郭文贵破产案 · TRANSCRIPT · ECF #3852

元数据

当事人: 郭文贵 (Guo Wengui / Miles Guo / Ho Wan Kwok)
法院: CTB
案号: 22-50073
ECF #: 3852
类型: TRANSCRIPT
立案日: 2024-11-26

原始法庭文件为英文，下方为英文全文。

全文

1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION IN RE: . Chapter 11 . Case No. 22-50073 (JAM) HO WAN KWOK, *et al., .* . (Jointly Administered) Debtors. . . . . . . . . . . . . . . . . . . LUC A. DESPINS, *et al.*, . Adversary Proceeding . No. 23-05017 (JAM) Plaintiffs, . . v. . . TAURUS FUND, LLC, *et al.,* . . Defendants. . . . . . . . . . . . . . . . . . . GENEVER HOLDINGS, LLC, . Adversary Proceeding . No. 23-05007 (JAM) Plaintiff, . . v. . . AIG PROPERTY CASUALTY . COMPANY, . . Defendant . . . . . . . . . . . . . . . . . . LUC A. DESPINS . Adversary Proceeding . No. 24-05225 (JAM) . Plaintiff, . . v. . . CURTIS DESIGN CORPORATION, . *et al.,* . . Defendants. . . . . . . . . . . . . . . . . Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 1 of 117

2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 . . . . . . . . . . . . . . . . LUC A. DESPINS, CHAPTER 11 . Adversary Proceeding TRUSTEE, . No. 24-05273 (JAM) . Plaintiff, . . v. . . NGOK, *et al.,* . . . Defendants. . . . . . . . . . . . . . . . . . LUC A. DESPINS, CHAPTER 11 . Adversary Proceeding TRUSTEE, . No. 24-05318 (JAM) . Plaintiff, . . v. . Courtroom 123 . Brien McMahon Federal Building ALFA GLOBAL VENTURES . 915 Lafayette Boulevard LIMITED *et al.,* . Bridgeport, Connecticut 06604 . Defendants. . Tuesday, November 19, 2024 . . . . . . . . . . . . . . . 1:05 p.m. TRANSCRIPT OF HEARING BEFORE THE HONORABLE JULIE A. MANNING UNITED STATES BANKRUPTCY JUDGE Audio Operator: Electronically recorded Transcription Company: Reliable The Nemours Building 1007 N. Orange Street, Suite 110 Wilmington, Delaware 19801 Telephone: (302)654-8080 Email: gmatthews@reliable-co.com Proceedings recorded by electronic sound recording, transcript produced by transcription service. Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 2 of 117

| Case 22-50073 | Doc 3852 Filed 11/26/24 | Entered 11/26/24 14:12:30 Page 3 of 117 | |---------------|-----------------------------------------------|---------------------------------------------------------------------------------------------| | | | 3 | | | | | | 1 | APPEARANCES: | | | 2 | For the Chapter 11 | | | 3 | Trustee: | Patrick Linsey, Esquire NEUBERT PEPE & MONTEITH, P.C. 195 Church Street | | 4 | | 13th Floor New Haven, Connecticut 06510 | | 5 6 | | -and- | | 7 | | Luc A. Despins, Esquire PAUL HASTINGS, LLP | | 8 | | 200 Park Avenue New York, New York 10166 | | 9 | | Nicholas A. Bassett, Esquire Doug Barron, Esquire | | 10 | | 2050 M Street, NW Washington, DC 20036 | | 11 | For Taurus Fund LLC, | | | 12 | Taurus Fund Management, and Scott Barnett: | Michael T. Conway, Esquire | | 13 | | LAZARE POTTER GIACOVAS & MOYLE, LLP 747 Third Avenue, 16th Floor | | 14 | | Fifth Floor New York, New York 10017 | | 15 16 | For Genever Holdings: | Michael T. McCormack, Esquire O'SULLIVAN MCCORMACK JENSEN | | 17 | | & BLISS, P.C. 180 Glastonbury Boulevard | | 18 | | Suite 210 Glastonbury, Connecticut 06033 | | 19 | For AIG Property | | | 20 | Casualty Company: | Michael P. Thompson, Esquire GORDON & REES SCULLY MANSUKHANI 95 Glastonbury Boulevard | | 21 | | Suite 206 Glastonbury, Connecticut 06033 | | 22 | | | | 23 | | -and- | | 24 | | John O'Connor, Esquire John J. Kavanagh, Esquire STEPTOE, LLP | | 25 | | 1330 Connecticut Avenue, NW Washington, DC 20036 |

4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 For G-Club International Limited and G-Club Jeffrey Sklarz, Esquire Operations: GREEN & SKLARZ LLC One Audubon Street, Third Floor Hew Haven, Connecticut 06511 For Hing Chi Ngok, Mei Guo, Hudson Diamond New York, Gypsy Mei Food Services, Leading Shine New York, and Hudson Diamond Holdings: Steven Kindseth, Esquire Zeisler & Zeisler 10 Middle Street, 15th Floor Bridgeport, Connecticut 06604 For Rule of Law Foundation 3 Inc. and Rule of Law Society 4 Inc.: Bryan Ha, Esquire John Newton, Esquire BRYAN HA, ATTORNEY AT LAW 455 Tarrytown Road, #1244 White Plains, New York 10607 For Victor Cerda: Jason Swergold YANKWITT LLP 140 Grand Street, Suite 705 White Plains, New York 10601 For Beile Li: Ivan Ladd-Smith, Esquire SPEARS, MANNING & MARTINI 2425 Post Road, Suite 203 Southport, Connecticut 06890 For Yongbing Zhang: James Edward Nealon, Esquire NEALON LAW LLC 1266 East Main Street, Suite 700R Stamford, Connecticut 06902 For Gladys Chow: Emily McDaniels, Esquire SHER TREMONTE LLP 90 Broad Street, 23rd Floor New York, New York 10004 Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 4 of 117

5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 INDEX MOTIONS: PAGE Matter No. 136: **Genever Holdings LLC v. AIG Property Casualty Company Adversary Case no. 23-05007** Order Scheduling Status Conference on Motion To Modify Scheduling Order Matter No. 124: **Luc A. Despins** *et al***. v. Taurus Fund LLC** *et al***. Adversary Case No. 23-05017** Motion for Summary judgment Filed by Patrick R. Linsey on behalf of Luc A. Despins, Plaintiff Matter No. 23: **Despins v. Cirrus Design Corporation** *et al.* **Adversary Case No. 24-05225** Motion for Default Judgment by Court pursuant to Fed.R.Civ.P.55(b)(2) and Fed.R.Bankr.P.7055 against Qiang Guo. Filed by Patrick R. Linsey On behalf of Luc A. Despins, Plaintiff Matter No. 94: **Despins, Luc A., Chapter 11 Trustee v NGOK et al. Adversary Case 24-05273** Order setting Status Conference Matter **Despins, Luc A., Chapter 11 Trustee v. Alfa** No. 106**: Global Ventures Limited et al.** Order Scheduling Status Conference on Stipulated Judgment Transcriptionist's' Certificate Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 5 of 117

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6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 (Proceedings commenced at 1:05 p.m.) THE CLERK: Adversary Number 23-05007, Genever Holdings LLC versus AIG Property Casualty Company; 23-05017, Despins versus Taurus Fund LLC, *et al*.; 24-05225, Despins versus Cirrus Design Corporation, *et al*.; 24-05273, Despins versus Ngok, *et al.;* 24-05318, Despins versus Alpha Global Ventures Limited, *et al*. THE COURT: Okay. Thank you. If we could have appearances for the record, starting with the Chapter 11 Trustee, please. MR. DESPINS: Good afternoon, Your Honor. Luc Despins, Chapter 11 Trustee. THE COURT: Good afternoon. MR. BASSETT: Good afternoon, Your Honor. Nick Bassett. Excuse me. Nick Bassett from Paul Hastings, counsel for the Chapter 11 Trustee. THE COURT: Good afternoon. MR. LINSEY: Good afternoon, Your Honor. Patrick Linsey, Neubert, Pepe & Monteith, counsel for the Chapter 11 Trustee. THE COURT: Good afternoon. MR. BASSETT: And Your Honor, my colleague, Doug Barron from Paul Hastings is also on the Zoom today. THE COURT: Great. Good afternoon. MR. BARRON: Thank you.

7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. SKLARZ: Good afternoon, Your Honor. Jeffrey Sklarz for G-Club Operations and G-Club International in Adversary 24-5273. THE COURT: Good afternoon. MR. KINDSETH: Good afternoon, Your Honor. Steven Kindseth for Hing Chi Ngok, Mei Guo, Hudson Diamond New York, Gypsy Mei Food Services, Leading Shine New York, and Hudson Diamond Holdings. THE COURT: Good afternoon. MR. HA: Good afternoon, Judge. This is Bryan Ha for Defendant Rule of Law Foundation 3 Inc, and Rule of Law Society 4 Inc. And also on the call is my colleague, John Newton. Good afternoon, Judge. THE COURT: Good afternoon. MR. O'CONNOR: Good afternoon, Your Honor. John O'Connor, joined by Michael Thompson representing AIG in matter 23-5007. THE COURT: Good afternoon. MR. MCCORMACK: Good afternoon, Your Honor. Michael McCormack on behalf of Genever Holdings LLC in the Genever Holdings versus AIG matter, No. 23-05-007 THE COURT: Good afternoon. MR. SWERGOLD: Good afternoon, Your Honor. Jason Swergold, Yankwitt LLP, on behalf of Victor Cerda in 24- 05273. Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 7 of 117

8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: Good afternoon. MR. CONWAY: Good afternoon, Your Honor. Michael Conway, Lazare, Potter, Giacovas & Moyle. I'm here on behalf of Taurus Fund LLC, Taurus Fund Management LLC, Scott Barnett, and a host of others in the status conferences. Did you want me to recite every one of them? THE COURT: You do not need to do that, Attorney Conway. Thank you. We have your -- I mean, we can indicate, for any recording purposes or transcript purposes, the parties for whom you are counsel of record. MR. CONWAY: I appreciate that, Your Honor. THE COURT: Okay. Is there anyone else whose appearance we haven't taken yet? MR. LADD-SMITH: Yes, Your Honor. Ivan Ladd-Smith from Spears, Manning & Martini on behalf of Beile Li in the 24-5273 matter. THE COURT: Thank you. MR. NEALON: (Inaudible) for Defendant Yongbing Zhang in the 5273 matter. THE COURT: I'm sorry, counsel. I spoke over you. Would you announce your appearance again? MR. NEALON: Sure. James Nealon for the Defendant Yougbing Zhang in the 5273 adversary proceeding. THE COURT: Thank you. MR. NEALON: Thank you, Your Honor. Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 8 of 117

| Case 22-50073 | Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 9 of 117 | |---------------|--------------------------------------------------------------------------| | | 9 | | 1 | MS. MCDANIELS: And good afternoon, Your Honor. | | 2 | I'm Emily McDaniels on behalf of Defendant Gladys Chow in 24- | | 3 | 5273. | | 4 | THE COURT: Good afternoon. Does that include | | 5 | everyone's appearance now? Okay. Hearing nothing to the | | 6 | contrary then, there are, as you all know, many matters on | | 7 | the calendar this afternoon. So I'm going to turn to the | | 8 | Chapter 11 Trustee to see what your suggestion is as to how | | 9 | to handle these matters. | | 10 | MR. DESPINS: Thank you, Your Honor. I was | | 11 | thinking that we should start with the AIG matter, so that | | 12 | would allow Mr. O'Connor and Mr. McCormack to leave after | | 13 | because I'm not really interested in the rest of the case, if | | 14 | that's okay with Your Honor. | | 15 | THE COURT: That makes complete sense to me. Go | | 16 | right ahead. Well, I can tell you why I scheduled the status | | 17 | conference, actually. You as far as the AIG adversary, 23- | | 18 | 5007. Because I know you filed a motion with regard to | | 19 | extending the discovery deadline. | | 20 | And when we had our last hearing, I was, you know, | | 21 | we had talked about some final deadlines, and I was concerned | | 22 | that the supplemental brief on summary judgment relating to | | 23 | fact discovery, the extended deadlines might have an impact | | 24 | on discovery being delayed. | | 25 | And maybe I'm wrong, but that's why I set it for a | | | |

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10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 status conference. Because when we had our last status conference, the representations on the record was -- were that there was no need for delay, and that's why we had set those deadlines. So I just want to hear from the parties to make sure I'm not missing something, with regard to these issues related to fact discovery. MR. O'CONNOR: Yeah. Your Honor -- Your Honor, this is John O'Connor for AIG. I can -- I can speak to that. The request for an extension came about because of two things that occurred about a week before the close of discovery. One, we had a deposition set for a third party witness who concluded that he needed to change counsel because he needed to put his -- it's a broker. He needed to put his carrier on notice and let the carrier select counsel. And so, in speaking with Genever's counsel, there was, you know, we wanted to be able to accommodate that because someone should -- you know, we don't

19 20 want to jam someone so they can't have their counsel of choice.

21 22 23 24 25 Also, one week before the close of discovery, Genever sent us over, for the first time, a 30(b)(6) notice. And at the time, I was in the middle of a federal court trial in Virginia. And it just wasn't going to be practical to get a notice on the 1st and have a witness by 8th.

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1 2 3 4 5 6 So as we talked about it with counsel, it we thought it made sense to modestly extend the deadline to allow those things to occur. And Genever wants a -- wants to depose a former AIG employee that, you know, they will - they'll pursue it or they won't. But it seemed to make sense to put a little

7 8 9 10 11 12 breathing room there for those things to occur. I will say, you know, the motion we filed asked to extend the discovery deadline to December 6. Actually, we'd like to extend it to December 13th, if we could, just to allow for the scheduling of those couple of matters. There's no additional discovery. It's just getting those things scheduled.

13 14 15 16 17 18 19 20 21 Your Honor had asked about the briefing on summary judgment. We would like -- and I'm speaking just for AIG - to move those dates back by just one week. And I think if we -- if we're able to extend the discovery to December 13, I think, just a week move back on the briefing would be fine. That would involve us filing -- AIG filing its supplemental paper. That would move from November 26th to December 3rd, and then Genever would have two weeks, they'd have until the 17th. But it would not meaningfully affect

22 the briefing on summary judgment.

23 24 THE COURT: Okay. Have you talked with, Genever's counsel about that? Or about

MR. O'CONNOR: Talked about everything in the

12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 briefing? The proposed one week move back on briefs, which occurred to me as I was preparing, but everything else is agreed to. THE COURT: Okay. Debtor Good afternoon, Your Honor. Michael McCormack. Yes. We have had discussions with Attorney O'Connor about the extension to complete the outstanding depositions. With respect to the brief, one-week extension for briefing, I don't see an issue with that if Attorney Despins does not, my client. THE COURT: Okay. Yeah. Trustee Despins? MR. DESPINS: No. No. No. No. No issues, Your Honor. Thank you. THE COURT: All right. So then what I need you to do, Attorney O'Connor and Attorney McCormack, is submit a joint, you know, consent order with all that, please? MR. O'CONNOR: Okay, Your Honor. THE COURT: Because I just thought we were very clear, and it's fine. I have no problem doing what you want to do. I just wanted to make sure that this wasn't having some kind of an impact on what was going forward, being, you know, having it be delayed. But if everyone's in agreement, that's fine. So if you can just submit an order to that effect, do you think you can submit an order by this Friday? Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 12 of 117

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13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. O'CONNOR: I'm sure we can, Your Honor. I will -- I'll take the first stab, and I'll send it to Mr. McCormack no later than tomorrow. THE COURT: Okay. All right. Then unless I'm missing something, which is possible, I think that does address all the issues I wanted to address in the status conference in this adversary proceeding. But obviously, if anyone else wishes to be heard -- meaning Attorney O'Connor, Attorney McCormack, or Trustee Despins -- on any other issues in the adversary proceeding, you're welcome to raise them now. MR. O'CONNOR: Nothing from AIG, Your Honor. Thank you. THE COURT: Thank you. MR. MCCORMACK: Nothing from me, Your Honor, Attorney McCormack, at the time. THE COURT: Thank you. All right. Well, then I think that concludes the status conference in the AIG adversary proceeding, and they -- the parties will submit a joint, or a consent order, whatever you want to call it, modifying the scheduling order by on or before November 22nd. Okay? MR. O'CONNOR: Yes, Your Honor. Thank you. MR. MCCORMACK: Thank you, Your Honor. THE COURT: All right. Thank you both. And

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| 1 | obviously, you're welcome to leave. You don't have to stay | |----|----------------------------------------------------------------| | 2 | unless you would like to. That's up to you. | | 3 | MR. O'CONNOR: Thank you, Your Honor. | | 4 | THE COURT: All right. Thank you. | | 5 | MR. DESPINS: So, Your Honor, with your | | 6 | permission, we would like to move on to the RICO status | | 7 | conference. By the way, if I could ask everyone that's not | | 8 | speaking on these things to go -- to turn down their cameras. | | 9 | I think it makes it easier for everyone in the court to see | | 10 | exactly who's addressing the Court. But I think Mr. Bassett | | 11 | will handle the RICO status conference if that's okay, Your | | 12 | Honor. | | 13 | THE COURT: That's fine. Thank you. | | 14 | MR. BASSETT: Good afternoon, Your Honor. Again, | | 15 | Nick Bassett from Paul Hastings on behalf of the Chapter 11 | | 16 | Trustee. | | 17 | Your Honor, we were last before the Court on, I | | 18 | believe, October 15th, for a status conference in the civil | | 19 | RICO adversary proceeding, which I believe is 24-5273. At | | 20 | that hearing, as the Court will recall, we requested that the | | 21 | Court enter an order staying the civil RICO adversary | | 22 | proceeding pending developments and ultimately the outcome of | | 23 | the omnibus alter ego adversary proceeding, the basis for | | 24 | that request being that there is substantial overlap in | | 25 | parties and that all -- and that legal theories in the two | | | |

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adversary proceedings are asserted in the alternative.

