right. |\n| 17 | MS. CALLARI:
Yeah. |\n| 18 | THE COURT:
But I have a question or two you. |\n| 19 | MS. CALLARI:
Yes.
Please. |\n| 20 | THE COURT:
So assume that I agree with you and I |\n| 21 | convert this case to a Chapter 7, how is your claim -- your |\n| 22 | clients' claims going to be liquidated?
Because the trustee |\n| 23 | can't do it. |\n| 24 | MS. CALLARI:
Correct, Your Honor. |\n| 25 | THE COURT:
So then your claim has to still be |\n| | |\n\n tried outside this court in the New York Court as do the other personal injury claim claimants' claims. MS. CALLARI: Yeah. So certainly with respect to Rui Ma, Your Honor, has that proposed order -- Your Honor has had that proposed order and we presumed you were waiting until after this to lift the stay in order to have her proceed in state court. So, yes, for certainly Rui Ma we would anticipate that that would be litigated back in state court. THE COURT: So what's a trustee going to do with that claim? I'm trying to -- MS. CALLARI: No. I understand. THE COURT: I'm trying to -- what is a Chapter 7 trustee going to do with that claim? A Chapter 7 trustee has to wait -- MS. CALLARI: Yeah. THE COURT: -- until that claim is liquidated, right? And then depending upon what you do, which is completely your clients' rights under applicable non- bankruptcy law, there's a trial, whatever the decision is is the decision. Somebody may appeal it. Somebody may not. But let's be honest, it's likely there will be an appeal, so that case could go on for years before that claim is liquidated, correct?\n\n MS. CALLARI: It could. THE COURT: Yeah. MS. CALLARI: And it also could be liquidated pretty promptly. THE COURT: Okay. MS. CALLARI: We don't know. So -- THE COURT: But not in this court. MS. CALLARI: No. Her claim would have to be liquidated in the state court. Or generally personally injury claims, Your Honor -- I do think that when you have personal injury claims sometimes a bankruptcy court can set forth a mediation process and -- THE COURT: Not in a -- not under 28 U.S.C. -- MS. CALLARI: Correct. You can estimate -- THE COURT: -- 157(b)(2)(B) in a Chapter 7 case where the claims are contingent and unliquidated. The statute is very clear that it's not a core proceeding. And so one of the problems that we have in this case is that those are the types of claims that the trustee is going to be met with, right? MS. CALLARI: Correct. THE COURT: So what's -- so my questions is, so what's the trustee supposed to do? MS. CALLARI: The trustee -- THE COURT: Keep the case open for years until --\n\n| | 88 |\n|----|---------------------------------------------------------------|\n| 1 | and then investigate with no funds? |\n| 2 | I mean, I hear what you're saying about a funding |\n| 3 | issue, but why couldn't the committee have funding funders |\n| 4 | right now? |\n| 5 | They could have the -- the committee could have |\n| 6 | litigation funding.
Why couldn't they? |\n| 7 | MS. CALLARI:
They couldn't at this point, because |\n| 8 | within the last two weeks, to try to get that when you knew |\n| 9 | your were facing a dismissal and the committee would be |\n| 10 | disbanded, was not practical. |\n| 11 | THE COURT:
Okay.
But the dismissal -- I |\n| 12 | understand what you're saying about the debtor's position on |\n| 13 | dismissal.
But PAX's position on dismissal has been clear |\n| 14 | for some time.
In fact, they agreed to extend the hearing |\n| 15 | period out because the code required that a hearing be -- |\n| 16 | happened within 30 days and it didn't. |\n| 17 | You know, all I'm saying to you is a Chapter 7 |\n| 18 | case, the Chapter 7 trustee, what's the Chapter 7 trustee |\n| 19 | got to work with? |\n| 20 | MS. CALLARI:
So there's two things. |\n| 21 | One, on your point about the committee, until two |\n| 22 | weeks ago, the committee had funding from the debtor.
They |\n| 23 | pulled the funding so we didn't need to go see -- |\n| 24 | THE COURT:
Well, they didn't have funding.
It |\n| 25 | hadn't been approved yet.
Okay? |\n| | |\n\n MS. CALLARI: This is true. THE COURT: So no one had funding. MS. CALLARI: But we anticipated there would be some sort of funding, so we -- THE COURT: I understand that. MS. CALLARI: Right. THE COURT: But it hadn't been approved yet. And that's how the process works, right? MS. CALLARI: Yes. THE COURT: Just how -- we have to remember how the process works. So they didn't have funding. There was no funding that was authorized by the Court. The Court took that funding under advisement. And then the debtor decided -- or I shouldn't say the debtor -- the funder, the loan -- the lender decided to withdraw its funding commitment and the debtor withdrew the motion for the DIP financing. So I understand every thing you're saying, but there's a process the Court has to follow, right? I mean, we talk about litigation funding, contingent special counsel. Just because people say that can happen doesn't mean it will happen. The Court still has to approve those applications. And if those applications aren't approved, then there isn't going to be this plan to\n\n go down the way that people have, you know, suggested. The problem is there's a lot of different concerns when -- if and when this case converts to a Chapter 7 as opposed to staying -- staying a Chapter 11. So, again, the Court can deny dismissal, could deny conversion, could deny the appointment of a trustee. That's what I'd have to find. Attorney Goldman is correct. And the issue is what are we going to do? And I think I said that I think a week or so ago when you all stipulated that cause exists. Okay. Great. That's very helpful to the Court. And I appreciate that everybody's stipulating that cause exists, but I have to do one of those things, right? So I have to figure out what is the best thing to do in this case. And the concerns about conversion are many. Handing this to a Chapter 7 trustee to do what? What's the Chapter 7 trustee going to do? The Chapter 7 trustee has no available assets to do anything. You're talking about possibly getting a litigation funding source. Okay. But that has to be approved and it might not be approved. And there has to be a plan. And if the plan -- I don't mean a plan of reorganization, that's not what I mean.\n\n I mean -- I don't mean the word plan as used in the bankruptcy code -- there has to be a way to accomplish what you're trying to accomplish. And a Chapter 7 trustee won't have anything to work with. MS. CALLARI: Thank you, Your Honor. Either a Chapter 11 or a Chapter 7 trustee, Your Honor, we believe will have funding. I know it's not here. But to the point was, is that even though Your Honor had not approved it yet, the committee did not have a need to go look for funding before May 11th. That was the first part. We believed there was funding. THE COURT: That's fair. MS. CALLARI: And now a Chapter 11 or a Chapter 7 trustee, we are asserting, would be able to receive the necessary funding to go after, for instance, the yacht. It shouldn't take that much to proceed with that litigation. And if that actually goes the way we think it will, there would be ample funding for this case. THE COURT: Well, how is a Chapter 7 trustee going to go after the yacht? Explain that to me. MS. CALLARI: It can't marshal -- it can marshal assets the way it does in any other case. THE COURT: But right now there's no finding in this court that the debtor owns the yacht, so how's a Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 91 of 119\n\n| | 92 |\n|----|------------------------------------------------------------------|\n| 1 | Chapter 7 trustee going to marshal the yacht? |\n| 2 | MS. CALLARI:
Eleven or a -- Chapter 11 or a |\n| 3 | Chapter 7 would have to have a finding made first. |\n| 4 | THE COURT:
Well, right now, there's an order for |\n| 5 | relief from stay -- |\n| 6 | MS. CALLARI:
Right. |\n| 7 | THE COURT:
-- governing what happens with the |\n| 8 | yacht, right? |\n| 9 | MS. CALLARI:
Yes. |\n| 10 | THE COURT:
Which is the yacht has to come back |\n| 11 | into the jurisdiction.
And then, if it does in a timely |\n| 12 | manner, then the \\$37 million goes back to the party that |\n| 13 | posted the money and then the yacht's there.
Where?
Either |\n| 14 | in Connecticut or New York depending upon how things are |\n| 15 | developed. |\n| 16 | So how's a Chapter 7 trustee going to marshal the |\n| 17 | yacht? |\n| 18 | MS. CALLARI:
Just like you would in a Chapter 11. |\n| 19 | You -- |\n| 20 | THE COURT:
But the debtor doesn't own the yacht |\n| 21 | in this court.
There's been no findings.
So he'd have to |\n| 22 | start some cause of action, wouldn't he? |\n| 23 | MS. CALLARI:
Right.
Yes. |\n| 24 | THE COURT:
So who's going to pay to do that? |\n| 25 | MS. CALLARI:
That's where the funding comes in. |\n| | |\n\n THE COURT: And who's -- who's going to defend to do that? And then when the trustee does that, then PAX is going to object and say it's already -- it's already been determined in the New York State Court. So you can't undo the judgment of the New York State Court judge. You can't -- you can't do that. There's going to be collateral estoppel effects, right? 9 There hasn't been an appeal. There's all kinds of issues here, right? So, as I said, my issue with -- there's -- I have issues with every path. Okay? But with regard to the Chapter 7, I don't know what a Chapter 7 trustee is supposed to do or can do. The Chapter 7 trustee could come here and say they're going to do 18 things, but if they don't have the right to do those things or a funding source to do those things, then there's no point in converting the case to a Chapter 7. MS. CALLARI: Yeah. And we -- THE COURT: There's no point. MS. CALLARI: And we believe that the Chapter 7 trustee would -- and, again -- or a Chapter 11 trustee -- but either way -- would have the ability to have funding sufficient to have this court adjudicate that it is property of the estate, and that's what we would expect them to do,\n\n and do the marshaling first before they deal with actually adjudicating the claims. Which the other litigations are generally going to be stayed, so that reduces costs. People talk about costs -- THE COURT: Well, I don't agree with that. You don't want yours stayed, right? And other claimants may come in and seek relief from a stay too -- MS. CALLARI: They may. THE COURT: -- and want their claims adjudicated outside of this court. And so what I'm saying to you is -- I'm just trying to understand -- your client in particular has what is -- apparently no ruling has been made, but what is a personal injury tort claim that under the United States code Congress decided this court can't decide. Okay. And *Stern* supports that, right? And even *Wellness* supports that because no one is consenting to this court adjudicating that claim. Okay? So the -- it can't be adjudicated here. MS. CALLARI: Correct. THE COURT: So all the other claims that we talked about -- and I don't -- I don't have the figures in front of me right now -- but the claims other than PAX's claims I\n\n| 1 | believe -- and you should all correct me -- but more than |\n|----|----------------------------------------------------------------|\n| 2 | half of them are personal injury tort claims.
And if |\n| 3 | they're personal injury tort claims, they cannot be -- |\n| 4 | estimate -- the statute says -- and I think I can recite it |\n| 5 | -- liquidated or estimated for purposes of distribution in a |\n| 6 | case under title 11. |\n| 7 | All Congress decided that a bankruptcy court could |\n| 8 | do as a court proceeding is estimate claims in connection |\n| 9 | with a plan in a Chapter 11, 12 or 13 case.
But it says you |\n| 10 | cannot -- a bankruptcy court cannot liquidate or estimate |\n| 11 | personal contingent and unliquidated personal injury tort |\n| 12 | claims and wrongful death claims for purposes of |\n| 13 | distribution in a case under title 11. |\n| 14 | So a trustee can't do that. |\n| 15 | MS. CALLARI:
Right. |\n| 16 | THE COURT:
I mean, the Chapter 7 trustee can't do |\n| 17 | that.
He/she's hands are already tied from the start. |\n| 18 | So then they have to -- then they're going to try |\n| 19 | to find assets that -- the debtor's going to fight that.
I |\n| 20 | mean, look at what's going on for the last 15 years or how |\n| 21 | many years it's been. |\n| 22 | If you do think the debtor's not going to fight |\n| 23 | the attempt to have the boat be deemed an asset of the |\n| 24 | estate, I mean, of course they're going to fight it.
And |\n| 25 | then anything else you do. |\n| | |\n\nFiore Reporting and Transcription Service, Inc.\n\n And then -- so how much money is there going to be to fund this Chapter 7 estate on claims that are at this point -- at this point -- I'm not saying couldn't change -- but at this point they're speculative, right? So the concern is that a Chapter 7 trustee, from the Court's view of this case at this point, I don't know how the Chapter 7 trustee can carry out the duties that are required under the code under the facts and circumstances of this case. MS. CALLARI: Thank you, Your Honor. We do think the funding is -- could be available and we do think that the trustee could marshal the assets while the claims are being litigated and then brought back here to be distributed, the alternative of having it dismissed, and basically having PAX be able to grab it all and each individual creditor have to then adjudicate individually to go after each -- after each asset. We don't think that's in the best interest of creditors. But I understand Your Honor's concern. But we do think a conversion or a Chapter 11 is certainly better than a dismissal for the creditors, Your Honor. Thank you. THE COURT: Okay. I appreciate that. And I'm just asking you the questions -- MS. CALLARI: Yeah. I appreciate that. THE COURT: -- specifically because of your\n\n clients' claims. MS. CALLARI: I appreciate that. Thank you, Your Honor. THE COURT: All right. Thank you. Attorney Claiborn? MS. CLAIBORN: Good afternoon, Your Honor. Holley Claiborn for the U.S. Trustee. THE COURT: Good afternoon. MS. CLAIBORN: This case has now devolved to a simple, but difficult place. Cause has been found under section 1112(b) and it's now the Court's difficult and heavy duty and burden to make a choice. The debtor has admitted that the relief available under 1112(b)(2) is no longer in play, so that puts the choices for a form of relief to the three that we've discussed briefly today, dismissal, conversion, or a Chapter 11 trustee. And each of them admittedly has its own challenges and impact on the constituencies of this case. The U.S. Trustee has no preference for which form of relief the Court should choose. And with respect to the relief of an examiner that was requested in the U.S. Trustee's motion at ECF 102, that relief, provided the Court makes an immediate decision as to dismissal, conversion, or a Chapter 11 trustee, will become moot.\n\n I want to make clear to the Court, Your Honor, that is the U.S. Trustee's job to point out that in this particular case, and consistent with all Chapter 11 cases, that should the Court determine a Chapter 11 trustee is the most appropriate relief, that such a trustee should have the powers and the rights bestowed by the code in section 1106, and that there is no authority to limit them or prescribe them or control them.\n\n If the Court determines today that dismissal is the most appropriate relief, then this case should be dismissed immediately and not conditioned on any event, and nor should the dismissal be in conjunction with any event.\n\n Fee applications for retained professionals can be filed and determined after dismissal.\n\n And in the end, Your Honor, I think the most important point -- and it's a hard one -- is that this case needs a swift decision. But the Court has before it the facts that would enable the Court to make a choice. And in the end, in urging a swift decision, I want to point out delay negatively affects the creditors and does reward the debtor. Thank you, Your Honor. THE COURT: Thank you. Mr. Friedman?\n\n MR. FRIEDMAN: Your Honor, I just want to make some brief rebuttal points.\n\nFiore Reporting and Transcription Service, Inc.\n\n The first is that counsel for the committee and others argue that the debtor would be rewarded by having this case go away. It's just not true. People are going to get the debtor's assets one way or the other. The second point -- to the extent they exist. The second point is I didn't fully -- I think there was reference to the fact that Chapter 7 could be useful because maybe the -- Mr. Kwok wouldn't get discharges. Of course, outside of bankruptcy, he doesn't get a discharge either. Another point I wanted to make, Your Honor, I'd ask you to look at exhibit 27 we filed because -- THE COURT: Of your own exhibits? Of PAX exhibits? MR. FRIEDMAN: Exhibit 27. PAX exhibit 27. THE COURT: Okay. Give me one second, please, and I will try to get there. MR. FRIEDMAN: Thank you. THE COURT: You'll have to give me a minute. Do you know what page of the document it starts on? It's document 404. Do you know what page exhibit 27 starts on, because it's 1500 pages. MR. FRIEDMAN: My apologies. THE COURT: Oh, 1,149. MR. FRIEDMAN: Thank you.\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 100 of\n\n| 1 | THE COURT:
There you go. |\n|----|----------------------------------------------------------------|\n| 2 | MR. FRIEDMAN:
That's amazing. |\n| 3 | THE COURT:
Staff that is -- |\n| 4 | MR. FRIEDMAN:
That's amazing. |\n| 5 | THE COURT:
That is amazing. |\n| 6 | MR. FRIEDMAN:
That's amazing.
Thank you. |\n| 7 | THE COURT:
That is amazing. |\n| 8 | MR. FRIEDMAN:
Your Honor, this is our summary of |\n| 9 | claims. |\n| 10 | And one of the reasons that Mr. -- counsel for the |\n| 11 | committee, Mr. Goldman, in his thoughtful argument said that |\n| 12 | the Sapphire case could be distinguished is because there |\n| 13 | people had other -- other people that they could pursue. |\n| 14 | And I just wanted to observe that when you look at |\n| 15 | our summary of cases, which is in evidence, many of the |\n| 16 | defendants -- I'm sorry -- many of the plaintiffs also have |\n| 17 | other parties that they can go after. |\n| 18 | If you look on page 2, the last claim, the Keyi |\n| 19 | Zilkie claim is against GTV, Saraca and Mr. Guo, Miles Gwok. |\n| 20 | On the next page, the Zheng Xu Dong case is against GTV, |\n| 21 | Saraca and Wayne Guo.
The next case is against Voice of Guo |\n| 22 | and Miles Guo.
And on and on. |\n| 23 | And in particular, Your Honor, I would note -- and |\n| 24 | like the Rui Ma allegations, I said it before, earlier in |\n| 25 | this case, I'm not diminishing at all what happened to her. |\n| | |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 101 of\n\n I would say, if you look at the Rui Ma case, it's not just against Mr. Kwok. My understanding is that Golden Spring New York is also a defendant in that case. We know that Golden Spring New York had at least \\$8 million to fund a DIP. So there is a co-defendant that can be pursued in that case even if Mr. Kwok doesn't have money. So I just note that there are other pockets of potential availability -- available recoveries, not just Mr. Kwok. Your Honor, there are -- also in Rui Ma's counsel's arguments -- I didn't count them, but there are a lot of if's and could be's about funding -- there's no evidence. You know, people were regrettably, you know, taken in by the debtor's offer of finance or arrangement of potential financing -- which we opposed from the outset -- and here we are in a case that we thought never should have been filed that didn't have -- that still doesn't have funding. Counsel tried to argue that we're only owed \\$46 million when we have judgments for more than \\$260 million. And while it's true I guess that I don't get to call people -- not creditors -- people don't get to also say that PAX isn't owed \\$261 million because it is. The last point I would make, Your Honor, is simply\n\n| | 119 |\n|----|--------------------------------------------------------------|\n| | 102 |\n| 1 | that we stand by our citations in the cases that we cited -- |\n| 2 | that we filed on Friday and that we referenced today that |\n| 3 | stand for two propositions: |\n| 4 | Fundamentally, it's not necessary that the |\n| 5 | interest of every creditor actually favor conversion.
And |\n| 6 | the interest of a single creditor can matter. |\n| 7 | Where that line is drawn -- let's say, you know, |\n| 8 | one person had 99 percent of the claim, one person had 1, |\n| 9 | there's no hard and fast rule. |\n| 10 | But I think the Court can clearly take into |\n| 11 | account from Acme, from Staff, which cited the Goodrich |\n| 12 | Lines cases, is that the Court's discretion -- which is |\n| 13 | substantial in this case -- can take into account the |\n| 14 | disparity in claims and what people are entitled to. |\n| 15 | And, again, I think, you know, we cited a variety |\n| 16 | of cases that do stand for the proposition that it's okay to |\n| 17 | dismiss a case even if one creditor will potentially wind up |\n| 18 | with a better result. |\n| 19 | I can't predict the future. |\n| 20 | I will say that, with respect to the apartment in |\n| 21 | the Sherry-Netherland, there is an enormous wood -- amount |\n| 22 | of wood to chop with respect to PAX having to take on, you |\n| 23 | know, to continue its undertakings to demonstrate that that |\n| 24 | trust agreement is bogus.
It's not right there for the |\n| 25 | picking.
