Since Bob brought up the issue of his and Joy's websites I went to go look for the previous testimony/non testimony from the duo about who or who didn't own all of them, and found the following transcript (of the hearing preceding the contempt of court and sanctions the Judge issued was now available.)
Quite eye opening, I thought...
UNITED STATES BANKRUPTCY COURT
WESTERN DISTRICT OF MASSACHUSETTS - WORCESTER
================================
IN THE MATTER OF: . Case #07-43128
.
GAILON ARTHUR JOY . Worcester, Massachusetts
. January 31, 2008
Debtor . 10:29:40 a.m.
================================
GAILON ARTHUR JOY . Adv. #07-4173
Plaintiff, .
vs. .
DANNY LEE SHELTON and .
THREE ANGELS BROADCASTING .
NETWORK, INC. .
Defendants. .
================================
TRANSCRIPT OF HEARING IN THE MAIN CASE ON:
(#33) MOTION OF THE CHAPTER 7 TRUSTEE, JANICE G. MARSH, FOR ORDER
AUTHORIZING AND APPROVING PRIVATE SALE OF PROPERTY OF THE
ESTATE (ALL DOMAIN NAMES OWNED BY THE DEBTOR AND ALL PREPETITION
CLAIMS THE BANKRUPTCY ESTATE MAY HAVE AGAINST (a)
THREE ANGELS BROADCASTING NETWORK, INC., AND (b) ITS OFFICERS,
DIRECTORS, SHAREHOLDERS, AND EMPLOYEES, INCLUDING DANNY
SHELTON, INCLUDING A RELEASE OF ANY CLAIMS THE ESTATE HAS OR
MIGHT HAVE AGAINST THE BUYERS); (#47) OBJECTION OF THE DEBTOR;
(#54) MOTION OF THE CHAPTER 7 TRUSTEE, JANICE G. MARSH, FOR AN
ORDER OF CONTEMPT AND FOR SANCTIONS;IN THE ADVERSARY CASE ON:
(#4) MOTION OF DEFENDANTS DANNY LEE SHELTON, THREE ANGELS
BROADCASTING NETWORK, INC. TO DISMISS ADVERSARY PROCEEDING;
(#15) OPPOSITION OF DEBTOR BEFORE THE HONORABLE JOEL B. ROSENTHAL, JR., J.U.S.B.C....
APPEARANCES -
For the Debtor/Defendant: LAIRD J. HEAL, ESQ.
...
For Defendant Three Angels Broadcasting: JOSEPH COLLINS, ESQ.
...
For Janice G. Marsh, Trustee: JANICE G. MARSH, ESQ.
...
For John P. Pucci, Esq. And Fierst: JOHN P. PUCCI, ESQ.
...
For Jerrie M. Hayes, Esq., Gerald Duffy, Esq.:JERRIE M. HAYES, ESQ.
...
Electronic
p. 2
(At 10:29:40 a.m.)
2 MS. MAGEROWSKI: Gailon Arthur Joy. Case #-07-43128.
3 Hearings in the main case and adversary proceeding 07-4173.
4 Please identify yourselves for the record.
5 MS. MARSH: Good morning, Your Honor. Janice Marsh,
6 the Trustee.
7 MR. HEAL: Good morning, Your Honor. I’m Laird Heal
8 for the debtor, Gailon Arthur Joy.
9 THE COURT: Go ahead, Ms. Marsh.
10 MS. MARSH: Thank you, Your Honor.
11 THE COURT: One moment, please.
12 (Pause)
13 THE COURT: We’re just noticing that Mr. Roumeliotis
14 isn’t here yet.
15 MS. MARSH: Yes, Your Honor. And I talked to Mr.
16 Collins either Monday or Tuesday, and he was aware of the
17 hearing today.
18 THE COURT: I understand, and it’s just --
19 MS. MAGEROWSKI: Yes, it’s just --
20 THE COURT: -- ten --
21 MS. MARSH: Oh, I see. Okay.
22 THE COURT: -- just on the dot of 10:30.
23 MS. MARSH: I understand.
24 THE COURT: If we started two minutes, Mr. Heal
25 wouldn’t have been here either. So why don’t we just wait five
page 3
1 minutes --
2 MS. MARSH: Fine.
3 THE COURT: -- rather than have to repeat ourselves,
4 okay?
5 MS. MARSH: Okay. Thank you, Your Honor.
6 THE COURT: I’ll take a brief recess.
7 MS. MARSH: Thank you.
8 [Off the record at 10:30:53 a.m.]
