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UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

FORT LAUDERDALE DIVISION

IN RE:

ROTHSTEIN ROSENFELDT ADLER, P.A., 1

CASE NO.: 09-34791-RBR

INVOLUNTARY CHAPTER 11

Alleged Debtor.

/

____________________________________

EMERGENCY MOTION TO ENFORCE THE AUTOMATIC STAY

[Hearing Requested on November 20, 2009 at 9:30 a.m.]

Basis for Emergency Relief:

The Movants request that this Court stay any attempt to

conduct third party discovery against the Debtor or the Chief

Restructuring Officer. Currently, one party is attempting to

take the deposition of Stettin on November 19, 2009. It is

impossible for Stettin to continue his review of the Alleged

Debtor’s books and records and prepare this case for

stabilization if he is subject to onerous third party discovery.

The Movants request a hearing on November 20, 2009. 2

The Hon. Herbert Stettin (“Stettin”), the State Court appointed 3 receiver (“Receiver”) and

Rothstein Rosenfeldt Alder, P.A. (“Alleged Debtor” or “RRA”), by and through Stettin as the

Chief Restructuring Officer (“CRO”) of RRA (collectively the “Movants”), hereby move this

Court for an Order, pursuant to 11 U.S.C. §§ 105(a), 362(a), enforcing the automatic stay and

staying any and all future depositions until further order of this Court (the “Motion”). In support

of the Motion, Stettin states as follows:

BACKGROUND

  • 1. This case was commenced as an involuntary chapter 11 proceeding on November

10, 2009, by four petitioning creditors [D.E. 1]. No Order for Relief has been entered.

  • 1 The address and last four digits of the taxpayer identification number of the Debtor, Rothstein Rosenfeldt Adler, P.A., is Las Olas City Centre, 401 E. Las Olas Blvd, Suite 1650, Fort Lauderdale, Florida 33301 (TIN 7961).

  • 2 This Motion shall also serve as a motion for a protective order staying any deposition pursuant to Local Rule 7026-

  • 1 and 9014-1.

  • 3 On November 4, 2009, the Honorable Jeffrey E. Streitfeldt, Judge, Broward County Circuit Court, appointed Stettin as the Receiver of RRA. Broward County Case No. 09-059301.

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  • 2. Prior to the commencement of this case, Stuart A. Rosenfeldt (“Rosenfeldt”), on

behalf of himself and RRA, filed a lawsuit against his partner Scott W. Rothstein (“Rothstein”)

alleging multiple wrongful acts on the part of Rothstein, RRA’s former Chief Executive Officer.

Exhibit A attached to D.E.2 (the “Receivership Action”).

  • 3. On November 4, 2009 the state court presiding over the Receivership Action (a)

removed Rothstein as the Chief Executive Officer, and (b) appointed Stettin as the Receiver for

RRA. Exhibit B attached to D.E.2.

  • 4. On November 11, 2009, Rosenfeldt, as the sole officer and director of RRA,

executed a resolution (the “Resolution”) appointing Stettin as the CRO of RRA and delegated to

Stettin all operational and managerial control over RRA. The Resolution, inter alia, authorizes

Stettin, exclusively, to contest or consent to the involuntary petition.

  • 5. Lawyers from RRA represent the plaintiff in the case Jane Doe #2 v. Epstein, 08-

cv-80119 Marra/Johnson (S.D.Fla)(“District Court Action”). 4 On November 12, 2009, the

Defendant filed his “Emergency Motion for Order For the Preservation of Evidence &

Incorporated Memorandum of Law.” (“Emergency Motion”) in the District Court Action [D.E.

405], attached hereto as Exhibit A.

  • 6. The motion seeks an “Order to preserve all evidence relevant to the investment

scheme, as described [therein] and to further prohibit the persons and RRA from tampering,

destroying or altering any such evidence.” Emergency Motion at 6.

  • 7. On November 13, 2009, the District Court entered an order granting the

Emergency Motion on a temporary basis. District Court Action [D.E. 408] attached hereto as

Exhibit B.

4 This case has twelve (12) related cases and some related state court litgation. The Movants request that this relief apply to all related cases and parties, including, but not limited to, Broward County Case No. 09-059301.