2 3 4 5 6 7 It's the Trustee's view that developments in the omnibus alter ego adversary proceeding could significantly limit and/or focus what would ultimately need to be litigated in the civil RICO adversary proceeding. And for that reason, we think a stay makes good sense for the parties and for the Court.

8 9 10 11 12 13 14 At that last status conference, a few of the defendants appeared. Based on my review of the transcript and recollection, there were, I think, ultimately, maybe three defendants who actually were continuing to oppose any stay of the litigation. Those defendants are -- it was Victor Cerda, whose counsel is on the line. And I'm getting the other names in a moment, Your Honor. My apologies.

15 16 17 18 19 20 21 22 It was counsel it was Victor Cerda, Your Honor, Defendant Gladys Chow, and Defendant Beile Li. We have had discussions with their counsel since the last hearing, and I believe we have resolved their objection to this day. I'll describe how we've done that in a moment. And with that objection being -- with those objections being resolved, I think there is no longer any party opposing the Trustee's requested stay.

23 24 25 Now, the way we had resolved the objection, as the Court may recall, those defendants had asserted that at the last hearing that they wanted to have the opportunity to be

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1 2 3 4 5 heard on their motions to dismiss. They explained that they thought the Trustee should file an amended complaint, and one of the reasons they opposed the stay is because they said they didn't want -- that it was harmful for them to have the complaint pending.

6 7 8 9 10 Well, what we've done to resolve that, Your Honor, is we have agreed with those defendants, to enter into a stipulation that will dismiss the Trustee's claims against them without prejudice. And to be very clear, the reason we are doing this is because it simply preserves the status quo.

11 12 13 14 15 We are dismissing the claims without prejudice to our ability to add them back in to the adversary proceeding in an amended complaint, which, as we've described previously, the Trustee does, in fact, intend to file once this adversary proceeding moves forward.

16 17 18 19 20 21 And the Defendants, in exchange, have agreed that they will not raise any statue of limitations or other timebased defenses as a result of the Defendants having been temporarily dismissed from the complaint and then added back in, which we fully expect will be the case when the Trustee refiles.

22 23 24 25 So, basically, it will, you know, result in those three Defendants no longer being a part of the case in the interim. But if and when the Trustee amends and decides to add them back in, he can do that, and they have agreed to

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1 2 3 not, you know, argue that the Trustee is unable to do that based on the statute of limitations or other similar defenses.

4 5 6 7 8 We have a stipulation that we've agreed upon with those Defendants, that we are prepared to submit to the Court today. Subject to having done that, as I said, I believe there is no longer any opposition to the Trustee's request to stay the adversary proceeding.

9 10 11 12 THE COURT: Okay. I understand what you're saying. And so and I'll obviously hear from any of the Defendants' counsels who wish to be heard. But my question, Attorney Bassett, is just logistics, I suppose.

13 14 15 16 17 18 19 So the stipulation that you're talking about that you're going to present to the Court, that will dismiss the specific Defendants from the adversary proceeding without prejudice when you file an amended complaint to add them back in. You're going to submit that to the Court, and then after that enters, then an order enter -- staying the adversary proceeding would enter? Is that how you would --

20 21 22 MR. BASSETT: That's -- yes, Your Honor. That's how I envision the sequencing, and I believe we still owe the Court a proposed order staying the adversary --

23 24 25 THE COURT: On the stay. Right. Right. Okay. All right. That's what -- that's what I thought you were - you meant, so that's good that I've understood what you said.

18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 So thank you. Do any of the Defendants' counsel wish to be heard with regard to the comments and agreements that Attorney Bassett has noted on the record? Okay. Well, then that's fine. And I think that's -- MR. NEALON: Excuse me, Your Honor. I'm sorry. I was on mute. THE COURT: That's okay. MR. NEALON: James Nealon for Defendant Yongbing Zhang. THE COURT: Yes. MR. NEALON: You know, I think it's fine that three of the defendants entered into this stipulation, but I think there are 57 other defendants. And the same stipulation or arrangement should, in theory, be open to them. THE COURT: Well, if they didn't object initially, Attorney Nealon, when they had the opportunity to do so and they were unnoticed, then I don't agree with you. MR. NEALON: Okay. Well, the other thing is I think that the Trustee should actually file a motion to stay with the proposed order. THE COURT: I think he -- I think he's already filed the motion to stay, hasn't he? MR. BASSETT: Your Honor, I believe the way that Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 18 of 117

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1 2 3 4 5 6 7 this transpired was the Court had requested a status conference on both the civil RICO and the omnibus alter ego adversary proceedings on October 15th. At that conference, we made an oral request on the motion to stay. Obviously, that conference was on notice to all the Defendants. So there has not been, I don't believe, a formal written motion filed.

8 9 10 11 We are happy to give -- you know, to upload a proposed order on the docket and give parties the opportunity to, you know, respond or comment on it if the Court would like, but there's not been an actual written motion filed.

12 13 14 15 16 17 MR. NEALON: Well, Your Honor, there's potential moving parts that were discussed, none of which were run to ground at the last status conference. Was there going to be a stay? What was going to happen with the defaulting Defendants? When would an amended complaint be filed. And that's why I think all of that should be put into a motion.

18 19 20 21 It could be heard on an expedited basis. Attorney Bassett could attach his order. But there were some elements or concepts that were being thrown around that were problematic.

22 23 24 25 THE COURT: Well, I don't think you would -- I don't think it's fair to say that they were being thrown around. It's the status conference on the adversary proceeding. All of the Defendants were made aware of it.

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1 2 3 4 5 6 I'm not going to have every issue be heard seven times to make sure that every Defendant asserts whatever rights they feel they have. They had an opportunity to be at a -- at a status conference. You were there. Your client was there, and I'm not going to accept other Defendants making arguments on behalf of other Defendants.

7 8 9 10 11 So that's -- so just so that's clear, I don't think it's fair to say that it was thrown around. It was a status conference on an adversary proceeding in which all the claims are submitted in an -- in a complaint. Everybody's on notice as to what the claims are.

12 13 14 15 16 MR. NEALON: Right. Your Honor, respectfully, Attorney Bassett laid out for the 1st time at that hearing a whole bunch of different ideas about how the stay could work, some of which had not been raised previously. And there's questions about at least the legality of part of those.

17 18 19 20 21 For example, one of the concepts was you could sever off the defaulting Defendants and somehow put them into a separate action or adversary proceeding, and that's contrary to Supreme Court precedent. That came up for the first time at that conference.

22 23 24 25 So my only point is -- and I understand what Your Honor is saying is this should be put in a motion and parties should have a chance to weigh in on it, whatever the final form of order is.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Your Honor, I believe counsel may actually be confusing the two adversary proceedings. The Court already entered an order severing Defendants from the omnibus alter ego adversary proceeding. That has already happened. So that's done, over with. The only issue that we raised at the last hearing with respect to the civil RICO litigation was a request to stay the litigation. I don't believe there were any permutations on that. It was simply a request to stay. THE COURT: Right. MR. NEALON: Okay. I'll accept that representation, Your Honor. But there was also some discussion that the Trustee was giving thought as to what they were going to propose on an amended complaint. THE COURT: Well, exactly. But they haven't amended their complaint yet. And so when they amend their complaint, you can act accordingly under the Federal Rules of Civil Procedure. Correct? MR. NEALON: Right, Your Honor. Based on Attorney Bassett's representation, I withdraw my objection. THE COURT: Okay. Thank you. MR. HA: Your Honor, if I may, at the last conference, on behalf of the Rule of Law Foundation 3 and the Rule of Law Society 4, Inc., I did reserve our right to object to the stay after consulting with my clients and to

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 object on the same substantially the same grounds as raised by the other Defendants who objected. And on that basis, Your Honor, we would also request the same situation that the Trustee's counsel is extending to those objecting Defendants and have our clients dismissed without prejudice as well. THE COURT: Sorry. Did you have any discussions with Attorney Bassett about that, counsel? Rule of Law Foundation 3 and the Rule of Law Society 4, Inc: We haven't discussed that, Your Honor. THE COURT: Okay. MR. BASSETT: Your Honor, to the extent to the extent that the Rule of Law Foundation entities had a continuing objection to the motion, I think it was very clear on the record at the last status conference that the parties were to meet and confer. We did that with the two parties who had indicated clearly to us that they were objecting. And therefore, we had to meet and confer with them to see if those objections could be resolved. We did not have any reason to meet and confer with the Rule of Law entities. If they had decided they were going to press their objection, they obviously could have reached out to us. But we're not, you know, we're not agreeing to -- the Trustee is not in a position to agree to dismiss all of these entities from the complaint.

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We've done that on a case by case basis to resolve objections that were asserted. But again, we could have met and conferred about this in advance of today, but that didn't happen. We didn't receive any communication from counsel.

5 6 7 8 MR. HA: Well, Judge, I mean, we stand in the same position as to those other objecting Defendants. So I mean, it's for the same reasons, the same grounds we're dismissing those. I mean, it would apply to us.

9 10 11 12 13 14 15 16 MR. BASSETT: The other thing I would note, Your Honor, is that the other three people who have raised this issue, and which the Trustee was willing to talk to them about, was the fact that they had asserted that there was a long stay as entity or as individuals who, you know, have professional reputations, et cetera. They had expressed to us that, you know, they may incur some form of hardship in the event that this complaint remain pending against them.

17 18 19 20 21 22 23 24 25 We don't agree with that. But in in response to that concern, we worked out an arrangement that ultimately preserves everybody's rights and works for all involved. I don't think the same issue at all applies to the Rule of Law entities. These are parties that are, you know, components of the Debtor's fraudulent activities. I believe their websites have been shut down. I mean, they're not -- they're not individuals who have a reputation to protect. It's just not -- it's apples and oranges.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. HA: But we strongly disagree with that, Your Honor. Those are allegations. The Rule of Law entities are nonprofit organizations. They continue to operate, and they continue to raise funds, and having this complaint is extremely prejudicial. THE COURT: But weren't you involved in the last status conference, counsel? You were there? MR. HA: I was, Your Honor. THE COURT: Okay. So why didn't you reach out to Attorney Bassett or somebody else? I don't mean it necessarily has to be Attorney Bassett, but the Trustee or his counsel. MR. HA: I was discuss -- I was in discussion with my client about the issue and what to do. And -- THE COURT: I think you even made a statement that you wanted to discuss it with your client on the record. It's my recollection. I could be wrong, though. I don't have the transcript in front of me. But I could be wrong. MR. HA: That's -- yes. That's my recollection as well. THE COURT: Okay. MR. HA: I think I do have the right to object after consulting with my client, Your Honor. THE COURT: Right. But you didn't object. You and you didn't tell Attorney Bassett or anybody, the

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Trustee's counsel, what you -- how you consulted with your client. Right? You didn't say anything before today. MR. HA: Correct, Your Honor. Correct. I have not spoken to Attorney Bassett. THE COURT: Okay. Well, I'll think about it then. I mean, the long story short is we had a conference. These issues were raised. Defendants, including you, counsel, raised concerns about the stay. And the -- at the conclusion of that conference, we continued the hearings of today, the conference of today, and that the Trustee and the Defendants were to discuss the Trustee's proposal to stay. You didn't have that conversation, apparently, but other Defendants did. The Trustee's counsel has agreed to enter into stipulation, and I guess you can try to talk about that with Attorney Bassett after the status conference. But as I said to Attorney Nealon, you know, I'm not going to have Defendants raise issues for other Defendants and/or if they have issues that they want to raise, then they have to raise them, and they have to deal with them. So at this point in time, what I'm going to do is have the parties who have agreed with the Trustee's counsel about dismissal with prejudice -- without prejudice, excuse me -- to have that stipulation submitted, and then you can talk with Attorney Bassett and/or whomever else, you know,

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Trustee or the Trustee's counsel, about what position they may take with regard to you. But at this point, I'm not going to have any more discussion about it today. It is what it is, and you'll see where things stand. Okay? MR. HA: Understood, Your Honor. Thank you. THE COURT: All right. Thank you. So Attorney Bassett, when do you believe you'll be submitting this stipulation? MR. BASSETT: I believe we could do that later today, Your Honor. THE COURT: Okay. I'm not sure we're going to get to it today, but that's fine. MR. KINDSETH: Your Honor, can I be heard with respect to the proposed order? THE COURT: What proposed order? MR. KINDSETH: For the stay. My clients are not opposing the stay, generally, but we would like, as Attorney Bassett had stated on the record, to have the opportunity to just review and comment upon the form of the proposed order. THE COURT: I think that's what Attorney Bassett said. Right? He's going to be submitting some form of an order. So we'll -- all right. So let's figure out the logistics with regard to that, Attorney Bassett. MR. KINDSETH: Sure, Your Honor. MR. NEALON: And Your Honor, if I could just

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 clarify on behalf of Mr. Zhang, we're not opposing a stay. That really wasn't the basis for me to raise it. It was only a question about what the fine print of that stay would include. So just want to clarify that. We don't have an objection to a stay of the RICO case. THE COURT: Okay. Thank you. Did I lose all of you or are you still there? MR. BASSETT: No, we're here, Your Honor. THE COURT: It must be me. MR. BASSETT: So, Your Honor, I think, as I said, we should be able to submit the stipulation that we've reached with three of the Defendants by the end of the day today, and then, we could follow that with a proposed order that we could submit, I would say, certainly, by the end of the week. And I think, you know, we could do whatever Your Honor would like. We could file that proposed order on the docket. We could submit it to chambers, copying counsel, on the -- on the conference today. Happy to proceed it however the Court would like. THE COURT: Well, I think we have to set up a way for people to be able to respond to the order staying the adversary proceeding. And I suppose what would be the best thing to do is to -- well, I'm not sure. My thought process is to docket the order in this adversary proceeding.