We have work to do. |\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 102 of\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 103 of\n\n And, you know, we don't know what will happen with other creditors. Perhaps other creditors will come to arrangements with Mr. Kwok. We have to take that risk. And so, for those reasons, and the practical reasons that we've identified as to why we believe this case is not well suited to a Chapter 7 conversion, we, you know, we believe that dismissal is the right option. I do -- I will say we agree with the U.S. Trustee that if the Court were to conclude that the right path is a Chapter 11 trustee, obviously we strongly support dismissal, but there should be no fetters on any power that a trustee has. And with that, Your Honor, I have nothing further. THE COURT: Thank you. Mr. Jonas? MR. JONAS: Your Honor, Jeff Jonas, Brown Rudnick, for the debtor. I will be brief. And I'll say I do stand on my previous argument supporting dismissal for cause under 1112(b)(1) and (4)(A). I would note in that regard interestingly no one opposing dismissal addressed the arguments I made earlier with respect to the standard being prejudice to creditors and that prejudice is determined by looking at whether any of their -- those creditors' pre-petition legal expectations are prejudiced, which in this case they are not.\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 104 of\n\n I really rise, Your Honor, only to make the record clear that the debtor does refute and refutes the many disparaging comments that have been made about him. Lawyers here have made many bald, unsupported statements which are not evidence. And they've come in different forms and flavors, Your Honor. For example, there was a reference to Greenwich Land owning -- in connection with possibly having certain, quote/unquote, \"Hidden assets.\" Nothing's been proven, Your Honor. Nothing's been demonstrated. Just the bald allegation which might as well be that certain neighbors and friends and other family members have assets that are allegedly hidden assets. Secondly, Your Honor -- and these are just by way of some quick examples I noted while presentations were being made -- Ms. Callari referred to certain charges that exist in China. Again, no evidence, just the bald statement. It's not evidence. It shouldn't be given any worth or any voracity at all. Third, litigation funding. There is zero evidence. It is utter and complete speculation and conjecture. There's no evidence before the Court. I'll add my own speculation that the committee --\n\n and probably Ms. Callari -- have been running around feverishly over the last few weeks looking for some\n\n# financing so they could come before the Court and present some evidence. They have none. So from that I'll infer that none exists. But nevertheless, I don't want to pile on my own speculation. I'll just leave it that there is no evidence at all before the Court in that regard. So all of the Court's concerns are -- at least our concerns -- and I think Mr. -- as expressed by other parties that there won't be funding, that's the only evidence that there is. Again, Your Honor, we would urge dismissal. Thank you, Your Honor. THE COURT: Thank you. Mr. Goldman? MR. GOLDMAN: Yes. Thank you, Your Honor. Just a few brief points, Your Honor. On this idea of all these claims constituting personal injury or wrongful death claims, which obviously under section 128 U.S.C 157 -- THE COURT: (b)(2)(B). MR. GOLDMAN: Thank you. -- the Court doesn't have jurisdiction. It has to be tried in a district court, unless of course relief from -- THE COURT: That's not -- that's not the trial. Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 105 of\n\n| | Case 22-50073
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119 |\n|----|-----------------------------------------------------------------------------------------------|\n| | 106 |\n| 1 | The trial section is (b)(5).
(b)(2)(B) talks about the |\n| 2 | estimation or liquidation of contingent -- |\n| 3 | MR. GOLDMAN:
Correct. |\n| 4 | THE COURT:
-- and disputed personal injury |\n| 5 | claims.
That's different from -- |\n| 6 | MR. GOLDMAN:
Correct. |\n| 7 | THE COURT:
-- the trial issue under (b)(5). |\n| 8 | MR. GOLDMAN:
You're quite correct. |\n| 9 | So there can't be estimated as well under 502(c) |\n| 10 | except under Chapter 11. |\n| 11 | THE COURT:
Or 12 or 13 in a context of a plan. |\n| 12 | MR. GOLDMAN:
Or 12 or 13.
But certainly that |\n| 13 | doesn't prevent them from being liquidated upon relief from |\n| 14 | stay in their court of origin. |\n| 15 | And certainly the debtor could defend, especially |\n| 16 | since they are potentially non-dischargeable under section |\n| 17 | 523(a)(6) as willful and malicious injury.
So certainly the |\n| 18 | debtor would have an interest in doing that. |\n| 19 | I would also point out that I don't think it's a |\n| 20 | given that all of these claims, for example, the claims |\n| 21 | based on defamation, would constitute personal injury tort |\n| 22 | claims of the type that you can't estimate were of the type |\n| 23 | that under -- you mentioned (c) -- |\n| 24 | THE COURT:
(b)(2)(B). |\n| 25 | MR. GOLDMAN:
-- (b)(2)(B), but also (b)(5) -- |\n| | |\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 107 of\n\n| | 107 |\n|----|-------------------------------------------------------------|\n| 1 | THE COURT:
(b)(5) -- |\n| 2 | MR. GOLDMAN:
Yeah. |\n| 3 | THE COURT:
-- is where it says the district -- |\n| 4 | MR. GOLDMAN:
Yeah. |\n| 5 | THE COURT:
-- court has to try those claims. |\n| 6 | MR. GOLDMAN:
Exactly. |\n| 7 | THE COURT:
Right. |\n| 8 | MR. GOLDMAN:
I don't think it's a given that the |\n| 9 | defamation claims are of the type of claim that fit -- |\n| 10 | THE COURT:
There is all kinds of case law about |\n| 11 | that. |\n| 12 | MR. GOLDMAN:
Yes. |\n| 13 | THE COURT:
And I agree with you. |\n| 14 | MR. GOLDMAN:
So there is a division of authority. |\n| 15 | And of course the one Gawker Media goes the other way. |\n| 16 | So I don't think, unless Your Honor has a |\n| 17 | definitive opinion on that, you can conclude that, hey, all |\n| 18 | of these can't be estimated or that, you know, you don't |\n| 19 | have jurisdiction to preside over a claims objection. |\n| 20 | You know, as far as how a Chapter 7 trustee would |\n| 21 | marshal the yacht, here's how I would envision it. |\n| 22 | There is a pending adversary proceeding right now |\n| 23 | that squarely presents the issue of whether this yacht is |\n| 24 | property of the estate or not.
A Chapter 7 trustee could |\n| 25 | certainly replace, or it would be proper to replace the |\n| | |\n\n| Case 22-50073 | Doc 884 | Filed 09/27/22 | Entered 09/27/22 12:36:24 | Page 108 of |\n|---------------|---------|----------------|---------------------------|-------------|\n| | | 119 | | |\n\n| | 108 |\n|----|----------------------------------------------------------------|\n| 1 | debtor, or substitute himself as a party in that adversary |\n| 2 | proceeding and get special counsel. |\n| 3 | I am very confident that we could find special |\n| 4 | counsel that would take this on some sort of contingency |\n| 5 | fee, which would be negotiable. |\n| 6 | The trustee would then move to make a dispositive |\n| 7 | motion based on the preclusive effect of Judge Ostrager's |\n| 8 | findings, which we believe do have preclusive effect.
Your |\n| 9 | Honor would then decide whether that does have actual |\n| 10 | preclusive effect to make the boat property of the estate. |\n| 11 | That is not an elaborate proceeding and it really -- I would |\n| 12 | suggest -- has a substantial likelihood of getting done. |\n| 13 | And if that does happen, we don't even need the |\n| 14 | litigation funding. |\n| 15 | So that's the -- that is the lowest hanging fruit. |\n| 16 | I think, Your Honor, there are a couple options |\n| 17 | that Your Honor could consider here. |\n| 18 | Since we've only had a couple of weeks to, for |\n| 19 | example, look for litigation funding and no time to look for |\n| 20 | any contingency counsel, you could convert the case with the |\n| 21 | idea that we would be given time to locate the funding.
And |\n| 22 | if during that time period nothing could be located or we |\n| 23 | can't locate special counsel, the case could then be |\n| 24 | dismissed. |\n| 25 | And I didn't really mention the third option, |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 109 of\n\n which is the Chapter 11 trustee option, which would allow some of these claims to get estimated. You know, the committee is not adverse to the idea of negotiating an equitable division of whatever assets the debtor has with PAX. We are not unmindful of the efforts that PAX has made in chasing this debtor and getting its judgment. And I think the committee would -- let me just say -- be reasonable in negotiating a plan with PAX that gives some recognition to their pre-petition efforts. And certainly a creditors' plan of reorganization is achievable in this case. All it has to provide is the marshaling of the assets. We would even -- maybe PAX's counsel wants to be the special counsel. We would have no problem with that. And the debtor would not retain any interests in property. So a Chapter 11 trustee, where the creditors have an ability to negotiate a plan, I think is also a viable option here. So I would -- THE COURT: Well, you're the first one that said that. MR. GOLDMAN: Well, I do think as opposed -- THE COURT: And so no one else has said that. So if you're -- MR. GOLDMAN: No. THE COURT: So if you're thinking that that's a\n\n possibility, then -- MR. GOLDMAN: I would -- THE COURT: -- are you asking that you have an opportunity to talk to parties about that? Is that what you're asking? MR. GOLDMAN: Well, I would love the opportunity to talk to parties about that, except that I'm not sure the discussions would be productive. Because I think -- I think PAX would prefer Your Honor to rule first on whether dismissal -- THE COURT: Well, I have to rule by the way under the code, so I don't have a choice unless you all decide something different. I have a -- I have a -- I have no choice. Once the hearing starts, right, don't I have to rule -- I don't have it in front of me, but I'm sure PAX knows -- I think I have to rule in 15 days or something like that, don't I? At the conclusion of the hearing. I don't have a lot -- as I said, I don't know, two months ago -- there isn't a big window of opportunity in this case. I tried to make that -- maybe I didn't do a very good job -- but I tried to make that very clear to all parties that this is not a case where the Court has discretion. Congress made the changes to the code, right? That's what -- I have no choice. I have no Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 110 of\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 111 of\n\n| | 111 |\n|----|--------------------------------------------------------------------|\n| 1 | discretion.
I don't.
Yeah.
It says here, Attorney Goldman |\n| 2 | -- I know you probably know this too -- after the -- the |\n| 3 | Court shall commence the hearing on the motion under 30 days |\n| 4 | unless the movant consents to a specific time frame, which |\n| 5 | the movant did, which is today, right? |\n| 6 | And then decide the -- and shall -- no discretion, |\n| 7 | right -- and shall decide the motion not later than 15 days |\n| 8 | after the commencement of such hearing. |\n| 9 | So I am where I am, right? |\n| 10 | There's not a lot I can do unless you all have |\n| 11 | some other plan.
I don't think you're going to have another |\n| 12 | plan today. |\n| 13 | I'm not going to write a decision between today |\n| 14 | and tomorrow.
That's not going to -- I mean, I just can't. |\n| 15 | I have other hearings.
We have other things.
But I have to |\n| 16 | decide within 15 days of today. |\n| 17 | MR. GOLDMAN:
Understood, Your Honor. |\n| 18 | I think what -- what I think is going to obstruct |\n| 19 | or not provide for conducive discussions about a Chapter 11 |\n| 20 | trustee is the fact that PAX would rather Your Honor just |\n| 21 | rule on dismissal.
And so I'm not -- I don't think I'm |\n| 22 | going to be able to engage them in a discussion until that |\n| 23 | ruling comes down. |\n| 24 | What Your Honor could do though, in ruling on this |\n| 25 | motion, is to appoint a Chapter 11 trustee and provide an |\n| | |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 112 of\n\n| | 112 |\n|----|--------------------------------------------------------------|\n| 1 | opportunity for a period of time for -- without prejudice -- |\n| 2 | to revisiting that order depending on what happens within |\n| 3 | the first 30 days of the case or so. |\n| 4 | In other words, you could still meet your |\n| 5 | statutory obligations and come back to this issue within a |\n| 6 | defined period of time to determine whether the case should |\n| 7 | be dismissed based on what we are able to accomplish when a |\n| 8 | Chapter 11 trustee is appointed and that would still satisfy |\n| 9 | the statutory obligation of ruling. |\n| 10 | THE COURT:
I hope the -- |\n| 11 | MR. GOLDMAN:
But it keeps options open is the |\n| 12 | point I'm making. |\n| 13 | THE COURT:
I understand your point. |\n| 14 | MR. GOLDMAN:
That's all.
That's all I have, Your |\n| 15 | Honor. |\n| 16 | THE COURT:
Okay.
Thank you. |\n| 17 | Does anyone else wish to be heard? |\n| 18 | (No audible response.) |\n| 19 | THE COURT:
Okay.
As I just noted for the record, |\n| 20 | I have to rule on this decision -- |\n| 21 | Oh, is there something else you'd like to add? |\n| 22 | Oh, yes.
We have to finish the exhibits, right? |\n| 23 | The exhibits.
The transcripts. |\n| 24 | Attorney Goldman, there were some references made |\n| 25 | to some of the transcripts by Attorney Friedman. |\n\n| | Case 22-50073
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119 |\n|----|-----------------------------------------------------------------------------------------------|\n| | 113 |\n| 1 | MR. GOLDMAN:
No.
No objection. |\n| 2 | THE COURT:
No objection. |\n| 3 | All right.
So then all of PAX's exhibits are |\n| 4 | admitted in full except for 7, 8 and 31.
Was that the other |\n| 5 | one? |\n| 6 | MS. ARONSSON:
That's right.
Thanks, Your Honor. |\n| 7 | And I have some references if it would aid the Court for the |\n| 8 | transcripts. |\n| 9 | THE COURT:
Yes.
Please.
Go ahead. |\n| 10 | MS. ARONSSON:
For PAX 18, we would direct the |\n| 11 | Court to pages 21 to 28.
For PAX 20, we direct the Court to |\n| 12 | pages 8 to 19.
And for PAX 21, we direct the Court to pages |\n| 13 | 11 to 20. |\n| 14 | THE COURT:
Okay.
Thank you. |\n| 15 | MS. ARONSSON:
Thank you. |\n| 16 | THE COURT:
Attorney Goldman? |\n| 17 | MR. GOLDMAN:
May I make one further point, Your |\n| 18 | Honor? |\n| 19 | THE COURT:
Yes.
They can't hear you though. |\n| 20 | MR. GOLDMAN:
Okay. |\n| 21 | THE COURT:
Speak into the -- |\n| 22 | MR. GOLDMAN:
Okay. |\n| 23 | THE COURT:
You can speak right next to you to |\n| 24 | Attorney Aronsson. |\n| 25 | MR. GOLDMAN:
Okay.
I know this may not be a |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 114 of\n\n| | 114 | |\n|----|----------------------------------------------------------------|--|\n| 1 | specific factor under 1112(b), but Your Honor knows from the | |\n| 2 | litigation budget that was filed in connection with the DIP | |\n| 3 | motion, at the end of April, we had incurred almost \\$200,000 | |\n| 4 | in fees.
That number has obviously escalated. | |\n| 5 | It just would be I think a travesty to the process | |\n| 6 | that a committee is appointed, they retain counsel on the | |\n| 7 | reliance of the process moving forward -- we did our job for | |\n| 8 | the committee -- and now to just dismiss the case with all | |\n| 9 | those fees being unpaid I think is a disservice to the | |\n| 10 | process. | |\n| 11 | THE COURT:
I understand.
Thank you. | |\n| 12 | Does anyone else wish to be heard? | |\n| 13 | (No audible response.) | |\n| 14 | THE COURT:
All right.
So that the record is | |\n| 15 | clear, on April 6th, 2022, the creditor, Pacific Alliance | |\n| 16 | Asia Opportunity Fund, LP, filed a motion to dismiss the | |\n| 17 | case for cause, or in the alternative, a partial joinder to | |\n| 18 | the U.S. Trustee's motion for an order directing the | |\n| 19 | appointment of a Chapter 11 trustee. | |\n| 20 | We have had several hearings in the case at which | |\n| 21 | we've talked about the motion to dismiss.
And we also had a | |\n| 22 | status conference to talk about the motion to dismiss and | |\n| 23 | that status conference was held on April 13, 2022. | |\n| 24 | Following the status conference, and as part of | |\n| 25 | the discussions had at the status conference, the hearing on | |\n| | | |\n\n#### Case 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 115 of\n\n| | 119 | | | |\n|----|--------------------------------------------------------------|--|--|--|\n| | 115 | | | |\n| 1 | the motion to dismiss was scheduled to be held today, May | | | |\n| 2 | 25th, 2022, with the consent of the movant, PAX. | | | |\n| 3 | And we also scheduled a hearing for tomorrow | | | |\n| 4 | anticipating that we'd have more evidence that might need to | | | |\n| 5 | be submitted to the Court in connection with the motion to | | | |\n| 6 | dismiss. | | | |\n| 7 | At a recent hearing, prior to the hearing on the | | | |\n| 8 | motion to dismiss, the debtor confirmed through counsel that | | | |\n| 9 | they were not objecting to the motion to dismiss and | | | |\n| 10 | consenting to the fact that cause exists under 1112 to | | | |\n| 11 | dismiss the case. | | | |\n| 12 | Every other party that has filed a document or a | | | |\n| 13 | pleading regarding the motion to dismiss has consented to | | | |\n| 14 | the fact that cause exists. | | | |\n| 15 | So this court has to make no finding that cause | | | |\n| 16 | exists. | | | |\n| 17 | The court only has to make findings with regard to | | | |\n| 18 | what the cause is and what the ultimate relief will be. | | | |\n| 19 | And I've stated this on the record before, but I | | | |\n| 20 | will state it again, that the Court will either dismiss the | | | |\n| 21 | case, convert the case, or appoint a Chapter 11 trustee, in | | | |\n| 22 | accordance with the applicable provisions of 1112(b) of the | | | |\n| 23 | code. | | | |\n| 24 | I have stated for the record today the exhibits | | | |\n| 25 | that have been admitted in full in this hearing that have | | | |\n| | | | | |\n\n| | Case 22-50073
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119 | | | |\n|----|-----------------------------------------------------------------------------------------------|--|--|--|\n| | 116 | | | |\n| 1 | been submitted by PAX and the official committee of | | | |\n| 2 | unsecured creditors.
No other party has submitted evidence, | | | |\n| 3 | but has joined in those -- in that evidence, which is fine | | | |\n| 4 | with the Court. | | | |\n| 5 | I have reviewed the position papers that were | | | |\n| 6 | filed by all of the parties on Friday, the 20th, regarding | | | |\n| 7 | those respective positions with regard to the motion to | | | |\n| 8 | dismiss. | | | |\n| 9 | And of course have heard all of the parties today | | | |\n| 10 | make their arguments with regard to the motion to dismiss. | | | |\n| 11 | As I also indicated, I'm bound by the statute to | | | |\n| 12 | rule on this motion within 15 days of the commencement of | | | |\n| 13 | the hearing. | | | |\n| 14 | The hearing is concluded today there being no | | | |\n| 15 | further evidence to be submitted or arguments to be made so, | | | |\n| 16 | therefore, the clock starts to run as far as a decision on | | | |\n| 17 | this motion to dismiss. | | | |\n| 18 | I have -- I appreciate all of the arguments that | | | |\n| 19 | have been made by all of the parties.
They have been | | | |\n| 20 | thoughtful and thorough.
And you have made your points | | | |\n| 21 | well. | | | |\n| 22 | But I do have to make the determination as to | | | |\n| 23 | which way this case will proceed and I will do so.
And | | | |\n| 24 | obviously I will do so within 15 days of today. | | | |\n| 25 | Although I suppose under the Federal Rules of | | | |\n| | | | | |\n\n| | Case 22-50073
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119 | | | |\n|----|-----------------------------------------------------------------------------------------------|--|--|--|\n| | 117 | | | |\n| 1 | Civil Procedure you don't count today, under 9006, at rule | | | |\n| 2 | 6, you don't count the day -- today -- so I think that's | | | |\n| 3 | correct honestly. | | | |\n| 4 | But in any event, if you have any other concerns | | | |\n| 5 | or questions regarding the motion to dismiss, I am generally | | | |\n| 6 | available for a conference.
But in the meantime, I'm going | | | |\n| 7 | to be ruling on the motion to dismiss. | | | |\n| 8 | Okay.
Does anyone have any further questions? | | | |\n| 9 | (No audible response.) | | | |\n| 10 | THE COURT:
All right.