9 * * * * * * * *
10 [On the record at 10:40:14 a.m.]
11 MS. MAGEROWSKI: Please be seated. Gailon Arthur Joy.
12 Case #07-43128. Hearings in the main case and adversary
13 proceeding 07-4173. Please identify yourselves for the record.
14 MS. MARSH: Janice Marsh, the Trustee.
15 MR. COLLINS: Joseph Collins, counsel for Three
16 Angels Broadcasting Network and Danny Shelton.
17 MR. PUCCI: John Pucci. I am representing myself
18 here in the adversarial action, Your Honor, as well as my law
19 firm.
20 MS. HAYES: Jerrie Hayes, Your Honor. I’m here
21 representing myself as well as the firm of Siegel, Brill,
22 Greupner, Duffy & Foster.
23 THE COURT: Did you hear that?
24 MR. HEAL: I’m Laird Heal for the debtor, Your
25 Honor.
page 4
1 THE COURT: Did you get that, Leah?
2 MS. DIDONATO: I’m not sure I got the --
3 THE COURT: You’re far away from the microphone, so
4 I’m not sure that we got that.
5 MS. HAYES: It’s Jerrie, J-E-R-R-I-E, Hayes, H-A-Y-
6 E-S, here representing myself, Gerald Duffy, and the law firm
7 of Siegel, Brill, Greupner, Duffy & Foster.
8 THE COURT: Ms. Marsh, where are we?
9 MS. MARSH: Thank you, Your Honor. As Your Honor
10 will recall I had filed -- I filed a motion to sell property.
11 I filed that on November 30 , and I have recently, on January th
12 24 , filed a motion for an order of contempt and for sanctions th
13 that I didn’t receive information that the Court had ordered be
14 provided to me by January 17 . th
15 The proposed buyers brought to my attention that
16 there were two domain names and alleged counterclaims against
17 the buyers. The debtor and the buyers have offered to purchase
18 this property, and I tentatively accepted the offer, and I
19 filed the motion to sell.
20 The debtor has objected to my motion to sell, and
21 also has filed a motion to dismiss, which is not before the
22 Court today. At the hearing on December the 18 , Your Honor
23 asked specifically about the alleged counterclaims. I believe
24 more information is needed about those counterclaims; and Your
25 Honor ordered the debtor to provide all requested information
p 5
1 to me within thirty days.
2 On December the 18 before I received a copy of the
3 order, I sent a fax to Mr. Heal, the debtor’s attorney, to
4 request specific information about the alleged counterclaims,
5 and that fax is included as an exhibit to my motion for
6 contempt and for sanctions. Mr. Heal received a copy of the
7 fax at 1:44 p.m. on December the 18 .
8 On January 24 when I had received no response from
9 Mr. Heal, I filed a motion for contempt against the debtor for
10 appropriate sanctions, and I also asked for a hearing today.
11 At about 5:30 p.m. on January 24 I received a fax from Mr.
12 Heal, and he wrote that the, quote, “ --- debtor had no such
13 documents.” And then Mr. Heal also wrote that the registration
14 for the domain names in question had expired on January 8,
15 2008. And he gave me the address for the registrants in the
16 State of Washington, and he said the debtor had “no involvement
17 with the operation, establishment, or ownership of those domain
18 names or websites,” and he said, “Thus the entire matter of the
19 sale of the domain names is moot.”
20 Then on Sunday night, January 27 , at 6:44 p.m. --
21 THE COURT: When did he do -- when did he provide
22 this information?
23 MS. MARSH: I received that, Your Honor, at -- I
24 think it was 5:31 p.m. on January 24 . That’s what’s at the
25 top of the fax I received from Mr. Heal.
p 6
1 THE COURT: And he told you then that the --
2 MS. MARSH: The debtor has no such documents.
3 THE COURT: Do you have a copy of that for me?
4 MS. MARSH: Yes, Your Honor. I do. This is my
5 original, but I’ll be --
6 THE COURT: Well, we can make a copy.
7 MS. MAGEROWSKI: I’ll just make a copy.
8 MS. MARSH: I actually did receive another one, but
9 it has an October 16 date, and so he went me -- he sent me a
10 revised one on January 27 .
11 THE COURT: So he didn’t respond to you until you
12 filed your motion.