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| 1 | Therefore, every Defendant that's already appeared, including | |----|-----------------------------------------------------------------| | 2 | Defendant's counsel that are participating in this status | | 3 | conference, will see the order. And then I think you could | | 4 | say -- you could say notice of filing of proposed order and | | 5 | with an objection deadline, Attorney Bassett. | | 6 | And I would give, depending upon when you have the | | 7 | order filed, I would probably give, you know, 14 days for an | | 8 | objection period. | | 9 | MR. BASSETT: That's fine with the Trustee, Your | | 10 | Honor. | | 11 | THE COURT: Does any of -- do any of the appearing | | 12 | Defendants have an issue with the 14 days for an objection | | 13 | proposed by the Court? | | 14 | MR. NEALON: No issue, Your Honor. Thank you. | | 15 | MALE VOICE: No objection. Okay. | | 16 | THE COURT: All right. So I think that's the way | | 17 | we should proceed in the -- in this adversary proceeding. Is | | 18 | there anything else that we need to address in this adversary | | 19 | proceeding this afternoon? | | 20 | MR. SKLARZ: Your Honor, Jeff Sklarz for G-Club | | 21 | International. I just want to make sure that my silence | | 22 | doesn't mean I don't want to look at the order as well. | | 23 | THE COURT: Are you a defend -- you're a Defendant | | 24 | in this adversary proceeding? | | 25 | MR. SKLARZ: Yes. Yes. | | | |

29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: Then you can look at that order. MR. SKLARZ: Thank you. THE COURT: I thought you were. I'm not suggesting otherwise. I just -- MR. SKLARZ: I don't have to be if Attorney Bassett wants to dismiss the case, but I assume he doesn't. THE COURT: If you're a Defendant in the adversary proceeding, you will see it and you will be -- there'll be an objection deadline set. MR. SKLARZ: Thank you, Your Honor. THE COURT: Okay. Thank you. All right. Is there anything else that we need to address on this adversary proceeding then? MR. BASSETT: I don't believe so, Your Honor. THE COURT: All right. Then a notice of proposed order saying adversary proceeding will be submitted with an objection deadline of 14 days after the submission. MALE VOICE: Thank you, Your Honor. MR. DESPINS: All right. Thank you all. And I think we can move on to the next -- whatever matter, Attorney Despins, you think we should address next. MR. DESPINS: So the next one that should not be too extensive either is the -- that you'll recall that we commenced the alter ego proceeding. We call that alter ego part 1 proceeding in February, and there were a series of Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 29 of 117

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 defaulted parties. One of them was Karen Mastriello (phonetic), and there was, you know, these were severed from the main proceedings so we could deal with the default separately. And there is a resolution with, Ms. Mastriello, and Mr. Bassett will handle this matter, Your Honor. THE COURT: Okay. Thank you. MALE VOICE: I apologize, Your Honor. May I be excused? THE COURT: Oh, of course. Yes. Anyone that is not involved in any other matters may absolutely be excused. Thank you. MALE VOICE: Thank you, Your Honor. Have a good day. THE COURT: You too. MR. BASSETT: So, Your Honor, as the Trustee indicated, today the filing of issue is Docket No. 104 in the omnibus alter ego adversary proceeding, which is adversary proceeding number 24-5318. THE COURT: Yes. MR. BASSETT: As the Trustee indicated, the Trustee has entered into an agreement through discussions with counsel for one of the Defendants, Karen Mastriello, in that adversary proceeding, pursuant to which -- and I guess, by way of background first, Your Honor. It it's alleged in the complaint that Defendant

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1 2 3 4 Mastriello is the nominal sole owner of an entity called Alpha Global Ventures Limited, which is also a Defendant in the alter ego litigation and one of the entities that the Trustee alleges is an alter ego of the Debtor.

5 6 7 8 9 10 11 Counsel for Ms. Mastriello had reached out to us, Your Honor, to see if a resolution of the adversary proceeding was possible. She indicated to her counsel indicated to us that Ms. Mastriello does not believe that she has any interest in that entity, and to the extent that she does, she is willing to relinquish that interest to the Trustee and to the Chapter 11 estate.

12 13 14 15 16 17 18 19 20 So the stipulation that we ended up reaching is simply a stipulation which says that to the extent Ms. Mastriello holds any interest in that entity, for example, to the extent that she is the nominal record shareholder of that entity, which the Trustee has, you know, believes that she is based on documentation the Trustee has obtained, she will relinquish that interest to the Chapter 11 estate and will take whatever actions are reasonably necessary to ensure that ownership of the entity is transferred to the estate.

21 22 23 24 25 And we believe, you know, as far as the Federal Rules of Civil Procedure are concerned, Your Honor, Rule 54 as an example, I mean, there is, in our view, no just reason for delaying entry of this judgment. It's, as the Court knows from, you know, past requests that the Trustee has made

32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 to resolve portions of adversary proceedings, this is very important for the Trustee to -- THE COURT: Right. MR. BASSETT: -- move expeditiously and where he can, you know, obtain orders of ownership over entities so he can proceed accordingly to protect the estate assets. So, happy to answer any questions -- THE COURT: Understood. MR. BASSETT: -- but that's just the background of where we are. THE COURT: I under- -- yeah. Attorney Bassett, I understand completely. And the reason that this was scheduled for a hearing was status conference was just because of the 54(b) issue. Right? We need to say somewhere in that judgment that there's no just reason for delay and that, you know, cite to cases that approved that because I have to make, at least from all of the case law that I have seen and on appeals and issues where there have not been that finding by the Court, that express finding. But there's been a remand and things for the Court to make that express finding under Rule 54(b). So what my point is I think you need to do that in order for the Court to enter the judgment. Otherwise, someone could try to attack it at some point in the future, and we could have an appeal on it. And I do find that under Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 32 of 117

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 the specific facts and circumstances, as you've described with regards to the Defendant Karen Mastriello, that there is no just reason for delay for the entry of a judgment with regard to that specific Defendant. And I think that the rules support that finding, but I -- but the judgment itself, and the order granting the judgment has to say that. Otherwise, we could have issues in the future that none of us would want to spend any time on. MR. BASSETT: Understood, Your Honor. And we should have anticipated as much. We will certainly submit a revised proposed order that includes that language. THE COURT: Okay. Thank you. That would be very helpful. So how much time, again, Attorney Bassett, you can have as much time as you would like. I just do this -- we do this for the -- it's helpful for the clerk's office to be able to track things if we have a date by which a revised proposed order will be submitted. MR. BASSETT: Certainly, Your Honor. By the end of the week would be more of a time. THE COURT: Thank you. Then I'll note that the revised proposed order will be submitted on or before November 22nd.

23 24 MR. KINDSETH: Your Honor, I'd like to make a very brief statement, with respect to this matter.

THE COURT: You don't represent the Defendant

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1 though, Attorney Kindseth.

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. KINDSETH: It's -- very briefly and it's really just a courtesy to the Court. And just to alert, and I've already alerted the Trustee and just to make sure not in the future accused of sitting on our hands, Ms. Mei Guo believes adamantly that she is the sole shareholder of Alpha Global Ventures. We're not seeking any relief here, we're not objecting, we're not -- we just felt as a courtesy to the Court, it should put on the record. And just so Your Honor knows -- THE COURT: What information does your client have to support that belief? MR. KINDSETH: Well, we've requested records from BBI, the corporate body. And we've also requested records from the Trustee, and we're going to be looking into it further. Again, we're not seeking any relief now. We're not in a specific case -- THE COURT: What records would you be seeking from the -- you mean Trustee Despins? MR. KINDSETH: Yeah. As to what records he's relying upon to establish that Ms. Mastriello, who actually does not believe she is the sole shareholder, is, in fact, the sole shareholder, which was the basis for the allegation in the complaint. There's no allegation against Ms. Guo. And again,

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1 2 3 4 5 6 Your Honor, I'm not -- we're not interfering. We're just -- I don't want to be accused of not advising the Court of such an issue. We intend to gather what information we can, provide it to the Trustee, find out what information the Trustee has to establish the ownership of Alpha Global, and then we'll take whatever action we feel is appropriate.

7 8 9 10 11 But I don't want -- I just didn't want to be accused of sitting on my hands. And so we're just advising the Court that Ms. Mei Guo adamantly believes she's the sole shareholder and that Ms. Mastriello is not the sole shareholder of Alpha Global.

12 13 14 15 MR. BASSETT: Your Honor, we had the, exact same questions as the Court. You know, to the extent that Ms. Guo believes she is the owner of this entity and has evidence to support that position, we are happy to see it.

16 17 18 19 20 21 22 23 24 25 As far as any request for information from the Trustee as to the Trustee's allegations in the complaint, I don't see any basis for that request. As it stands, as far as I'm concerned, Ms. Guo has no standing to contest claims that we have asserted against other parties. The stipulation that we are asking the Court to enter is only going to resolve the claims as to Ms. Mastriello. It's not going to prejudice Ms. Guo. Again, she has evidence she owns the entity, happy to see it from Attorney Kindseth, and we can go from there.

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| 1 | MR. KINDSETH: Your Honor, we agree. We don't | |----|----------------------------------------------------------------| | 2 | have any standing to oppose claims against other parties. | | 3 | We're not trying to interfere. It really is just both a | | 4 | courtesy to the Court and to avoid an accusation that we | | 5 | should have brought it to the Court's attention sooner. And | | 6 | we will file whatever is necessary in the future should I be | | 7 | able to gather the documentation necessary to prove the | | 8 | ownership interest. | | 9 | THE COURT: Okay. Thank you. | | 10 | MR. KINDSETH: Thank you, Judge, for hearing me. | | 11 | THE COURT: All right. Then I think with regard | | 12 | to adversary 24-05318, we've done all we can do in that | | 13 | matter today. Is that correct, Attorney Bassett? | | 14 | MR. BASSETT: That's correct, Your Honor. | | 15 | THE COURT: All right. So then the only thing | | 16 | left on the calendar today, if I'm correct, is the motion for | | 17 | summary judgment in the Taurus Fund adversary and then the | | 18 | motion for default judgment in the Cirrus Design Corporation | | 19 | adversary. Is that correct? | | 20 | MR. DESPINS: That's correct, Your Honor. And we | | 21 | would propose to go to the Cirrus matter. Mr. Linsey would | | 22 | handle because it should be shorter. | | 23 | MALE VOICE: Your Honor, may I be excused? I'm | | 24 | not -- | | 25 | THE COURT: Yes. Yes. You may. Thank you. | | | |

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37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MALE VOICE: Thank you, Judge. MR. HA: And may I be excused as well, Your Honor? THE COURT: Absolutely. Anybody that is not involved in any other matters. I did say that at the beginning, but I should have said it again. You're absolutely welcome to leave, when your matter is resolved. Thank you. MR. HA: Thank you, Judge. MR. LINSEY: Thank you, Your Honor. For the record, Patrick Linsey for the Chapter 11 Trustee. This is on an adversary proceeding that the Trustee commenced against Cirrus Design Corporation and Qiang Guo on February 14, 2024. The only one of the Trustee's five claims in the adversary proceeding is at issue. The first four claims are fraudulent transfer claims, actual and constructive fraudulent transfer claims against Cirrus under Section 548 of the Bankruptcy Code and applicable state law. The fifth claim is the claim issue in the motion for default judgment. That is the claim the Trustee has asserted against Qiang Guo to recover the value of the transfers from Qiang Guo because he is the party for whose benefit the transfers were made. That claim was brought pursuant to Section 550(a)(1) of the Bankruptcy Code. The clerk issued a summons on February 24th. And

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 on March 21st, 2024, the Trustee caused Qiang Guo to be served via Federal Express at his address in London, England. Pursuant to the summons and the procedures governing avoidance actions, Qiang Guo had a deadline of May 20, 2024, to respond to the complaint. He did not respond to the complaint by the deadline, and he's not responded to the complaint since. On September 17th, 2024, the Trustee requested entry of default against Qiang Guo, and the clerk entered that default on September 23, 2024. On October 28, the Trustee filed this motion. I will briefly describe the factual allegations in the complaint, which in the posture of a motion for default judgment are taken as proved. As discussed in the complaint and the Trustee's memorandum of law, the complaint involves transfers to Cirrus Design Corporation by the Debtor via Lamp Capital LLC, HCHK Technologies, and Leading Shine, New York. As to the first two of those entities, Lamp Capital and HCHK Technologies, the Court has already entered judgments determining that these were among the Debtor's alter egos. As to Leading Shine New York, the Trustee has a pending summary judgment motion to establish that. And the Trustee has incorporated by reference his claims for that declaratory relief into his complaint against Qiang Guo -- Cirrus and Qiang Guo.

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1 2 3 4 5 6 The complaint describes five transfers totaling approximately \$3.9 million made between September 2019 and the petition date. All of these transfers fall within the lookback period under applicable state law, that's New York law. All but one of them fall within the two-year lookback period under Section 548 of the Bankruptcy Code.

7 8 9 10 11 The Debtor's fraudulent intent in connection with these transfers is readily apparent based on facts discussed in the complaint. Those include that the transfers were effectuated by the Debtor's alter ego shell companies, which -- and operated as part of the Debtor's shell game.

12 13 14 15 16 The Debtor organized his financial affairs as a shell game for the purpose of concealing and dissipating millions of dollars of assets in order to live like a billionaire and allow his family to live like billionaires while creating poverty to his creditors.

17 18 19 20 21 22 The assets the Debtor concealed and dissipated included funds that the Debtor obtained from the victims of his cryptocurrency securities and other fraudulent sweepings. And the Debtor knew that by concealing and dissipating his assets in this manner, there would not be sufficient assets remaining to pay his creditors.

23 24 25 In particular here, Qiang Guo, the Debtor's son, is a close family member, an insider of the Debtor, and participated in many of the Debtor's fraudulent schemes. At

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1 2 3 4 the time of the transfers, the Debtor was facing significant creditor claims, including, among others, by tax. These transfers, it's further discussed in the complaint and in our memorandum of law, were made for the benefit of Qiang Guo.

5 6 7 8 9 10 11 12 As the Court is well aware, Qiang Guo is the Debtor's son, who's played a critical role in the Debtor's shell game. The Court has already determined that Qiang Guo received other direct fraudulent transfers from the Debtor. Qiang Guo was also involved in efforts to -- attempts to falsely claim an interest in the Debtor's apartment at the Sherry-Netherland Hotel in Manhattan, and in similar efforts involving an apartment in London.

13 14 15 16 17 18 19 20 Specifically, the transfers at issue here funded the purchase of two aircraft from Cirrus Design Corporation, an SR 22 propeller aircraft, and an SS 50 single-engine, personal, private jet. The value of those transfers went to Qiang Guo. Qiang Guo was the one, not the Debtor, who enjoyed the use of those aircraft, after the aircraft were delivered. And as mentioned, the Debtor received no consideration for the transfers.

21 22 23 24 25 The Trustee explained in the memorandum of law that the motion is intended to be solely seeking relief as to Qiang Guo and not relief with respect to Cirrus Design Corporation. After the Trustee filed the motion, counsel for Cirrus contacted the Trustee and requested that the Trustee

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1 2 3 4 5 6 add language to the proposed order, making, I guess, further formalizing that fact. And the Trustee has filed a revised form of order under the docket, which is at Docket No. 27 of this adversary proceeding. And that adds language to paragraph 13, which language has been agreed upon with Cirrus.

7 8 9 10 11 12 The Trustee's memorandum of law also addresses by final judgment should enter under 54(b) solely as to the Trustee's claim against Qiang Guo. Entry of judgment on this claim will benefit the estate so that the Trustee may take steps to seek to enforce the judgment against Qiang Guo before he further dissipates assets.

13 14 15 16 17 18 19 As the Court is aware, Qiang Guo is abroad, is possessed of substantial resources and ability to dissipate assets and to endeavor to frustrate the Trustee's claims. As the Trustee has further advised the Court, the Trustee is involved in litigation abroad and obtaining judgment against Qiang Guo will bolster the Trustee's efforts to protect the estate's interests abroad.

20 21 With that, I'm happy to answer any questions the Court may have.

22 23 24 25 THE COURT: I'm looking at your -- thank you. I'm looking at your revised proposed order, and I don't see any reference to Rule 54(b) in the revised proposed order. I know you said -- you recited some issues about 54(b), but

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1 2 3 maybe I'm missing something. But obviously, this is only a judgment against one defendant and one count of the complaint.

4 5 6 7 8 9 10 So, I think we need to -- I don't know what language necessarily because I didn't compare what Cirrus asked you to add to this revised proposed order, but that's fine. Whatever you've agreed to with them is fine. But I don't see any language about Rule 54(b) and that there's no just cause for delay in connection with this matter, and I do think we need that.

11 12 13 14 I mean, I'm not -- regardless of what I think, I'm going to insist that on it because, otherwise, this judgment could be, you know, appealed and said that I was -- it was an improper entry of a judgment without that express finding.

15 16 17 MR. LINSEY: Understood, Your Honor. So the answer to the one issue, the language that was added that was agreed upon with Cirrus was --

18 THE COURT: Paragraph 6?

19 20 MR. LINSEY: Paragraph -- it's paragraph 13. THE COURT: Oh.

21 22 23 24 25 MR. LINSEY: And it's the final sentence of the revised paragraph 13, which is the Trustee will not use this order or any other order on the motion, whether as law of the case or otherwise against Cirrus or against the other -- THE COURT: Yeah. That's paragraph 6 in the

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 proposed order I'm looking at anyway. Are you looking at the motion? Or I'm looking at a proposed order, revised proposed order that I think is what I should be looking at, 27? MR. LINSEY: Oh, that's correct, Your Honor. I apologize. So we filed the -- we filed the revised order and we filed a red line together with it. THE COURT: Oh, I see. I'm looking at the red line. Yeah. MR. LINSEY: Well, yeah. It it's less helpful than it should be, Your Honor, because for some reason, where the numbering of the decretal paragraph picks up in the red line -- THE COURT: Oh, I see. MR. LINSEY: -- starts where the prior version -- THE COURT: Right. Right. MR. LINSEY: -- writes off. Which is why I'm saying -- we're looking at the same paragraph. Just the red line version. THE COURT: Okay. Okay. MR. LINSEY: So in any event, we would -- we would appreciate the opportunity to file or provide the Court with a revised order, and we'll use language that is in keeping with the other orders where the Court has entered final judgment on less than all of the claims at issue in the adversary proceeding.

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1 2 3 MR. DESPINS: And we cannot be at the same the same language that that was used in the last milestone, the Qiang Guo default judgment.