Well, I appreciate the | | | |\n| 11 | efforts of all the parties. | | | |\n| 12 | I'm taking the motion to dismiss under advisement | | | |\n| 13 | and I will rule accordingly. | | | |\n| 14 | And this is the last matter on today's calendar, | | | |\n| 15 | so court is adjourned. | | | |\n| 16 | (Proceedings adjourned at 12:51 p.m.) | | | |\n| 17 | | | | |\n| 18 | | | | |\n| 19 | | | | |\n| 20 | | | | |\n| 21 | | | | |\n| 22 | | | | |\n| 23 | | | | |\n| 24 | | | | |\n| | | | | |\n| | | | | |\n\n| | Case 22-50073
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119 | | | |\n|----|-----------------------------------------------------------------------------------------------|--|--|--|\n| | 118 | | | |\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 | April 21, 2022 | | | |\n| 10 | Christine Fiore, CERT-410 | | | |\n| 11 | Transcriber | | | |\n| 12 | | | | |\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| | | | | |\n\n| | 119 | |\n|----|--------------------------------|-------|\n| | | 119 |\n| 1 | INDEX | |\n| 2 | PAX EXHIBITS: | Rec'd |\n| 3 | 1-6, 9-17, 23-29, 31 | 8 |\n| 4 | | |\n| 5 | CREDITOR'S COMMITTEE EXHIBITS: | |\n| 6 | 1-14 | 16 |\n| 7 | | |\n| 8 | | |\n| 9 | | |\n| 10 | | |\n| 11 | | |\n| 12 | | |\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| | | |\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 119 of","body_zh":"案件 22-50073 文书 884 于 09/27/22 提交 于 09/27/22 12:36:24 登记 第 1 页，共 119 页\n\n美国破产法院（UNITED STATES BANKRUPTCY COURT）\n康涅狄格地区（DISTRICT OF CONNECTICUT）\n布里奇波特分院（BRIDGEPORT DIVISION）\n更新于 7/20/22\n关于 * 案号 22-50073(JAM)\n *\nHo Wan Kwok（郭文贵）， * 康涅狄格州布里奇波特\n * 2022年5月25日\n债务人。 *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n *\n关于命令指定任命审查员之动议的庭审记录，或备选地，关于命令指定任命第11章受托人之动议；驳回第11章案件之动议，或备选地，部分加入美国受托人关于命令指定任命第11章受托人之动议\n\n于尊敬的 JULIE A. MANNING 法官阁下\n美国破产法官\n\n出庭人员：\n\n代表债务人：\nBENNETT S. SILVERBERG, ESQ.\nJEFFREY L. JONAS, ESQ.\nBrown Rudnick, LLP（布朗·拉德尼克律师事务所）\nSeven Times Square\nNew York, NY 10036\n\n代表债权人 Pacific\nAlliance Asia Opportunity\nFund L.P.：\nPETER FRIEDMAN, ESQ.\nLAURA ARONSSON, ESQ.\nO'Melveny & Myers LLP（奥麦文律师事务所）\nTimes Square Tower\n7 Times Square\nNew York, NY 10036\n\nPATRICK M. BIRNEY, ESQ.\nRobinson & Cole LLP（罗宾逊与科尔律师事务所）\n280 Trumbull Street\nHartford, CT 06103\n\n程序由电子录音记录，庭审记录由速记服务机构制作。\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与庭审记录服务公司）\n4 Research Drive, Suite 402\nShelton, Connecticut 06484\n(203)929-9992\n\n出庭人员（续）：\n\n代表美国受托人：\nHOLLEY L. CLAIBORN, ESQ.\nOffice of the United States Trustee（美国受托人办公室）\nThe Giaimo Federal Building\n150 Court Street, Room 302\nNew Haven, CT 06510\n\n代表无担保债权人\n正式委员会：\nIRVE GOLDMAN, ESQ.\nPullman & Comley（普尔曼与康利律师事务所）\n850 Main Street\nBridgeport, CT 06601\n\n代表债权人 Rui Ma（马锐）、Zheng Wu（吴征）及\nWeican Meng（孟伟灿）：\nKRISTIN MAYHEW, ESQ.\nMcElroy, Deutsch, Mulvaney & Carpenter（麦克尔罗伊、德意志、马尔瓦尼与卡彭特律师事务所）\n30 Jeliff Lane\nSouthport, CT 06890\n\nCAROLLYNN H.G. CALLARI, ESQ.\nLaw firm of Callari Partners（卡拉里合伙人律师事务所）\nOne Rockefeller Plaza\nNew York, NY 10020\n\n（程序于上午10时05分开始。）\n\n法庭书记员：案号 22-50073，Ho Wan Kwok。\n\n法庭：好的。早上好。请从债务人代理律师开始，为记录说明出庭人员，可以吗？\n\nJONAS 律师：早上好，法官阁下。我是 Brown Rudnick 的 Jeff Jonas。与我一同出庭的是 Ben Silverberg，Bill Baldiga 今天上午坐在我身后，代表债务人。谢谢。\n\n法庭：早上好。\n\nFRIEDMAN 律师：早上好，法官阁下。我是 O'Melveny & Myers 的 Peter Friedman，Laura Aronsson 与我一同代表 Pacific Alliance Group（太平洋联盟集团）。\n\n法庭：早上好。\n\nBIRNEY 律师：早上好，法官阁下。我是 Patrick Birney，同样代表 PAX。\n\n法庭：早上好。\n\nGOLDMAN 律师：早上好，法官阁下。我是 Pullman and Comley 的 Irve Goldman，代表债权人委员会。\n\n法庭：早上好。\n\nCLAIBORN 律师：早上好，法官阁下。我是代表美国受托人的 Holley Claiborn。\n\n法庭：早上好。\n\nMAYHEW 律师：早上好，法官阁下。我是 McElroy, Deutsch, Mulvaney & Carpenter 的 Kristin Mayhew，代表债权人 Rui Ma、Zheng Wu 和 Weican Meng。与我一同出庭的还有 Callari Partners 的 Carollynn Callari。\n\n法庭：两位早上好。今天上午还有其他需要记录其出庭情况的人员吗？好的。好。如各位所知，今天就一项驳回动议举行听证，或备选地，就任命受托人举行听证。在上一次听证会中，为今天的听证作准备时，我获告知所有当事人均已达成一致。你们已在提交的书面材料中确认，你们同意认定根据 1112(b) 存在事由，可以采取某项措施，即驳回本案、转换本案，或任命第11章受托人。我已审阅你们的证人和证物清单，也已审阅你们关于驳回、转换或任命第11章受托人的立场文件。在我们开始举证之前，我不知道当事人是否还有任何事项希望告知法庭？Jonas 律师？Friedman 律师？\n\nFRIEDMAN 律师：没有，法官阁下。我认为 Aronsson 律师将说明我们作为证据提交的材料。我相信 Aronsson 律师和委员会的代理律师已就哪些材料可以采纳达成一致，我们也撤回了一些材料，因此我认为应交由 Aronsson 律师，然后由 Goldman 律师说明各方希望采纳的材料。之后，我请求准许在此结束后进行辩论。\n\n法庭：当然可以。好的。Aronsson 律师，请您开始，可以吗？您要继续吗？\n\nARONSSON 律师：好的。谢谢您，法官阁下。\n\n法庭：在您继续前，先等一下，我必须询问法庭书记员，我们是否需要处理任何技术问题。您将要——您将要提交证物吗？\n\nARONSSON 律师：是。\n\n法庭：好的。\n\nARONSSON 律师：计划提交——\n\n法庭：那么，为此我是否需要打开这个摄像头？\n\n法庭书记员：[法庭书记员发言]\n\n法庭：它已经打开了，但我是否需要实际上——将这个打开并显示？\n\n法庭书记员：[法庭书记员发言]\n\n法庭：因为我在这里什么也看不见，所以我想，遗憾的是，我必须把它打开。\n\n法庭书记员：[法庭书记员发言]。\n\n法庭：不，但她会这样做。所以我不想，您知道，打断程序。\n\nARONSSON 律师：法官阁下，我不确定我们现在是否需要展示任何证据。\n\n法庭：好的。好。那么，在您准备这样做时，您能否告知我，以便我确保我们的技术人员——我没有做错什么，因为我很可能会做错，但我会尽量不这样做。好吗？\n\nARONSSON 律师：会的。\n\n法庭：好的。那么，Aronsson 律师，请继续。您可以继续。\n\nARONSSON 律师：谢谢您，法官阁下。PAX 请求将案卷中编号为 PAX 1 至 PAX 31 的证物作为证据提交，但 PAX 7、PAX 8 和 PAX 30 除外。\n\n法庭：7、8 和 30 不予采纳？\n\nARONSSON 律师：正确。\n\n法庭：是否有人——你们是否讨论过是否有人反对提交这些证物？\n\nARONSSON 律师：因此，我们昨天与 Goldman 律师会面并协商，我理解，我们的撤回反映了我们善意的会面与协商。我理解——\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与庭审记录服务公司）\n\n可能还存在一项分歧——\n\n法庭：好的。\n\nARONSSON 律师：——基于我们今天上午的谈话。\n\nGOLDMAN 律师：是的。正确，法官阁下。我们只是——我认为，我预期会就他们寻求从纽约诉讼中提交的一组——一系列庭审记录进行简短辩论。因此，这就确定了争议所在。\n\n法庭：好的。那么，关于——还有其他人希望就采纳证物发表意见吗？没有人？好的。那么，Aronsson 律师，您是完整提交这些证物，正确吗？\n\nARONSSON 律师：正确。\n\n法庭：好的。现在，我想我可能在先前的听证中说过这一点。我不反对你们申请完整采纳这些证物。这并不意味着我会阅读每一页，因此，您知道，在此期间，您们可能希望向我指出某些内容。但无论如何，我已经说过这一点。这是我对所有代理律师所说的话。这并非本案所独有。我不反对并且赞赏当事人就证物采纳进行合作，但我不——我只是希望各位知道，这并不意味着我会阅读每一页。好吗？\n\nARONSSON 律师：明白。\n\n法庭：好的。请继续。\n\nARONSSON 律师：您希望听取关于该——的辩论吗？\n\n法庭：有可能。\n\nARONSSON 律师：好的。\n\n法庭：请稍等一下。那么，我将在记录中宣布，证物——PAX 证物 1 至 31，但 PAX 证物 7、8 和 30 除外，均作为完整证物采纳。\n\nGOLDMAN 律师：我可以作一项限定吗？\n\n法庭：可以。\n\nGOLDMAN 律师：存在一些证物——存在受到质疑和反对的证物，即证物 18 至 22。它们是他们寻求从纽约州最高法院听证中提交的庭审记录。因此，我们——您知道，法官阁下需要作出裁决——\n\n法庭：好的。那么，您对那些证物有什么异议——\n\nGOLDMAN 律师：嗯，异议是，它们纯属传闻证据。仅仅因为它们来自法院程序，并不使其成为公共记录。\n\n法庭：它们为什么是传闻证据？\n\nGOLDMAN 律师：嗯，它们是庭外——\n\n陈述。\n\n法庭：它们不是陈述。它们是听证记录，对吗？\n\nGOLDMAN 律师：嗯，它们当然是记录中的陈述，由不同当事人作出——\n\n法庭：对。\n\nGOLDMAN 律师：——由代理律师和——\n\n法庭：其证明力将按我认为适当的程度予以考量。但它是一份庭审记录。您是否——如果您反对的是庭审记录本身，称其在某种意义上并非正式或未经认证——\n\nGOLDMAN 律师：不。不。\n\n法庭：——那么那是不同的异议。\n\nGOLDMAN 律师：那不是我的异议。\n\n法庭：好的。\n\nGOLDMAN 律师：我的异议是，它们显然是传闻证据，因为它们是为证明陈述所主张事项真实而提交的庭外陈述，而且它们并不——不属于公共记录例外。\n\n法庭书记员：抱歉，法官阁下。\n\n法庭：等一下，Goldman 律师。您听不见吗？\n\n法庭书记员：我听不见 Goldman 律师。\n\n法庭：我们听不太清楚您说话。\n\nGOLDMAN 律师：抱歉。它们显然是为证明所主张事项真实而提交的庭外陈述。\n\n法庭：它们不是——它们不是——它们是当事人的自认。它们是债务人和 PAX 在一次听证中的陈述。\n\nGOLDMAN 律师：嗯——\n\n法庭：并且它们被采纳用于——什么——无论如何。请继续，Goldman 律师。您继续说，但我还不确定我已被说服。\n\nGOLDMAN 律师：好的。您知道，在他们寻求提交债务人陈述的范围内，债务人并未反对——\n\n法庭书记员：抱歉，法官阁下。\n\n法庭：等一下。我们还是听不见您？\n\n法庭书记员：是的。有人告诉我，如果 Goldman 律师能到讲台前会更好。\n\n法庭：有些问题——他们没有收到您的声音，Goldman 律师。\n\nGOLDMAN 律师：我可以到那里去吗？\n\n法庭：可以，请。\n\n法庭书记员：麦克风没有——\n\n亮灯。\n\n法庭：由于某种原因，那个麦克风不工作。\n\nGOLDMAN 律师：好的。好的。\n\n法庭书记员：有些问题，因为——\n\n法庭：好的。好。是的，如果您能上前？\n\nGOLDMAN 律师：可以。\n\n法庭：谢谢。\n\nGOLDMAN 律师：当然。这样好些吗，法官阁下？\n\n法庭：是的。现在我——我相信，是吧？各位都能听见 Goldman 律师吗？\n\nGOLDMAN 律师：是。\n\n法庭：好的。请继续。\n\n法庭书记员：是。\n\nGOLDMAN 律师：因此，在他们希望提交债务人代理律师所作陈述的范围内，我认为债务人实际上并未出席任何这些听证。出席的是代理律师。因此，债务人在这里并非对方当事人。债务人同意所请求的救济，所以为了作为对方当事人陈述而构成非传闻证据，该陈述必须被提出——它必须是对方当事人的陈述。这里唯一的对方当事人是委员会。因此，它不能作为非传闻证据成立。\n\n一方当事人的对方。公共记录例外不涵盖法院庭审记录。其规定——法院：为什么？GOLDMAN先生（戈德曼）：——公共机构的记录或陈述，如果其载明该机构的活动、在负有法定报告义务期间所观察到的事项。在民事案件中，依法获授权调查所作出的事实认定。另一法院的庭审根本不符合公共记录例外的要件。该例外旨在准许将州政府和联邦政府机构或部门的报告作为证据。法院：那么，你是说，经认证的任何曾经举行过的庭审记录都永远不能作为证据准许接纳，因为每一份记录都将构成传闻证据？GOLDMAN先生：它是庭外——它是一项庭外陈述。它不属于公共记录例外，或我所知的任何其他例外，除非在——法院：那么，记录的意义何在？GOLDMAN先生：——除非法院作出事实认定或法律结论。法院：嗯，也许法官在那些——在那些庭审期间作出了那样的认定。GOLDMAN先生：嗯，那么，法官阁下，您知道——法院：我认为他作出了，不是吗？GOLDMAN先生：嗯，他们——有300页记录——法院：我明白。GOLDMAN先生：所以我不知道什么——法院：我不会阅读全部，但我知道——GOLDMAN先生：我不知道什么——法院：——在那些记录中，我相信此前在本案中见过法院就证言的真实性、某些证人、法官的认定以及该船的所有权所作出的认定。诸如此类的事项，那是他的认定。那些是他的认定。GOLDMAN先生：我承认那将可以准许接纳。我说的是，您知道，他们正在寻求准许接纳整份——法院：而且正如我已经说过的，我不会阅读整份记录。如果律师希望我关注记录中的某些内容，我会这样做。届时，如果其构成传闻证据，你可以有机会提出异议。但目前我不确定我是否被说服。\n\n我会允许你——你知道，我会允许你在律师指出该记录中她——他们要求我审阅的具体部分时再次提出该论点。如果届时你希望重新提出你的传闻证据异议，那么你可以重新提出，我将据此作出裁定。GOLDMAN先生：好的。只是为了让法官阁下——让我明确，我对于法院作出的事实认定或法律结论没有异议。只是——我认为记录中法院的观察意见不属于公共记录例外。这就是我的意思。法院：好的。好的。谢谢。GOLDMAN先生：好的。谢谢您，法官阁下。法院：律师，请继续。ARONSSON女士（阿伦松）：谢谢。因此，为澄清起见，在我们昨天与Goldman先生的谈话中，我们确实打算使用——为提出Ostrager法官（Ostrager）的认定而提交这些记录——而不是任何可能构成传闻证据的证人证言。因此，我认为我们在这一点上达成一致。法院：好的。那么，我现在要做的是——再次说明，我们必须澄清记录。截至目前，PAX证物1至6、9至17、23至29以及31，均作为完整证物准予接纳。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n18、19、20、21和22仍可能遭债权人委员会提出异议；当且如果你引导我审阅记录的某些具体部分时，法院将对此作出裁定。好吗？\n\nARONSSON女士：谢谢您，法官阁下。\n\n法院：好的。谢谢。\n\n（PAX证物编号1-6、9-17、23-29和31全部准予接纳）\n\n法院：请继续，Goldman律师。\n\nGOLDMAN先生：是。如果——法官阁下，代表委员会，我们提出将我方证物1至14作为证据，我相信对此不存在任何异议——\n\nFRIEDMAN先生（弗里德曼）：对此没有异议，法官阁下。我是Peter Friedman。而且，我们也支持委员会的建议，即法院对本案的记录予以司法认知。我认为这也是美国受托人和委员会律师都提出的一点，我们认为提出这一点是公平的，而且应当对这些案件的全部记录予以司法认知。\n\n法院：这个——好的。谢谢。Goldman律师，我尚未进行交叉核对，但你的任何证物是否与PAX的证物相同？\n\nGOLDMAN先生：我相信有一份，即债务人的声明。我想我们双方都有。那是我们的——\n\n法院：你的证物2？\n\nGOLDMAN先生：是。\n\n法院：好的。请稍等。还有PAX的证物2。编号相同，对吗？\n\nGOLDMAN先生：是。\n\n法院：好的。好的。那么，Goldman律师，你请求法院将无担保债权人委员会的证物1至14作为完整证物准予接纳。正确吗？\n\nGOLDMAN先生：是，法官阁下。\n\n法院：好的。还有其他人希望就债权人委员会证物1至14的接纳发表意见吗？\n\n好的。那么，这些证物均作为完整证物准予接纳。我对你说，Goldman律师，正如我对Aronsson律师所说，我不会阅读其中每一页。如果这些证物中有你希望我关注的具体内容，你需要让我关注那些内容。好吗？\n\n我的意思是，我有可能全部阅读，但我没有义务全部阅读。好吗？\n\nGOLDMAN先生：不，明白，法官阁下。我会——\n\n法院：好的。\n\nGOLDMAN先生：我会这样做。\n\n法院：好的。\n\n（债权人委员会证物编号1-14全部准予接纳）\n\n法院：好的。债权人Rui Ma（马睿）、Zheng Wu（吴铮）和Wiecan Meng（孟维灿）的加入申请，因此，就你的——任何证物而言，你没有其他内容，你与委员会立场一致，对吗？\n\nMAYHEW女士（梅休）：正确，法官阁下。\n\n法院：好的。谢谢。至于美国受托人办公室，我认为情况相同——嗯，我认为你的陈述中说过，Claiborn律师（克莱伯恩），但如果我错了，你当然应当纠正我，即你保留就任何证物进行询问和询问任何证人的权利，但你本人并未提交任何证据。该办公室并未提交任何证据，正确吗？\n\nCLAIBORN女士：正确，法官阁下。\n\n法院：好的。谢谢。