13 MS. MARSH: Correct, Your Honor. Then on Sunday
14 night I received an e-mail from Mr. Heal, and -- received it on
15 my Blackberry and I looked at it -- and it said that the -- it
16 included the complaint and the answer --
17 THE COURT: What date was that?
18 MS. MARSH: Sunday, January 27 , 2008. 6:44 p.m.
19 THE COURT: Go ahead. What did he include there?
20 MS. MARSH: And may I approach the bench, Your
21 Honor?
22 THE COURT: Sure. Why don’t you give her that one
23 back. This was one that was sent wrong.
24 MS. MAGEROWSKI: Do you want a copy of that?
25 THE COURT: Yes, I want a copy of this one. All
p 7
1 right, let me take a moment to read this. (Pause) Take a copy
2 of that as well when you have a chance. Go ahead.
3 MS. MARSH: Thank you, Your Honor. Included in the
4 e-mail he sent to me on Sunday night was a copy of the
5 complaint initiated by the buyers in Federal District Court
6 against the debtor and Mr. Pickle and the debtor’s and Mr.
7 Pickle’s answer to the complaint. And it goes on to say in the
8 e-mail, which Your Honor has read,
9 “It’s quite clear that 3ABN and Danny Shelton have
10 engaged in a practice and pattern of discouragement
11 of Mr. Joy,”
12 -- but not at all clear that this has led to any damages.
13 I haven’t received any other responses from the
14 debtor.
15 THE COURT: Well, let me just refresh my memory. I
16 ordered them to provide documents in support of his objection
17 to your sale.
18 MS. MARSH: You asked for information --
19 THE COURT: Because you were saying that there were
20 valuable counterclaims and the like that you were giving away.
21 MS. MARSH: There are counterclaims, and Your Honor
22 justifiably wanting to try to value those counterclaims. The
23 complaint that I received on Sunday night includes as exhibits
24 information about the websites that I’m trying to sell. So I
25 have that information about the websites, and then I have
p 8
1 limited information about the counterclaims. On January 28 ,
2 on Monday, I did some searched on the internet, and I typed in
3 “Save-ABN” or “3ABN.com” and I found a website, and I have
4 copies if Your Honor’s interested in them. It says, “Save-
5 3ABN.com.” And it says at the top,
6 “Archive of content from Save3ABN.com with continuing
7 coverage of 3ABN saga.”
8 Then it says,
9 “Danny Shelton and 3ABN are trying to buy the domain
10 name Save3ABN.com in Bankruptcy Court without proving
11 their case in U.S. District Court. Hence, this
12 archive and new site. See also
13 3ABNinvestigated.com.”
14 So I looked at also 3ABNinvestigated. -- excuse me -- .info.
15 .info. And it says,
16 “Archive of content from Save3ABN.com with the new
17 information as it becomes available. This site is
18 launched since Danny Shelton and 3ABN are trying to
19 buy the domain name Save3ABN.com in Bankruptcy Court
20 for $5,000, without proving their case in the
21 lawsuit. Archives also reside at 3ABNanalyzed.info’
22 and 3ABNcritiqued.info.”
23 So I looked at those sites. 3ABNanalyzed.info says:
24 “What was formerly at Save3ABN.com with new material.
25 Danny Shelton and 3ABN are trying to buy the domain
p 9
1 name Save3ABN.com and Gailon Joy’s claims against
2 them in Bankruptcy Court for a mere $5,000. We
3 didn’t want all this information to disappear, so
4 we’ve put it here. You can also find it at
5 3ABNexamined.info and evaluating3ABN.info.”
6 Excuse me. So I looked at evaluating3ABN.info and it says the
7 following:
8 ““What was formerly at Save3ABN.com with new
9 material. We felt that we needed to protect the
10 information at Save3ABN.com, but putting a copy here
11 just in case Danny Shelton and 3ABN get to buy that
12 domain name in Bankruptcy Court for $5,000.”
13 Then today I tried to do an updated site, and I found
14 the following at
www.Save-3ABN.com.
15 “A Save-3ABN exclusive. Reaping the whirlwind. The
16 IRS criminal investigation of 3ABN”
17 And it has --
18 THE COURT: The whose criminal investigation?
19 MS. MARSH: IRS criminal investigation --
20 THE COURT: Oh, okay.
21 MS. MARSH: -- of 3ABN. And then it has,
22 “Original message from G. Arthur Joy. Subject: IRS
23 criminal investigation. Date: Friday 30 November
24 2007,”
25 And it’s about a six-page e-mail or message, and at the bottom
p 10
1 it says,
2 “Gailon Arthur Joy, AUR reporter, Save-3ABN.com.”