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: Yeah. It's necessary because otherwise, the whole -- the whole judgment could become - could come undone. And I have found on the record that there is no just reason for delay in connection with this specific claim and other matters with those specific claims as you've recited in your motions and in the motion to expedite the hearing and under the specific facts and circumstances of the case. So that's fine. You can submit a revised proposed order. And I do see the language that you've added that with Cirrus's request, so that's fine as well. MR. LINSEY: We will submit that by the end of the week, Your Honor. THE COURT: All right. Just give me one moment, please. So then -- I'm just -- I'm sorry. Just a little delayed here. Just give me a second. MR. LINSEY: I hope Your Honor feels better. THE COURT: I do too, but thank you. Here we go. I'm just -- I don't know why I'm just a little delayed. In any event -- oh, I got -- I'm just having a little computer problem. If you just bear with me for a second. Okay. So the motion for default judgment, ECF 23, is granted as against the Defendant Guo, and the -- a revised

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 proposed order will be submitted on or before November 22nd. I'm sorry. That's Friday. November 22nd. So I think that concludes that adversary proceeding that is on the calendar this afternoon as well. MR. LINSEY: That does, Your Honor. One thing I just wanted to mention, Your Honor entered an order approving my firm's fee application. My colleagues at Paul Hastings pointed out there was an arithmetical error in one of the paragraphs of my firm's fee application. If it's all right with Your Honor, we'll send a revised form of order and a red line -- THE COURT: Sure. And just cite to Rule 60 in 9024 that there was some clerical error you discovered, and that's the reason for an amended order. Okay? MR. LINSEY: I just wanted to let the Court know that that will be coming. Thank you, Your Honor. THE COURT: Okay. Thank you. All right. So then we're moving to the Taurus Fund adversary. Is that correct? MR. DESPINS: That's correct, Your Honor. And Mr. Bassett will take the lead. Thank you. THE COURT: Okay. Thank you. MR. BASSETT: May I proceed, Your Honor? THE COURT: Yes. You may. MR. BASSETT: Thank you. Again, for the record,

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Nick Bassett from Paul Hastings on behalf of the Chapter 11 Trustee. Your Honor, one logistical item, I have my colleague Doug Barron, who is on the line at some point, not right at the beginning, I'm going to ask him to share on the screen if he can, some slides that we prepared to help walk through some of the evidence. So I just want to make sure he has the technological capability to do that. THE COURT: Has Mr. Conway seen these slides yet? MR. BASSETT: Yeah. We sent them this morning, Your Honor, and they are -- they do nothing other than highlight for the Court evidence that is already in the record as attachments to our Rule 56 statement and cited it

14 on memorandum of law.

15 16 THE COURT: Okay. I just want to make sure Mr. Conway has seen them.

17 18 19 20 21 22 MR. CONWAY: And Your Honor, Michael Conway of Lazare, Potter, Giacovas & Moyle for the Defendants in this adversary. Yeah. I got them a few hours ago. I've been able to peruse them, somewhat, and they do look like they are a compilation of things that were produced by counsel in the motion for summary judgment.

23 24 25 I will note that I object to every one of these slides on the grounds that every piece of information in them lacks foundation and is -- constitutes hearsay. And so,

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 while I suspect you're going to let them use the slides, I want to make sure the record is clear that we do not consent to their use and we -- nor do we consent to, as you know, any of the exhibits that they produced. So we're not -- they're not part of the record is what I'm saying. They're documents that they wish to be part of the record. They've not been admitted into the record yet. THE COURT: They're not -- they've never been - what's contained in the slides have not been submitted in support of summary judgment? MR. CONWAY: They've been submitted. They've been filed on the record, but they've not been admitted is what I -- it's accepted over objection. MR. BASSETT: Your Honor, they are part of the record on summary judgment. They're submitted with the Trustee's statement of undisputed facts. They are admissible on summary judgment for a variety of reasons. I'm happy to discuss all of that in the context of responding to Attorney Conway's evidentiary objections. I would note that his evidentiary objections are actually waived because, per the local rule, he did not articulate those objections in his opposition to the Trustee's motion for summary judgment, did not provide any basis other than one line in his response to the Trustee's

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 statement of undisputed facts and why he objects to many of the Trustee's exhibits. It's all admissible. Most of the testimony that we're going to introduce in support of summary judgment is testimony under oath in a criminal trial citing case law in paragraph 67 of our motion for summary judgment, the memorandum of law talking about how courts routinely consider sworn testimony from other proceedings, including criminal proceedings on summary judgment, has the exact same effect as a declaration because that testimony under oath could be elicited at trial. Case law is ironclad on that. To the extent that we're citing to exhibits, those are exhibits that were authenticated by evidence in the criminal trial and/or otherwise are admissible because they fall within a hearsay objection. They have been properly authenticated by deposition testimony taken in this adversary proceeding or otherwise. I'm happy to go through as to every document that Attorney Conway wants to talk about as to why they're admissible, but we think there's no question about that. And again, I think the argument over admissibility has been waived anyway. THE COURT: Let me ask you a question, Attorney Bassett. Oh, I'm sorry, Attorney Conway. Let me ask Attorney Bassett a question first, and then I'll hear back

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1 from you.

2 3 4 5 So are you asking the Court -- and I haven't seen whatever your -- you know, these slides yet. Are these just demonstratives, or are you asking them to be admitted as evidence?

6 7 8 9 10 11 12 MR. BASSETT: Your Honor, we're asking them to be considered by the Court on summary judgment. I think there may be some confusion created by Attorney Conway's objection. The slides are simply demonstratives. We are not asking for the slides themselves to be admitted into evidence. They are designed to help aid the Court, in understanding the evidence that we have presented.

13 14 15 16 17 Every single document that is excerpted on these slides has been independently put into the record as part of the Trustee's statement of undisputed facts and/or as an exhibit to one of the declarations that we submitted with that.

18 19 20 21 22 23 24 We followed the exactly correct procedure that is always followed in offering evidence to the Court in support of the motion for summary judgment, which is to submit that evidence as part of the statement of undisputed facts, task the declarations as necessary. And again, in this case, much of it does come from the criminal trial, but that is all information that the Court can and should consider.

But it's all in the record as part of our exhibits

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 submitted to the Court. We're not asking the Court to, separately accept in the evidence the demonstrative. I think it's simply an aid, to help facilitate the argument today. THE COURT: Okay. Thank you. Attorney Conway, I cut you off before. I'm sorry. Go right ahead with what your point is. MR. CONWAY: And yeah, the point that I was going to make is that there were a host of comments made by Attorney Bassett, one of which was that there were documents authenticated in other proceedings. There's only there's only a handful of those, and those we didn't object to, frankly. But the entirety of the 280 or so documents that were produced in this motion were authenticated by Mr. Barron, with the following: attached are a true and correct copy of the following documents. That's the entirety of the authentication in our -- in both in our memorandum where we say we find that these are not authenticated broadly and not -- and they are hearsay, and in the accompanying list of specific objections, we've reserved properly our objections to these documents. Frankly, like I say, with respect to -- even though Mr. Barron didn't actually authenticate anything, we just didn't object to certain things because I know that I was there or one of my partners was there when they were

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1 2 authenticated, and we're not going to make frivolous objections.

3 4 5 6 7 8 9 10 11 So even though they weren't properly presented to Your Honor in this motion, we didn't object to the things that we know could have been properly authenticated. But for the most part, we've got a bunch of information that, you know, there's actually no attempt to offer foundation for it. And just saying it came from a criminal trial is not enough. That's always hearsay, didn't involve us. We didn't have an opportunity to cross examine. We weren't invited to that criminal trial.

12 13 14 15 16 17 18 19 And frankly, even if we had been, none of the information that's been produced was authenticated something that went into evidence at the criminal trial. Not even the transcripts. They're not even certified. So that said, Your Honor, I think we should probably move on to the actual crux of why we're here because I'd anticipate we'd get to objections to evidence, but it's really not the heart of the presentation I think Mr. Bassett wants to make.

20 21 22 23 24 25 MR. BASSETT: Your Honor, let me just briefly respond. Attorney Conway is wrong across the board. First of all, they submitted a 15-page objection to summary judgment that maybe has the word we object to evidence in it. There's absolutely no articulation in that opposition as to the basis for any of these evidentiary objections. We cite

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1 2 3 4 5 the local rule in our reply brief. Any objection that is not articulated in an opposition to the motion for summary judgment is waived. These have absolutely been waived. We've not been put on any notice of these arguments, number one.

6 7 8 9 10 11 12 Number two, all of these documents have been authenticated. I'll give you an example. He says that the exhibits that are attached to the Barron declaration have not been authenticated. That is categorically untrue. We've attached to the Barron declaration things like the criminal trial testimony of the broker who represented the buyer of the Mahwah Mansion.

13 14 15 16 17 18 19 She testified in the criminal trial about, for example, text messages that she sent and received with Aaron Mitchell (phonetic). She authenticated those text messages as part of the criminal trial testimony that we are also offering. That is the exact same thing as submitting a declaration and a sworn testimony where the witness who is able to authenticate the underlying exhibits has done so.

20 21 22 23 24 25 It's no different than if we had the broker submit a declaration to the Court attaching those documents that is all in the record. We cited case law in paragraph 67 of our motion for summary judgment talking about how courts routinely consider sworn testimony from other proceedings. That's exactly what we've done here. All the exhibits were

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1 2 properly authenticated through that testimony. I think we should just move on, Your Honor.

3 4 5 THE COURT: All right. Well, why don't you proceed, and we will see where we stand after each party makes their respective arguments.

MR. CONWAY: Thank you, Your Honor.

7 8 9 10 11 12 13 14 MR. BASSETT: So, just to just to level set, obviously, Your Honor, in this adversary proceeding, we are here on the Trustee's motion for summary judgment that the Chapter 11 estate is the beneficial owner, reference for the Debtor having been the beneficial owner, of the property known as the Mahwah Mansion. We also seek summary judgment on our claim that Defendant Taurus Fund LLC, which as the nominal owner of the mansion, is the Debtor's alter ego.

15 16 17 18 19 20 21 22 Now, Your Honor, as the Court is aware, there's a criminal trial this past summer in which the Debtor, Mr. Kwok, was convicted for orchestrating multiple massive fraudulent schemes and leading a criminal racketeering enterprise, all for the purpose of lining his pockets and funding his and his family's over-the-top, extravagant lifestyle. The Court has heard a lot about that. It's very familiar with it.

23 24 25 The Court may not know is that a major focal point of the Government's case in the criminal trial was showing how Mr. Kwok directed monies within his controls to be used

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1 2 3 4 5 6 7 8 to purchase, renovate, and furnish the Mahwah Mansion as a home for his family. The Government spent days on this topic across multiple witnesses and numerous exhibits. By the end of the trial, this evidence convinced a federal jury beyond a reasonable doubt of Mr. Kwok's guilt. Of course, that is a much higher standard than the preponderance of the evidence standard that applies to proceedings before this Court.

9 10 11 12 Now, I want to be clear. The Trustee is not asking Your Honor to find that the guilty verdict in the criminal trial has a binding effect in this adversary proceeding. It does not.

13 14 15 16 17 18 19 20 But what I am asking you to do is to look at the same evidence, which is properly before this Court, that was presented to that jury and more evidence that the Trustee has uncovered in his litigation that the Government didn't even have access to and conclude from that evidence that there cannot possibly be a genuine dispute of material fact that Mr. Kwok beneficially owns the mansion and that Taurus Fund is Mr. Kwok's alter ego.

21 22 23 24 25 I'll get to this in a moment with the slides, Your Honor. The evidence supporting these conclusions is absolutely overwhelming. In fact, I would have a hard time imagining a record more definitive on this issue in a case involving these claims than the one the Trustee has put

1 before the Court.

2 3 4 5 6 Now, to briefly summarize the legal standard, Your Honor, which I won't spend too much time on because I know the Court is very familiar with it from this and other cases, but I do think it is important to briefly recap what is required to defeat summary judgment.

7 8 9 10 11 12 Under Rule 56, Your Honor, a movant who has presented competent evidence supporting his claims is entitled to summary judgment unless the opposing party can show through its own evidence that there is no genuine dispute of material fact -- or sorry. The opposing party has to show that there is a genuine dispute of material fact.

13 14 15 16 17 18 19 And in that standard, Your Honor, the words genuine and material are both critical because what they show is that not just any dispute of fact will suffice to defeat summary judgment. The disputed fact must first be a material one, and what that means according to the case law is that the fact might affect the outcome of the suit under governing law.

20 21 22 If the outcome of the suit under the applicable law would be the same, regardless of whether the fact is true, then the fact is not material.

23 24 25 And in addition, Your Honor, even if the fact is material, in order to defeat summary judgment, the dispute about that fact must also -- must also be genuine. And that

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1 2 3 means, Your Honor, that the evidence must be such that a reasonable jury, a reasonable finder of fact, could return a verdict for the nonmoving party.

4 5 6 7 8 Not just any dispute will suffice. It needs to be one that could genuinely support a decision by the fact finder for the nonmovant. So, again, here, which we'll come back to, the jury found beyond a reasonable doubt that Mr. Kwok was guilty in this criminal trial.

9 10 11 12 13 14 15 16 17 Your Honor, we also have in our papers, and I will not address it at the moment, but the law of governing the substance of the Trustee's claims. In short, under New Jersey law, which we believe applies here, courts will look past nominal title and look at who actually exhibits the characteristics of beneficial ownership and control over an asset. Court system that they quote, will not be concerned with the technicalities of title in bankruptcy when it comes to determining what is property in the estate.

18 19 20 21 22 23 24 25 In addition, Your Honor, I won't spend too much time with it. And by the way, I would just say, too, that, you know, the Court has already applied, you know, similar law or similar jurisdictions to reach conclusions that other property nominally owned by the Debtor's relatives or others close to him is actually property of the estate. The Court did that in the adversary proceeding involving the Debtors from (inaudible), the Lady May adversary proceeding, and of

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1 2 3 course, the adversary proceeding involving the Debtor's home in Greenwich, Connecticut, the Greenwich Land adversary proceeding.

4 5 6 7 8 9 Your Honor, we also have our alter ego claims with respect to the Debtor's ownership and control over Taurus Fund LLC. The law there is similar to that which the Court has applied in other adversary proceedings, including, again, the Greenwich Land adversary proceeding. I won't repeat that in detail again today.

10 11 12 13 14 15 What I would like to do now because, I do think the evidence is critical -- I know from past experience the Court does focus on the evidence on summary judgment -- is walk through it. And I would like, at this point, to see if my colleague, Mr. Barron, could put the slides on the screen. MR. BARRON: And this is Doug Barron, Your Honor.

16 17 18 I have requested the ability to share my screen. Thank you. THE COURT: Certainly. I'm sure the courtroom deputy is working on that right now.

19 20 COURT OFFICER: (Inaudible) he should be able to share right now.

21 22 23 24 25 MR. BASSETT: All right. Thank you for that. So, Your Honor, if the Court will indulge me, there are a large number of slides here. I will not dwell on each one of them. Part of the reason there's a large number of slides is because there is so much evidence of the Debtor's ownership

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 of the mansion. And frankly, Your Honor, it is from really beginning to end all aspects of ownership that one would look to in determining who is the actual beneficial ownership of a property. The evidence that we will go through in a moment shows that Mr. Kwok was intimately involved in every aspect of purchasing the home, renovating the home, and living in the home. Everything that an owner would do with respect to a property, Mr. Kwok did. And to the contrary, there is no evidence that anyone else, including the Defendants, ever took any actions that would be consistent with them and not the Debtor owning the property. If we could please move to the third slide. And by the way, is this large enough on Your Honor's screen for the Court to see? THE COURT: I can see it. Yes. Thank you. MR. BASSETT: Okay. Great. So, Your Honor, what this slide shows, this is sort of the beginning of the process. This is November, approximately, of 2021, early December 2021. There was testimony in the criminal trial from Christine Prostini (phonetic), who is the buy side broker, and also from Amy Buck (phonetic), who is the attorney for the buyer of the property.

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1 2 3 4 5 What this testimony from both of these witnesses shows is that the Debtor's personal counsel within the Court is very familiar reached out to both of them about the Mahwah Mansion to start the process of potentially purchasing the property in December of 2021.

6 7 8 9 10 11 12 13 14 You'll see according to Ms. Prostini's testimony, Mr. Mitchell said he had a client who "wanted to see a couple of homes" including the Crocker Mansion. Again, referring to this property as a home. Amy Buck, the lawyer, said essentially the same. She went on to also refer to Mr. Mitchell's clients as clients who were "like family" to Mr. Mitchell's wife. I don't know about the Court, but I don't think that sounds like a reference to a bunch of G-Club investors.