Jonas律师（乔纳斯），我认为你的情况也是如此，只是你基本上请求对本案提交的所有文件，以及另一方当事人标识或提出的任何证物，以及在弹劾之后为反驳所必需的任何证物，予以司法认知，正确吗？\n\nJONAS先生：正确，法官阁下。\n\n法院：好的。那么，你们也都准备好了。\n\n案件 22-50073 文件 884 提交 09/27/22 录入 09/27/22 12:36:24 第 17 页，共 119 页\n\nJONAS先生：是，法官阁下。\n\n法院：暂时如此。\n\nJONAS先生：是，法官阁下。\n\n法院：理解你们的——\n\nJONAS先生：谢谢。\n\n法院：——你们的范围。\n\nJONAS先生：谢谢您，法官阁下。\n\n法院：好的。谢谢。\n\n请给我一秒钟。\n\n（暂停）\n\n法院：现在，我们还有另一方当事人提交了——实际上，我不认为他们就证人和证物清单提交了任何文件，所以我认为他们只是提交了一份陈述；另一名基本上加入委员会立场的债权人——是的，他们没有提交列有证人和证物的任何文件。\n\n那么，Aronsson律师，你可以直接继续。你可以进行。\n\nFRIEDMAN先生：法官阁下，我是Peter Friedman。\n\n法院：好的。Friedman律师。\n\nFRIEDMAN先生：我将要——\n\n法院：请继续。\n\nFRIEDMAN先生：那么，法官阁下，我是代表PAX的O'Melveny and Myers（欧迈律师事务所）的Peter Friedman，我将主张驳回本案。\n\n法院：好的。\n\nFRIEDMAN先生：本案系恶意提出，具体目的在于规避一项藐视法庭判决，我知道法院已听闻很多相关情况，我们还会回到这一点。我认为，事实上，在无担保债权人委员会（UCC）证物2，即我方证物2，Kwok先生（郭文贵）的声明第3和第24段中，他基本承认——在我们看来，藐视法庭是本案的阿尔法，也应当是欧米伽，因为本案的目的就是规避该项判决，而这不是申请破产的正当目的。在其同意书中，债务人称，PAX对其毫无约束的法律战是其同意的原因。我认为这具有讽刺意味，因为正如我们在案卷编号50中指出的，Kwok是在破产前紧接着表明其意图立即对PAX发动全面战争的人。随后，Kwok就在必须面对执行Ostrager法官所施加的藐视法庭制裁的前一晚提交本案。那么，我们在那个时候得到的是什么样的案件？一个没有列明资产、没有经营业务、没有雇员、没有需要承接的待履行合同、没有收入——除少量COVID救助支票外——的案件。没有真正的破产目的，没有改变Kwok先生的生活方式。仅仅是又一个可以利用的审理场所，我认为这导向如下结论：这里确实存在双重恶意，首先是规避藐视法庭判决，其次是重新诉讼PAX的请求权；二者均非正当的破产目的，而对此的救济应当与提交本案的动机相适应。\n\n法官阁下，我想先回顾Kwok先生为阻挠PAX所作努力中的全部策略性行为。这些内容均来自PAX证物23，自第2段开始。\n\nPAX于2008年向Kwok先生的公司出借$30,000。Kwok以个人名义为该贷款提供担保。PAX和Kwok于2011年重新协商该贷款，以合并剩余债务。Kwok再次签署了个人担保。\n\n2013年4月，Kwok同意通过向PAX转让北京若干公寓的所有权来清偿其债务。该和解以满足若干先决条件为前提，包括交付无瑕疵所有权。PAX多次延长该和解的期限，最终期限定为June 30, 2015。\n\nKwok从未履行其先决条件。因此，PAX于2017年4月以违约为由起诉Kwok。顺便说一句，该诉讼与任何其他原告提起的任何其他诉讼完全无关。请求权持有人与PAX之间不存在共同的事实核心。我特意使用“请求权持有人”这一术语，因为我不认为这些人——提出债权申报的绝大多数人——实际上是债权人。他们持有请求权，这与作为债权人不同。他们没有判决。On September 15th, 2020，PAX在其违约案件中赢得简易判决。PAX将遭受如此严重阻挠的第一声警示是，此后不久Genever New York（吉尼弗纽约）在纽约南区（Southern District of New York，SDNY）申请破产，这是Kwok先生试图阻挠Kwok的一贯模式的一部分。此后不久，纽约法院限制处置Lady May（“Lady May”号）和其他——以及Sherry Netherland（雪莉-内瑟兰大厦）。证物23，案卷183.3，October 15th，Ostrager法官命令。最终判决于2021年2月作出，距破产案件早一年。当时，法院作出$116 million的判决，并适用纽约法定利率，使其在Kwok先生提交申请之日增至$127 million。随后，在PAX努力执行其判决时，发生了所有这些伎俩。正如我指出的，Ostrager法官不得不寻求——明确认定，而这是证物——PAX 18第21页。在October——在一次October 15th庭审中，如果委员会律师希望提出异议，我仅强调这一点。\n\n我们认为应当作为证据提交的听证记录中的事项之一。如2020年9月15日命令所反映，本院认为 Kwok 先生（郭文贵）曾试图误导本院。本院认为，Kwok 先生作为原告——正如原告所主张——在玩弄障眼法。这将到此为止。我们不会再容许任何障眼法。Kwok——由于这些持续不断的障眼法，PAX 被迫在纽约州诉讼中多次提出藐视法庭动议。2021年3月16日，如 PAX 证据24所载，本院指出，显然，在本院审理的程序中存在令人无法容忍的策略性操弄、肢解和欺骗。本院继而表示，与其逐一列举被告所实施的众多障眼法，本院在如下范围内准许藐视法庭动议。自2021年5月15日后，游艇在本院管辖范围之外的每一天，被告将被处以罚款——Kwok 将被处以 $500,000 罚款。这并不会迫使 Kwok 先生申请破产；他只是继续蔑视，这次不仅蔑视判决书，也蔑视州法院的命令。在2021年7月的一次听证会上——此为 PAX 证据21——\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n——本院指出，本院曾发布命令，指示不得将该船移出美国领海。Kwok 先生和/或其控制的实体无视该命令。此构成藐视法庭。法庭：律师，你在证据21中看到第几页？FRIEDMAN先生（弗里德曼先生）：第16至17页。法庭：谢谢。FRIEDMAN先生：再看第19页，本院谈到他的——Ostrager 法官（奥斯特拉格法官）谈到他的抗命，即 Kwok 对法院命令的抗命。Kwok 就该罚款提起上诉。第一部门维持原判，并指示审判法院举行进一步证据听证会。在最终证据听证会上，正如本院所指出，那恰恰——那促成了破产申请，本院谈到1,180项案卷条目。这载于 PAX 25。其中几乎全部涉及被告逃避和欺骗的努力。谈到——PAX 因资产隐藏在迷宫般的公司实体之中而遭遇困难。最后，正如本院指出，而且我知道本院此前已经听过这一点，但如果亿万富翁诉讼当事人可以同时寻求利用纽约和其他地方的法院程序，同时明知且故意违反法院\n\n命令，法治便无从谈起。Kwok 先生试图对此提起上诉，寻求对这些命令的紧急中止，但未获批准。Ostrager 法官在其意见——一项命令中指出，将会有其他后果。我认为，我们——根据我们从证词中所知、根据本院所听取的内容，以及我认为可以推断出的内容，Kwok 先生显然并不真正担心金钱问题。他担心因抗拒法院命令而入狱，而这正是促使他申请破产的原因。那么，破产申请提出后发生了什么？我认为，本院可以从 Kwok 先生的声明、债务人对审查员动议的答复、债务人对 PAX 提出的解除中止动议的异议，以及债务人试图将 PAX 的诉讼从州法院移送至联邦法院的努力中观察到这一点。所有这些都指向一件事。本案随后被——被提起的目的不当，即重新审理 PAX 问题，对吗？您在声明中看到，Kwok 先生坚持认为 PAX 诉讼建立在伪造之上，对吗？认为已取得的判决书存在不当之处。曾作出各种努力——您知道，这载于案卷编号83第12段。Kwok 先生主张，\n\n您知道，该个人担保不知何故是伪造的。\n\n我认为，他谈到希望重新评估什么才真正属于他的财产，而这只不过是显而易见地试图让本院重新审理 Ostrager 法官的藐视法庭命令。\n\n移送一个案件的想法——曾试图移送一个案件，而它是最没有理由移送的案件。其中的核心问题已经在上诉中，但除此之外还会有什么目的，若非试图重新审理；我们所援引的判例指出，这并非提出破产案件的正当目的。\n\n阁下，我要指出，在这些程序中唯一被提及的另一案件是债权人 Rui Ma（马睿）的债权，但并未试图将该案移送至此。恰恰相反，我相信实际上已提交一份同意约定，让该案继续在纽约州法院系统中审理裁决。\n\n因此，我认为本院可以根据其所见的一切作出推断。本案的真正目的在于专门阻挠 PAX，并具体就 PAX 而言获得第二次或第三次机会。\n\n阁下，谈一下 PAX。本院，我认为，已经观察到，鉴于缺乏资产、缺乏经营业务、缺乏持续收入、业务等等，本案是多么不同寻常。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n而且，本案的性质如此坦率地集中于专业人士的费用和预算，而非以任何方式进行传统且有意义的重组；PAX 的债权金额比下一项已判决债权大逾1,300倍。第二大的实际——我想是理论上无争议的——债权，是内部人的债权；我认为本院在此情形下不必对此给予太多关注。\n\n因此，鉴于我方债权的规模，我们希望着重说明 PAX 所发挥的积极作用；我认为，在处理本案提出后所发生的事情时，PAX 发挥这种作用确实十分重要。\n\n债务人进入程序。债务人提交了一项计划。我认为这项计划一开始就注定失败。其寻求借款 $8 million。而 PAX 对此表示反对。其他人没有。其他人认为，也许在彩虹尽头会有一罐黄金。我们从一开始就说，DIP 是一场骗局；当 Golden Spring（金泉）决定不再为本案提供资金时，其他人确实猝不及防。\n\n但是，仅仅是——您知道，试图取得债务人占有融资，其目的并非为了任何人而只为了专业人士，或为了开展调查，这对我们而言从来没有道理；本案的任何方面对我们而言也从来没有道理。我们认为，当时的现状\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n——即债权人有权根据州法追求其权利——才是处理这类债务人的真正适当机制。\n\n而且我们认为判例支持这一点。例如，在康涅狄格联邦地区法院的 Sapphire Development Company v. McKay（蓝宝石开发公司诉麦凯案）中，债务人没有业务、雇员，并由债务人负责人的关联方提供资金；该负责人曾有——并且存在州法院判决认定其转移资产、误导法院等等的历史。法院驳回该案，并特别指出，无担保债权人可以如同本案债权持有人一样，在州法院向他们希望追究的任何人主张权利，并且这属于适当行使裁量权。我想强调，本院确有广泛裁量权——您知道，判例非常明确，本院在决定今日应如何处理时拥有极大的裁量权。\n\nPAX 债权的规模，我认为，正如我们在 495 BR 212 的 Acme Cake Company（阿克梅蛋糕公司）案中所援引的，在单一债权人持有足够大的债权并认为驳回案件是最佳结果时，驳回案件是适当的。驳回符合债权人的最佳利益，因为破产财产不会受到如下可能结果的影响：最大债权人将在其他无担保债权人之前执行其判决书并取得债务人的资产。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n因此，PAX 主张其为最大债权人并认为这是正确结果，并无任何不当。再次强调，我们在此所做的只是恢复现状。我们是否能够执行我们的判决书，我无法断言，但我认为恢复现状是适当的。\n\n来自科罗拉多州的 OptInRealBig.com, 345 BR 277。该法院准许了一项驳回动议，因为在破产程序之外，债权人整体可收回的价值可能更大；我们认为本案也会如此，当然对 PAX 而言如此，正如我稍后将谈到的。即使第7章程序能够获得资金，也会给 PAX 带来巨大成本。\n\n但该法院裁定，债权人——在此，我会将该法院所谈及的人类比于持有或有未清算债权的债权持有人，甚至是持有极小债权的人——不应仅为利用破产程序向债权人提供的利益而被允许拖延或维持案件；而且，如果如我认为我方对手所主张的那样，保障破产法的优先顺位制度是驳回案件的先决条件，那么根据破产法，任何案件都不可能被驳回。\n\n因此，如果只有在100 percent确定任何至少\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n理论上处于相同地位的人都能获得保障的情况下才能驳回案件，那么您永远无法驳回案件。我们不认为任何判例支持这一点；事实上，我们认为恰恰相反，诸如 OptInRealBig 和 Acme Cake Company 的判例表达了相反的观点。\n\n阁下，我认为，在来自堪萨斯州的 Regional Evangelical Alliance of Church's（教会区域福音联盟）破产案中，您知道，法院指出，尽管存在其他债权人，但当破产本质上是试图阻挠债权人在州法院诉讼中实现回收时，适当做法是允许人们寻求其根据适用的非破产法有权获得的救济，而不必就否则可能设置的破产障碍进行诉讼。\n\n阁下，我认为我们还在我们针对——抱歉，在支持我们的回复状中援引了三宗案件。Wally Findlay（沃利·芬德利）案指出，将破产程序用于重新审理破产案件是不可允许的使用方式；而在债务人采取该立场时，驳回案件是适当的。纽约东区的 Bridge to Life（生命之桥）案中，案件被驳回，因为债务人试图，您知道，将非破产法问题纳入第11章案件。在 D&G Construction: Dean Gonzalez（D&G建筑：迪恩·冈萨雷斯）案中，法院裁定，将破产程序作为延迟合法行使州法权利并攻击其他法院终局命令的平台，足以正当化\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n驳回。法官阁下，有些案件的论证并不详尽。我理解。我认为对方的一些其他案件也是如此，我会谈到他们的案件；但我认为其中存在一条主线，即没有什么能够阻止——也没有理由阻止——恢复原状，并让人们在此类案件中行使其所享有的任何州法院权利。让我说明本案不是什么。本案不是大规模侵权案件。本案不是这样一种案件：你可以说，好吧，债务人在五年前做了坏事，当然有些人比其他人更早受到伤害，但我们知道——我们知道，因诸如进攻性非互惠争点排除之类的原则，必然会有人在未来获得对其有利的裁决；我们甚至可以制定一个矩阵，说，好吧，如果你患有间皮瘤且年满45岁，你将获得X；如果你遭受阿片类药物伤害，你将获得Y。这里每个人的请求权类型都极为不同。因此，尽管存在某种争抢向法院提起诉讼的问题，但这正是州法允许人们做的，而PAX一直极其、极其、极其勤勉且警觉，这并无不当。我想谈谈对方援引的案件，首先我认为——其中有几条主线贯穿其中，我认为这些主线显示出相当重大的差异。\n\n对方所援引的案件，我认为首先显然是Julian案。我认为显然存在有力的驳回理由。我认为，债务人在该案全过程中的行为显然构成显著的区别因素。\n\n本案至今所历时间幸而很短，我认为我对本案的理解可能远不及您、Birney先生或Goldman先生；但我认为，关于该案中债务人律师的事实存在某些独特情形，因此最终由法院继续监督该案可能是相当恰当的。但我不认为——我认为债权人最终获得的结果并不理想，而且无论该案中是否适当地行使了自由裁量权，我不认为这对本案具有指导意义。\n\n来自District of Connecticut（康涅狄格联邦地区法院）的SWJ Management（SWJ管理公司）案中，债权人压倒性地寻求转换。我想明确指出，正如Acme Cake Company（艾克米蛋糕公司）案所说，不应当按人头计算。真正应当按金额计算，因为试想，如果有100个——您知道，PAX拥有$260 million的判决。试想PAX将其贷款拆分为$261 million的关联基金，每一个基金各自提交债权请求。\n\n而且每一个人都可以来到这里说，261名债权人赞成驳回。我不认为这是按人头计算。我认为这是按金额计算，而PAX的——您知道，PAX资金的价值才是真正重要的。Premier Golf Properties（普瑞米尔高尔夫地产公司）案是被大量援引的案件。该案为564 BR 710。法院在决定应当驳回还是转换时使用了一个有趣的词。其称关键问题——实际上其称该案的关键问题——是作为高尔夫球场的基础资产之不确定价值，能否通过持续经营企业的破产出售或止赎实现最大化。这与本案毫无相似之处。法院所依据的事实是，债务人维持着一项经营业务，拥有60名员工及每月$300,000的收入。驳回该案将导致止赎以及由此带来的财务和就业损失。法官阁下，如果您驳回本案，我可能会失业，但我不认为其他任何人会失业。我认为，Premier Golf Properties案极其、极其、极其不同。Pier Village（码头村）、Team Systems International（团队系统国际公司）、West Hampton Coach Works（西汉普顿客车厂）、Speer（斯皮尔）和Babayoff（巴巴约夫）案，均涉及没有任何非债务人一方主张驳回优于转换的情形。在大多数案件中，除非债务人偏好该选项，否则甚至没有讨论驳回。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与转录服务公司）\n\nTeam Systems案的法院，该案是Goldblatt法官——其在特拉华法官席附近——作出的极具深思熟虑的意见，曾多次明确指出，所有参与的债权人和U.S. Trustee（美国受托人）均主张，转换比驳回更有利于债权人和破产财产。在该情形下，Goldblatt法官认定驳回没有意义而转换有意义，当然并非滥用自由裁量权。这完全不是本案的情形。\n\nFleetstar案被Rui Ma（马睿）债权人大量援引。我认为该案涉及一种非常、非常不同的情形。该案试图实行结构性驳回，我认为根据Jevic案的原则，这种做法即使不是完全被禁止，也是存在严重问题的。本案并非结构性驳回。没有人请求法院说，好吧，你可以驳回案件并取得豁免，只要你给一些人一些东西，而给其他人什么也不给，您知道，自认倒霉。\n\n这是一个纯粹的驳回请求。有一些要求他人支付费用的努力。我认为我们一直说，如果其他人获得费用支付，我们没有问题。我们不会坚持支付我们自己的费用，但本案确实完全不是一种结构性驳回案件。\n\nFleetstar案的法院解释称，即使债务人所提议的驳回方案能够通过可行性\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与转录服务公司）\n\n测试，而且法院对该结构性驳回拟实施的方式存在真正的担忧，该方案仍必须被驳回，因为其试图未经当事人同意而改变其权利，并且缺乏《破产法典》中许多最重要的保障措施。\n\n在这里，我们请求恢复原状。没有人会失去其享有的权利。您知道，债务人的破产申请前债权人并未被要求作出任何牺牲。我们只是寻求恢复原状。\n\n委员会还援引Capra案。Capra案是一件有意思的案件。我实际上认为，如果你对Capra案作一些深入思考，它对我们有利而非不利。Capra案中法院多次提到的主要因素是，有利于转换的严重不当行为，因为债务人来到法官的法庭并寻求破产保护。他做了什么？他未能——您知道，他——实际上是他未做的某些事情。他没有实质性参与破产程序，而本案尚未进行很久，但当然已经提交了MORs，债务人也已提出聘任申请。没有发现——您知道，我们不认为他所做的事情合理，但他确实参与了这一程序。但该案的关键问题是，债务人在破产期间出售了一辆\n\nBentley（宾利）和一辆Rolls Royce（劳斯莱斯），却未遵守《破产法典》第363条。这是在——比如说，在极其糟糕的行为清单上，这是一件极其糟糕的事。对吧？你不能同时说，我想进入破产程序，却又不遵守最重要的保障措施之一。显然，这并非正常经营过程。他不是汽车经销商。他是个人。因此，他违反了第363条，而法院多次谈及此事有多么糟糕，并进一步表示，我认为该案的大意是，法院不想允许驳回，因为债务人基本上不会为其行为承担任何后果。因此，我认为理解该案的方式是，如果你在法官面前做了坏事，法官将继续对你进行监督。那么就把本案送回Ostrager法官。对吧？Kwok（郭文贵）所做的真正恶劣之事发生在Ostrager法官面前。因此，我认为，如果——如果Capra案——您知道，Capra案的教导是，当人们做了坏事时，法官有权监督他们。本案中真正的恶劣行为是在Ostrager法官面前所为。因此，本案被驳回后，您知道，我们将继续在Ostrager法官面前追求我们的权利，而他可以——他可以让Kwok先生为其行为负责。法官阁下，援引了Rolick案。这是一份非常简短的意见。我认为看待Rolick案的一种方式是\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与转录服务公司）\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 36 of 119\n\n应当重视拥有最大债权的人。另一个关键区别是，Rolick案选择转换而非驳回，涉及的是一组在破产申请前获得判决留置权的债权人；他们寻求驳回案件，以避免可能针对其提起的撤销诉讼。这根本不是本案的因素。我们没有任何——不存在可以针对我们主张的优先受偿请求权，因为我们未曾收取债务人财产。\n\n法官阁下，我只想花一点时间讨论几个其他被援引的案件。Steve and Barry's案，我认为其俗称也是Steve and Barry's，即BH S & B Holdings LLC案。委员会援引该案称，如果在一个有偿付能力的案件中存在行政留置权，这应当有利于转换。\n\n第一，我认为法院因正当理由而关注这一点。第二，该案已经进行了数年。有存货需要处理，有——您知道，已经清算的门店。