3 Your Honor, I don’t believe the debtor has been
4 forthcoming in this case. He failed to list on his schedules
5 the domain names for counterclaims he might have had, and he
6 didn’t testify about them at the 341 meeting. I haven’t
7 received all the information that I requested in my December
8 18 fax. I did, of course, receive on January 27 copies of th th
9 the complaint and the answer. My request #3, the debtor claims
10 he doesn’t have any documents. And my questions 4, 5, and 6
11 have received nothing. 5 and 6 specifically go to whether or
12 not any claims could be compulsory counterclaims.
13 And I will note that the answer to the complaint
14 filed in the federal District Court does not include a
15 counterclaim, so if there were on, well, it’s been waived.
16 Whether or not there is a permissive counterclaim out there, I
17 don’t know.
18 The debtor provided the information only after I
19 filed my motion for contempt.
20 Your Honor, I request again that my motion to sell be
21 approved; and I also ask for sanctions. I believe the debtor
22 has had plenty of time to provide information. He didn’t
23 provide it timely. What I did get was insufficient; and I
24 believe what’s on the website frankly contradicts some of the
25 representations made upon behalf of the debtor in this case,
p 11
1 Your Honor.
2 THE COURT: Does the debtor have a discharge?
3 MS. MARSH: Yes, except Mr. -- well, Mr. Collins has
4 a pending motion, and -- to extend that deadline -- or the
5 deadline’s been extended, I believe.
6 MR. COLLINS: I don’t know if the motion’s been
7 allowed, but we have moved to extend the time.
8 MS. MARSH: And, of course, Your Honor, there may be
9 grounds under 727 for transferring property within a year post-
10 petition, too. So there’s that option available. Thank you,
11 Your Honor.
12 THE COURT: Thank you. Anybody else want to be
13 heard in favor of the motions filed by Ms. Marsh?
14 MR. COLLINS: Thank you, Your Honor. Joseph
15 Collins, counsel for 3ABN and also for Danny Shelton.
16 Your Honor, what you just heard really in my opinion
17 is an outrageous set of circumstances. We have a debtor that
18 owns domain names, doesn’t disclose them on the bankruptcy
19 schedules, doesn’t disclose them at a Section 341 meeting.
20 When we attempt to sell those domain names, use as
21 the opportunity that this Court gives to Mr. Joy to object to
22 the domain -- to the sale of the domain names, as an
23 opportunity to transfer the domain names. You heard there was
24 an expiration on the domain names. That’s not really how it
25 works. I don’t profess to be an expert in the subject of
p 12
1 domain names and their transfer; but as I understand it, when
2 an expiration date comes, that does not mean that a domain name
3 necessarily lapses. As I understand it, there is an automatic
4 extension during which the host of the domain name, or whoever
5 issues the domain names, will not automatically cancel that.
6 In order to re-register in a new name, the existing
7 domain name has to be extended. We believe that’s what
8 happened. We’re having difficulty in determining that
9 precisely because the new registered owner is using an
10 artificial entity that won’t disclose information regarding the
11 actual ownership. We heard though from Mr. --
12 THE COURT: Well, 2004 is, of course, available to
13 you.
14 MR. COLLINS: Excuse me?
15 THE COURT: 2004 examinations are, of course,
16 available to you.
17 MR. COLLINS: Well, that’s true. We have learned
18 from Mr. Heal this morning, he indicated essentially that
19 Robert Pickle is the individual who now controls the new domain
20 names. The Court will recall --
21 THE COURT: Well, we’ll see about that at some
22 point.
23 MR. COLLINS: And the Court -- I’d just like to
24 remind the Court, Mr. Pickle filed an affidavit in this case in
25 response to our motion for relief from stay some weeks ago in
p 13
1 which he acknowledged that Mr. Joy was the owner of the domain
2 names and that he was the webmaster for those domain names, and
3 Mr. Pickle is the co-defendant in the federal District Court
4 case that’s pending.
5 What this is, Your Honor, and in my opinion is simply
6 a transfer of -- an attempt by the debtor to transfer an asset
7 we believe that is void. My client is still prepared to go
8 ahead with the sale, but I’d like to remind the Court that my
9 client required before and would still require a finding that
10 the domain names are property of the bankruptcy estate and that
11 Mr. Joy is the registered owner.
12 We understand that if the Court issues such an order,
13 we may have to, in state court or other federal court, go ahead
14 and find -- and take some action to get those restored, but
15 we’re prepared to undertake that process.
