Beruflich Dokumente
Kultur Dokumente
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In Re: : 02-16212
4 :
ACTRADE FINANCIAL TECHNOLOGIES LTD. : One Bowling Green
5 : New York, New York
:
6 Debtor. : December 16, 2008
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APPEARANCES:
11
For the Trustee: PHILIP ANKER, ESQ.
12 Jonah Meer JAMES H. MILLAR, ESQ.
Wilmer Cutler Pickering Hale and
13 Dorr LLP
399 Park Avenue
14 New York, New York 10022
25
3 APPEARANCES: (cont’d)
25
3
3 telephone.
4 [Pause in proceedings.]
7 telephone.
9 Eric Resenberg.
12 Go ahead. Go ahead.
21 Honor.
2 Distributors.
9 [inaudible].
13 D’Allesandris.
18 agreement.
23 settlement agreement?
6 the settlement.
22 filing under seal and opened that up. But I don’t think there
1 read them.
11 framework in terms of what the law is and what the law requires
20 about what has transpired. I submit that the Martin case and
21 numerous cases that have filed it, and no case has rejected it,
25 the Court and look for the best opportunity for this estate and
7
14 -- believe --
4 the province of the trustee today to say that deal isn’t in the
15 think the better answer to that question is no, he may not, and
22 submit in breach of his duty not to. Case after case says that
23 when you are a party and you enter into an agreement with a
25 has an obligation to benefit the estate and look for the best
9
6 reach that question. Because there have been new events that
7 have occurred. There are several. First, Your Honor, when the
12 Aharoni. This was $31 million taken out of this estate after a
22 one penny has been recovered. And these are loan agreements,
9 that he understood at the time that that was the price one had
14 going to mislead the Court, there’s always risk. But I’ve had
5 action here, and I think that’s where the record stands today.
18 should look back in time with blinders on recent events and ask
1 but even if that record hasn’t changed the trustee can come in
4 hasn’t changed --
9 strong and for real dollars. Put aside for a moment all the
10 other action, the options and the like that add to it tens of
16 MR. ANKER: I --
18 some day but we’re not trying that case today, so I don’t think
19 you need to get too deeply into it. I hear the number, and I
2 to another point.
11 of Chancery.
22 judgment.
25 let others speak and then I’ll respond. There -- one of the
15
7 be both candid but careful in what I say. The trustee has been
20 before yours --
2 about the length of time that has elapsed. But that’s only one
4 other parties.
10 right.
13 Your Honor has read all the papers, I think it might be just
3 action --
6 then --
16 Honor.
8 cooperated?
17 retained in --
19 can’t testify --
4 the fact that that was -- for example, the mediation was
7 Allou --
5 that issue is not before Your Honor. That issue, as Mr. Anker
9 presentation today.
12 question.
14 to make clear that if all the other parties who are here today,
25 much less than perhaps they would have actually entered into.
21
1 So that, number one, that when -- the statement was made that
3 -- I was there, Mr. Anker was not there, this was before his
8 trustee points to the $31 million. Did you receive any of the
11 --
13 your hands?
15 -- I’m --
18 not --
24 before -- you know, this issue was addressed before, two years
8 actually his counsel Mr. Vann [Ph.] was present as well as the
15 buy into the explanation either before we signed the March 2004
16 settlement.
18 reasons that was very clear that the trust had decided at the
19 time that we had the May 2004 mediation, the class settlement,
20 that from a macro picture it was far better for the estate to
25 the facts were. And, Your Honor, while I didn’t like the
23
7 records from BCP Bank that demonstrate that Mr. Aharoni was in
17 --
25 time did not take the position that he had misappropriated the
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1 funds.
10 I gather, the position that they didn’t get the benefit of that
11 money.
14 undisputed that all of the facts that were known then before
22 and there’s no dispute, the trustee at the time knew that there
1 that was the price that they had to get, give Aharoni a
2 release.
5 was entered into in March 2004. The Delaware Chancery case was
7 mediation took place a month later. And over the course of the
10 were negotiated, even though Judge Berman had been told by Mr.
24 thing in the world that Mr. Aharoni or, for that matter, Mr.
13 appears that Mr. Anker has obtained in the last year, I would
15 view that was strongly held by the trustee and by Paul Weiss
2 have been a class action settlement, and Mr. Anker would not be
6 benefit of the deal that he’s trying to now redo just simply to
10 from the Third Circuit, the interesting thing about that case
11 is that the changed circumstances were that the trustee was not
18 There was more money coming into the estate, making the prior
19 deal, which was not as good for the estate, less preferable
6 But I will say that if this class action settlement that was --
7 has been waiting for approval for four years -- although the
18 that.
20 Union may well say that, you know what, we wanted to arbitrate
6 which I’ve been doing this for a while and I appreciate Mr.