第三，我认为如果你阅读该意见，没有任何迹象表明有人甚至希望转换。因此我想法院可以——您知道，必须评估这是否适当，但没有人希望如此，更不用说最大债权人。\n\n您知道，Mitan v. Duval案，您知道，这是第六巡回法院的案件。在该案中，最大债权人并不赞成驳回，只有债务人赞成。那些债权人——因此，您知道，法院希望指定一名第7章受托人以进行调查。在这里，我们认为每一位债权人都可以继续进行其认为重要且必要的任何取证。\n\n法官阁下，关于这些案件，我还想指出几件事。法官阁下，关于被大量援引的Capra案，还有一点是，赞成驳回的当事人，您知道，是有担保债权人，而法院指出，这两名债权人正受到债务人的优待，并且可以合理预期，如果案件被驳回，他们将继续获得优待。\n\n我不知道今后我们与债务人之间会发生什么。债务人在其诉状中说，他们打算向债权人付款。我不知道这是否会发生。我假定我们将不得不进行更多诉讼。我不知道，但显然不存在——您知道，支持本案驳回的当事人过去没有受到优待。远非如此。轻描淡写地说，我们与Kwok在支持本动议方面是颇为不自在的同床者。因此，我认为这又是一个区别点。\n\n法官阁下，我想就证据27提出几点，该证据是——您知道，这——是我们的——\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷记录与转录服务公司）\n\n这是其他诉讼的摘要。法庭：该文件已作为完整证据提交，未有异议，因此请继续。我只是做个记录——弗里德曼先生：好的。法庭：——关于该证据，因为我们仍须——我们仍将在某个时候处理庭审记录证据。但请继续。弗里德曼先生：法官阁下，您知道，其中谈及列于附表 F 的债权。现在——我先说明，已经提交了一些债权证明，我猜想我们可能会听到这样的说法：如果提交了债权证明，在有人提出异议之前，它将自动被视为有效。我认为法庭可以注意到，部分依据证据 27，但总体而言，确实尚未提出异议，但所有这些案件均处于积极诉讼中，因此，当您知道这些债权多年来一直在诉讼中受到积极争议时，说在提出异议之前债权证明表面上有效，就有些——并不完全正确。无论如何，我认为这些诉讼债权有一点非常重要：有一项已确定金额的债权，我认为金额为 300 及可能 \\$96,000。当您查看该图表时，有 \\$35,648,868 的债权已被驳回。有 \\$37 million 的债权已搁置两年多。或大致如此。我不想——我认为是两年多。这当然——而且您可以看出，这是一段相当长的时间。因此，您知道，您实际上面对的是一个小得多的潜在债权池。没有证据表明其中任何一项已有或曾有确定的审判日期，而且，您知道，我们对这些债权中的任何一项何时会被审理知之甚少；我们主张，法庭适宜考虑两者之间的质的差异，即我们拥有一份判决书，而这些都是与我方债权没有共同事实核心的潜在未来债权。\n\n此外，法官阁下，我还——您知道，还有几点需要指出。许多债权——据我们所能确认，至少八项债权涉及证券违法行为，您知道，这些债权可能被从属处理或不予承认，但我仅将此作为一个问题提出。我认为，这既意味着 PAX（PAX）的观点在此应获得相当大的重视，也意味着，考察这些债权并注意到其中有多少是诽谤债权，以及 Rui Ma（马睿）债权——显然属于人身伤害类型的债权——可说明本案极不适合破产程序的一些原因。\n\n我认为，本法庭未必是必须监督十余项人身——诽谤债权的适当审理场所；这些债权彼此之间没有共同的事实关联，并且均已在州法院推进至某一阶段。如果解除自动中止以允许它们全部确定金额，这将违背集中审理场所或单一——单一事实裁判者的目的。\n\n坦率地说，如我们所引述，就 28 USC 157(b)(5) 而言，尚存在悬而未决的问题：本法庭是否甚至可以审理这些债权，抑或这些债权必须由地区法院审理。康涅狄格州法院在 Ice Cream Liquidation（冰淇淋清算案）中，对人身伤害侵权债权采取了更宽泛的解释，认为其包括任何构成对人格权利侵害的伤害。我认为法庭无需就其中任何问题作出结论，这些问题并未提交至法庭，但我认为我是在让法庭了解，为何在存在让人们回到州法院等其他选择时，由本法庭对这些债权确定金额会存在问题，且并不能真正服务于破产程序的核心功能。\n\n显然，在 Chapter 7（第 7 章）中——为明确起见，法官阁下，我理解存在一种更宽泛的观点。我们引述 Gawker Media（高客传媒）案，是因为我认为，当存在与我们观点不同的判例时，我们始终有责任予以承认。但我确实认为，District of Connecticut（康涅狄格联邦地区）的 Ice Cream Liquidation, Inc.（冰淇淋清算公司）案是一个有助于在此背景下思考的案例。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷庭审记录与转录服务公司）\n\n法官阁下，接下来就要谈到所有这些案件会如何发展。原告仍将会——如果他们在这里，原告仍将承担费用——法庭：如果案件——如果本案被转换，这些案件会如何发展？这是您的——弗里德曼先生：是，法官阁下。法庭：是。请继续。弗里德曼先生：因此，受托人将不得不为其抗辩。我不知道受托人——受托人不能只是说，好吧，各位，您知道，我将承认你们的债权。这显然会严重损害拥有有效债权的债权人的利益。受托人必须以某种方式获得报酬来做这件事。我不知道——您知道，我稍后会谈到这一点。但这需要真正到位的现金，而不是——您知道，不一定是诉讼融资或风险代理费安排，对吧？将会有人必须真正深入审查每一个案件的是非曲直。这可能给 PAX（PAX）带来同样的负担，要求其作为利害关系方从事同样工作，如法庭所知。任何债权人，尤其是在第 7 章程序中，均可对任何其他债权人的债权提出异议。您知道，如果没有真正能够进行抗辩的受托人，该负担将不公平地落在 PAX 身上。\n\n您也可能有债务人在该方面参与案件。\n\n我认为——您知道，您确实会得到某种不太适合法院破产庭审理的情形；但适当的做法是让这些人——您知道，这些债权人回到其州法院救济途径，并继续追诉他们截至目前已经提起的任何案件。\n\n法庭：那么，除您关于 157(b)(5) 的论点外，28 USC 157(b)(2)(B) 又如何？该条规定，人身伤害债权和非正常死亡债权不得被估算——\n\n弗里德曼先生：是。\n\n法庭：——或确定金额——\n\n弗里德曼先生：是，法官阁下。针对破产财产。\n\n法庭：——用于在 Title 11（第 11 编）项下案件中进行分配？\n\n弗里德曼先生：这正是相应的一点，我预料到有人可能会主张，哦，那么您可以估算这些债权，而且，您知道，人们的分配不会永远被拖延。但再说一次，届时您又要到本法庭之外去完成此事，而且，您知道，您是在给康涅狄格州联邦法院系统施加沉重负担，而这些问题本可在州法院系统中处理。法官阁下，我认为——因此我认为——这是相当关键的一点。\n\n接下来，我们谈谈鉴于其当前态势，本案呈现出的其他特征。该案没有资金，我们始终担心，永远不会有本案所需的那种资金。对吧？唯一的资金是用于开展调查，而我们从一开始就说过，这是一座通向虚无的桥梁，因为如果您要做任何事情，您需要的是某种行动。而我们——您知道，我们在破产法院之外采取的行动类型，是有帮助的。\n\n在此，您有一个没有流动资产且存在长期未来争议的债务人。我们知道，已经在本法庭提起一项诉讼，即一项对抗程序，涉及撤销郭先生（Ho Wan Kwok（郭文贵））享有何种权利，以及是否有他人对该游艇享有权利。\n\n我们知道，围绕 Sherry Netherland（谢里·内瑟兰）公寓存在广泛诉讼，这将要求债务人——该债务人——第 7 章受托人参与纽约的一宗破产案件。仅为处理重整计划问题等等，甚至不仅仅是取得该资产，而且还要对他人的债权提出异议；该案件有效，并且还涉及英属维尔京群岛组成部分。您必须为英属维尔京群岛的律师支付报酬，而没有资金用于此事。对吧？还可能会有诉讼，大概是因为这是第 7 章程序，您将就债权免责发生争议。您知道，受托人将不得不处理该问题，或者个别债权人将不得不承担该负担。然后，您知道——那么您最终得到什么？您最终得到一种情形：没有可供受托人使用的资金。没有可在短期内变现的财产。有几宗诉讼和一条狗，但仅此而已。有人可以追索一些东西，但如何追索？好吧，您可以有诉讼融资。我们没有看到任何可用诉讼融资的证据。我认为其成本会非常高昂。该成本将主要由 PAX 承担，并会侵蚀 PAX 能够获得的任何回收款。您知道——法庭：任何债权人能够保留的任何回收款。弗里德曼先生：绝对如此，法官阁下，而且我认为，这将不成比例地落在我们身上，风险代理律师也是如此。本法庭可以依据法官本人经验予以注意，风险代理律师费用昂贵。我们知道，委员会在驳回之前——您知道，在驳回听证会之前，不仅——提交了聘用欺诈审查员和资产追踪人的动议，对吧？如果人们要在事后收费的基础上承接该等工作，所有这些都会很昂贵。我甚至不知道他们是否会这样做。通常，我认为这类人员按小时费率报价，但没有钱支付他们。而且，您知道，我认为确有判例——您知道，委员会援引的 Babayoff（巴巴约夫）案认为，在资金不足且受托人只会给破产财产增加更多成本和负担的情形下，应优先驳回案件。法庭：律师，那是什么案件？弗里德曼先生：Babayoff，445 BR 640 -- 64，第 82 页。法庭：我只是不认得那个名称。您援引的其他案件我认得，但您是说它在委员会的书面意见中？弗里德曼先生：我相信是的。该案继而援引 Midwest Properties of Shawano（沙瓦诺中西部地产）案。因此，您知道，听着，我们认为受托人会在费用方面增加重大负担，我不确定——您知道，其益处何在，因为尤其是我们知道，可以寻求州法救济，或者在适当情况下可以追究揭开公司面纱。人们如愿，可以自行追究州法上的欺诈转让债权。人们可以申请限制令。PAX 当然这样做过。而且没有任何事情阻止人们运用其所拥有的州法救济。\n\n您知道，Rui Ma（马睿）债权人团体称，如果案件被驳回，非 PAX 债权人将无法获得平等分配。我不知道这是否属实。我不——或许他们会和解其债权。我不知道。对吧？在破产程序之外，不能保证任何人会获得什么，但各方应能尽其所愿追究郭文贵，以收回他们想要收回的款项。\n\n如果那里什么也没有——这只是一个小小的题外话——如果那里确实有什么，没有人对可能存在的数额设定上限。很可能，潜在地，会有足够供其他人获得。我们不——您知道，诚然，我们不知道，但 PAX（PAX），我认为尤其鉴于其债权数额及其迄今所付出的努力，不应当——不应因本次申请而受到损害，而且我认为，不应允许其他债权人实质上利用债务人的恶意申请。\n\n其他当事人某种程度上说，您知道，郭文贵的品行——郭文贵在这里的行为具有策略操纵的一面，他不应因此获得奖励。我认为他并未获得奖励。如果本案被驳回，除避免在 Ostrager 法官（Justice Ostrager）面前进行几个月的程序外，他没有从本案获得任何真正利益，而他\n\n不得不重新回到这一点。他没有获得任何利益。唯一获得利益的人，是那些没有已确定债权、却在拖延 PAX（PAX）的人，而 PAX 已经被拖延了将近 14 年。我认为这既不公平也不公正，我也不认为这符合 PAX 所拥有的 $261 million 债权的利益。\n\n您知道，我们认为，主张继续留在破产程序中的实际上是其他当事人、其他债权持有人，他们是在主张不平等对待。他们实质上希望将破产程序作为一种追偿工具；正如 In Re: Murray（Murray案）所称，破产不应被用作一种比非破产法下同等权利更有力的债务追偿救济。法院谴责债权人将破产程序用作一种比州法——比非破产法下同等权利更有力的债务追偿救济。\n\n鉴于他们目前所处的位置，这将是其他人插队在前，迫使 PAX 分摊追偿所得，同时施加数百万美元不必要的成本。\n\n我注意到，债务人指出，其他债权人实际上是在劫持一宗 Chapter 11（第11章）案件\n\nFiore Reporting and Transcription Service, Inc.（Fiore 记录与转录服务公司）\n\n以制造一种伪自愿破产。我怀疑他们对此加以渲染。这原本将不是他们可获得的救济途径。我将留待委员会进一步阐述该论点。我认为该论点有其依据，法官阁下。\n\n法官阁下，委员会援引了——我认为我们也注意到——Collier（科利尔）所讨论的一些因素。法院对此大致是——有些法院确实依赖这些因素，有些法院只是顺带提及。我认为我今天所讨论的内容确实涵盖了这些因素。例如，债权人是否收到优先付款是一个因素。现在当然没有理由认为 PAX 收到了任何优先付款。如果案件被驳回而不是转换，案件中授予的权利是否会丧失？\n\nRui Ma（马蕊）集团认为，如予驳回，对 $37 million 托管资金的权利将会丧失，但该命令明确设想了如案件被驳回将会发生什么。这并非未知之事。债权人——您知道，债权人对该资金并无任何特定权利，而且对于在驳回情形下可能发生什么，已有明确协商约定。因此，我不认为任何人正在失去其原本会享有的权利。\n\n债务人在案件被驳回后是否会仅仅再次提起案件。我是说，我想 Kwok（郭文贵）在已同意本案的情况下或许可以尝试，而且，您知道，我不认为这\n\nFiore Reporting and Transcription Service, Inc.（Fiore 记录与转录服务公司）\n\n支持这一点。受托人为债权人利益取得资产的能力。我认为，您知道，也许如此，但受托人目前没有资金支持其努力。所谓唾手可得的成果——首先，是 Kwok——您知道，是 PAX 种下了这棵树；但更重要的是，要在那棵树上取得成果，仍有许多工作要做。即便假定能够获得资金，也将以债权人为代价，特别是我认为将以 PAX 为代价。您知道，最大化财产作为经济实体的价值——谁又真正知道其经济实体价值为何。我们知道——我认为这主要出现在诸如 Premier Golf（Premier Golf案）之类的案件中，在那些案件中，清算会造成明显的价值和就业岗位损失——毁灭性的损失。剩余问题是否将在破产法院以外得到解决，我认为法院可能已经就该问题进行了讨论，而且我认为，例如，我们已经对债务人和 Rui Ma 说过，嘿，你们已有案件，回去设法在其他地方解决。债务人是否存在不当行为。我认为，此处债务人的不当行为几乎完全发生在破产申请之前。围绕本案仍有一些事情，我们显然——您知道——并不喜欢债务人处理本案的方式，但我认为这些属于糟糕的决定，而非腐败。并且，您知道，我不认为债权人需要一宗 Chapter 7（第7章）案件来保护其利益。人们完全可以获得其州法救济。然后，您知道，其他因素，单一资产计划已经获得确认，环境问题，我认为正如我们在审阅拟议命令时从 DIP（债务人持有融资）中了解到的，本案不存在循环性问题。不存在环境问题。这不是 Midlantic（Midlantic案）类型的情形。因此，法官阁下，这些就是我们认为驳回适当的理由，即判例法支持 PAX 的理由，而其他当事人所依赖的案件确实不足以使其达到所需程度，从而让本院行使裁量权，将案件转换而非驳回。谢谢您，法官阁下。法院：谢谢。Jonas 律师？JONAS 先生：早上好，法官阁下。我是 Jeff Jonas（杰夫·乔纳斯），Brown Rudnick（布朗·拉德尼克律师事务所）律师，代表债务人 Miles Kwok（郭文贵）。在特别讨论驳回该 Chapter 11（第11章）案件或其他替代方案之前，我认为重要的是先稍作回顾，审视我们是如何走到今天的，以便置于背景之中，因为我确实认为，今天对法院而言，将事情置于背景中并聚焦于事实很重要，\n\n1 而不是律师将会提出、已经提出并将会提出的许多毫无根据的指控、影射和论证，\n\n2 \n\n3 因此，今早您不会从我这里听到任何夸张言辞或恶毒言论。\n\n4 \n\n5 本案中，您已听取两名证人的现场证言，\n\n6 即 Verdolino & Lowey（Verdolino & Lowey）的 Craig Jalbert（克雷格·贾尔伯特），以及\n\n7 债务人 Miles Kwok（郭文贵）的证言。\n\n8 正如 Kwok 先生作证所述，以及其提交的\n\n9 声明中所载，他是\n\n10 中国共产党，即 CCP 的直言不讳的批评者。数亿人\n\n11 观看他与批评\n\n12 CCP 有关的播报。他及其家人曾在\n\n13 中国遭监禁和酷刑。他亲眼目睹其兄弟被枪击\n\n14 身亡。他持续遭受\n\n15 CCP 的追捕和迫害。\n\n16 这并非荒诞虚构。美国政府的高级\n\n17 官员和商界领袖已被\n\n18 刑事起诉并认罪答辩，其中包括就\n\n19 非法寻求将 Kwok 先生驱逐至中国，以便他遭到\n\n20 监禁或杀害一事，担任 CCP 的外国代理人。\n\n21 这些人员包括 Elliot Broidy（埃利奥特·布罗伊迪）和\n\n22 George Higginbotham（乔治·希金博瑟姆）。\n\n23 法官阁下，上周——我认为我们已在书面材料中提及此事，\n\n24 但为确保您知悉——上周，\n\n25 司法部对 Steve Wynn（史蒂夫·永利）提起诉讼，他是一名\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 51 of 119\n\n亿万富翁筹款人、共和党全国委员会前财务主席，理由是其在寻求引渡 Kwok 先生时充当未登记的中国代理人。司法部提到，中国最高领导人习近平主席曾直接向时任特朗普总统提出由美国将 Kwok 先生遣返中国一事。Wynn 先生为争取中国政府支持其在澳门的赌场，与白宫国家安全委员会高级官员、白宫办公厅主任以及时任特朗普总统接触，寻求将 Kwok 先生列入禁飞名单、不予续签 Kwok 先生的美国签证，并将 Kwok 先生遣返中国，而他再次很可能面临监禁或死亡。Kwok 先生认为，对其提出的部分——即便不是全部——债权人所主张的债权，都是 CCP 持续试图诋毁并使其噤声的一部分。在此背景下，Kwok 先生仍坚持不懈。尽管他几乎没有资产和收入，但他获得家人的慷慨资助。尽管其所谓债权人可能不喜欢这一点，但这并无任何违法、不当或错误之处。今年二月，面对其无力支付的纽约州法院判决书和命令，Kwok 先生提起本破产案件。正如他作证所述及其声明中所载，他希望 Chapter 11（第11章）能够帮助其就所谓债权人债权达成公平公正的解决方案。其破产申请以及自案件提起以来对本案的管理，始终出于善意并且完全透明。没有相反证据。我认为甚至 Friedman 先生也基本承认了这一点。尽管有人可能指称 Kwok 先生拥有某些资产，无论是游艇还是纽约市公寓，这些指称仍未得到证明和确定。自提起本案以来，Kwok 先生已提交完整、准确的财产清单和事务说明。他参加了近两整天的 341 债权人会议。他出庭并提供了现场证言。他安排并协助返还纽约州法院命令所涉游艇，目前该游艇的返还由 $37 million 现金担保。他获得了 $9 million 的 DIP 融资，该融资本应为无担保且次级的，并包括向破产财产作出的 million dollar 赠与。他还提交了一项重整计划。其希望是，破产程序将提供一个场所和机会，使其能够与债权人及所谓\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 54 of 119\n\n债权人进行对话，以达成协商一致的解决方案，这正是破产程序的确切目的和要点。本破产申请并非出于恶意，而且自提起以来也不存在任何恶意。因此，法官阁下，转向驳回问题，根据《破产法典》第 1112(b)(1) 条，存在驳回事由，具体而言，1121(b)(4)(A) 规定，事由包括破产财产发生重大或持续损失或价值减损，以及不存在合理的恢复可能性。这是唯一存在的事由。如果您查看——我理解该条并非绝对穷尽，但如果您查看 1112(b)(4)——显然我已将 (A) 作为我们认为与本案相关的事由——如果您查看 (B)，我们认为其他任何事由均不适用，法官阁下。(B) 对破产财产的严重管理不善，我已就此说明；(C) 未维持适当保险；(D) 未经授权使用现金担保物；(E) 未遵守法院命令；(F) 无正当理由未及时满足任何提交或报告要求；(G) 未出席债权人会议；(H) 未及时提供美国受托人要求的信息或出席其要求的会议；(I) 未及时缴纳税款；(J) 未提交披露声明；(K) 未支付《美国法典》第 28 编第 123 章项下的任何费用或收费；(L) 确认命令被撤销；(M) 无法使已确认计划实质性完成；(N) 债务人就已确认计划发生重大违约；(O) 已确认计划终止；以及最后，(P) 债务人未支付任何家庭扶养义务。因此，法官阁下，如我所述，我们认为存在事由。相关且适用的事由是 1121(b)(4)(A)。法院：我可以就此问您一个问题吗？JONAS 先生：当然可以，法官阁下。法院：我理解——我理解您对该清单的陈述，也理解您主张仅 (4) 适用，但您是否——您是否在争议如下判例法：对“事由包括”的解释意味着——并不意味着事由只能符合该清单？JONAS 先生：不，法官阁下。法院：好的。\n\n乔纳斯律师：完全不是。法院：这正是我所问的全部。乔纳斯律师：是。法院：好的。乔纳斯律师：而且我想我已提到，法官阁下，我们的观点是——我理解这并非穷尽列举。法院：我以为你说过——乔纳斯律师：是。法院：——但我只是想为记录确认一下。乔纳斯律师：不，不，不。绝对如此，法官阁下。法院：好的。乔纳斯律师：但我确实认为，列明这些特定项目是有原因的——法院：我明白。乔纳斯律师：——我认为审查这一点很重要。法院：不，我认为这很有帮助。谢谢。乔纳斯律师：不客气。法官阁下，关于驳回、转换程序或任命受托人，尽管债务人的偏好并非决定性因素，仍应给予一定权重。在本案中，债务人及其最大债权人均支持驳回。1112(b)(1)规定，法院应审查驳回、转换程序或任命受托人三者中何者最符合债权人及破产财产的最佳利益。在 SWJ Management, 551 B.R. 93，这是一宗2015年康涅狄格州本辖区地区法院的案件，其中将该分析表述为驳回是否会——引号——“损害债权人利益。”