16 THE COURT: Thank you.
17 MR. COLLINS: If I could, Your Honor, I have a
18 proposed order if the Court would like to --
19 THE COURT: That’s on the sale?
20 MR. COLLINS: Yes, and I believe I submitted this --
21 if I could approach -- this proposed order when we were here a
22 month ago. I don’t know if I -- I think I gave it to the
23 Court. I think the Court’s review of this order is what caused
24 the extension of time.
25 This order is different than the one you’ve seen
p 14
1 before in that at the previous hearing you said that you would
2 be unwilling to enter the order that transferred all domain
3 names, so we have modified this order so that all we’re asking
4 the Trustee to do is to transfer the two domain names:
5 Save3ABN.com and Save3ABN.org. And we also clarified just with
6 some minor language to the effect that the Trustee is also
7 authorized to sign a release of the claims that she might have,
8 but in other respects, the order is identical.
9 THE COURT: Thank you.
10 MR. COLLINS: Thank you, Your Honor.
11 THE COURT: Anybody else want to be heard in favor
12 of the two motions filed by the Chapter 7 Trustee? All right,
13 I’ll hear you, Mr. Heal, first on the motion for contempt and
14 sanctions.
15 MR. HEAL: I’m sorry, Your Honor. I didn’t know
16 that the Trustee needed a formal response when there were no
17 documents. I’ve talked to the Trustee --
18 THE COURT: Oh, please, Mr. Heal. Please. I
19 ordered you --
20 MR. HEAL: To provide the documents.
21 THE COURT: -- requested documents within thirty
22 days. Did you -- what did you send her within thirty days?
23 MR. HEAL: Your Honor, I did not send anything.
24 THE COURT: Did you say “There are no documents”?
25 No.
p 15
1 MR. HEAL: No, I’m sorry. I didn’t.
2 THE COURT: Don’t apologize to me. You know your
3 responsibility. You’re a member of the bar, and I -- you’re
4 going to tell me you’re a new member of the bar and you don’t
5 understand that. That’s baloney. You knew exactly what you
6 were doing. Did you know these things were expiring?
7 MR. HEAL: Your Honor, I had been told they were
8 expiring.
9 THE COURT: So you took advantage of the fact that a
10 deadline was given. You knew that there was at least an issue
11 that they were property of the estate, and you just let them
12 expire, and you think you’re not culpable?
13 MR. HEAL: Your Honor, the domain names are rented
14 for a year, and the expiration date is on the registration.
15 THE COURT: Are you going to answer my question now?
16 MR. HEAL: No, Your Honor, I didn’t --
17 THE COURT: You don’t think you had any
18 responsibility to the Court or to the Trustee to bring it to
19 their attention that there was an act that was required to
20 extend it? You don’t think so.
21 MR. HEAL: I was intending to, but I just didn’t
22 send the notice. I’m sorry. I didn’t know exactly what notice
23 to send.
24 THE COURT: How about, “Hey, Trustee! There’s an
25 expiration date coming up. Thought you ought to know about it,
p 16
1 since it’s your responsibility to preserve and protect the
2 assets of the estate,” as, by the way, I think it is the
3 debtor’s, and maybe the debtor’s counsel.
4 MR. HEAL: The debtor has paid nothing for this
5 domain throughout its existence, and he was not prepared to pay
6 anything again.
7 THE COURT: Didn’t say “pay.” Nothing -- nobody
8 said anything about paying. Just alerting people that this is
9 an asset that may be wasting. You don’t think -- you didn’t --
10 did -- have you amended your schedules yet to include these
11 assets? These alleged counterclaims that you signed -- that
12 you told me about in your objection? What are these
13 counterclaims? That was the whole purpose of giving you time.
14 You didn’t want there to be a sale, because you said the
15 Trustee was giving away assets, that there were valuable
16 assets. So I said, “Okay, fine, let’s find out about them.”
17 What are they, Mr. Heal?
18 MR. HEAL: Well, I asked the debtor and he told me
19 there were no documents that established that there were
20 counterclaims.
21 THE COURT: What are they, Mr. Heal? Maybe they’re
22 not documents, but what are the counterclaims?