15 16 17 18 19 20 21 If Mr. Barron could please go to the next slide. This slide, Your Honor, and again, there are references to the exhibits which are attached to the Trustee's statement of undisputed facts, which are before the Court. This is merely summarizing the documents that have already been submitted. Just want that to be very clear, and the exhibit references are on all of the slides.

22 23 24 25 This slide, Your Honor, shows that initially, when Mr. Mitchell reached out about the property, he suggested that Mei Guo, the Debtor's daughter, and her "family trust" were going to be buying the property. No reference to G-

60 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Club, no reference to Hamilton, no reference to other of the entities that now form the basis for the Defendant's story to the contrary. This is also shown in a text message from Mr. Mitchell on the right hand of the page, talking about how the Debtor's daughter initially was the one who was purportedly interested in buying the property. If we go to the next slide, Your Honor, slide 5. This slide talks about the first visit that occurred for the first showing of the property on November 28, 2021. Who attended that showing of the property? Of course, it was Mr. Kwok and his wife. Slide 6, please, Doug. This slide shows that following the first visit, Mr. Kwok through Mr. Mitchell reached out and asked questions about the property, including whether it had any ghosts, other questions that somebody looking to purchase a property for themselves might want to ask. Please go to slide 7, Doug. This slide, Your Honor, shows that in late November of 2021, the Debtor communicated an offer of \$26 million to buy the property. The Debtor himself was the one who came up with this offer. We know this because the Debtor asked his top lieutenant, Ya Li (phonetic), who testified at the criminal trial, to transcribe and translate his voice Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 60 of 117

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memo that he gave to her and have it sent to Mr. Mitchell. That was an exhibit in the criminal trial, and the testimony that we've attached, sworn testimony, the Court has considered on summary judgment, talks about that voice memo, authenticates that voice memo. All of it is admissible and can be considered by the Court.

7 8 9 10 11 12 13 14 Notably, in his transcribed voice memo that was sent to Mr. Mitchell, the Debtor says that the "family fund" will buy the property. And he says that William G, the Debtor's close friend and criminal coconspirator, is the one who should be contacted about it, Your Honor. Family fund, there's no reference to the G-Club. There's no reference to the story the Defendants would now have the Court believe.

Slide 8.

15 16 17 18 19 20 21 22 This slide, Your Honor, shows that after formulating the offer, the Debtor visited the mansion for a second time on December 2nd, 2021. And if you look at these text messages, it's very telling. You have, Mr. Mitchell texting the real estate agent, saying would it be possible for the father to come back to the house tomorrow? And then he talks about how there's -- that how the mother had a concern about the air conditioning.

23 24 25 Your Honor, this is Mr. Kwok visiting a project, visiting a property that he wanted to purchase, and it's Mr. Kwok's wife asking questions about the air conditioning,

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1 2 something that somebody who is going to live in that house would want to ask.

3 4 5 6 And the testimony from Ms. Prostini at the criminal trial on the right hand side of the page describes who she understood the buyers to be, the father of Ms. Guo and the mother, his wife.

The next page, please.

8 9 10 11 12 13 This slide, Your Honor, is more testimony from Ms. Prostini at the criminal trial, talking about what happened at the second visit on December 2nd. During that visit, Mr. Kwok and his wife went through every room in the house. Again, the behavior of somebody looking to buy a home for themselves.

Next slide, please.

15 16 17 18 19 20 21 22 23 24 25 Your Honor, this is, another excerpt from the voice memo that we discussed previously, which it's, I think, the same excerpt but it shows that the Debtor, not only did he send the offer memo to Mr. Mitchell communicating his \$26 million offer price, but on the right hand side of the page, you see that on December 3rd, 2021, Mr. Mitchell sent a letter to the seller formally conveying that offer. It's the exact same offer. The \$26 million offer that the Debtor relayed was the one that Mr. Mitchell sent to the seller. Again, the Debtor controlling every aspect of the process. On the next page, slide 11, we see that Mr.

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1 2 3 4 5 6 7 Mitchell begins texting the real estate agent, asking for copies of the floor plans for the mansion, saying that they, referring to the buyers, were focused on getting it ready for their case. She then said in the next -- in a subsequent text message on the left hand side of the page at the bottom that Mei and the mother really want to see them, referring to the floor plans.

8 9 10 11 12 Again, it is obvious to anyone who the buyer of this property is going to be. And sure enough, on the right hand side of the page, Ms. Prostini, the real estate agent who interacted with the buyers, said that the buyers were, "the Guo family" at the bottom of the page.

13 14 15 16 17 18 19 20 21 The next slide, Your Honor, I won't belabor the details, but what this shows, these are, again, exhibits authenticated and entered into evidence at the criminal trial, is that the Debtor's assistant, Gladys Chow, who has an email address of HGHK Technologies, which, of course, is one of the Debtor's alter egos, sent floor plans to the real estate agent, to the real estate broker, highlighting certain things that she would like to have done, including, rearranging certain rooms.

22 23 24 25 And there's a corresponding invoice from a design firm which talks about creating a wing for the son on the 3rd level and a wing for the daughter also on the 3rd level. That's at the bottom of the page. Again, Your Honor, from

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 all this evidence, very clear who's going to be living in this house. The next page, page 13. Who else visited the property? The Debtor's criminal coconspirator, agent, and employee, Yvette Wang. As Ms. Prostini testified, she, of course, worked with Mr. Guo. She also visited the property. The next slide, Your Honor. These are the actual documents that were put together by Mr. Mitchell initially identifying Taurus Fund SP as the purchaser of the property. I will get into in a moment how that changed. If you look at page 15, the next slide, there is language from the purchase contract, indicating that the property would be used "as a single-family residential dwelling". We have that highlighted on the page, not as a clubhouse for G-Club members, as Defendants claim. The next slide, Your Honor, is the buyer's affidavit from the transaction. This, again, if you look at the bottom of the page, we have it highlighted, designated as residential property. The next slide, Your Honor, slide 17. This shows testimony from Amy Buck, the lawyer for the buyer at the criminal trial, talking about how at closing, in fact, on the day of closing, an LLC, Taurus Fund LLC, was created to acquire the property. Again, this shows very clearly, Taurus 1 2 3 Fund LLC is an entity that does nothing and never has done anything other than serve as a vehicle to acquire this property for the Debtor.

4 5 6 7 8 9 10 The next slide, Your Honor, corporate formation documents for Taurus Fund LLC shows how it was structured, its two managers in the document on the left, bottom of the page, for Taurus Management LLC and another defendant to the adversary proceeding, and Scott Barnett, also a Defendant. Mr. Barnett, of course, is the Debtor's bodyguard and acknowledged head of security.

11 12 13 Mr. Barnett's signature appears on the formation document, which is also exhibited on the right hand of the page.

14 15 16 17 18 19 Now, interestingly, Your Honor, if you look at slide 19, despite Mr. Barnett's role in signing the documents and serving as a manager of Taurus Fund LLC, he testified at the criminal trial that he basically knew nothing about it. When he was asked if he had a role at Taurus Fund, he said he did not have a role.

20 21 22 23 24 25 He acknowledged that he was a signatory, and then he says, well, he didn't find that out until much later. And on the right hand side of the page, he said they had me down on paper as a manager. And what that amounted to, Your Honor, and how he explained that, as well, and this is the bottom of the right hand side of the page, Mr. Mitchell gave

65

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1 2 3 him paperwork. Mr. Mitchell, the Debtor's personal attorney, well known to the Court, gave him paperwork to sign, and Mr. Barnett simply signed it.

4 5 6 7 8 9 Your Honor, this bears all the hallmarks of the other activity we have seen the Debtor engage in when a company -- when he tries to take assets that are really his and put them in the nominal control of others. He has people like his bodyguard, his wife, his daughter's boyfriend, others, stand in and put their names on documents.

10 11 12 13 14 15 16 The next slide, Your Honor, this is after the home was purchased. Further communications which, again, make crystal clear to anyone that the buyers of the home were, in fact, Mr. Kwok and his family and not G-Club or anyone else. You have Ms. Prostini, the real estate agent, texting Mr. Mitchell, saying that she wants to congratulate the buyers, saying the buyers are so nice and so is their staff.

17 18 19 20 21 22 23 24 25 I want to do -- I want to talk to you about what I can do to thank them. In the last text, she wanted to talk about them, talk about buying them a nice holiday gift, a floral arrangement. And she says, tellingly, she wants to know where to send something, and asking if she could send it to their Connecticut home. Who has a home in Connecticut, Your Honor? Of course, the Debtor. That's the home at Taconic Road that the estate now owns. Testimony from Ms. Prostini on the right hand side of the page refers

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1 definitively to the Debtor as the buyer.

2 3 4 5 6 7 The next slide, Your Honor, and it's hard to imagine something more telling than this. This is testimony of Mr. Barnett from the criminal trial. And again, you can take, you know, all of Attorney Conway's evidentiary objections for what they are worth, which I think is, frankly, nothing.

8 9 10 11 12 13 14 15 But this one is his client testifying at the criminal trial in response to questioning from Mr. Kwok's counsel. Were you surprised when Mr. Guo purchased the property? Referring to the Mahwah Mansion. Yes. What does this show, Your Honor? He didn't even fight the suggestion that Mr. Guo is the one who purchased the property. Everybody knew that. That was baked into the question, and he acknowledged it, didn't question it in his response.

16 17 18 19 20 21 So, Your Honor, next -- to the next slide, we've now sort of summarized evidence, and that's just a portion of the evidence to be clear. All the evidence is discussed in our -- in our papers and then set forth in the statement of undisputed facts, relating to the Debtor's purchase of the property.

22 23 24 25 The next slide, which I'll try to go through, hopefully, relatively quickly, detail how after purchasing the property and while he was still in the process of purchasing it, in fact, the Debtor worked with his assistant

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1 2 3 4 5 to buy furnishings for the property. The documents that are -- the messages that are exhibited on slide 22, these are all text messages, which were authenticated in the criminal trial through testimony that is in the record in support of the Trustee's motion for summary judgment.

6 7 8 9 10 11 12 Mr. Kwok is texting with Gladys Chow, his assistant, talking about all the things that he wanted to buy -- lampshades, custom furniture, et cetera. And in the highlighted text there, he said it's all to be used in New Jersey. Talked about ordering a bed and furnishings for his wife's room and his daughter's room at the bottom of the page.

13 14 15 16 17 18 19 20 21 22 23 The next slide, Your Honor, this actually details testimony from a deposition that occurred in this adversary proceeding in the Bankruptcy Court, where the Trustee deposed the owner of La Belle Modern, which is one of the outlets from which Mr. Kwok bought furnishings for the home. The witness testified that an individual resembling Mr. Kwok came in, acquired pieces for his home, and that that home was located in Mahwah. He confirmed that that picture on the right, which the Court can see based on her experience in this case, is Mr. Kwok. He's the individual who came in and made the purchases.

24 25 On the next slide, Your Honor, slide 24, this is sort of more of the same. I won't go over this in detail,

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1 2 3 4 5 6 7 but it is Gladys Chow, communicating with the owner of La Belle Modern concerning purchases. Gladys Chow is using a Golden Spring address in her signature block, and she is making purchases of these furnishings to go to the Mahwah Mansion. Your Honor, Golden Spring is already an adjudicated alter ego of the Debtor, and the connection there is very clear.

8 9 10 11 The next slide, Your Honor, slide 25. This is an account statement of La Belle Modern, again, showing that Amy Buck's escrow account that was used for furnishings at the mansion was actually used to make purchases.

12 13 14 15 16 17 18 19 20 21 Slide 26, Your Honor, I'm going to go through these fairly quickly. But I would actually ask the Court to focus on these, as well, because they are, in my view, incredibly compelling. These are excerpts from text messages where the Debtor actually attached videos that he sent to Ms. Chow, which he was going through in painstaking detail and marking up the floor plan of the Mahwah Mansion, talking about where he wanted to place his daughter's bathroom, where he wanted to place her bedroom. He marked up a spot for the Debtor's boyfriend's room.

22 23 24 On the next slide, on slide 27, he's marking up where he wants Miles' room, Qiang Guo's room to be, talking about his dressing room.

The next slide, slide 28, this is his wife's wing

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1 2 3 4 of the house, talking about where he wanted her bedroom to be, what he wanted her bathroom -- where he wanted her bathroom to be, et cetera. Again, this is all coming directly from the Debtor.

5 6 7 8 9 10 11 12 The next slide, more of the same, Your Honor. Finally, if you get to slide 30, this is further compelling evidence of the Debtor's ownership, as if what we've seen already were not enough. This is testimony in the bankruptcy case of the -- of an individual with, Pro Memoria, which is a high end design company that does renovations for projects such as this. And as we'll see on the next page, they've done renovations for Mr. Kwok in the past.

13 14 15 16 Over here on page 30, he testified that somebody reached out to him on behalf of Mr. Kwok to do a project in the New York area. And he just testified that it was for a renovation project at the Mahwah Mansion in New Jersey.

17 18 19 20 21 22 23 24 25 He was contacted by Gladys Chow, the Debtor's assistant, to come up with a bid for the project. And when it came time to talk about the project in detail on the right hand side of the page, what did he do? In September, he met -- in September of 2022, he met with the Debtor in his offices in Columbus Circle and discussed the plan in detail. Where else -- where else did he meet with the Debtor? He knows the Debtor at his home at Taconic Road in Greenwich. Again, the Debtor controlling intimately every aspect of the

| | Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 71 of | |---|----------------------------------------------------------------------------------------| | | 117 71 | | 1 | process. | | 2 | The next page, Your Honor, I won't spend too much | | 3 | time on it, but this is demonstrating that this isn't the | | 4 | first time Pro Memoria had worked for Mr. Kwok personally. | | 5 | They also did work on Mr. Kwok's home in Beijing. | | 6 | Slide 32. If it weren't already clear who the | | 7 | client was, who the person controlling the renovation of this | | 8 | home was, here is the offer proposal submitted by -- and this | | 9 | is an exhibit to the deposition transcript. She's | | | authenticated. There's no evidentiary objection whatsoever. | | | This is Pro Memoria is sending the offer to Dear MK, | | | addressing the offers for the renovations to Mr. Kwok | | | himself. | | | And then when you look at the details of the offer | | | of the proposal, does it say anything about a meeting room |

10 11 12 13 14 15 16 17 18 19 20 authenticated. There's no evidentiary objection whatsoever. This is Pro Memoria is sending the offer to Dear MK, addressing the offers for the renovations to Mr. Kwok And then when you look at the details of the offer of the proposal, does it say anything about a meeting room for members of a club? No. It's the daughter's room, the mother's room, the son's room, to the tune of millions of dollars. This is Mr. Kwok and Mr. Kwok alone controlling a renovation of this house so it would suit him and his family as their home.

21 22 23 24 25 If it weren't painfully obvious enough what was going on here, Your Honor, on slide 33, what happens in April of 2023 after the Debtor gets arrested? Pro Memoria reaches out to Gladys Chow, the Debtor's assistant, and says, it is with great regret what happened in Miles Kwok. At this

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point, we can consider definitively the project canceled.

2 3 4 5 Why would the project be canceled if this was a G-Club house? Of course not. It was a house for Mr. Kwok, and when he was arrested, the project no longer needed to go forward.

6 7 8 The next slide, Your Honor, I won't spend time on it because we've covered over and over again more evidence of furnishings for the Debtor's family's rooms in the house.

9 10 11 12 13 14 15 Slide 35, this is Amy Buck testifying at the criminal trial, again, the lawyer, who worked on the purchase, talking about how she used funds from her trust account belonging, ostensibly, to Taurus Fund to purchase, among other items, a \$36,000 mattress, which ultimately went into the daughter's bedroom. Again, more overwhelming evidence of the Debtor's ownership.

16 17 18 19 20 21 22 Scott Barnett, the Defendant in this case at the criminal trial, slide 36. Your Honor, he acknowledged all of this. That Mr. Kwok had a bedroom in the mansion, his wife had a bedroom in the mansion, his son had a bedroom there, his daughter did. Not only did they have bedrooms, they had whole wings. All of that acknowledged by Mr. Barnett in his testimony.

23 24 25 Slide 37, Your Honor. In addition to having orchestrated the purchase process from beginning to end and controlling the renovation and furnishing process from

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1 2 3 beginning to end, Mr. Kwok also directed the flow of funds used to purchase the mansion. On slide 37 here, we have a diagram showing how the funds flowed.

4 5 6 7 8 The funds ultimately were at Crane Advisory Group. They were transferred to an account, a trust account at Mr. Mitchell's law firm, then they flowed through William G's Hamilton entities and ultimately to the recipients of funds on behalf of the sellers of the mansion.

