Guo Wengui / Miles Guo — bankruptcy case · ORDER · ECF #1063-2

## **EXHIBIT B**

Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 2 of

UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION In Re \* Case No. 22-50073 (JAM) \* HO WAN KWOK, \* Bridgeport, Connecticut \* August 30, 2022 Debtor. \* \* \* \* \* \* \* \* \* \* \* \* \* \* \* \* \* \* TRANSCRIPT OF ORDER SCHEDULING STATUS CONFERENCE; MOTION FOR ORDER ESTABLISHING REPAIR RESERVE FOR LADY MAY; MOTION TO EXPEDITE HEARING; MOTION TO STAY PENDING APPEAL ESTABLISHING REPAIR RESERVE FOR THE LADY MAY; MOTION TO STAY SECS.523/727 ADVERSARY PROCEEDINGS; MOTION FOR ORDER PROVIDING THAT CONTROL OF PRIVILEGES PASSED TO TRUSTEE UPON APPOINT AND FOR RELATED RELIEF BEFORE THE HONORABLE JULIE A. MANNING UNITED STATES BANKRUPTCY JUDGE APPEARANCES: For the Debtor, STEPHEN M. KINDSETH. ESQ. HK International and AARON ROMNEY, ESQ. Mei Guo: ERIC HENZY, ESQ. Zeisler & Zeisler, P.C. 10 Middle Street, 15th Floor Bridgeport, CT 06604 For the Creditor, Pacific LAURA ARONSSON, ESQ. Alliance Asia Opportunity STUART M. SARNOFF, ESQ. Fund L.P.: O'Melveny & Myers LLP Times Square Tower 7 Times Square New York, NY 10036 PATRICK BIRNEY, ESQ. Robinson & Cole 28 Trumbull Street Hartford, CT 06103 Proceedings recorded by electronic sound recording, transcript produced by transcription service. **Fiore Reporting and Transcription Service, Inc. 4 Research Drive, Suite 402 Shelton, Connecticut 06484 (203)929-9992** 11

Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 3 of 11

> APPEARANCES: (Cont'd) For the Creditors Committee: IRVE GOLDMAN, ESQ. Pullman & Comley 850 Main Street Bridgeport, CT 06601 For the U.S. Trustee: HOLLEY CLAIBORN, ESQ. Office of the United States Trustee The Giaimo Federal Building 150 Court Street, Room 302 New Haven, CT 06510 Chapter 11 Trustee: LUC A. DESPINS, ESQ. Paul Hastings LLP 200 Park Avenue New York, NY 10166 Counsel for the NICHOLAS BASSETT, ESQ. Chapter 11 Trustee: Paul Hastings LLP 200 Park Avenue New York, NY 10166 PATRICK R. LINSEY, ESQ. Neubert, Pepe & Monteith, P.C. 195 Church Street, 13th Floor New Haven, CT 06510 For Verdolino & Lowey: WILLIAM BALDIGA, ESQ. Brown Rudnick Seven Times Square New York, NY 10036

2

| | Case 22-50073<br>Doc 1063-2<br>Filed 11/02/22<br>Entered 11/02/22 20:38:32<br>Page 4 of<br>11 | |----|-----------------------------------------------------------------------------------------------| | | Ho Wan Kwok - August 30, 2022<br>104 | | 1 | are limiting that. | | 2 | If you look at the request for release section of | | 3 | our motion, which we cited again in our reply, we're looking | | 4 | specifically for assets of the estate, his financial | | 5 | condition and matters relating to administration. | | 6 | The debtor identifies his concerns about | | 7 | potentially privileged documents related to criminal issues | | 8 | such as allegations of rape and false imprisonment and other | | 9 | things that have been made against him as well as his asylum | | 10 | application.<br>We are not, in our investigation at this time, | | 11 | seeking any documents related to those issues. | | 12 | Again, we're focused on assets and an | | 13 | investigation that hopefully be used to augment this estate. | | 14 | Second, Your Honor, we're not asking for a waiver | | 15 | or any control over privileges that belong to other parties. | | 16 | And, in fact, I don't know how one could even read our | | 17 | motion to be requesting that relief. | | 18 | We are, to be clear, seeking a determination that | | 19 | the trustee has succeeded to any privileges that the debtor | | 20 | holds with other parties in terms of a common interest or a | | 21 | joint defense privilege.<br>And we cite case law for that in | | 22 | our motion.<br>And I don't think that's contested, frankly. | | 23 | But what we're not seeking, what the debtor seems | | 24 | to suggest we are seeking, but we're not, is an order from | | 25 | the Court that the trustee now controls any privilege that | | | |

Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 5 of

Ho Wan Kwok - August 30, 2022 107 that very specifically seek documents related to assets of the estate, other transactional matters involving the debtor prior to the bankruptcy, and other things that simply do not implicate the types of concerns regarding criminal liability, et cetera, that this debtor is worried about. So there's nothing in the approach that the *Foster* case was concerned about that we're trying to ask the Court to do here. And frankly, if you look at other cases, there are plenty of other cases that have issued the type of order that we're asking this court to issue, including one of the cases we cite is the *In re Tarkington* case from the Eastern District of North Carolina in 2010. There, there was an investigation into potential estate assets. The trustee wanted to depose an attorney who represented the debtor prior to the bankruptcy, and what the Court ended up doing was, all right, I'm going to let the deposition go forward, here is what I consider to be within the scope of the privilege. All of the privilege related to assets of the estate, et cetera, has passed to the trustee. Anything that could go under criminal liability or those things could still be covered by a privilege. So you can go take the deposition, and counsel to the debtor can interpose objections consistent with that,

Ho Wan Kwok - August 30, 2022 110 These are cases where the issue was the trustee was trying to investigate assets of the estate that would potentially relate in, you know, augmenting the estate, of the value of those assets. And what the courts held in those cases is that this is a situation where the debtor would benefit from that. These are -- when the debtor's estate is augmented by additional -- the location of causes of action or the identification of other assets he benefits. He's not harmed by that. So, you know, the debtor contends, well, as I said before, there's a concern that, you know, it's possible documents that the trustee is seeking to have access to could involve potential criminal liability, whether it's the rape allegations that he mentioned, false imprisonment, or completely unrelated issues like his asylum application, but, again, as I said before, we're not seeking to get those documents through our discovery requests. The debtor has identified one request in our subpoena directed to the debtor's former law firms and professionals, Request 17, that asks for information about legal disputes which could be read to include criminal actions against him, to the extent there are any, or his asylum application, we're willing to make clear on the Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 6 of

Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 7 of

| | 11 | |----|--------------------------------------------------------------| | | Ho Wan Kwok - August 30, 2022<br>111 | | 1 | record that we're not seeking to get that type of | | 2 | information and we'll limit that request accordingly. | | 3 | I mean, the only plausible scenario where the | | 4 | debtor could say that he has a document that is responsive | | 5 | to our subpoena, but also could result in harm to him, is | | 6 | that there's some document that relates to his assets, | | 7 | relates to the topics that we're seeking to explore, and | | 8 | also somehow implicates his criminal liability. | | 9 | But the debtor has not even offered one hint of | | 10 | what that could be.<br>He's come forward with nothing to | | 11 | suggest other than, as he said in his opposition, | | 12 | allegations of false imprisonment and the like. | | 13 | There is no reason to believe that he's given of | | 14 | that we have that I could even imagine as to why the | | 15 | documents we're seeking related to, for example, his | | 16 | interest in the New York condominium, the Lady May, to all | | 17 | the other private jets and things like that that he's talked | | 18 | about, there's no conceivable scenario where those documents | | 19 | would relate to these types of issues. | | 20 | So this idea that the balancing test would weigh | | 21 | in favor of not passing control over of these privileges to | | 22 | the estate is just -- I think there's no weight to that. | | 23 | The debtor also raises, Your Honor, the non | | 24 | dischargeability actions that have been filed against him. | | 25 | And he says that while there's a concern there I could be | | | |