23 MR. HEAL: Well, the most I heard is that on various
24 television broadcasts, which are, you know, are not in the
25 debtor’s or my possession, that they have impugned or slandered
p17
1 Mr. Joy and Mr. Pickle.
2 (Pause)
3 THE COURT: Anything further?
4 MR. HEAL: I have to say, Your Honor, the Trustee
5 did not so much as make a phone call to tell me that she was
6 going to file this motion. Otherwise, she would have had her
7 answer a lot sooner. And she has --
8 THE COURT: Excuse me. Didn’t she write you a
9 letter the same day? How much more than that? She was helping
10 you. She said, “This is what would be helpful to me.” You’re
11 not denying you received it, I gather.
12 MR. HEAL: I received the letter.
13 THE COURT: So you just didn’t respond until the
14 24 of January. The court order was entered on December 18 --
15 MR. HEAL: And the complaint and the --
16 THE COURT: And the debtor --
17 MR. HEAL: The complaint and the answer that I filed
18 were available from PACER, and that’s where I got them, Your
19 Honor. I gave her the copies that came from PACER. I paid for
20 them. Mr. Joy hasn’t paid me a dime.
21 THE COURT: That’s not the point. Is it? There was
22 -- you had a request before the hearing on the 18 of the --
23 you hadn’t provided to anything to them, so I ordered you to
24 provide the information. From the 18 of December you -- and
25 on that same date you received a note from the Trustee by fax
p 18
1 -- you acknowledge receiving it -- and you didn’t respond at
2 all until January 24 . So you had a Court order -- we had a th
3 court hearing. You knew the order was entered. You got a copy
4 of the court order presumably the next day or the same date
5 electronically, and you got a fax reminding you, “This is the
6 stuff we’re looking for.”
7 You did nothing about it. Your client did nothing a
8 about it. Thirty days came and went. You knew there was
9 another hearing because we’d scheduled this hearing at that
10 time. You knew there was another hearing. Meanwhile, on the
11 back (unclear) you’re telling me your client has nothing to do
12 with any of these other websites I assume, too.
13 MR. HEAL: Your Honor, this is the first I’ve heard
14 anything except that Mr. Pickle told me that on December 24th
15 he re-registered Save3ABN.com, and, you know, he did it, again,
16 with his own dime.
17 THE COURT: I have a lot of trouble buying that.
18 And then on January 24 , your -- you finally got around to th
19 responding to something, and that was a week late. All right.
20 MR. HEAL: No, I’m -- the Trustee has asked me to
21 get a formal response from Mr. Joy regarding her request. And
22 I will do that for her.
23 THE COURT: All right, when are you going to get
24 around that? I know you must be a very busy man.
25 MR. HEAL: I’ll do that today, Your Honor.
p 19
1 (Pause)
2 THE COURT: Thank you. Anything else, Mr. Heal?
3 MR. HEAL: Your Honor, I -- Mr. Collins has said
4 that he’s having trouble finding out about these domain names,
5 and he has Mr. Pickle -- or rather his client has Mr. Pickle as
6 an opponent in a lawsuit, and all that would have to do is
7 issue a discovery request, and as far as I know, and I ought
8 to, that no such discovery request has been made.
9 THE COURT: Well, that’s really -- I’m not so
10 concerned about these new domain names, because frankly I think
11 that’s going to be in another court in another place. Right
12 now I’m trying to deal with two simple motions: One, for
13 contempt and sanctions, and two, whether I should approve this
14 sale.
15 MR. HEAL: As far as approving the sale, Your Honor,
16 the -- you know, it’s -- unlike Mr. Collins, I would contend
17 that these are not property of the estate. They merely took
18 out a one-year rental on domain names. And in direct
19 opposition, what he claimed was a process whereby domain names
20 expire, we have all heard on the news where microsoft.com and
21 Sun’s websites have expired and been taken over by new
22 registrants who had their way with them until Microsoft and Sun
23 were able to get them back. It simply -- you know, the domain
24 is --
25 THE COURT: Of course, if your client aided and
p 20
1 abetted and purposely let the debtors expire and hid the asset
2 from -- in their schedules, then there may be culpability; and
3 if you conspired with them, there may be culpability on your
4 part, Mr. Heal. But that’s for another day, maybe in this
5 court, maybe in another court.
6 The rulings I’m making today have nothing to do with
7 the activities of you and/or your client or clients after. I’m
8 dealing with the assets of the estate as of the date that they
9 were filing, and your conduct and the conduct of your client
10 with respect to my December 18 order. That’s all I’m dealing
11 with.
12 MR. HEAL: Well, with respect to the Save3ABN.com
13 and Save3ABN.org websites, Mr. Pickle as technical contact did
14 the re-registration.