9 10 11 12 Now, the next slide, slide 38, this is Mr. Collette's (phonetic) testimony at the criminal trial. Mr. Collette was a key witness at the criminal trial. All this testimony is admissible, Your Honor, on summary judgment.

13 14 15 16 17 18 What did Mr. Collette say? That Mr. Kwok was the principal. All this testimony shows that Crane was simply an entity that Mr. Kwok used to do his bidding. Mr. Kwok was the boss. When Mr. Collette was hired originally, he met with Yvette Wang, and this is on the right hand side of the page.

19 20 21 22 23 24 And he -- whether he was going to be hired depended upon Mr. Kwok approving him being hired. His offer letter when he was hired was from Saraca Media Group, one of the Debtor's alter egos. Who paid Mr. Collette's salary? Of course, it was Lexington Properties, another adjudged alter ego of the Debtor.

You go to the next page, and the Defendants

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 will -- I'm sure you'll hear from Attorney Conway that all these funds were not Mr. Kwok's funds. What did Mr. Collette say at the criminal trial? On the right hand side of the page, the wires that you received for G-Clubs, Mr. Guo, Mr. Kwok had control over those. Correct? Correct. And if he had control over them, he had a financial -- did you believe he had a financial interest in those wires? Yes. This is Mr. Collette at Crane saying that the Debtor had control over the funds. Further evidence of the Debtor's control over funds at Crane on slide 40. This is a recorded phone call, which is -- which was authenticated as part of testimony, but it's also part of the record on summary judgment. This is Mr. Kwok not just asking, not just demanding, but screaming at the top of his lungs to force Mr. Collette and others to transfer funds to Mr. William G's foundation. That's exactly what he did in this case as well, Your Honor. The next slides I will flip through quickly. It just -- it keeps piling on top of each other. If we need more evidence of the Debtor's use of the Mahwah Mansion as its own, let's look at what we seized from the residence. Again, all these images were authenticated in the criminal trial. That testimony is admissible here. These images are admissible here.

| | Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 75 of | |----|----------------------------------------------------------------------------------------| | | 117 75 | | 1 | You have the Debtor's medication on slide 41. | | 2 | You have a club membership card of the Debtor on | | 3 | slide 42. | | 4 | On slide 43, you have a picture of the Debtor's | | 5 | Brioni suits found in the closet. You have his New York | | 6 | learner's permit. You have a Hong Kong passport. You have | | 7 | the Debtor's Hong Kong ID. | | 8 | On slide 44, you have more of the same, a credit | | 9 | card of the Debtor's wife, the Debtor's Social Security card, | | 10 | health insurance card. | | 11 | Slide 45, you have images of the Debtor's family | | 12 | members, all found in the mansion. | | 13 | Slide 46, pictures of the closets, showing that | | 14 | they're stocked full of clothes, including the Debtor's | | 15 | suits. Obviously, this is not a place that was used as | | 16 | something other than a home for the Debtor and his family. | | 17 | More of the same on page 47. We have, certificate | | 18 | to the Debtor's son concerning his participation in a Ferrari | | 19 | challenge program. You have Legos that were found in one of | | 20 | the rooms, and there's Scott Barnett's -- again, the | | 21 | Defendant's testifying in a criminal trial talking about how | | 22 | much the Debtor's daughter likes Legos and that these were | | 23 | for her. All the indications of what one would do with a | | 24 | home they live in. | | 25 | Slide 48, Your Honor. This is a full list, so I | | | |

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1 2 3 won't go through in detail of what we found in the criminal - - in the mansion when it was raided in connection with the criminal proceedings.

4 5 6 We have on slide 49, a receipt from an antique dealer, talking about certain items that were going to be used for Madame's bed living maid's bedroom.

7 8 9 10 11 12 13 Slide 50, Your Honor. This shows that the Debtor had property moved from his current home, or his -- one of his homes in Greenwich, the Taconic Road property, which is now property of the estate, to the Mahwah Mansion. This is signed by the Defendant, Mr. Barnett. Again, the common thread was Debtor's house. He's moving things from one of his houses to the other.

14 15 16 17 18 19 20 21 22 23 The next few slides, Your Honor, these really go to beyond everything that we've already talked about. What additional indicia are there that the Debtor controlled Taurus Fund LLC and that Taurus Fund LLC was the Debtor's alter ego. Well, the evidence we have with that, Your Honor, is that were all -- there are all kinds of things that Taurus Fund LLC did, and this is just in addition to help the overwhelming evidence of the Debtor actually controlling the mansion and owning the mansion and using Taurus Fund as a novel owner of it.

24 25 In addition to all of that, the Debtor used Taurus Fund to buy items unrelated to the mansion and do other

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1 2 3 4 things for his other alter egos. For example, he caused Taurus Fund to buy a \$130,000 piano and have it shipped to his office on Columbus Circle, care of Gladys Chow. That's on page 51.

5 6 7 8 On page 52, this shows that the Debtor had invoices due to Golden Spring billed to Taurus Fund, for items shipped to Columbus Circle. Again, this is the Debtor using Taurus Fund to fund the Golden Spring expenses.

9 10 11 12 13 14 It gets even worse on slide 53. This is Taurus Fund paying an invoice for plumbing work at the Debtor's home in Connecticut. Now, if correspondence with the Defendants claim it to be, there's absolutely no logical explanation for why making payments to satisfy plumbing invoices for work done at the Taconic Road property.

15 16 17 18 And Your Honor, if we needed any further evidence that Taurus Fund existed for no purpose other than to do the Debtor's bidding, I think we all saw that play out in real time.

19 20 21 22 23 24 On Slide 54, this is an excerpt of the email that the Court has already seen where, shortly after the Debtor was convicted, a representative of Taurus Fund reached out to the security company and said, in light of the verdict in the criminal trial, they were no longer going to fund the expenses of the Mahwah Mansion.

Once Mr. Kwok went down, Taurus Fund no longer had

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1 2 3 a reason to continue existing and no reason to continue maintaining the property. That much is obvious from the correspondence and from everything else that we've seen.

4 5 6 7 8 I'll pause there, Your Honor, and briefly I know I've been going on for a while, but like I said, I appreciate the Court's indulgence, and I think that it is important to really understand just how extensive the evidence is in support of the Trustee's claims.

9 10 11 12 13 And before concluding, I do want to briefly be, you know, more directly responsive to some of the arguments that the Defendants have made in response to the Trustee's motion. And we can keep this -- we can take the slides down for now and just leave it there, I guess.

14 15 16 17 18 19 20 But briefly, Your Honor, you know, the Defendants filed an objection to the motion. The Court, I'm sure, has read it. It's a 15-page objection which, frankly, in my view, barely puts up a fight. And I say that because it does virtually nothing to address the mountain of evidence that we just went through, and there's more, supporting the Debtor's ownership of the mansion.

21 22 23 24 25 The Defendants raised some factual arguments and some legal ones. I'll address the factual ones first and then briefly the legal ones at the end, although I won't spend much time on those because they're standing arguments that the Court has heard before and overruled on multiple

1 occasions.

2 3 4 5 6 7 In terms of their attempts to create a genuine dispute of material fact, Your Honor, the Defendants -- I can't believe they say this, but they make the remarkable contention in their brief that the Trustee "has failed to present any evidence that the Debtor has an interest in the mansion".

8 9 10 11 12 13 The evidence is absolutely overwhelming. And what makes this assertion all the more remarkable is if you actually look at the substance of the Defendant's objection and their response to the Trustee's Rule 56 statement, they dispute virtually none of the Trustee's facts. They simply try to ignore them and I guess, ask the Court to ignore them.

14 15 16 17 18 I won't go over this in in detail because it's in our paper. We do this in paragraph 16 to 21 of our reply brief. But there, we talk about how the Defendants only even purport to dispute 6 of these 56 paragraphs in the Trustee's statement of undisputed facts.

19 20 21 22 23 24 25 Now, having no ability to actually dispute the Trustee's facts, what do the Defendants do? They do two things. First, they try to come up with a gotcha moment by arguing that the Trustee has admitted virtually every fact in the case based on the Defendant's request for admissions. And then second, they put forward two declarations that are, for reasons I will discuss, wholly deficient to

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1 create a genuine dispute of material fact.

2 3 4 5 6 7 8 9 10 11 12 First, on the request for admissions, I won't spend too much time on this, Your Honor, because it's laid out very clearly in our reply brief. The Trustee never had a deadline to respond to those requests for admissions because they were served shortly before the Court granted its order staying this litigation pending the conclusion of the Debtor's criminal trial. The Court very clearly directed the parties within seven days following the termination of that stay to file a joint proposed order proposing modification of existing scheduling deadlines or in the absence of an agreement to request a status conference.

13 14 15 16 17 18 19 20 I would note that in correspondence prior to the motion for that stay being filed, after the request for admission had been served, defense counsel had initially suggested setting a deadline in the order which would say that the Trustee would have a certain number of days following the expiration of the stay by which to respond to request for admissions, but that did not actually end up being in the order.

21 22 23 24 25 Instead, the order entered by the Court contained no deadline, but rather established a meet-and-confer requirement. And after the criminal trial, when it came time to meet and confer as required by the order, the Trustee reached out to Attorney Conway twice, once on August 7th and

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1 2 once on August 8th, to meet and confer and telling him that we plan to file for summary judgment.

3 4 5 6 7 8 In response to that, we got no response, other than asking if we believe discovery would be closed. And we said we didn't think further discovery was necessary. Zero mention of request for admissions or Defendant's position that they were entitled to have a deadline set for response to those.

9 10 11 12 13 14 15 16 17 To make matters worse, after that, in accordance with the order when we had a status conference before the Court, which I'm sure the Court will recall, on August 13th, Taurus Fund did not even appear. The Defendants did not even appear at that status conference. By their own preference, it occurred only between the Trustee and the Court with Defendants not showing up, raising any issue about further discovery, any issue about their request for admissions, et cetera.