在 Hull 案，339 B.R. 304，这是一宗2006年纽约东区破产法院案件，法院讨论了在此语境下何为对债权人的损害。该案称——引号——“债权人通常不会因驳回而受到损害，因为他们将不再被中止在州法院寻求执行及实现其债权。也就是说，在债务人及时提出驳回动议的语境下，应当考虑的是债务人债权人在申请破产前合理的法律预期和权利，而不是失去通过破产程序获得分配的机会。”法院：律师，你能再告诉我一遍那个案件吗？乔纳斯律师：当然可以。法院：抱歉。乔纳斯律师：是 Hull 案。H-U——法院：Hull，H-U-L-L？\n\n乔纳斯律师：是。案号引注为339 B.R. 304。这是一宗2006年的案件，纽约东区。破产法院案件。法院：谢谢。谢谢。乔纳斯律师：是。法院：我刚才没有听清你开头所说的内容。抱歉。乔纳斯律师：当然，法官阁下。法官阁下，为记录起见，我仅陈述，我们认为1112(b)(2)不适用；该条可能会禁止转换程序或驳回，原因有数项。我们认为，不存在表明转换程序或驳回不符合债权人及破产财产最佳利益的异常情形。该条的另一项要求，我们认为同样不适用，即我们认为不存在一项计划将在合理期间内获得确认的合理可能性；这是1112(b)(2)项下的另一项要求。而如果转换或驳回的理由是1112(b)(4)(A)，则1112(b)(2)不适用。再强调一次，我正在向您说明我们的立场，即1112(b)(4)(A)项下的损失或减损，以及不存在合理的恢复可能性，构成驳回的依据。\n\n法官阁下，我不会进一步审查 PAX（PAX）关于恶意的指称。我认为我已经回应了这些指称。我的意思是，他们——再简要说一下——我认为以缺乏支持的方式提到，清单中存在虚假陈述，所谓“虚假的 DIP 贷款”，以及债务人所谓“终止本案”。我认为这些都不是本案中发生的事情。我可以告诉您，债务人来到本法院时——正如我先前提到的——希望最终能够进行重整。这没有发生。但尽管如此，我认为 Friedman（弗里德曼）先生说过，他或许不喜欢这样，但他实际上并未对自本案开始以来存在恶意这一事实提出异议。最后，法官阁下，关于因债务人没有持续经营业务而导致破产申请不当这一说法，我认为您在 Lucarelli 案中已作出最佳表述，法官阁下，517 B.R. 42，其中您曾说，或者我们曾听到有人引用：“《破产法》的明确文字允许未从事经营活动的个人债务人根据第11章申请救济。”法院：不过，我认为我为此引用的是最高法院的判例。乔纳斯律师：您引用了多宗案件，法官阁下。\n\n法院：我认为是——乔纳斯律师：我把这份功劳归于您。法院：我认为是最高法院。乔纳斯律师：我认为您是对的。法官阁下，我只是——我确实认为，应当简要指出，今天到庭的债权人委员会成员所主张的债权实际上均未确定且存在争议。正如——再说一次，Friedman（弗里德曼）先生已经讲过这一点，我没有重复许多原本可能会说的内容，因为我认为弗里德曼先生已作说明——这些债权将会——将需要通过诉讼解决。以任何形式继续本破产案件，都将是在一个行政上无清偿能力、没有资金支持可能长达数年的诉讼的案件背景下进行。法官阁下，最后，Kwok（郭文贵）先生请我感谢您和您的工作人员为本案所投入的时间和给予的考虑。尽管本案可能没有像他所希望的那样成功，但至少在一定程度上恢复了他对司法体系的信心。话虽如此，法官阁下，谨此恳请，现在是继续前行的时候了。本破产案件应予驳回。谢谢。法院：谢谢，乔纳斯律师。Goldman（戈德曼）律师。\n\n戈德曼律师：谢谢，法官阁下。早上好。我是代表债权人委员会的 Irve Goldman（欧文·戈德曼）。法官阁下，我想先指出，无论本案是否出于恶意申请，或者是否存在其他事由，正如我们已约定的，摆在法院面前的问题——摆在法院面前的问题——并非本案是否出于恶意申请，而是转换程序、驳回或任命一名第11章受托人是否最符合债权人的最佳利益。因此，本案是否出于恶意申请，或者是否存在其他事由，并不改变本案中何为最符合债权人最佳利益的标准。而且，若以债务人自身的恶意作为驳回本案的理由，这将极具讽刺意味，因为这将使其得以避免第7章程序的审查；该程序将对 PAX（PAX）所称的其隐藏资产进行彻底调查，而 PAX 在本案申请前已接近取得该等资产，而他将因此受到奖励，因为在 PAX 作为本案唯一判决债权人取得该等资产后，剩下的将是分散在不同法院的各债权人，只能各自设法追索该债务人所拥有的任何资产。因此，他们确实需要第11——7章程序的保护。\n\n关于1112项下的标准，我想从法条的明确文字开始；第二巡回区最高法院一再指示下级法院在解释《破产法》时应重点关注该文字。第1112(b)(1)条规定，一旦事由成立，法院必须将案件转换程序或予以驳回，以其中最符合债权人及破产财产最佳利益者为准，除非法院认定任命一名第7章受托人或审查员最符合债权人及破产财产的最佳利益。法院：我想你的意思是第11章受托人，不过没关系。戈德曼律师：是，是。谢谢，法官阁下。法院：没关系。我明白。我明白你的意思。戈德曼律师：PAX（PAX）希望法院解读该法条的方式，是依据债权人债权的金额——数额来确定债权人的最佳利益。当然，该法条根本没有这样说。我想强调，在考虑最佳利益时，法条使用的是复数形式，即“债权人”，因此必须考虑整体债权人群体的利益，而不仅仅是一名拥有大额债权的债权人的利益；该债权人在破产前已接近取得——本案所有债权人似乎都同意——债务人目前已知的资产，即 Lady May（“五月女士”号）以及债务人在 Sherry-Netherland（雪莉-内瑟兰）公寓中的权益。而在确定债权人群体时，法院可以对目前已提交的债权证明以及债务人的附表 F 予以司法认知。截至今日，尽管尚未设定申报截止日期，债权证明总额为 \\$71 million，其中有些案件以严重人身伤害的指称为基础。例如，Rui Ma（马睿）的债权已接近纽约州最高法院的审判阶段，其主张在数年期间内存在性侵、非法监禁和故意造成情感痛苦。Bob Fu（傅希秋）的债权以得克萨斯州联邦法院的一项诉讼为基础，依据的指称是债务人宣扬针对 Fu（傅）博士的暴力行为，实际上曾鼓励其——引号——“同志们”——引号结束——杀害傅博士，并煽动在其住所前持续数周的骚扰性抗议。Bruno Wu（吴征）和 Yang Lan（杨澜）的债权以纽约州最高法院的一项诉讼为基础，该诉讼指称债务人利用其广泛的社交媒体账户对其二人进行人身攻击，声称杨澜有婚外情，并利用性好处获得其在中国的显赫文化地位，而且——引号——“浑身都是性传播疾病”——引号结束；还多次指控吴征企图谋杀和行贿，并在社交媒体上威胁对这两名债权人施加暴力。\n\nFiore Reporting and Transcription Service, Inc.\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 64 of 119\n\n说这些人并非应与 PAX（PAX）一样获得其利益同等考虑的真正债权人，实在是对这些债权人的冒犯。\n\n正如我提到的，债权证明的截止日期甚至尚未设定。根据附表 F 所列内容，我们很可能会收到大量额外债权申报，因此该 \\$71 million 无疑将会增加。\n\n回到法条的明确含义，在确定根据第1112(b)(1)条必须予以考虑其利益的债权人时，我请法院参照《破产法》第101(10A)条；该条将债权人定义为——引号——“在申请日对债务人拥有债权的实体”——引号结束。\n\n以及第101(5A)条对债权的定义，该条将债权定义为包括获得付款的权利，无论该权利是否已化为判决、未确定或存在争议。\n\n因此，PAX（PAX）主张这些债权人并非真正债权人的说法，与《破产法》的明确文字相悖，因为债权人是持有债权的人。\n\nFiore Reporting and Transcription Service, Inc.\n\n且一项债权可以是无争议、未确定金额且附条件的。因此，这里存在债权人，即实际债权人。如果这些人不是实际债权人，美国受托人又怎能任命债权人委员会？如果不存在其他实际债权人，该委员会应当代表哪些债权人？PAX（PAX）当然并未以不存在需要维护的实际债权人为由，反对聘任委员会专业人员。因此，根据对法条的通常分析，就 Section 1112(b) 项下最大利益测试而言，诸如本案中已提交债权证明但尚未获得判决的债权人，与 PAX 一样，均为该破产财产的债权人。即便有所不同，那些主张遭受严重人身损害的债权人，其利益在最大利益测试中应获得与 PAX 至少同等、甚至更大的考量；PAX 的实际金钱判决——作为证据1附于弗里德曼先生（Mr. Friedman）就驳回动议所作的声明——本金仅为 $46 million。他们有按合同利率 15 percent 计算的 $70 million 利息，而 $134 million 的藐视法庭罚款并非对任何金钱损失的补偿。许多法院，实际上是大多数法院，在确定 Section 1112(b)(1) 项下何为债权人最大利益时所适用的测试，是哪一种行动方案能够使最大数量的债权人在最短时间内获得最大金额的偿付。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n在本案中，该方案要么是转换程序，要么是任命一名第11章受托人。因为一旦驳回案件，最大数量的债权人将受制于一名单一的判决债权人；该债权人将在案件被驳回时获得最大金额的偿付，而所有其他债权人仍将陷于与债务人的诉讼之中。\n\n关于该船，我们知道，根据奥斯特拉格法官（Judge Ostrager）于 February 9th, 2022 作出的决定和命令，即我方证据1，债务人已经被以明确且令人信服的证据认定为该船的受益所有人并对其享有控制权。这载于其决定第4页。\n\n该船返还后，PAX 将仅对该受益权益实施扣押，并在其变现时最终获得分配。\n\n关于 Sherry-Netherland 公寓——当然，他们已准备在案件被驳回之日采取该行动，因为该程序正在奥斯特拉格法官面前进行。\n\n关于 Sherry-Netherland 公寓，如案件被驳回，他们同样已准备就该资产实现受偿。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n在债务人的声明中，即 UCC 证据2，其承认拥有 Genever Holdings Corp.（吉尼弗控股公司）100 percent 的成员权益；该公司是持有 Sherry-Netherland 公寓产权的 Genever Holdings, LLC（吉尼弗控股有限责任公司）的唯一成员。Genever Holdings, LLC 是 Southern District of New York（纽约南区）第11章程序中的债务人，而债务人主张其权益由信托为其儿子的公司 Bravo Luck（布拉沃·拉克）持有。该内容载于其声明第 33(B) 段。根据于 October 8th, 2021 登记的命令，即 UCC 证据3，加里蒂法官（Judge Garrity）批准了 Genever Holdings、PAX 和 Bravo Luck 之间的一项和解协议。该和解协议将作为 UCC 证据4出现，标记为 ECF 131-1，日期为 September 24th, 2021；该协议准许 PAX 解除自动中止，以继续推进纽约州最高法院（New York Supreme Court）诉讼。该内容载于和解协议第 7(A) 段，即和解协议共12页中的第7页。由于 PAX 已于 February 3rd, 2021 获得其金钱判决，纽约州最高法院诉讼中唯一尚待审理的事项，是 PAX 针对 Genever 各实体提出的揭开公司面纱主张。该等主张载于其第一次修订起诉状的罪名项2，即 UCC 证据10。\n\n这是起诉状第17页。\n\n此外，PAX 是一项命令的受益人，\n\n该命令要求郭先生（Mr. Kwok）向 PAX 交付其对 Genever——Genever Holdings 的100 percent 所有人——所享有的100 percent 所有权权益。该命令为 UCC 证据6。该命令于 September 22nd, 2021 登记。PAX 已于 January 7th, 2022 在纽约提出藐视法庭动议，理由是 Kwok 未交付该等股份。我相信那是我方证据中的证据7。\n\n预计该动议将在案件被驳回后重新提出或恢复审理。\n\nPAX 在 British Virgin Islands（英属维尔京群岛）法院中亦有类似的揭开公司面纱类型的救济主张待决。UCC 证据11是 PAX 在该法院提交的修订后诉讼请求书。在该修订后请求中，其尤其主张，郭先生使用其自身的 $70 million 资产向 Bravo Luck 转让——该内容载于证据11第29段——郭先生主张其与 Bravo Luck 订立的信托声明是一项欺诈，原文为：“Devised to hold his shares in Genever BVI in trust for Bravo Bravo.”\n\nBravo Luck 是一项欺诈——抱歉——那是一项欺诈，原文为：“Devised for the sole purpose of concealing an asset of Mr. Kwok from his creditors.” 该信托文件应被撤销，因其系一份原文所称“Document intended to defraud creditors of Mr. Kwok.”的文件。债权人，复数。该内容载于第35段。并且，郭先生是 Bravo Luck 的受益所有人，而其儿子仅是其名义持有人。\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n\n根据加里蒂法官批准的和解协议，各方，即 PAX 和 Bravo Luck，也获准继续推进英属维尔京群岛诉讼。因此，他们也完全有条件依据将在英属维尔京群岛或纽约州法院解决的该等主张，就 Sherry-Netherland 公寓实现受偿。关于 Genever Holdings 案件中该公寓的情况，梅拉妮·西加诺夫斯基（Melanie Cyganowski）被任命为出售专员，以推销和出售该房产。该任命载于 UCC 证据8。Sotheby's（苏富比）获批准担任该房产的经纪人，见 UCC 证据9；该房产目前在苏富比网站上以 $38,500,000 挂牌出售。因此，PAX 在案件被驳回后，就资产实现受偿方面处于极为有利的地位，并将优先于其他债权人；如前所述，其他债权人将只能继续与郭先生诉讼，之后取得判决，再追查届时所剩的任何资产。我们主张在第7章程序中可追回的其他潜在资产，是由 Greenwich Land, LLC（格林威治置地有限责任公司）拥有的两处 Greenwich 房产。UCC 证据13和14。该等房产载于该等证据中。在郭先生声明第17段中，他主张其 Greenwich 住所，原文为：“Is owned by my wife through Greenwich Land, LLC.” 那是否又是其隐藏资产之一，仍有待查明。当然，这可以在第7章程序中调查；在债务人于 May 11th 提交其同意驳回案件的文件时，我们正试图进行该调查。现在，我想转向 PAX 的论点，即何为破产财产最大利益的试金石在于债权人的偏好，并且债权人的最大利益必须反映作为单一最大债权人的 PAX 的观点。债权人最大利益测试的试金石并非债权人偏好什么，而是何种行动方案能够为最大数量的债权人提供最有希望的追偿，而不是为最直言不讳或最大的债权人提供最多追偿的方案。首先，PAX 为以下主张所引用的判例依据——即一名债权人只要其债权数额足够大，便可满足最大利益测试之目的——我认为完全与本案相反，而且并不支持 PAX 的理论。在 Acme Cake 案中，即其所依赖的案件，没有一名债权人，甚至没有债权人委员会本身，反对驳回该案。\n\n反对驳回的是债权人委员会的律师，其理由是，由于包括其费用在内的行政费用尚未支付，因此不应准许驳回；而驳回将允许请求驳回的债权人先于行政债权人获得偿付，从而违反破产法典的优先顺位制度。\n\n当然，本案的论点并非如此。代表所有无担保债权人利益的债权人委员会正在反对驳回。我们并未提出该项论点，尽管我确实认为，若法庭倾向于驳回，本案应以支付该等费用为条件。\n\n我们反对的原因是，驳回不符合债权人的最大利益，而这根本不是 Acme Cake 案中提出的论点。事实上——\n\n法庭：我能就此问您一个问题吗？\n\n戈德曼先生（MR. GOLDMAN）：可以。\n\n法庭：您刚才说——显然，我理解委员会的立场是驳回不适当，而应转换程序或任命受托人；但您刚才也说，如果法庭要驳回，您希望以支付委员会的\n\nFiore Reporting and Transcription Service, Inc.（菲奥雷速记与转录服务公司）\n1 费用为条件。\n而我只是想了解，\n2 从您的角度看，这将如何运作？\n3 法庭将如何在没有资金的破产财产中，\n4 以支付费用为条件来驳回案件？\n5 戈德曼先生：\n如果郭先生希望驳回\n6 案件，以便其无需经历第7章\n7 程序，并面对潜在的 523 不可免责主张，\n8 以及 727 拒绝免责主张，并面对\n9 追查其隐藏资产并予以收集的程序，\n10 那么，正如他找到了资金来提供担保\n11 以确保该船返还，正如他找到了资金来\n12 提议以一笔 $8 million DIP 贷款为本案提供资金，\n13 如果法庭以支付费用为驳回条件，\n14 他就会找到资金。\n15 法庭：\n您是否——我没有看到——但我\n16 可能遗漏了这一点，好吗，请理解——您是否\n17 引用了任何支持法庭有权\n18 这样做，即按您所建议的方式做的判例？\n19 戈德曼先生：\n我没有找到直接相关的判例，\n20 法官阁下。\n21 法庭：\n好的。好的。我只是提出这个\n22 问题——\n23 戈德曼先生：\n没有。\n24 法庭：\n——以确保我已正确阅读\n25 您的书面材料。\n\n请继续。抱歉，您提到这一点时，我只是想问一下。戈德曼先生：谢谢您，法官阁下。Acme Cake 案的另一项关键区别是，该案中法庭认定，转换案件或任命一名第11章受托人，原文为：“Would result in the unsecured creditors receiving little distribution, if any.” 而本案当然不能——不能作出这样的认定。他们确实作出了——他们实际上引用了加利福尼亚州破产法院的一项决定——一项来自加利福尼亚州破产法院的决定——并称，原文为：“It is not necessary that the interest of every creditor actually favor conversion. There is no specific numerosity requirement inherent in section 1112(b). The interest of a single creditor with a large enough claim will suffice.” 这是对一宗名为 In re Staff Investment 的案件的直接引述，该案是加利福尼亚州破产案件，146 B.R. 256。如果您查看该案，它与本案完全不同。该案中的单一最大无担保债权人，就破产财产的唯一资产上的一项抵押权持有 $600,000 的不足额债权。那是该债权中的不足额部分。该债权占所有无担保债权的 95 percent。其他无担保债权合计仅为 $21,000。\n\n因此，这一引自加利福尼亚州破产案件的单一引文，实际上属于附带意见，因为当时并无人主张——即，主张驳回的债权人会抢先取得全部资产、优先于其他债权人——实在过于单薄，不足以推翻压倒性的权威观点；该等观点认为，1112(b)项下债权人最佳利益应当考量全体债权人的利益，而非单一债权人的狭隘利益。\n\n这意味着要考虑，整体而言，债权人是否会在Chapter 7（第7章）程序中获得更好的结果。根据PAX（PAX）就目前已存在的、我称之为唾手可得的资产进行追偿的有利条件，而我们知道，至少就这些资产而言，财产有正当且极具分量的请求权，因此本案显然正是如此。\n\nPAX因其债权的金额和地位而极为自信，以至于其宣称，引用原文，“鉴于Pax已获裁判的判决金额，PAX有权优先受偿。”该表述见其法律备忘录第4页。这颠倒了债权人之间平等分配这一基本政策，转而采纳破产程序之外适用的各债权人各自为战的规则。但这并非债权人最佳利益的标准。\n\n我们是在破产案件中。该标准所固有的要求，是考量何者将维护平等——何者将维护破产法上平等分配这一压倒性政策。\n\n最后，将委员会倾向于转换程序与非自愿破产相比较，仅仅因为债务人希望驳回案件，乃是转移焦点。\n\n第一，法院认为，除非债务人对驳回的偏好恰好与债权人的利益一致，否则该偏好在1112(b)项下无关紧要。\n\n而且，section 1112(b)(1)（第1112(b)(1)条）仅提及债权人和财产的最佳利益，并未提及债务人的利益；后者则如Bankruptcy Code（破产法）section 305（第305条）中所提及的那样。\n\n因此，1112(b)(1)中未列入债务人利益是有意为之。\n\n第二，如果符合债权人的最佳利益，本案转换程序获得section 1112(b)(1)的授权，且是明确授权。\n\n该标准与根据section 303（第303条）启动非自愿申请毫无关系。\n\n二者是在完全不同情形下适用的两项完全不同的标准，因此，不能将1112(b)明确授权的事项类比于启动非自愿破产程序。\n\n我想提出的最后补充一点是，该债务人不应能够逃避Chapter 7程序的审查，尤其是根据section 727(a)(2)（第727(a)(2)条）可能拒绝给予债务人免责的审查；如果在破产前一年内存在隐匿资产，该条将提供或确实提供拒绝免责的依据。许多案件认为，即使一项资产在一年期间之外已被转让，如果债务人在该一年期间内继续隐匿该项权益，该等隐匿将构成根据section 727(a)(2)拒绝免责的依据。