15 THE COURT: I’m not interested in spending my time
16 on it. It’s not before me.
17 MR. HEAL: Mmhmm.
18 THE COURT: I’m not judging that. It sounds fishy
19 and smelly.
20 MR. HEAL: Mmhmm.
21 THE COURT: But that’s not what I’m dealing with
22 right now. I’m not selling those domain names that didn’t
23 exist as of the date of the filing of this petition. That may
24 -- become before some other time, but it’s not before me now.
25 MR. HEAL: I’m sorry, Your Honor. Those are the two
p 21
1 websites in question.
2 After the first of the year those websites did go
3 silent with a message apparently from Mr. Joy that said that,
4 you know, because for some reason he was ordering them shut
5 because of the cost of expense or something.
6 THE COURT: What right did he have to do anything?
7 MR. HEAL: And then another message came after Danny
8 Shelton had gotten on the -- on this broadcast, and said that
9 there was an order that the sites be shut, so that then the
10 message came that they were being reopened for two days, at
11 which point the president of 3ABN said, “Well, there was an
12 appeal and they were allowed to be opened for two days on
13 appeal.” And, you know, all of this is of limited relevance,
14 but it’s all I’ve heard about what has happened to the
15 websites.
16 THE COURT: You seem to be hearing a lot more than
17 you seem to be willing to share from time to time. All right.
18 I’ve heard enough on the sale aspect. I’m still waiting to
19 hear a reasonable and rational basis why I shouldn’t hold you
20 and your client in contempt for failure to abide by my court
21 order of December 18 . All I heard so far was you were sorry.
22 MR. HEAL: Well, there are no such documents,
23 according to the debtor, and, you know, the failing, if there
24 was one, to not tell the Trustee that there were no documents,
25 well -- you know, I would have to say that was my failing
p22
1 When I realized I could get a hold of the complaint
2 and the answer, I did provide them to her. Although they are
3 public records, and, you know, the answer, if one had to be
4 provided, was that it could just as well that the Trustee could
5 have accessed them as easily if not more easily (unclear).
6 THE COURT: What about the answers to #5 and 6?
7 Whether any of the debtor’s alleged claims against the buyers
8 arise out of any of the transactions or occurrence of the
9 subject matter of any of the buyer’s claims against the debtor?
10 If so, specifically what claims against the buyers?
11 And then 6: Whether the time of the complaint was
12 filed the debtor’s claims, if any, against the buyers were the
13 subject of any other pending action? If so, what specific
14 action? That doesn’t require a requested document. That
15 requests information. That requests statements. Did you not
16 read that at the time?
17 MR. HEAL: Yes, I did, Your Honor. And as I said,
18 the debtor’s answer was simply that there were no such
19 documents, so --
20 THE COURT: But that’s not -- that’s like saying,
21 like a stupid kid’s joke. “No soap radio.” That’s not an
22 answer to the question that was asked. The question that was
23 asked was maybe a No, maybe a Yes, or maybe further expansion
24 was necessary, but that there were no documents doesn’t answer
25 the question, and you’re blaming it on the debtor. You have a
p 23
1 responsibility. This was sent to you.
2 MR. HEAL: Yes, Your Honor.
3 THE COURT: Anything else?
4 MR. HEAL: No, Your Honor.
5 THE COURT: Thank you. All right, with respect to
6 the motion of the Trustee, Janice Marsh, for an order of
7 contempt and for sanctions, I’m granting that motion. The
8 debtor and Attorney Heal are hereby found in contempt and are
9 hereby sanctioned $1,000 each for failure to abide by the
10 Court’s order of December 18 , 2007. Payment to be made
11 within ten days -- made to the Clerk of the Court within ten
12 days.
13 MR. HEAL: Your Honor, can the debtor have any more
14 time?
15 THE COURT: No.
16 MR. HEAL: I don’t believe he has the money.
17 THE COURT: Well, file appropriate affidavits then
18 if he doesn’t. Now -- you may be seated, Mr. Heal.
19 Now, Ms. Marsh, you know, I don’t know what I’m
20 selling anymore. Do you? And it’s not that I object to the
21 amount at this point, because frankly I think the debtor is
22 just blowing smoke, and if they’re not you’ll be suing them
23 very shortly. But I don’t know what -- what’s going -- I don’t
24 know enough to know what’s going on, and that makes me very
25 uncomfortable.
p 24
1 MS. MARSH: Your Honor, I believe that the debtor
2 had an interest in the domain names.