18 19 20 21 22 23 24 So, Your Honor, if they wanted a deadline, they could have asked for it. They could have met deferred as they were required to do it. They didn't. Even if there was a deadline, the Court is well within its discretion under Federal Rule of Civil Procedure 36(b) to permit the Trustee to amend his responses. There's no prejudice to the Defendants.

``` 25 ``` Most of the requests for admissions were central

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1 2 3 4 5 6 issue type requests, like admit that the Debtor is not the owner of the mansion or admit the Taurus Fund is not the Debtor's alter ego. The Defendants obviously knew that the Trustee had taken the opposite position in the litigation, so they were not prejudiced by not seeing that in writing in response to a request for admission.

7 8 9 To the extent required, we've attached to my declaration in support of the reply at ECF 147 responses to the requests for admission.

10 11 12 13 14 15 16 17 18 19 Your Honor, once that straw man argument is cast to the side, the Defendants are left with two declarations that they submitted in support of their counternarrative in their opposition that what really happened here is that Taurus Fund and the William G-controlled Hamilton entities located in the BVI, they helped G-Club, which again is the Debtor's fraudulent membership organization, acquire this mansion as a clubhouse for members that they could use and enjoy as part of their G-Club membership, which again was proven to be a big fraud in the criminal trial.

20 21 22 23 And they say that the Debtor has no interest in the property and indeed no relationship to it whatsoever than having helped G-Club find the property and then assist with renovations.

24 25 Two declarations, Your Honor. The declaration of Mr. Mohammed, who purports to be, I think, I believe the

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1 2 3 4 5 corporate secretary of one of the Hamilton entities, and then a declaration from Defendant Barnett. The Mohammed declaration talks about the purported process that was followed to find a clubhouse for members and the entities that were formed in accordance with that effort.

6 7 8 9 10 But Your Honor, the Mohammed declaration, first, shouldn't be considered by the Court for two reasons, which I will discuss. And then even if it were considered, it is not even close to sufficient to create a genuine dispute of material fact.

11 12 13 14 15 16 17 18 19 First, the declaration should not be considered because Mr. Mohammed was not identified anywhere in the Defendant's initial disclosures. Had they listed Mr. Mohammed, the Trustee could have taken his deposition. They didn't, and we have this -- we have the case law and the authority for this in our papers. Because they didn't, the Court can and should exclude his declaration on that basis. And by the way, this is an individual that we have never heard of prior to receiving his declaration.

20 21 22 23 24 25 In addition, if the declaration were not excluded for that reason, it should be excluded because it is not based on personal knowledge and relies entirely on hearsay. Mr. Mohammed admits in the first paragraph of the declaration that he was not personally involved in any of the transactions that he discusses. Instead, he said he reviewed

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hamilton documents, in the ordinary course of business, but he never describes what those records are. And there are some cases, Your Honor, which has said that on summary judgment, a corporate representative can testify on matters outside of his personal knowledge if that person says that the testimony is based on his review of particular corporate records. But at a minimum, that business must reasonably identify what those records are and show that there's a plausible connection between those records and the testimony that the witness is offering. For example, a chief financial officer could say that he reviewed financial statements created prior to his involvement with the company to testify about obligations that a company owes. But here, Mr. Mohammed simply says, I reviewed all of the records of Taurus Fund, and all of these records told me that Taurus Fund purchased the Mahwah Mansion as a clubhouse for members. That's essentially the thrust of his testimony. There is zero citation to a single record. Not a single one of these records that allegedly supports this story was produced to the Trustee in discovery. You would think that if the Defendants were serious about opposing summary judgment and Mr. Mohammed had access to documents

25 which supported his story, he would have attached those to

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| 1 | | his declaration. | | | | | He did no such thing. | | |---|--|------------------|--|--|--|--|-----------------------|--| |---|--|------------------|--|--|--|--|-----------------------|--|

2 3 4 5 6 7 8 9 10 11 And even if the Court were to consider this testimony, Your Honor, it is flatly contradicted by the mountain of evidence to the contrary. The idea that G-Club purchased a mansion and a clubhouse for members cannot remotely be reconciled with all the evidence of the Debtor having controlled the purchase process from the very beginning, worked with the broker, worked with counsel, formulated the offer, designed whole wings of the property for his wife, filled the house with his own personal items from his medication to his suits.

12 13 14 All of the evidence overwhelmingly indicates that this was a personal residence of the Debtor, and none of it supports this fantastical theory to the contrary.

15 16 17 18 19 20 21 22 23 Your Honor, in the interest of time, I'm not going to go over some additional slides at the end of the deck that sort of compare and contrast some of the testimony that the Debtor's witnesses offered in their declarations with the evidence to the contrary. But suffice it to say that everything they said is simply not supportable by the other evidence in the record, including Mr. Barnett's own testimony where he talks about how this is not a home of the Debtor. In the criminal trial, he talked about how the

24 25 Debtor -- this is all on the record -- sometimes, you know, in the first few weeks after its purchase was there two to

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1 2 3 4 5 6 7 8 three times a week. Sometimes, he stayed there for four or five nights in a row. He acknowledged that the Court saw in response to questioning from the Debtor's counsel that it was, in fact, the Debtor who purchased the property. None of that can be reconciled with the story that he's now trying to tell the Court in his declaration, Your Honor. And that is not, in that situation, sufficient to create a genuine dispute of any material fact.

9 10 11 12 13 14 15 Lastly, Your Honor, before wrapping up, I will very briefly address the legal arguments, and I'll do this briefly because there are arguments that have been raised before. The Defendants argue that the Trustee lacks standing under both Section 541 and Section 544(a) of the Bankruptcy Code. Those arguments should be rejected. The Court has already considered this in prior adversary proceedings.

16 17 18 19 20 For example, on the motion to dismiss the Trustee's counterclaims in the HCHK USA adversary proceeding the Court correctly found there that Wagner and in pari delicto do not bar the Trustee's claims under Section 541 because the insider exception applies.

21 22 23 24 25 That same exception applies here, Your Honor. Taurus Fund, as alleged by the Trustee, is an insider of the Debtor. It'd be inequitable, to say the least, to permit Taurus Fund to keep the mansion after having assisted the Debtor and hiding it from his creditors.

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1 2 3 4 5 6 7 In addition, Your Honor, even if the Trustee lacks standing under Section 541 of the Bankruptcy Code, due to the Wagner rule or the in pari delicto doctrine, he can get around that as the Court has recognized in other adversary proceedings by pursuing his claims under Section 544 of the Bankruptcy Code as claims are brought on behalf of all creditors equally.

8 9 10 11 12 13 14 15 16 The Court reached the same conclusion in the Lamp Capital and the Greenwich Land adversary proceedings. And I would also direct the Court, Your Honor, to a case that we cite in our papers, the new Second Circuit decision from 2024, the In Re Nordlicht case, which completely undermines all the arguments that Defendants have made in their papers to the effect that an alter ego claim is not a claim that can be pursued on behalf of creditors generally, and that's an individual claim. That case held squarely to the opposite.

17 18 19 20 Your Honor, with that, again, I think that was a lengthy presentation, but I thought it was important to go through the evidence in detail. Appreciate the Court's indulgence. I'm happy to answer any questions.

21 22 23 THE COURT: Thank you. I do not have any questions at the moment. I may later, but I don't at the moment. Thank you.

24 25 Mr. Conway, do you wish to be heard? MR. CONWAY: Yes. Thank you, Your Honor. Michael

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1 2 3 4 5 Conway on behalf of the Defendants. We heard a lot just now. Most of it is concerning because the Trustee has taken two positions in this case. Now he's taking one, granted. But it at the outset, couldn't come up with the theory that he would ultimately rely on.

6 7 8 9 10 11 12 The two theories under which a Trustee can say that this -- here, the Taurus Fund property is estate property, one being that it was new -- it was purchased or acquired using funds that come from the bankruptcy estate, come from the Debtor. Okay? And you know, there have been times where the Trustee has said, he was a billionaire. Of course, it was his money.

13 14 15 16 17 18 They're not doing that now, and for obvious reason. They can't find any evidence. They've gone around the world. They've gotten every bank account they can find, they prosecuted cases around the world, but there's not a single shred of evidence that ties any dollar that the Debtor may have ever touched with the Taurus Fund property.

19 20 21 22 23 24 25 So they changed course. They changed course by saying that, well, the Taurus Fund property was acquired through this fraud. I use Trustee's counsel's language. These facts are proven beyond a reasonable doubt in a criminal trial, which resulted in the Debtor's conviction for, among other things, using G-Club as a fraudulent membership organization to fleece victims out of hundreds of 1 millions of dollars.

2 3 4 5 6 7 8 Okay. That's theory two. It's not his money. It's somebody else's money that he defraud -- he defrauded these people into investing their money or contributing their money, and then he misused their money so that he could live like a billionaire. He wasn't a billionaire. He used somebody else's money to live like a billionaire. That's what they've settled on in this motion.

9 10 11 12 13 14 15 And in order to prove their motion, they -- and I got to say, I'll get to this issue of whether we had a meetand-confer. It's a flatly false statement. The Trustee has argued that there was a criminal trial in which the Debtor, not our clients, but the Debtor was faced with evidence. And he's gone through, as he points out, mountains of evidence that came into that criminal trial.

16 17 18 19 20 21 22 Now, we don't have any evidence that's actually provided to Your Honor in a way that's admissible. In other words, there's no trial transcript that's certified. There's no -- there's been no exhibit from the criminal trial where we can show that it was actually admitted in the criminal trial, as opposed to the judge in the criminal trial saying, well, that's hearsay.

23 24 25 Now, we don't know what these documents are. The audio recordings in Chinese with some translation that's not authenticated. We don't know what those documents are. We

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1 2 3 4 can't, as Mr. Bassett rightly stated, we state in a lot of our responses, we can't really address those because we don't know why those people testified, where those allegations come from.

5 6 7 8 9 10 What we can say, though, is that they're all irrelevant. And what is relevant is what happened here, not what somebody else thought might have happened, what somebody heard from their brother, sister's cousin. What really happened here is what's important. And what is it that really happened here?

11 12 13 14 15 16 17 We have -- and there -- and I just want to -- I don't want to belabor this point, but I got to say, all of this testimony that we just saw, you know, if I had been invited to the criminal case, I would have asked for followup questions such as, well, why do you think that? To see whether there's any basis for any foundation for making a statement.

18 19 20 21 22 23 24 25 You know, statements by, Scott Barnett. You know? Well, were you surprised when Mr. Guo bought the house? But of course, somebody on the witness stand is not going to say, well, you can't ask me a question like that. He didn't buy the house. No. The response was, it made no sense to me. The allegation of him buying the house made no sense to him because it didn't happen. Okay? That's why it made no sense to him.

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1 2 3 4 5 6 7 But moving along, Your Honor, we've got a fairly, I'll call it, simple but distressing fact pattern here. And either the Debtor was engaged in a massive fraud that ultimately hurt the G-Club members, or this is his money. We know there's no evidence it's his money. So let's focus on the latter because that's consistent with what we have presented as what happened here.

8 9 10 11 12 What happened here is a bunch of members of the New Federal State of China, who put the Debtor as their figurehead, much like the United States puts their president as their figurehead, they put him in a position where he could utilize their property.

13 14 15 16 17 18 19 20 21 22 In G-Club's case, they brought in memberships. The membership money was used at first to buy a casino in London. That casino in London didn't work out because of circumstances that are not really relevant here. Only -- the only thing that's really relevant here is had they really been doing this for the benefit of the Debtor, they wouldn't have done it in a -- in a country where the Debtor couldn't actually travel to, which is, you know, common knowledge on you just Google it, and he says he can't do that. He's stuck here.

23 24 25 Now, when that fell through, according to our evidence that's been presented here, they came to United States. Now, who in the United States has an understanding

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 based on their relationships with their -- the person who developed their homes, the person from whom they bought their antiques, the people who manage their properties, who has those connections? The Debtor. So they go to the Debtor, and they say, look. You helped us with our purchase of the Mahwah House, and we let you use it as your home base for the New Federal State of China. That's in the record. There's no reason to believe -- THE COURT: Where is that in the record, Attorney Conway? MR. CONWAY: That's in the record -- THE COURT: I listened to everything you just said except for that last sentence. You said it's in the record that people from G-Club or the New Federal State of China came to Mr. Kwok and said, help me purchase this mansion? MR. CONWAY: It's in the -- THE COURT: Is that what you said? MR. CONWAY: I did. Your Honor. And that's the declaration of Mr. Mohammed and the declaration of Mr. Barnett. THE COURT: Mr. Barnett -- but I have -- I have to be honest about Mr. Mohammed. I looked at it once, but I don't recall all of it right now as we're talking. But Mr. Barnett testified that the New Federal State of China came to

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| | 93 | |----|-----------------------------------------------------------------| | 1 | Mr. Kwok and asked that him to help them buy the Mahwah | | 2 | Mansion? | | 3 | MR. CONWAY: Would you like me to read it? | | 4 | THE COURT: Yeah. I would, please. | | 5 | MR. CONWAY: Okay. Let me find his -- okay. | | 6 | The Debtor was an asylum -- this is the Barnett | | 7 | declaration paragraph 2. The Debtor was an asylum seeker in | | 8 | the United States and leader of political movement known as | | 9 | the New Federal State of China, the movement. He required | | 10 | security due to the issues with Chinese government monitoring | | 11 | his communications and the attempts for the Chinese | | 12 | operatives to physically remove him from the United States. | | 13 | In December 2021, I learned that a property been | | 14 | purchased in Mahwah, New Jersey, which is the subject of a | | 15 | case, the Mahwah property, and that in exchange for his | | 16 | assistance with locating the Mahwah property in the first | | 17 | place, construction and remodeling, the movement would be | | 18 | allowed to use this location as a home base of sorts. | | 19 | THE COURT: Well, that's a little bit different | | 20 | than what you just said, first of all. First of all, it says | | 21 | he learned that. So I don't know who he learned it from, | | 22 | number one. But number two, he said in exchange, they'd be | | 23 | allowed to use it. He didn't -- it didn't say what you said, | | 24 | which is they came to Mr. Kwok and asked him to help them buy | | 25 | that. That's a different -- those are two -- that's a -- in |

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 my opinion, that's a -- that's a distinction with a difference. MR. CONWAY: Okay. Fair enough, Your Honor. I move on. And I would note that a good majority of what was stated by Trustee's counsel was characterizations that I would consider to be false. So if I have offended you by saying -- THE COURT: No, no, you haven't offended me at all. No, no, don't -- don't get me wrong, Mr. Conway. You haven't offended me at all. I'm trying to remember what I've looked at, right, as far as this motion for summary judgment and everything in the -- in the record. Don't -- not at all. I probably sound odd because I'm not feeling well. My voice is weird. All that kind of stuff. But what I was asking you was not about Mr. Mohammad's declaration, but Mr. Barnett's, which I have looked at. I didn't recall him testifying in his declaration to what you said, which was that -- that he -- that Mr. Barnett testified that he had firsthand knowledge that the - that the movement came to Mr. Kwak to help -- have Mr. Kwok help them buy the Mahwah Mansion. That's what you had said. And I didn't recall that being in Mr. Barnett's declaration anywhere. That was my question. MR. CONWAY: Okay. THE COURT: So go ahead. I wasn't -- I wasn't --

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1 2 3 I'm not taking offense to anything. Don't worry about that. I'm asking questions based upon what I have reviewed prior to this hearing.

MR. CONWAY: Correct.

THE COURT: Okay?

6 7 8 9 10 MR. CONWAY: So we can sort of summarize the bulk of what you saw from Mr. Bassett as Mr. Kwok going out. At least we can assume it was Mr. Kwok. There's no, you know, there's certain testimony that somebody had made that Mr. Kwok did this or, you know, resembled Mr. Kwok did that.

11 12 13 14 15 16 17 18 But let's just assume for the moment, arguendo, that Mr. Kwok is going out and buying things for the mansion, that he's going -- that he's talking to people about renovating the mansion. He's doing that, as testified by Mr. Barnett and Mr. Mohammed, in exchange for using the Mahwah property as a home base for the movement, which as we heard from Mr. Mohammed, the G-Club members are 90 percent members of the movement.

19 20 21 22 23 24 25 So we have a rationale for why they would do this, and we know that simply living -- let's just say for a moment that he's living in the house. We argue in our papers that's not proven. In fact, Mr. Barnett says that's just not true. He went to the -- to the house a few times a week or a month. He went there mainly because that's where the broadcast facility was that he was broadcasting on behalf of

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1 2 3 4 5 the movement for. It's very rare for him to spend the night. And you know, again, Mr. Bassett has repeatedly said, and it's in other papers as well, that the main residence of the Debtor is in Taconic -- the Taconic house in in Greenwich.

6 7 8 9 10 So we're not -- there's no dispute here as to what whether or not the Debtor lived in Connecticut. The Trustee admits that. The dispute is whether or not his occasional use of the Mahwah house gives him an ownership interest. That -- because that's what's really at stake here.

11 12 13 14 15 16 17 18 19 And again, I go back to if the Trustee were to come to you four years from now and say that the president of the United States has been living in the White House for four years, he and his wife helped redecorate it, and his suits are there, his driver's license is there, his medications are there, you would look at the Trustee and say, are you crazy? He's the president of the United States. That's where he's expected to spend his time. He's expected to do all these things.

20 21 22 23 24 25 Well, that's the position that our clients are taking here, that Mr. Kwok was the putative leader, the president, so to speak, of the movement. And while we never got to the point where this house was completed because this case was filed, and then Your Honor issued an injunction, and it was no longer possible for our clients to complete the

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1 2 3 4 5 6 7 construction, there was activity at the house, but not the activity that was intended because it was never completed. And frankly, the idea that, at the end of the criminal case, the manager, not Mr. Barnett, the manager for Taurus Fund, Mr. Barnett has never been a manager for Taurus Fund. In fact, as the Trustee cannot dispute, we've given a list of all the managers throughout time for Taurus Fund.

8 9 10 11 12 13 14 15 16 17 And the current one indicated that after reading in the newspaper that the Government was taking the house, he was under the impression he had to leave the house. Yeah. That's -- we brought this to Your Honor's attention in a court filing. Your Honor said we need to do something about this and figure out who's going to pay for everything because, on this emergency motion by the Trustee, we have this email from the manager saying that they want to stop funding. Well, that's not evidence that Mr. Kwok owned the house.

18 19 20 21 22 So we what we have here is Mr. Kwok using the house, being involved in the location of the house, being involved in the -- in the decoration of the house. What we don't have is a single shred of evidence that ties into the ownership of the house.

23 24 25 Now, what we also have is a problem for the Trustee. Because if what they're saying now is that the reason they should have this control of the house, the reason

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 they should have the ownership of the house is that it belonged -- it was purchased by these -- using the money of these defrauded victims, well, that's going to mean that the defrauded victims get defrauded twice because they can't - if they -- if their house, which they feel like they own, is now presented to the Trustee, that means that not only were they, it's in the words of the Trustee, policed by putting their money into G-Clubs, but now the property that was purchased with their money is given to somebody else. And this brings us, in part, to this point about standing. I don't want to spend a lot of time on this because I've seen Your Honor's response to the standing issues when they've been raised in other cases. But I do want to point one thing out. The Trustee makes it clear in their papers that under 541, it's not enough to say that there is a hypothetical creditor, and that's -- which Your Honor found in Lamp Capital, et cetera. You have to go beyond that and find that that hypothetical creditor has the same claim as the people across the board in the bankruptcy. And that's something that when this construct was created was fairly reasonable because what they're doing is they're saying if a Debtor -- in other words, if a CEO of a corporation takes property from the corporation and puts it in his own pocket, all the creditors in the corporation are

| 1 | | hurt equally. | |---|--|---------------| |---|--|---------------|

2 3 4 5 6 7 Here, you've got a hands -- I don't want to call it a handful because it's a number of people, but it is a discernible group who put their money in the G-Club. That money was put into the Hamilton Opportunity Fund, which was then put into the Taurus Fund, and then the property was purchased.