如果法院决定驳回本案而不以支付委员会专业费用为驳回条件，委员会希望保留提出动议、审查并追缴向债务人律师支付的金额为一百万美元的预付律师费的权利。因此，我将该项请求提交法院考虑。我想简要回应Friedman先生（弗里德曼先生）和Jonas先生（乔纳斯先生）在其陈述过程中不同时段提出的若干观点，然后我将结束发言。Friedman先生援引Sapphire案支持驳回。如果法官阁下审阅该案，该案中无担保债权人极少。此外，他们还有其他追偿来源，即保证人以及其他共同——和/或其他共同债务人。显然，本案并不存在这些情况。Friedman先生表示，他们在这里真正所做的，只是恢复原状。但恢复原状意味着他们将排在最前面，实现对全部资产的变现，而这正是这些债权人需要Chapter 7案件保护的原因。Friedman先生质疑本财产中存在的人身伤害侵权请求权。在Chapter 7案件中，将发生的是，受托人首先会审查并寻求追回财产资产。一旦该程序结束，受托人随后将审查各项债权，并在必要时对其提出异议。因此，首先将归集资产，以确定存在哪些资产。随后将审查各项债权。这是受托人根据section 704(5)（第704(5)条）应履行的职责。受托人不会聘请特别律师审查该等债权，因此该审查不会产生任何相关费用。如果认为这些债权更适合在其他法院解决，各方可以对其提出异议。可以准予解除自动中止，而且\n\n这对破产程序本身不会产生任何影响。\n\n债务人如愿意，可以就该等债权进行抗辩。\n\nCase 22-50073 Doc 884 Filed 09/27/22 Entered 09/27/22 12:36:24 Page 78 of 119\n\n这只是在其他法院对该等债权进行清算的程序，这种做法很常见。例如，如果某项债权即将开庭审理或接近审理，债权人为在其他法院将该债权清算，继而携带其债权金额返回破产法院，寻求解除自动中止，并不罕见。因此，这——这在Chapter 11——Chapter 7案件中是常规程序。至于就我们已知确实存在的资产，即船只和公寓，提供诉讼资金，我确信受托人能够获得诉讼资金。诚然，目前没有证据表明诉讼资金可用，但该债务人直到May 11th（5月11日）才提交其同意驳回的文件。您绝不可能期待委员会或受托人在短短几周内寻得诉讼资金——而这——这就是我们仅有的时间——并提出证据证明，存在向一个尚未存在的当事人提供诉讼资金的某种具有约束力的承诺，因为该资金必须提供给Chapter 7或Chapter 11受托人。因此，我认为，应当给予受托人机会这样做，或者至少聘请特别律师以风险代理费方式承办该诉讼。是的，这将涉及从任何追回款项中收取一定比例，但这——这在Chapter 7案件中很常见，而且该费用可以协商。是的，该船价值很高，如果特别律师以风险代理费方式承办，费用将从追回款项中支付，但这并非得出以下结论的依据：除PAX之外每一名其他债权人的最佳利益都会因该程序得到实现，因为他们会因该程序受益。唯一不会受益的债权人将是PAX。关于将破产作为债务催收工具，我的意思是，破产是一项集体程序，债务人申请破产，并将其非豁免资产交予债权人，以换取寻求免责。这正是破产的全部意义所在，因此它确实是一项集体程序，用于为全体债权人的平等利益归集和清算财产资产；我谨认为，这正是法院在本案中应当做的事。除非法官阁下有任何问题，否则我就这些，阁下。\n\n法官：我没有其他问题。谢谢。Claiborn律师（克莱伯恩律师），您希望陈述吗？抱歉。请继续，Callari律师（卡拉里律师）。她可以先上来。然后，如果您希望随后陈述，Claiborn律师可以接着发言。\n\nCALLARI女士：下午好，法官阁下。Carollynn Callari（卡罗琳·卡拉里）代表部分债权人出庭。法官阁下，我实际上只是来支持Goldman律师（高德曼律师）所陈述的内容。我认为他做得非常好。这让我的工作更轻松。不过，我确实想强调几个要点。第一，在讨论实际争议问题之前，先谈债务人的评论，他们讲述了一个很好的故事，但在提供背景时，他们没有讲完这个故事；即，有新闻报道说他，有人正被调查，意图将他遣返中国。该事实并无争议。背景故事中存在争议的是：为什么？他被中国要求遣返，以面对腐败、强奸、绑架和贿赂的指控。这就是他不想返回那里的原因。因此，我只是想澄清这一点。至于法院实际面临的问题，确实是何者最符合债权人和财产的最佳利益。我们听到了许多不同的说法，但实际上，在审视该具体问题时，首先，101关于债权人和债权定义的规定本身已说明一切。这里有许多债权人。这里也有许多债权。\n\n本案并不像PAX所援引的债权——案件，法官阁下。\n\n在那些案件中，当涉及一名大额债权人时，如果您审视这些案件，通常是拥有95至98%债权的有担保债权人，属于——您知道的——差额类债权。\n\n在本案中，如果加以拆分，法官阁下，PAX最初的债权——请让法院回顾一下——是$46 million。\n\n我的当事人Rui Ma（马睿）的债权主张为20 million。\n\n差别不大。\n\n他们只是先取得了判决。\n\n她不应因此受到不利影响。\n\n如果您查看债权清单，债务人列明的——尽管他对几乎每一项债权均有争议——债权总额约超过$120 million。\n\n此外，他还列有数十名其他债权人，其金额不明。\n\n因此，如果以PAX的46 million计算，与其他债权人相比，他绝非——他们绝非一名非常大的债权人。\n\n如果加上利息，则为116 million。\n\n116 million对比所列明的金额——即使存在争议，仅因存在争议并不意味着属于真实争议——但话虽如此，125 million对116 million。\n\n我们大约是50/50。\n\n只有将全部藐视法庭罚款计算在内，他们的债权才真正膨胀至超过250 million。\n\n因此，首先，他们不断试图声称自己是如此大的债权人，应当有发言权并主导本案的规模，与他们援引的其他案件并不相同。即使我们目前尚未清算，我们也是债权人，法官阁下。第二，当PAX对法官阁下说本案没有资产、应予驳回时，PAX不能两面兼得。这是什么样的案件？没有债权人，没有资产，没有经营活动。这是个人Chapter 11案件。我们知道没有经营活动。但我不认为坐在这张桌子这一侧的任何债权人，真诚地认为本案没有资产，尽管他们在资产清单中仅列有微不足道的资产。这就是我们在这里的原因。如Goldman先生所说，本案是为了归集这些资产。与其让每一位债权人——数十名债权人——都必须自行开展PAX律师已承认其多年来一直开展的工作，由一名受托人代表全体债权人归集资产，怎么会不更有效率？但我们每个人都必须进行揭开公司面纱以及其他所有——您知道的——为取得该等资产而必须经历的诉讼和环节，而一名受托人本可以归集资产。这是破产的目的。这是适当的目的。这就是为什么本案应转换为第7章程序，以允许该事项发生。\n\n就资金而言，Goldman先生（戈德曼先生）所提及的是，我们在过去两周内试图寻找初始资金时遇到的问题在于，我们尚未有相对方。融资必须由第7章受托人或第11章受托人作为相对方。如果只看本案事实，当存在一项唾手可得的游艇资产时，这非常适合采用风险代理式安排。因此，我认为，我们今天没有实际融资承诺的证据这一事实，不应妨碍法官阁下确认并推断，在这种情况下，第7章或第11章受托人可以获得资金。我也知道，Friedman先生（弗里德曼先生）在谈论本案20%至30%的风险代理费时，其谈判能力远胜于其书面文件。我认为可以设置阶段性节点——这正是我一直在讨论的——即就游艇设定一定比例。如果耗时更长，该比例就上升。然后，一旦取得游艇，也许那就是你们的资金来源。也许不需要更多资金。您知道，可以使用那些收益。因此，可以通过第11章——或者在我们的案件中，我们甚至提出第7章受托人——来为这些案件提供资金。我们认为，应当给予第7章受托人机会，由一名受托人审查此事，设法为全体债权人的共同利益归集全部资产。\n\n如果在较短期间内无法获得资金，则届时可在不妨碍权利的情况下驳回案件。\n\n但是，称我们的客户都应因案件现在应被驳回而受到不利影响，实质上是在奖励债务人——他得到了他想要的——他提出本案以获得喘息之机——他获得了短暂的喘息之机——而现在他不想面对第11章程序——破产程序的全部负担，因此不应因此得到奖励。\n\n我们应当能够进行调查，而该调查可以获得资金支持，并让所有债权人平等分享分配款，法官阁下，因为我们是真正的债权人。\n\n不过，法官阁下，顺便说，如果您认定不能附条件驳回案件，以确保各方不会因该债务人的恶劣行为而进一步受到不利影响，我认为这就更支持转换程序。我认为法官阁下可能可以附加条件。但如果不能，这就更支持转换为第7章程序，而不是驳回案件。\n\n债权人在本案中已投入大量时间和费用。现在，仅仅因为他们撤回了资金，就要将案件撤走——从我们脚下抽走地毯，这是极不公平的——此外，如案件被驳回，行政费用也应得到支付——我们请求法官阁下无论如何均保留管辖权，以处理某些问题，例如正如Goldman先生所说，与预付款及类似事项有关的问题，如果法官阁下确实驳回本案。\n\n但我们确实认为，转换为第7章程序是可行的，并且这样做最符合全体债权人的利益，法官阁下。\n\n而且我们不认为这会对PAX造成不利影响，因为坦率地说，如果他们希望对任命何人为受托人发表意见，我认为他们可以根据702条这样做。他们可以了解——您知道，对此发表意见——\n\n法庭：他们都可以选举受托人，对吗？\n\nCallari女士（卡拉里女士）：是的。\n\n法庭：但我有一两个问题要问你。\n\nCallari女士：好的。请讲。\n\n法庭：那么假设我同意你们的意见，并将本案转换为第7章程序，你的债权——你客户的债权将如何被确定？因为受托人不能这样做。\n\nCallari女士：正确，法官阁下。\n\n法庭：那么，你们的债权仍须在本庭之外、在New York Court（纽约法院）审理，其他人身伤害债权主张人的债权也是如此。\n\nCallari女士：是的。因此，就Rui Ma（马睿）而言，法官阁下，您已有那份拟议命令——我们推定您是在等待本次程序结束后解除中止，以便她在州法院继续进行诉讼。因此，是的，就马睿而言，我们预计该案将回到州法院审理。\n\n法庭：那么受托人要如何处理该债权？我想要——\n\nCallari女士：不，我理解。\n\n法庭：我想要——第7章受托人将如何处理该债权？第7章受托人必须等待——\n\nCallari女士：是的。\n\n法庭：——直到该债权被确定，对吗？然后，取决于你们如何处理，而这完全是你客户在适用的非破产法下的权利，会进行审判，无论裁决为何，裁决就是裁决。有人可能上诉，也有人可能不上诉。但我们实话实说，很可能会有上诉，因此该案件可能持续多年，直到该债权被确定，对吗？\n\nCallari女士：有可能。\n\n法庭：是的。\n\nCallari女士：也有可能相当迅速地被确定。\n\n法庭：好的。\n\nCallari女士：我们不知道。所以——\n\n法庭：但不在本庭。\n\nCallari女士：不，她的债权必须在州法院确定。或者一般而言，人身伤害债权，法官阁下——我确实认为，当存在人身伤害债权时，破产法院有时可以制定调解程序，并且——\n\n法庭：不是在——不是根据28 U.S.C.——\n\nCallari女士：正确。可以估算——\n\n法庭：——在第7章案件中，根据28 U.S.C. § 157(b)(2)(B)，当债权是或有且未确定时。该法条非常明确，这不是核心程序。因此，本案的问题之一是，这些正是受托人将要面对的债权类型，对吗？\n\nCallari女士：正确。\n\n法庭：那么——所以我的问题是，受托人应当做什么？\n\nCallari女士：受托人——\n\n法庭：让案件持续数年，直到——然后在没有资金的情况下进行调查？\n\n我的意思是，我听到了你们关于资金问题的说法，但为什么委员会现在不能有融资方提供资金？\n\n他们可以——委员会可以获得诉讼融资。为什么不能？\n\nCallari女士：现阶段不能，因为在过去两周内，当你知道将面临驳回、委员会将被解散时，试图获得该等资金并不现实。\n\n法庭：好的。但关于驳回——我理解你所说的债务人对驳回的立场。但PAX对驳回的立场已明确了一段时间。事实上，他们同意延长听证期间，因为法典要求在30日内举行听证，而实际上并未举行。\n\n您知道，我只是想说，第7章案件中，第7章受托人有什么可以着手处理的？\n\nCallari女士：有两点。第一，就您关于委员会的观点而言，直到两周前，委员会一直有债务人提供的资金。他们撤回了资金，所以我们无需去寻求——\n\n法庭：嗯，他们并没有资金。尚未获批准。好吗？\n\nCallari女士：这是真的。\n\n法庭：所以没有人有资金。\n\nCallari女士：但我们预计会有某种形式的资金，所以我们——\n\n法庭：我理解。\n\nCallari女士：对。\n\n法庭：但尚未获批准。而且这正是程序的运作方式，对吗？\n\nCallari女士：是的。\n\n法庭：只是——我们必须记住程序如何运作。因此，他们没有资金。没有任何经本庭授权的资金。本庭对该融资申请暂缓裁决。之后债务人决定——或者我不该说债务人——融资方，即贷款人，决定撤回其融资承诺，而债务人撤回了其债务人占有融资动议。因此，我理解你所说的一切，但本庭必须遵循程序，对吗？我的意思是，我们谈论诉讼融资、风险代理特别律师。仅仅因为人们说这可以发生，并不意味着这一定会发生。本庭仍须批准那些申请。如果那些申请未获批准，那么人们所建议的这一方案就不会按其所建议的方式推进。问题在于，如果以及当本案转换为第7章程序，而非维持为第11章程序时，存在许多不同的顾虑。因此，再次说明，本庭可以驳回驳回案件的请求，可以驳回转换程序的请求，可以驳回任命受托人的请求。这些是我必须作出的认定。Goldman律师是正确的。问题在于我们要怎么做？我想我大约一周前在你们都约定存在事由时说过这一点。好的。很好。这对本庭很有帮助。我感谢各方均约定存在事由，但我必须作出其中一项处理，对吗？所以，我必须确定在本案中何为最好的处理方式。对于转换程序的顾虑很多。将此交给第7章受托人去做什么？第7章受托人没有可用资产来做任何事情。你们谈的是可能获得诉讼融资来源。好的。但这必须获得批准，也可能不会获得批准。而且必须有一个方案。如果该方案——我不是指重整计划，这不是我的意思。\n\n我的意思是——我不是指破产法典中所使用的“计划”一词——必须有办法实现你们试图实现的事情。而第7章受托人将没有任何可着手处理的事项。\n\nCallari女士：谢谢，法官阁下。无论是第11章还是第7章受托人，法官阁下，我们相信都会有资金。我知道资金目前不在这里。但关键在于，即使法官阁下尚未批准，委员会在5月11日之前也没有必要去寻找资金。这是第一点。我们相信会有资金。\n\n法庭：这很公平。\n\nCallari女士：而现在，我们主张，第11章或第7章受托人能够获得必要资金，以追索例如该游艇。推进该诉讼不应需要太多资金。如果其实际结果如我们所认为的那样，本案将有充足资金。\n\n法庭：那么，第7章受托人将如何追索游艇？请向我解释。\n\nCallari女士：其可以——可以像在任何其他案件中一样归集资产。\n\n法庭：但目前，本庭没有认定债务人拥有该游艇，那么第7章受托人如何归集该游艇？\n\n案件22-50073，文件884，提交日期09/27/22，录入日期09/27/22 12:36:24，第91页，共119页\n\nCallari女士：第11章或——第11章或第7章受托人必须先取得一项认定。\n\n法庭：嗯，目前已有一项解除中止令——\n\nCallari女士：对。\n\n法庭：——规定该游艇应如何处理，对吗？\n\nCallari女士：是的。\n\n法庭：即该游艇必须返回本司法管辖区。然后，如果其及时返回，$37 million将返还给缴纳该笔款项的一方，随后游艇就在这里。在哪里？根据事态发展，可能在Connecticut（康涅狄格州）或New York（纽约州）。\n\n那么，第7章受托人将如何归集该游艇？\n\nCallari女士：就像您会在第11章程序中做的那样。您——\n\n法庭：但债务人在本庭并不拥有该游艇。尚未作出任何认定。因此，他必须提起某项诉讼请求，不是吗？\n\nCallari女士：对。是的。\n\n法庭：那么谁来支付这样做的费用？\n\nCallari女士：这就是资金发挥作用的地方。\n\n法庭：那么，谁——谁要出庭抗辩来做这件事？而且，当受托人这样做时，PAX 将会提出异议，并称该事项已经——已经由 New York State Court（纽约州法院）裁定。因此，你们不能推翻纽约州法院法官作出的判决。你们不能——你们不能这么做。会产生争议排除效力，对吗？尚未提出上诉。这里存在各种各样的问题，对吗？所以，正如我所说，我的问题在于——各种路径我都有问题。明白吗？但是，就 Chapter 7 而言，我不知道 Chapter 7 受托人应当做什么，或者能够做什么。Chapter 7 受托人可以到这里来，说他们要做 18 件事，但如果他们无权做这些事，或者没有资金来源做这些事，那么就没有必要将本案转换为 Chapter 7。卡拉里女士（Callari）：是。而且我们——法庭：没有必要。卡拉里女士：而且我们认为，Chapter 7 受托人将会——再者——或者 Chapter 11 受托人——但无论哪一种——都将有能力获得足以使本庭裁定该财产属于破产财团的资金，而这正是我们预期他们会做的，\n\n并且在实际裁定各项债权之前，先行归集资产。其他诉讼通常将会中止，因此这会降低费用。人们谈论费用——法庭：嗯，我不同意这一点。你们不希望你们的诉讼被中止，对吗？其他债权人也可能到庭申请解除中止——卡拉里女士：他们可能会。法庭：——并希望其债权在本庭之外得到裁定。因此，我想对你们说的是——我只是试图了解——尤其是你们当事人的债权，似乎尚未作出裁定，但它属于人身伤害侵权债权，而 United States Code（美国法典）中国会已决定本庭不能裁定该债权。明白吗。Stern 判例支持这一点，对吗？甚至 Wellness 判例也支持这一点，因为没有人同意由本庭裁定该债权。明白吗？因此，该债权——不能在这里得到裁定。卡拉里女士：正确。法庭：因此，我们谈过的所有其他债权——我现在手头没有数字——但除 PAX 债权之外的债权，我认为——你们都应当纠正我——其中超过一半是人身伤害侵权债权。如果它们是人身伤害侵权债权，它们不得——估算——法条规定——我想我可以背出来——为在 title 11 项下案件中进行分配之目的而予以清算或估算。国会决定破产法院作为法院程序所能做的，只是在 Chapter 11、12 或 13 案件中，就与计划有关的债权进行估算。但法条规定，你们不能——破产法院不能为在 title 11 项下案件中进行分配之目的，对未确定且未经清算的人身伤害侵权债权和非正常死亡债权进行清算或估算。因此，受托人不能这样做。卡拉里女士：正确。法庭：我的意思是，Chapter 7 受托人不能这样做。其从一开始就受到束缚。因此，他们必须——然后他们将试图寻找资产，而债务人将会抗辩。我是说，看看过去 15 年或不知多少年来一直发生的情况。如果你们认为债务人不会抗辩将该船只认定为破产财团资产的尝试，我是说，他们当然会抗辩。然后还有你们做的其他任何事情。\n\nFiore Reporting and Transcription Service, Inc.（Fiore 速记与转录服务公司）\n\n那么——因此，对于目前——目前——我并不是说不能改变——但目前属于推测性的债权，将会有多少资金来为该 Chapter 7 破产财团提供资金，对吗？因此，担忧在于，根据本庭目前对本案的看法，我不知道在本案的事实和情形下，Chapter 7 受托人如何能够履行法典要求的职责。卡拉里女士：谢谢，法官阁下。我们确实认为资金——可能可以获得，并且我们确实认为，受托人可以在债权正在诉讼期间归集资产，之后将其带回本庭进行分配；另一种选择是予以驳回，而这基本上会使 PAX 能够取得全部资产，并使每一名个别债权人必须分别裁定，以追索每一项——每一项资产。我们不认为这符合债权人的最佳利益。但我理解法官阁下的担忧。不过，我们确实认为，对于债权人而言，转换程序或 Chapter 11 肯定优于驳回，法官阁下。谢谢。法庭：好的。我理解这一点。我只是向你提出这些问题——卡拉里女士：是。我理解。法庭：——具体是因为你们当事人的债权。卡拉里女士：我理解。谢谢，法官阁下。法庭：好的。谢谢。Claiborn 律师？克莱伯恩女士（Claiborn）：下午好，法官阁下。霍利·克莱伯恩（Holley Claiborn）代表 U.S. Trustee（美国受托人）。法庭：下午好。克莱伯恩女士：本案现已演变为一个简单但困难的境地。根据 section 1112(b)，事由已经成立，现在本庭面临艰难而重大的职责和负担，即作出选择。债务人已承认，1112(b)(2) 项下可获得的救济已不再适用，因此可供选择的救济形式限于我们今天简要讨论过的三种：驳回、转换，或指定 Chapter 11 受托人。诚然，每一种都各自面临挑战，并对本案各利益相关方产生影响。美国受托人对本庭应选择何种救济形式没有偏好。至于美国受托人在 ECF 102 的动议中请求指定审查员这一救济，如果本庭就驳回、转换或指定 Chapter 11 受托人立即作出决定，该项救济将失去实际意义。\n\n我想向本庭明确说明，法官阁下，指出在本案中，并且与所有 Chapter 11 案件一致，如果本庭认定指定 Chapter 11 受托人是最适当的救济，则该受托人应当拥有法典在 section 1106 中赋予的权力和权利，而且不存在限制、规定或控制该等权力和权利的授权。\n\n如果本庭今日认定驳回是最适当的救济，则本案应立即驳回，不应以任何事件为条件，驳回也不应与任何事件相结合。\n\n受聘专业人士的费用申请可在驳回后提交并裁定。\n\n最后，法官阁下，我认为最重要的一点——也是困难的一点——是本案需要迅速作出决定。但本庭面前已有使本庭能够作出选择的事实。最后，在敦促迅速作出决定时，我想指出，拖延会对债权人产生不利影响，并确实会使债务人受益。