7 Anker has been doing this for a while and I’ve had a lot of
10 As I see it, the claims that were asserted against Mr. Aharoni
10 when I say that the problem and lack of benefit to the estate
16 estate will have is we’ll be back having to now spend the next
15 last year has been pressing the lawyers in the case when is
19 off any with respect as to why he’s still -- you know, his
4 for over ten years. The allegations of a massive fraud and the
5 numbers in excess of $31 million has been bandied about for ten
11 Union --
16 any of that?
19 hands?
25 were the subject matter of the class litigation. This was the
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15 your client?
22 policy for the claims that had been made in the class
7 have been resolved at this point but for the fact that
11 present trustee can assert is that his predecessor had not seen
12 and did not have available to him the new bank records. Once
3 the original settlement, that any new order should not provide
16 can know and be assured that you’re not going to settle today
17 and then the next day someone’s going to pop out of the
22 hypothetical.
5 turn sues the former officers and directors, and then the
18 that the only thing left before approval by the Court is the
23 Now we’re stuck with the spectra that the litigation could come
6 the trustee.
8 that Mr. Aharoni was not fulfilling his obligations under the
3 Thank you.
12 what’s been going on. Because if you look at the docket, for
14 the case, and from March until November again there was hardly
21 status of where things stood, saying there are two major issues
4 shareholders in ‘06 and ‘07 did not disclose, oh, by the way,
20 over the last many years, and what it believes still needs to
3 report, then you certainly may speak to it but I’m not sure
10 the motion says that there’s new evidence and Mr. Bronstein
12 this year, we’d like to understand why this evidence was not
18 and we --
20 disclose what’s been spent and on whom and who’s received any
21 funds, and where the funds are today and the protection of
22 those funds. Those who may have come to this hearing a few
4 and we’ll need a full accounting of where the money is, how
18 not have. But the question I think is when did the new trustee
21 Your Honor.
4 affiliation again.
8 statement?
10 what Mr. Rubin had said regarding the desire to maximize and
14 that was my, that’s my concern. I’d also like to address there
2 Honor, let me just say on the last point Your Honor raised we
14 I won’t repeat all of them but let me start with the most
22 matter. If Your Honor has doubt about it, take a look at what
2 pending trial --
7 had occurred, and the debtor had won. And in denying approval
9 fact, a fact that plainly was unknown to the trustee when the
12 money went.
14 would be you may or may not have proof but your ability to
20 whether or not you can collect it. Now, I’m not asking you to
21 try that case today, and I gather that the trustee has made
24 estate. However, the differences with the Martin case are not
2 that was a fait accompli, and I agree with that, and I was not
4 establishes that you ask the question, Your Honor needs to ask
7 answered it. But Your Honor just, I think, put your thumb on
8 exactly the right issue, and that is how do you decide today
13 case says is Your Honor can’t hold a trial today, you can’t
18 the answer is at the end of the day my firm, Mr. Salisbury, Mr.
20 and what case after case says is you defer in the absence of
22 judgment.
25 judgment, and we’ve been very careful in how we’ve worded this,
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1 that we are confident that we will be able to do a modified
9 claims. And we can deal with issues like the ones that have
13 occurred. I said one last point but now I’m going to -- I told
16 it to that level.
18 think of it before.
20 point and has gone on to two or three more has been telling me
24 last point. You asked, and I thought it was perhaps the most
2 would he answer that. And his answer was no, and you were left
3 --
5 an evidentiary hearing?
12 It means telling the truth. And when you’re asked the question
13 do you control ICC, did the money go into your pocket, and the
18 and people lied to us. That’s what happened here. And you
23 estate’s claims for more than $30 million will be in the best
25 rapidly.
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1 THE COURT: All right. Thank you.
3 you.
10 --
16 [Pause in proceedings.]
2 settlement. The trustee has also informed the Court that the
12 The trustee has informed the Court that Aharoni has not
3 the Court for approval. Aharoni’s counsel states that all the
5 the table, and were taken into account when the trustee made a
12 funds, and that the trustee did not receive cooperation but
22 estate. The trustee did not flout or breach any term of the
3 This appeal raises a very narrow issue, and we will not expand
8 changed circumstances.”
13 bankruptcy judge must assess and balance the value of the claim
25 the assumption that Aharoni was telling the truth and would
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1 cooperate but not under present circumstances. This Court has
5 litigation, but the Court cannot find that these are so clearly
18 also, I think, within 30 days make the further filing that was
21 can appear.
3 [Pause in proceedings.]
5 no, we --
7 record.
11 pretty constantly for the last couple of weeks to try and reach
13 report that before the Court goes away for the holidays. I
23 MR. FLINT: If I --
16 at 10:00 for the time being, but obviously it can be put over
20 agree on. All right. Very good. Thank you very much.
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1 I certify that the foregoing is a court transcript from an
3 entitled matter.
6 Sally Reidy
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