| | Case 22-50073<br>Doc 1063-2<br>Filed 11/02/22<br>Entered 11/02/22 20:38:32<br>Page 8 of<br>11 | |----|-----------------------------------------------------------------------------------------------| | | Ho Wan Kwok - August 30, 2022<br>113 | | 1 | all.<br>So there's just no legitimate concern at all that | | 2 | somehow we're going to get information related to these | | 3 | actions. | | 4 | And by the way, we're not going to share the | | 5 | documents we get with the plaintiffs to those actions, so | | 6 | this idea of a concern on the 523 actions, again, I think is | | 7 | just -- it's really nonexistent. | | 8 | A couple -- a couple more points, Your Honor, | | 9 | before I wrap up.<br>At least on my opening remarks. | | 10 | The debtor in his objection, although he initially | | 11 | says the Court shouldn't issue any ruling here, he says, | | 12 | well, if the Court does, it could issue certain guidance. | | 13 | And the way I think the debtor frames that | | 14 | guidance is to say that the Court could direct the | | 15 | recipients -- and this is in paragraph 33 of the objection - | | 16 | - the Court could direct the recipients of the subpoenas to | | 17 | withhold documents on the basis of privilege, quote, "Only | | 18 | documents that they believe potentially implicate harm to | | 19 | the debtor such as criminal allegations, facts relating to | | 20 | non-dischargeability, or facts that have nothing to do with | | 21 | the debtor's estate, such as his pending asylum application. | | 22 | Now, some of that actually sounds consistent with | | 23 | the remarks I've given today, but I think it also highlights | | 24 | sort of what we're also worried about and the mischief that | | 25 | could result if an order specific to that language is | | | |

| | Case 22-50073<br>Doc 1063-2<br>Filed 11/02/22<br>Entered 11/02/22 20:38:32<br>Page 9 of<br>11 | |----|-----------------------------------------------------------------------------------------------| | | Ho Wan Kwok - August 30, 2022<br>137 | | 1 | questions.<br>Thank you. | | 2 | MR. ROMNEY:<br>Thank you, Your Honor. | | 3 | MR. BASSETT:<br>Your Honor, just briefly in | | 4 | response.<br>I think I might stay here this time if that's | | 5 | okay. | | 6 | THE COURT:<br>That's fine. | | 7 | MR. BASSETT:<br>So Mr. Romney, in addressing our | | 8 | proposed changes to the language, I think his position was | | 9 | that, well, we're still not providing for the application of | | 10 | a balancing test because if what we're saying is that | | 11 | privileges related to the debtor's assets, financial | | 12 | condition, or the administration of his estate, pass to the | | 13 | trustee, it doesn't account for the possibility that there's | | 14 | some other personal, individual interest, criminality or | | 15 | otherwise that the debtor might have. | | 16 | And I think the fallacy in that logic is that | | 17 | there is no basis that's been provided as to why documents | | 18 | would relate to assets, financial condition, or the | | 19 | administration of the estate, would have anything to do with | | 20 | the debtor's asylum application, with criminal allegations | | 21 | that are made against -- that have been made against him for | | 22 | rape or false imprisonment. | | 23 | I mean, if the debtor's concern is that there | | 24 | could be hypothetically a document where the debtor was | | 25 | having a conversation with his counsel about both false | | | |

Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 10 of

Ho Wan Kwok - August 30, 2022 139 unrelated criminal liability or, you know, the particular things, again, that he's mentioned, his asylum application, things like that, in his objection, I think we could work out language to put in the proposed order to again make clear that we're not seeking that. I think there are other tweaks we would need, including to reserve our right to the extent of any withheld documents that we think might be relevant to the trustee's investigation on a crime-fraud exception to the attorney- client privilege, for example, but I do think there is a way to work out some language that could address some of the debtor's concerns. But, again, it cannot be a situation where the debtor gets to decide when he's harmed by the disclosure of a document because that is an open invitation for him to just withhold documents that he doesn't want us to see. Thank you, Your Honor.

THE COURT: Thank you.

MR. ROMNEY: Your Honor, if I may? THE COURT: Yes.

MR. ROMNEY: Very, very briefly. I've already said creating a privilege log is not deciding.

But I do want to make one perhaps significant clarification, which is, these order -- the proposed order

Ho Wan Kwok - August 30, 2022 150 MR. BASSETT: Thank you, Your Honor. THE COURT: Is there anything else that we can address today in the case? (No response) THE COURT: Okay. This was the last matter on today's calendar, so we will see you next Tuesday at 1:00 p.m., and court is adjourned. (Proceedings concluded at 4:29 p.m.) I, CHRISTINE FIORE, court-approved transcriber and certified electronic reporter and transcriber, certify that the foregoing is a correct transcript from the official electronic sound recording of the proceedings in the above- entitled matter. 16 September 10, 2022 17 Christine Fiore, CERT Transcriber Case 22-50073 Doc 1063-2 Filed 11/02/22 Entered 11/02/22 20:38:32 Page 11 of