谢谢，法官阁下。法庭：谢谢。弗里德曼先生（Friedman）？\n\n弗里德曼先生：法官阁下，我只想作几点简短的反驳。\n\nFiore Reporting and Transcription Service, Inc.（Fiore 速记与转录服务公司）\n\n第一点是，委员会的律师及其他人主张，如果让本案消失，债务人将会受益。这并不属实。无论以何种方式，人们都会取得债务人的资产。第二点——以该等资产存在为限。第二点是，我没有完全——我认为有人提到，Chapter 7 可能有用，因为也许——Kwok 先生（郭文贵）不会获得免责。当然，在破产程序之外，他也不会获得免责。我想提出的另一点，法官阁下，是请您查看我们提交的证物 27，因为——法庭：你们自己的证物？PAX 的证物？弗里德曼先生：证物 27。PAX 证物 27。法庭：好的。请给我一秒钟，我会尽力找到。弗里德曼先生：谢谢。法庭：你得给我一分钟。你知道该证物从文件的第几页开始吗？这是文件 404。你知道证物 27 从哪一页开始吗，因为它有 1500 页。弗里德曼先生：抱歉。法庭：哦，1,149。弗里德曼先生：谢谢。\n\n案件 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 100 页，共\n\n法庭：找到了。弗里德曼先生：太厉害了。法庭：工作人员真是——弗里德曼先生：太厉害了。法庭：确实太厉害了。弗里德曼先生：太厉害了。谢谢。法庭：确实太厉害了。弗里德曼先生：法官阁下，这是我们的债权汇总。委员会律师戈德曼先生（Goldman）在其周详的陈述中说，Sapphire 案可以区分的原因之一，是因为该案中的人可以追索其他——其他人。我只是想指出，当您查看我们的案件汇总时，该汇总已作为证据提交，许多被告——抱歉——许多原告也有其他可以追索的当事人。如果您查看第 2 页，最后一项债权，即 Keyi Zilkie（凯伊·齐尔基）债权，是针对 GTV、Saraca 和 Guo 先生、Miles Guo（郭文贵）提出的。下一页的 Zheng Xu Dong（郑旭东）案件，是针对 GTV、Saraca 和 Wayne Guo（郭文贵）提出的。下一案件是针对 Voice of Guo 和 Miles Guo 提出的。诸如此类。尤其是，法官阁下，我要指出——就如同 Rui Ma（马蕊）的指控，我此前在本案早些时候说过，我绝不是在淡化发生在她身上的事情。\n\n我想说的是，如果您查看 Rui Ma 案，该案并非仅针对 Kwok 先生。我的理解是，Golden Spring New York（纽约金泉）也是该案的被告。我们知道，Golden Spring New York 至少有 \\$8 million 用于为 DIP 提供资金。因此，即使 Kwok 先生没有钱，该案中仍有一名可以追索的共同被告。因此，我只是指出，除 Kwok 先生之外，还有其他可能可供获得赔偿的资金来源。法官阁下，在 Rui Ma 律师的陈述中——我没有统计——也有许多关于资金的“如果”和“可能”——没有证据。遗憾的是，人们被债务人的融资提议或潜在融资安排所吸引——我们从一开始就反对这一点——而我们如今身处一个我们认为根本不应当提交、且没有——至今仍没有资金的案件中。律师试图主张我们仅被欠 \\$46 million，而我们拥有超过 \\$260 million 的判决。尽管我想确实不能称人们为——非债权人——人们也不能说 PAX 没有被欠 \\$261 million，因为确实如此。我要提出的最后一点，法官阁下，简单地说是\n\n我们坚持我们在所援引的案件中所作的引证——即我们于周五提交并于今日提及的那些案件——支持两项命题：从根本上说，并非每一位债权人的利益实际上都必须支持转换。而且，单一债权人的利益也可能具有重要意义。界线划在何处——例如，一人持有99 percent的债权，另一人持有1——并无硬性规则。但我认为，法院显然可以根据 Acme（阿克梅）、Staff（斯塔夫）所援引的 Goodrich Lines（古德里奇航运公司）系列案件，考虑到法院的自由裁量权——在本案中该自由裁量权相当广泛——可以考虑债权数额的差异以及各人有权获得的内容。而且，再次强调，我认为，我们援引的多项案件确实支持这样一种命题：即使一名债权人可能最终获得更好的结果，驳回案件也是可以的。我无法预测未来。我想说的是，就 Sherry-Netherland（雪莉-荷兰酒店）的公寓而言，PAX 仍须承担大量工作，以继续其已着手的工作，证明该信托协议是虚假的。这并非唾手可得。我们还有工作要做。\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 102 页（共\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 103 页（共\n\n而且，我们不知道其他债权人会如何行事。也许其他债权人会与 Ho Wan Kwok（郭文贵）先生达成安排。我们必须承担该风险。因此，基于这些理由，以及我们所指出的、我们认为本案不适合转换为 Chapter 7 的实际理由，我们认为驳回是正确的选择。我确实——我想说，我们同意 U.S. Trustee（美国受托人）的意见，即如果法院认定正确路径是指定一名 Chapter 11 受托人，显然我们强烈支持驳回，但不得对受托人所拥有的任何权力施加限制。说完这些，法官阁下，我没有其他陈述。法庭：谢谢。Jonas先生？Jonas先生：法官阁下，Jeff Jonas（杰夫·乔纳斯），Brown Rudnick（布朗·拉德尼克律师事务所），代表债务人。我将简要陈述。我想说，我坚持此前所作的论点，即依据 1112(b)(1) 和 (4)(A)，因正当理由支持驳回。我注意到，有趣的是，没有任何反对驳回的人回应我先前就标准所作的论点：该标准是对债权人的不利影响，而该不利影响取决于其——即这些债权人——在申请破产前的法律预期是否受到损害；在本案中，它们并未受到损害。\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 104 页（共\n\n法官阁下，我起身发言只是为了明确记录：债务人确实反驳并反驳了针对他所作出的诸多贬损性评论。此处的律师作出了许多武断、毫无依据的陈述，这些都不是证据。它们以不同的形式和说法出现，法官阁下。例如，有人提到 Greenwich Land（格林尼治土地公司）拥有——可能与某些所谓“隐藏资产”有关的——资产。法官阁下，没有任何事情得到证明。没有任何事情得到展示。仅仅是武断的指控，这无异于声称某些邻居、朋友及其他家庭成员拥有据称的隐藏资产。第二，法官阁下——这些只是我在陈述过程中注意到的一些快速示例——Callari（卡拉里）女士提到了在中国存在的某些指控。同样，没有证据，只是武断的陈述。这不是证据。不应赋予其任何价值或可信度。第三，诉讼融资。证据为零。这完全彻底是推测和臆测。法院面前没有证据。我再加上我自己的推测：委员会——\n\n以及可能还有 Callari女士——在过去几周里一直急切地四处奔走寻找某种融资，以便他们能够来到法院并提交一些证据。他们没有任何证据。因此，我由此推断根本不存在此类证据。但无论如何，我不想再叠加我自己的推测。我只想说明，就此而言，法院面前根本没有任何证据。因此，法院所有的关切——至少是我们的关切——以及我认为其他当事人所表达的、即不会有资金的问题，是唯一存在的证据。再次请求，法官阁下，我们敦促驳回。谢谢，法官阁下。法庭：谢谢。Goldman先生？Goldman先生：是的。谢谢，法官阁下。仅就几项简要事项，法官阁下。关于认为所有这些请求权均构成人身伤害或非正常死亡请求权的观点，显然根据 28 U.S.C. § 157——法庭：(b)(2)(B)。Goldman先生：谢谢。——法院没有管辖权。它必须在地区法院审理，除非当然获得——法庭：那不是——那不是审判。\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 105 页（共\n\n案号 22-50073\n文件 884\n提交于 09/27/22\n登记于 09/27/22 12:36:24\n\n法庭：审判条款是 (b)(5)。(b)(2)(B) 讨论的是对或有——\n\nGoldman先生：正确。\n\n法庭：——及有争议的人身伤害请求权进行估定或清算。这不同于——\n\nGoldman先生：正确。\n\n法庭：——(b)(5) 项下的审判问题。\n\nGoldman先生：您完全正确。因此，除非在 Chapter 11 下，根据 502(c) 也不能进行估定。\n\n法庭：或者在计划情形下的 12 或 13。\n\nGoldman先生：或者 12 或 13。但这当然并不妨碍它们在原审法院获得自动中止解除后被清算。而且，债务人当然可以进行抗辩，特别是因为根据 523(a)(6)，它们可能作为故意及恶意伤害而不可免责。因此，债务人当然会有利益这样做。我还要指出，我认为不能当然地认为所有这些请求权——例如基于诽谤的请求权——都构成不能估定的人身伤害侵权请求权，或者属于根据——您提到的 (c)——\n\n法庭：(b)(2)(B)。\n\nGoldman先生：——(b)(2)(B)，以及 (b)(5)——\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 107 页（共\n\n法庭：(b)(5)——\n\nGoldman先生：是。\n\n法庭：——其中规定地区——\n\nGoldman先生：是。\n\n法庭：——法院必须审理这些请求权。\n\nGoldman先生：完全正确。\n\n法庭：对。\n\nGoldman先生：我认为不能当然地认为诽谤请求权属于该类请求权——\n\n法庭：关于这一点有各种各样的判例法。\n\nGoldman先生：是。\n\n法庭：而且我同意你的意见。\n\nGoldman先生：因此，存在不同的权威观点。当然，Gawker Media（高客传媒）一案持相反观点。因此，除非法官阁下对此有确定的意见，否则您不能得出结论说，所有这些请求权都不能估定，或者说，您对主持请求权异议没有管辖权。至于一名 Chapter 7 受托人将如何归集该游艇，我设想如下。目前有一项待决的对抗程序，直接提出了这艘游艇是否属于破产财产的问题。一名 Chapter 7 受托人当然可以替代债务人，或者由其本人作为该对抗程序中的当事人，并聘请特别律师。\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 108 页（共\n\n我非常有信心，我们能够找到愿意以某种可协商的风险代理费方式承办此事的特别律师。受托人随后将基于 Ostrager（奥斯特拉格）法官认定的排除效力提出决定性动议；我们认为该认定确有排除效力。随后，法官阁下将决定该认定是否确实具有实际排除效力，从而使该游艇成为破产财产。那并非复杂的程序，而且我确实——我建议——具有很大可能性能够完成。如果确实如此，我们甚至不需要诉讼融资。因此，那是最容易实现的目标。我认为，法官阁下，您可以在此考虑几种选择。由于例如我们仅有数周时间寻找诉讼融资，且没有时间寻找任何风险代理律师，您可以转换本案，以便给予我们时间寻找资金。如果在该期间内无法找到任何资金，或者我们无法找到特别律师，则本案之后可以被驳回。而且，我实际上没有提到第三种选择，\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 109 页（共\n\n即 Chapter 11 受托人的选择，这将允许对其中一些请求权进行估定。委员会并不反对与 PAX 就债务人所拥有的任何资产进行公平分配的想法。我们并非没有注意到 PAX 为追索该债务人并取得其判决书所作出的努力。我认为，委员会将会——让我这样说——在与 PAX 协商一项计划时保持合理，该计划将对其申请破产前的努力给予一定认可。而且，债权人重整计划在本案中当然可以实现。它所需要规定的只是资产的归集。我们甚至会——也许 PAX 的律师希望担任特别律师。我们对此不会有任何问题。债务人将不会保留任何财产权益。因此，在债权人有能力协商计划的情况下，指定一名 Chapter 11 受托人，我认为也是此处一个可行的选择。因此，我将——法庭：嗯，你是第一个这样说的人。Goldman先生：嗯，我确实认为，相对于——法庭：而且没有其他人这样说。因此，如果你——Goldman先生：没有。法庭：因此，如果你认为这是一种可能性，那么——Goldman先生：我将——法庭：——你是否请求获得与各方讨论此事的机会？这就是你的请求吗？Goldman先生：嗯，我很希望有机会与各方讨论此事，只是我不确定这些讨论是否会有成效。因为我认为——我认为 PAX 会希望法官阁下首先就驳回是否——法庭：顺便说一句，我必须根据法典作出裁定，所以除非你们全都决定采取不同做法，否则我没有选择。我有——我有——我没有选择。一旦听证开始，对吧，我是否就必须作出裁定——我手头没有相关条文，但我确信 PAX 知道——我想我必须在15天左右内作出裁定，对吗？在听证结束时。我没有很多——正如我说过的，我不知道，两个月前——本案不存在很大的机会窗口。我试图——也许我做得并不十分好——但我试图向所有当事人非常明确地说明，本案不是法院拥有自由裁量权的案件。国会对法典作出了修改，对吧？那就是——我没有选择。我没有——\n\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 110 页（共\n案号 22-50073 文件 884 提交于 09/27/22 登记于 09/27/22 12:36:24 第 111 页（共\n\n裁量权。\n\n我没有。\n\n是的。\n\n这里写着，戈德曼律师（Goldman）——我知道您可能也知道这一点——在……之后，法院应在30日内开始就该动议举行听证，除非动议提出人同意具体的时间安排；动议提出人已经同意，即今天，对吗？\n\n然后作出……并且应当——没有裁量权，对吗——应在该听证开始后不迟于15日内就该动议作出裁决。\n\n所以我目前只能如此，对吗？\n\n除非各位有其他方案，否则我没有太多能做的。\n\n我不认为你们今天会有其他方案。\n\n我不会在今天和明天之间写出一份裁决。\n\n那不会……我是说，我确实做不到。\n\n我还有其他听证事项。\n\n我们还有其他事情。\n\n但我必须在今天起15日内作出裁决。\n\n戈德曼先生：明白，法官阁下。\n\n我认为——我认为将会阻碍、或者不会促成关于第11章受托人的讨论的是，PAX宁愿法官阁下直接裁定驳回案件。\n\n因此，我不认为在该裁定作出之前，我能够让他们参与讨论。\n\n不过，法官阁下在就本动议作出裁定时可以指定一名第11章受托人，并给予一段时间，以便——不妨碍权利地——根据案件最初30日左右发生的情况重新审视该命令。\n\n换言之，您仍可履行法定职责，并在限定期间内重新审议此问题，以确定是否应根据我们在指定第11章受托人后能够取得的成果驳回该案件；这仍将满足作出裁定的法定义务。\n\n法庭：我希望……\n\n戈德曼先生：但我要表达的重点是，这会保留各种选择。\n\n法庭：我明白您的意思。\n\n戈德曼先生：仅此而已。\n\n我就这些，法官阁下。\n\n法庭：好的。\n\n谢谢。\n\n还有其他人希望陈述意见吗？\n\n（无可听到的答复。）\n\n法庭：好的。\n\n正如我刚才为记录所述，我必须就这一裁决作出裁定……\n\n哦，您还有什么想补充的吗？\n\n哦，是的。\n\n我们必须完成证物部分，对吗？\n\n证物。\n\n笔录。\n\n戈德曼律师，有一些对弗里德曼律师（Friedman）所涉若干笔录的提及。\n\n案号 22-50073 文件 884 提交日期 09/27/22 录入日期 09/27/22 12:36:24\n\n戈德曼先生：没有。\n\n不反对。\n\n法庭：不反对。\n\n好的。\n\n那么，除第7、8及31号外，PAX的所有证物均全部准予采纳。\n\n那是另一个吗？\n\n阿伦松女士（Aronsson）：对。\n\n谢谢，法官阁下。\n\n如果有助于法庭，我可就笔录提供一些引文。\n\n法庭：可以。\n\n请继续。\n\n阿伦松女士：就PAX 18而言，我们请法庭参阅第21至28页。\n\n就PAX 20而言，我们请法庭参阅第8至19页。\n\n就PAX 21而言，我们请法庭参阅第11至20页。\n\n法庭：好的。\n\n谢谢。\n\n阿伦松女士：谢谢。\n\n法庭：戈德曼律师？\n\n戈德曼先生：法官阁下，我可以再提出一点吗？\n\n法庭：可以。\n\n不过他们听不见您说话。\n\n戈德曼先生：好的。\n\n法庭：请对着……\n\n戈德曼先生：好的。\n\n法庭：您可以就在您旁边对阿伦松律师说。\n\n戈德曼先生：好的。\n\n我知道这可能不是1112(b)项下的具体因素，但法官阁下从与DIP（占有中债务人）动议相关提交的诉讼预算中得知，截至4月底，我们已经产生了近\\$200,000的费用。\n\n该数额显然已经增加。\n\n我认为，如果指定一个委员会，该委员会依赖于程序将继续推进而聘请律师——我们为该委员会完成了我们的工作——而现在却驳回案件，致使所有这些费用未获支付，这将是对程序的不公。\n\n法庭：我明白。\n\n谢谢。\n\n还有其他人希望陈述意见吗？\n\n（无可听到的答复。）\n\n法庭：好的。\n\n为使记录清楚起见，2022年4月6日，债权人Pacific Alliance Asia Opportunity Fund, LP（太平洋联盟亚洲机会基金有限合伙）提交了一项以存在事由为由驳回案件的动议，或者作为备选方案，部分加入美国受托人（U.S. Trustee）提出的请求下令指定一名第11章受托人的动议。\n\n本案已举行数次听证，我们在听证中讨论了驳回案件的动议。\n\n我们还举行了一次状态会议，讨论该驳回案件的动议；该状态会议于2022年4月13日举行。\n\n在状态会议之后，并作为状态会议讨论的一部分，经动议提出人PAX同意，驳回案件动议的听证安排于今日，即2022年5月25日举行。\n\n我们还安排于明天举行听证，预计将会有更多可能需要就驳回案件动议提交法庭的证据。\n\n在驳回案件动议听证之前最近举行的一次听证中，债务人通过律师确认，其不反对驳回案件动议，并同意根据1112存在驳回案件的事由。\n\n就驳回案件动议提交文件或诉状的其他每一方，均同意存在事由。\n\n因此，本法庭无需作出存在事由的认定。\n\n法庭仅须就该事由为何以及最终救济为何作出认定。\n\n我此前已在记录中说明过，但我将再次说明，法庭将根据《法典》1112(b)的适用规定，驳回案件、转换案件，或者指定一名第11章受托人。\n\n我今天已为记录说明，本次听证中已全部准予采纳的证物，系由PAX及无担保债权人正式委员会提交。\n\n案号 22-50073 文件 884 提交日期 09/27/22 录入日期 09/27/22 12:36:24\n\n没有其他当事方提交证据，但其加入了该等证据，这对法庭而言可以接受。\n\n我已审阅所有当事方于20日星期五提交的、关于各自就驳回案件动议所持立场的立场文件。\n\n当然，我今天也已听取所有当事方就驳回案件动议所作的论证。\n\n如我亦已说明，我受法律约束，必须在听证开始后15日内就本动议作出裁定。\n\n鉴于没有更多证据需予提交或论证需予提出，听证今日结束；因此，关于本驳回案件动议作出裁定的时限开始起算。\n\n我……我感谢所有当事方提出的全部论证。\n\n这些论证周详且全面。\n\n各位已充分表达了各自的观点。\n\n但我确实必须确定本案将以何种方式继续进行，我将会这样做。\n\n显然，我将于今天起15日内这样做。\n\n不过我想，根据《联邦民事诉讼规则》，今天不计入；根据9006第6条，当天——即今天——不计入，所以坦率地说，我认为这是正确的。\n\n但无论如何，如果各位对驳回案件动议有任何其他关切或问题，我通常可以安排会议。\n\n但与此同时，我将就驳回案件动议作出裁定。\n\n好的。\n\n还有人有其他问题吗？\n\n（无可听到的答复。）\n\n法庭：好的。\n\n我感谢所有当事方所作的努力。\n\n我将驳回案件动议留待审议，并将相应作出裁定。\n\n这是今日日程中的最后事项，现休庭。\n\n（程序于下午12时51分休庭。）\n\n案号 22-50073 文件 884 提交日期 09/27/22 录入日期 09/27/22 12:36:24\n\n本人，CHRISTINE FIORE（克里斯廷·菲奥雷），经法院批准的记录誊写员及认证电子记录员兼誊写员，证明上述内容系根据上述案件程序的官方电子录音制作的正确笔录。\n\n2022年4月21日\n\nChristine Fiore, CERT-410\n\n誊写员\n\n索引\n\nPAX证物： 收讫\n\n1-6, 9-17, 23-29, 31 8\n\n债权人委员会证物：\n\n1-14 16\n\n案号 22-50073 文件 884 提交日期 09/27/22 录入日期 09/27/22 12:36:24 第119页，共","key_entities":["Kwok","Je","CIPA","CCP","Guo","Ho Wan Kwok","GTV","Saraca","Miles Guo","Murray","Chinese Communist Party"],"ecf_references":[{"doc_number":102,"court":"CTB"},{"doc_number":131,"court":"CTB"},{"doc_number":404,"court":"CTB"}],"word_count":28671,"status":"published","published_at":"2022-09-27 00:00:00","created_at":"2022-09-27","updated_at":"2026-08-23 22:23:29"}