8 9 10 11 12 13 14 15 What the Trustee wants to do is take the proceeds of the sales of all this property and distribute it amongst all the creditors, maybe including them if you give them an opportunity to file a proof of claim, but to everybody else who might have a claim for -- personal injury claim against the Debtor, for all of the administrative claims of the Debtor. All that money is going to be gone. None of these putative victims are going to see a penny of it.

16 17 18 19 20 I pointed this out to the Trustee, you know, that they -- I don't represent them, and so they wouldn't -- and the Trustee didn't want to talk to me about this, but they all said, look. Just give the property to the DOJ where they can then sell it and give us back our property.

21 22 23 24 25 But no. What they're trying to do here is give this property to everybody, not just this group that was defrauded, not these putative victims, but to everybody who might have a claim for any reason against the Debtor. That's not a 541 claim. That is not acceptable under 541 because

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1 2 3 these are different people with different creditors, different claims. They're separate and apart from all the other creditors in the estate.

4 5 6 7 But moving all the way from that, I want to just -- I want to -- I want to talk about the Rule 26 issue. You know, these requests for admissions and this idea that there's no set date for response.

8 9 10 11 Rule 26 actually does set a date for response. It's 30 days. I offered, when I served these documents, the opportunity to get a potential number of days after there was a recommence of the case. That didn't happen.

12 13 14 15 So we're stuck with the 30 days. And even if it had happened, we had said 10 days. So that would have put us at August 11th. We did not get a response by August 11th. We did not get a response at all.

16 17 18 19 20 21 22 23 Now, counsel says, well, this is a sandbag moment. Well, no. It's not a sandbag moment, and Your Honor yourself said that if you don't respond to requests for admission, they're admitted, and they can be used against you in summary judgment. And that's what we're doing here. Counsel says, well, we should be allowed to just, you know, have a do over and say, well, no. We didn't -- we didn't fail to respond. Mr. Conway didn't meet and confer with us.

24 25 We did meet and confer. And this is what's - it's one of several things that's very frustrating about

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1 2 3 4 5 these papers and by what was said here today. On July 29th, we specifically met and conferred about all the discovery issues, about the fact that we're going to put together a scheduling order, finish discovery, and present it to Your Honor in conjunction with the recommencement of the case.

6 7 8 9 10 11 12 And on August -- I'll call it August 8th, I get an email saying, we want to set up a briefing schedule for summary judgment. I was shocked. We'd already gone through a substantial meeting confer on exactly what was left to be done. And counsel for the Trustee said, we're going to take this deposition, this deposition. They could've taken the deposition of each of these witnesses at the criminal trial.

13 14 15 16 17 18 19 20 But you know what? They didn't do it because they thought, well, we can just get this in under the radar without an actual foundation, where Mr. Conway could actually cross examine and get the actual facts into the record. They didn't do that. They completely turned everything on its head and said, we're not going to give you any more opportunity to discover, Mr. Conley. We're just going to set this for summary judgment. I was shocked.

21 22 23 24 25 There's no reason, though, for me to meet and confer on that. We met and conferred on discovery, and there was not any discussion at that point in time about a request by Mr. Bassett for more time to put in responses to the request to admit. He still had time at that point. He

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1 2 didn't say I'm going to need more time, and he didn't respond when the time came and went.

3 4 5 6 7 8 So now he says, well, let me just say, Judge, that, you know, we deny everything. Well, what does that do to me? I'm now in a position where I didn't press the issue of discovery because we had admissions from him. When he made his motion for summary judgment, we had admissions from him on multiple points that win the case for us.

9 10 11 12 13 14 15 16 And now he's saying, well, you know what? We want to say that we deny all those, and at the same time, deny Mr. Conway's client the right to do any discovery here. So at the very least, one, we don't think there's any basis for them making this oral motion now to put in responses to our request to admit. They haven't made a motion. They're asking you informally for this right, and there's no basis for that. There's no basis in the papers for that.

17 18 19 20 If Your Honor is willing to give them that, which we object to, we certainly should have the right to then proceed with discovery on all these points that we thought were admitted.

21 22 23 24 25 Now, that said, we also make the point that the Trustee had no standing under 541. And the response to that -- and again, I don't want to belabor this because I know Your Honor has dealt with this in other cases. And by no means do we concede that any other case is relevant here,

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1 2 3 4 5 you know, that we were not a part of. And I'm just saying this to the record, Your Honor. We object to this repeated construct that if it's been decided somewhere else, it's binding on Mr. Conway's clients. That's not the way collateral estoppel works.

6 7 8 9 10 11 12 13 14 15 16 17 18 We didn't -- if we didn't have a chance to participate, it's not binding on us. But that said, the idea that there is a -- this exception to the Wagner doctrine for insiders, what counsel is saying is this case involves an individual debtor, not a corporation, where insiders is appropriate to take into consideration, but an individual. And they can provide no evidence that the individual debtor has an ownership interest in any of the entities that are relevant or the entities are relevant here -- there's the - the only one they really care about is Taurus Fund. Let's face it. (Inaudible) and Taurus Management are irrelevant to this proceeding. They don't own the property that's being requested.

19 20 21 22 23 24 25 But there's no evidence that the Debtor has any interest in Taurus Fund LLC. So what they -- what they're saying is, what you should do, Judge, you should say, we win, that he has an interest in Taurus Fund LLC, and therefore, Taurus Fund LLC is an insider. And therefore, going back now to the case, as an insider, they're entitled to a defense under the Wagner doctrine. That's basically this -- the

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1 2 3 4 5 6 bootstrap logic there doesn't work. And the reason you shouldn't let it work is for the -- it's a logical reason. You don't employ this insider's theory to an individual Debtor. It's meant to be used when you've got insiders to a corporation, and the corporate -- the corporate entity is a Debtor.

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7 8 9 10 11 12 13 14 15 16 So I guess I'm going to finish off by just saying that, again, just to be more clear on the objections to evidence, what we have here is Mr. Barron stating that he's throwing a bunch of documents together, and they're true and correct copies. That's it. You know, their objections here to the evidence of Mr. Mohammed and Mr. -- and Mr. Barnett and their declarations, they're talking about what they have either reviewed in records and seen in records, what they know for a fact on their own, what they're entitled to testify about in terms of corporate ownership.

17 18 19 20 21 22 23 24 What we have from the other side is Mr. Barron saying, hey. I got a bunch of documents here. Check them out. It's -- they're legit. We don't know why he's saying that because he doesn't tell us. And what we do know is that they didn't even go so far as to explain any individual exhibits what the foundation was, such as a certified copy of the transcript, a certified interpretation of the Chinese audio piece.

The fact of the matter is, though, it's not

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1 2 3 4 5 6 critical because none of that information, in our opinion, is relevant to the issue at hand. The fact that Mr. Kwok was involved in some way, shape, or form in locating and decorating, even the renovation of the house is no different from when the president of the United States does it with the White House.

7 8 9 10 11 12 If we're saying that Mr. Kwok owns this house, I guess what we're saying is that the president of the United States owns the White House. It makes no sense. Nobody would agree to that, and god forbid, in four years, that's the argument that's made. And somebody says, yeah. You know what? We got a point.

13 14 15 16 17 18 I'm just -- I think that, Your Honor, we've been here a long time. I feel bad, and you feel bad. I also -- I think I have the same thing. Our whole family does. And so, I've -- as soon as this is over, I'm going to probably lay down and feel exactly as bad as you do. So I know what you're feeling.

19 20 21 THE COURT: Okay. Thank you, Attorney Conway. I understand your argument, and obviously, we'll go back and review some of the information.

22 23 24 Attorney Bassett, is there anything you'd like to add? MR. BASSETT: I know it's been a very long day,

Your Honor, so maybe just a few very, very brief points.

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1 2 3 4 5 I just want to correct the record of the responses to a couple of arguments that Attorney Conway made. First of all, he started with this notion that the Trustee has shifting theories of the case. That's just categorically untrue.

6 7 8 9 10 11 The Trustee's theory has always been that the Debtor acquired this property as a home for him and his family to live in, using funds that he was able to direct and had control over, and that he is the equitable owner of this mansion by all the evidence in the record. There's never been a change in that theory.

12 13 14 15 16 17 Now, what Attorney Conway focuses so much on is the, you know, idea that these funds, originally, were given to G-Club by members of G-Club. Your Honor, the fact that the Debtor may have acquired funds through fraudulent means does not mean they're not funds that he controlled and then deployed for his own benefit.

18 19 20 21 22 23 24 There's no bank account. The Court knows that the Debtor filed for Chapter 11 in February of 2022 claiming to have \$0. That's why we're here. If the Debtor had bank accounts with hoards of cash in them that he used to buy things like his Mahwah Mansion, his property in Connecticut, his Sherry-Netherland residence, his jets, his yacht, we wouldn't even have this case.

We're here because the Debtor never owns anything

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1 2 3 4 5 himself. He takes funds that are really his, that he has control of, or they're tucked in other companies and with other individuals, and deploys them for his own benefit. That's exactly what he did here. He took G-Club funds, and he bought the mansion.

6 7 8 9 10 You heard all this, you know, recitation from Attorney Conway, the story of how Mr. Mohammed says that this is really a club for members. I mean, Mr. Conway did not because he can't actually respond to the evidence that we presented.

11 12 13 14 15 16 How do you possibly explain if Mr. Kwok is using this property simply as a place to host members of the movement that he developed entire wings of the property for his wife, for his daughter, for his son, kept all of his belongings there? There's no logical response to any of that.

17 18 19 20 21 22 Your Honor, to briefly go through some of the other -- so the idea that we've admitted that the Debtor's home was in Connecticut, no, we haven't. The Debtor had multiple homes. It's been established. The Debtor had an apartment at the Sherry-Netherland Hotel. He had a home in Connecticut, and he had a mansion in New Jersey.

23 24 25 And he had, I'm sure, other homes as well. It doesn't mean that any one of them is any less his property. In fact, the Court has already found that he owned the

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1 2 Connecticut home, and the Sherry-Netherland apartment is also property of the estate.

3 4 5 6 7 8 And Your Honor, this -- I can't believe Attorney Conway is making this White House analogy. I don't think time is required on that. I'm pretty sure that Joe Biden did not defraud people and use the funds to buy the White House and design it from the ground up for his purposes. It's not even a remotely close analogy.

9 10 11 12 13 14 15 16 The case law that we cited in our papers, Your Honor, stands exactly for the proposition that even though nominal title to a property may be held by somebody else, that the law will look through that, particularly in bankruptcy, and look if you actually beneficially own and control the property, and then that person is the one who has actual recognizable ownership rights. We cited the cases in our papers. They're there for the Court to review.

17 18 19 20 21 22 23 24 25 The idea that the Trustee's Section 541 and 544 theories somehow fail, first of all, the Court has decided this in a number of other contexts. I don't think we need to go through it all again, but Attorney Conway raised an argument that I was trying to follow about how it doesn't work here because the members of G-Club who initially gave funds to G-Club that were later used, potentially, to buy the mansion that they somehow have different claims. I don't even follow that argument.

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1 2 3 4 5 6 What I do know is that whatever claims people have will be determined later. To the extent that Attorney Conway is raising an argument that the G-Club members have something other than an unsecured claim against the estate, A, that's premature, and, B, he cited zero case law or any other laws for that proposition.

7 8 9 10 11 12 13 14 Our theory and what we've proven is that the Debtor took funds over which he had control and bought an asset, a mansion in New Jersey, that he equitably owns. If the Court agrees with that, then that property is property of the estate. Attorney Conway has cited zero law to suggest that there would be any other result in that situation and that the Bankruptcy Code would operate how it normally operates.

15 16 17 18 19 20 21 22 And all of Mr. Kwok's creditors who have claims against the estate could assert those claims, and as part of the claims reconciliation process, will have an ability to receive a distribution or not from all of these assets, including assets of the mansion. To the extent that Attorney Conway wanted to argue otherwise, he could have articulated that in his papers, and he didn't. I don't know what the argument would be.

23 24 25 Lastly, Your Honor, on the request for admissions, we've stated what we stated in our papers. I've submitted a declaration. I categorically disagree with Attorney Conway's

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1 2 3 4 suggestion that we, following the conclusion of the criminal trial, met and conferred about taking additional depositions. Our position had always been that we didn't believe further discovery was necessary following the criminal trial.

5 6 7 8 9 10 11 And the bottom line is Attorney Conway never once mentioned wanting responses to his request for admissions when we talked about moving for summary judgment. He just said, do you think discovery is closed? And we said, yes. We don't think there's any more discovery necessary. That was a perfectly appropriate time for Attorney Conway to raise his hand and say something about his request for admissions.

12 13 14 15 16 17 18 19 20 He also could have attended the status conference, which he decided simply to sit home for with no advance notice whatsoever. And finally, it's well within the Court's discretion to allow the Trustee to amend his responses. There's absolutely no prejudice. If you look at the request for admissions, Attorney Conway said things like -- he asked for admissions on things like whether or not Taurus Fund LLC is the Debtor's alter ego. Literally, the ultimate issue in the case.

21 22 23 For him to sit here and suggest that he believed based on that, that we were conceding, that Taurus Fund is not the Debtor's alter ego is just not credible.

24 25 Finally, Your Honor, there's virtually no response to the issues that we raised with the declaration that

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1 2 3 4 5 Attorney Conway submitted from Mr. Mohammed, zero response to the fact that he was not identified in their initial disclosures, and no response to the fact that he shockingly doesn't attach a single document and relies entirely on hearsay.

6 7 8 9 10 11 12 13 14 It's -- if you look at the balance of the scales of the evidence in this case, you look at the slide deck that we showed to Your Honor today of all the evidence that absolutely is admissible based on the case law that we cite in our motion and for the reasons I explained, if you look at that and you weigh that against this declaration that says there were unknown documents that support this fantastical story, it's not even remotely close, Your Honor. It's not a closed call.

15 16 17 18 Trustee is entitled to summary judgment. This case is what summary judgment is for, to prevent the parties from having to go further down the path of disputing issues of fact that are simply not subject to dispute.

19 20 So with that, Your Honor, unless the Court has questions, I have nothing further.

21 22 23 24 25 THE COURT: I have nothing further. Thank you. Attorney Conway, anything further? MR. CONWAY: Yeah. I want to make three responsive points. One, with respect to the 544 issue that confused counsel, I hope we didn't confuse Your Honor, but it

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is something that they put in their own papers, so I'm not sure why they're confused. You have to have a claim that's identical to -- for all creditors to have standing, not just a hypothetical creditor.

5 6 7 8 9 10 And my point was, very clearly put, I thought, that these particular claims by the G-Club members who put the money in to buy the mansion are different from all the other claims in the estate such as, I believe they're even, you know, auto accident claimants. I don't -- you know, there are lots of different categories of claimants.

11 12 13 14 15 But unless they're all the same, which is why the rule was created where CEOs taking money from a corporation, putting it in his own pocket to the detriment of every creditor, they're all the same. Unless you have that fact, 544 standing does not exist.

16 17 18 19 20 21 22 23 24 25 Now, the second point is with respect to the Rule 26 issue, the request for admissions issue. Counsel should understand -- I know he wasn't being sarcastic, but he should understand that if he denies a request to admit, which they didn't do here, it's not sufficient to simply say deny. You have to say we deny because and explain why you deny, which allows us to then say, okay. We better deal with something about that. The because is what's important that they deny. We have to go out and do further discovery in the event of a denial or request for admission. And so

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sandbagging by saying nothing, and then later saying, well, we deny is inappropriate.

3 4 5 6 7 8 9 10 Third, and this was not raised before. I raised this as an afterthought because it just seems like it needs to be addressed on the record. There's a comment made in the reply brief that I somehow used some other law firm to assist me in our opposition, which is categorically false. And had counsel actually taken the time to call me and ask me, and I would have said, that's categorically false. That law firm didn't even know that I was doing this.

11 12 13 14 15 I, as a matter of practice, will take the last pleading in my file to start the next pleading. And the last pleading, as you may recall, Your Honor, that I was involved with was the motion to dismiss in the civil RICO action where that law firm did assist me.

16 17 18 19 20 21 And in this case, counsel made the allegation that I somehow secretly used another law firm to assist in my opposition. I can say to you, Your Honor, that no law firm, including the law firm mentioned by counsel, had any knowledge I was even working on in opposition to a summary judgment motion here.

22 23 24 25 And the fact that I'm hearing now that they're raising this in other matters as if it's true is something that's very distressing. You know, it's like, you know, they start saying, no. Mr. Barnett was the chauffeur or the

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| 1 | driver for the Debtor. They said that early |----|--------------------------------------------------------------- | 2 | became an every document occurrence. And now I'm sure Your | 3 | Honor believes Mr. Barnett somehow is a driver for the | 4 | Debtor, which is absolutely false. Never driven the car for | 5 | the Debtor in his life. | 6 | But it's these little things, and I say this only | 7 | because they add up, Your Honor. These little misstatements | 8 | in these briefs add up, and they get used in other cases as | 9 | if they're fact. And I just want to make that point for the | 10 | record. It's just untrue. | 11 | THE COURT: Okay. Thank you. | 12 | MR. BASSETT: May I just respond to that last -- | 13 | THE COURT: Very briefly. | 14 | MR. BASSETT: Very, very briefly. Your Honor, as | 15 | the Court well knows, we've had -- this case has a long and | 16 | tortured history where people aren't who they say they are, | 17 | people aren't representing who they say they are. We've | 18 | this time and time again, the HCHK case. We've seen it | 19 | elsewhere. It all played out in front of Judge Dooley | 20 | recently. | 21 | What the Trustee discovered was that the metadata | 22 | and the PDF that Attorney Conway filed said that it had been | 23 | prepared by attorneys at another law firm. As always, | 24 | indicated, it is the facts supporting that. I'll take | 25 | Attorney Conway's representation today that they had no | | on. And then it | ----| | | | | | | | | | | | | | | | seen | | | | | | | | | |

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115

1 2 3 4 5 involvement. But you know, that's what the Trustee had learned from what he uncovered, and we're taking discovery from the other law firm, who has volunteered to comply with our 2004 request. And we'll see where that goes. That's what 2004 discovery is for.

6 7 8 9 10 11 12 13 But I take exception to the fact that or to the allegation that the Trustee or his counsel is intentionally misleading the parties or the Court. We absolutely have not done that. I think the record in this case is 100 percent clear to the extent that there's been obstruction and other games that have been played throughout this case, it's come from only one direction. I'll just leave it at that, Your Honor.

14 15 16 17 18 19 20 THE COURT: Okay. Thank you. I'm going to take the motion for summary judgment under advisement, as I think you both can understand. There is a lot of information that is in the motion, the opposition, the attachments, and what we talked about today. So I have to review that, and I will rule accordingly. I have no idea on the timing, but I will do what I can, obviously, with regard to the motion.

21 22 So is there anything further we need to address this afternoon?

23 24 MR. DESPINS: Not from the Trustee's point, Your Honor. Thank you.

MR. CONWAY: I think we're good from the

# Defendant's side too, Your Honor. I feel better. THE COURT: Okay. Thank you. All right. I believe then, Trustee Despins, that takes care of all the matters on today's calendar. Is that correct? MR. DESPINS: That's correct, Your Honor. THE COURT: Okay then. Thank you then. Thanks to all of you, and Court is adjourned. MR. DESPINS: Thank you. MR. CONWAY: Thank you, Your Honor. (Proceedings concluded at 3:49 p.m.) Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 116 of

| | Case 22-50073 Doc 3852 Filed 11/26/24 Entered 11/26/24 14:12:30 Page 117 of | |----|-----------------------------------------------------------------------------------------| | | 117 117 | | 1 | CERTIFICATION | | 2 | I certify that the foregoing is a correct | | 3 | transcript from the electronic sound recording of the | | 4 | proceedings in the above-entitled matter to the best of my | | 5 | knowledge and ability. | | 6 | | | 7 | /s/ Wendy K. Sawyer November 23, 2024 | | 8 | WENDY K. SAWYER, CDLT | | 9 | Certified Court Transcriptionist | | 10 | For Reliable | | 11 | | | 12 | | | 13 | | | 14 | | | 15 | | | 16 | | | 17 | | | 18 | | | 19 | | | 20 | | | 21 | | | 22 | | | 23 | | | 24 | | | 25 | | | | | | | |