3 THE COURT: Oh, I do, too.
4 MS. MARSH: Yeah. And whether or not he still has
5 them, I don’t know; and that could give rise to a revocation of
6 discharge, at least by (unclear).
7 But to the extent he does have an interest in them, I
8 would like that interest to be sold. I can ask Mr. Collins if
9 his client thinks -- he’s willing to buy the interest, whatever
10 it may be. Maybe that’s the way it should be ordered.
11 THE COURT: Well, I don’t want you to end up with a
12 claim against the estate for breach of reps and warrantees
13 because it -- this -- the question now has been raised whether
14 these domain names (a), exist; (b), have in some fashion been
15 properly become somebody else’s property.
16 So I’m going to ask you to take a look at the order
17 and make whatever modifications you think are appropriate to
18 protect the estate from a claim coming back.
19 MS. MARSH: And I think in that regard I would say
20 as is -- as is where -- you know, whatever they might be, if
21 anything. I mean, pretty broad in that regard.
22 THE COURT: Fine. Make -- make such modifications.
23 I’m going to hand back the order. Why don’t you folks stay
24 around, mark it up in whatever way, and I’ll sign it.
25 MR. HEAL: Your Honor, if I may?
p 25
1 THE COURT: Excuse me?
2 MR. HEAL: If I may?
3 THE COURT: Sure, Mr. Heal.
4 MR. HEAL: The language in the order that was -- the
5 proposed order that was submitted -- says that the property
6 should be transferred free and clear of any liens against the
7 IRS or the Massachusetts Department of Revenue.
8 THE COURT: Are there any liens?
9 MR. HEAL: None that I know of, but doesn’t that
10 sound a little, well -- over-reaching again?
11 THE COURT: Well, they received -- I presume they
12 received notice.
13 MS. MARSH: Your Honor, I’m not sure that --
14 THE COURT: They did not ob --
15 MS. MARSH: I’m not sure the IRS did, but as I
16 recall -- and Mr. Collins can correct me since he’s also a
17 Trustee -- if the Trustee sells property free and clear, the
18 IRS lien does not attach to it. Is that your understanding,
19 Mr. Collins?
20 MR. COLLINS: Yes, it is.
21 MS. MARSH: Or, I assume that goes for the DOR, too.
22 THE COURT: Is there an IRS lien?
23 MS. MARSH: Pardon me?
24 THE COURT: Is there an IRS lien?
25 MS. MARSH: Your Honor, I don’t know if there is,
p 26
1 but even if there were --
2 THE COURT: Mr. -- you filed the petition. Is there
3 an IRS lien? Is there an IRS claim? Let’s start with that.
4 MS. MARSH: Your Honor, I don’t recall having seen
5 one, but I haven’t looked at the -- I haven’t even -- I’m not
6 even sure I requested it. (unclear) can’t remember. Oh,
7 actually, Your Honor, there’s a -- Mr. Collins has showed me
8 Schedule E has a Mass. Department of Revenue claim for
9 $2,573.43.
10 THE COURT: Well, what about the IRS?
11 MS. MARSH: It’s not listed on Schedule E.
12 THE COURT: Well, let’s see what they have a claim
13 for.
14 (Pause)
15 MS. MARSH: In fact, of course, as Mr. Collins
16 pointed out to me, Schedule E is an unsecured priority. Now
17 whether or not the Schedule E is correct, I don’t know; but
18 that’s what the debtor has --
19 THE COURT: Well, that’s -- that’s the debtor’s and
20 Mr. Heal’s responsibility. (Pause) The IRS is not listed on
21 your Schedule E. The Commonwealth is, for $2,500. (Pause)
22 Mr. Heal, when are you -- do you know something about a tax
23 lien that’s not disclosed on these schedules?
24 MR. HEAL: I’d have to say I do not, Your Honor. I
25 just noticed the language, and --
p 27
1 THE COURT: Well, it doesn’t appear that the IRS is
2 owed any money, based on the schedule that you filed and that
3 you have a responsibility to at least make a reasonable effort
4 to make sure they’re correct. So I presume that you at least
5 inquired of your client.
6 Anything else? All right, take a look at -- this --
7 these papers go with this contempt, and they’re going to submit
8 an order, okay? All right, just bring it around to the desk
9 and give it to Ms. Magerowski.
10 Thank you. That concludes the hearing.....
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Topic: Hearing Transcript (Read 6060 times)