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  • 8. Notwithstanding the shortness of time, Stettin on behalf of RRA filed a brief

response (“Response”). District Court Action [D.E. 409], attached hereto as Exhibit C. In his

Response Stettin agreed that he would comply with the duties imposed upon him by the

Receivership Action and by the Bankruptcy Code, including any obligation to preserve the books

and records of RRA. Stettin recognizes that he has fiduciary responsibilities and that “security of

the firm’s computer system and its documents is one his foremost present concerns and tasks.”

Response at 2. Furthermore, Stettin requested that any deposition of him be postponed for at

least 45 days so that he may continue to address the pressing needs of stabilizing the debtor.

  • 9. The Defendant filed a reply (“Reply”). District Court Action [D.E. 411], attached

hereto as Exhibit D. The Reply seeks to have the originally scheduled depositions proceed on

November 19, 2009, on the basis that certain trial deadlines are going to expire.

RELIEF REQUESTED

  • 10. “The automatic stay is the most important protection afforded a debtor; it is

intended to give a debtor the chance to catch his breath, collect all of the proceedings against him

in one place and proceed to reorganize his affairs.” In re Weinraub, 361 B.R. 586, 591 (Bankr.

S.D. Fla. 2007)(J. Ray); See ACandS, Inc. v. Travelers Cas. & Sur. Co., 435 F.3d 252, 258 (3d

Cir. 2006) (holding “that the automatic stay provision of the Bankruptcy Code promotes a public

policy sufficient to preclude enforcement of an award that violates its terms or interferes with its

purposes”); See also, Cavanaugh v. Conseco Fin. Servicing Corp. (In re Cavanaugh), 271 B.R.

414, 424 (Bankr. D. Mass 2001)(noting that “the automatic stay is the single most important

protection afforded to debtors by the Bankruptcy Code”).

  • 11. Stettin, through his Response, has attempted to accommodate the concerns that

parties may have about the security of RRA documents. However, to permit a non—bankruptcy

court deposition to proceed on the day before this Court has hearings on substantive motions

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including the motion to appoint a trustee, would undermine the very reason for the automatic

stay. Stettin’s efforts are best utilized in moving this bankruptcy case forward.

  • 12. Moreover, 11 U.S.C. §362(a)(1) stays “the commencement or continuation,

including the issuance or employment of process, of a judicial, administrative, or other action or

proceeding against the debtor that was or could have been commenced before the

commencement of the case under this title, or to recover a claim against the debtor that arose

before the commencement of the case under this title[.]” The allegations in the Emergency

Motion rise to a level to suggests that the Defendant may be bringing claims against RRA for

any alleged malfeasance on the part of RRA that may have occurred prior to Stettin’s

appointment. See Emergency Motion at page 6 (the purposes of the Emergency Motion is to

prevent the Defendants to analyze and evaluate whether the Plaintiffs and their lawyers have

been operating in good faith). This type of discovery is clearly stayed by the operation of 11

U.S.C. §362(a).

  • 13. Section §105(a) is a grant of equitable powers. In re Franzese, 2007 Bankr.

LEXIS 2490, at *5 (Bankr. S.D. Fla. 2007)(J. Ray). In Franzese, this Court re-imposed an

already expired stay pursuant to §105(a). In doing so, the Court noted that it “cannot resurrect an

expired stay. However, the Court will impose a stay identical to § 362(a) pursuant to § 105(a).”

  • 14. This Court also noted, in In re Weinraub, “that re-imposition of the stay is

precisely the type of equitable activity that promotes the purpose of the automatic stay. As such,

the Court is acting within its § 105 mandate to issue any order, process or judgment that is

necessary or appropriate to carry out the provisions of this title.” In re Weinraub, 361 B.R.

586,591 (Bankr. S.D. Fla. 2007)(J. Ray); §105(a); see also In re: Momentum Mfg. Co., 25 F.3d at

1136 (explaining "that § 105(a) should be construed liberally to enjoin [actions] that might

impede the reorganization process.")(brackets in original; internal quotations and citations

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omitted). Accordingly, it is well within this Court’s ability to stay any further discovery against

Stettin and RRA, as any continued discovery undermines the very provisions of this title.

  • 15. Accordingly, the Movants seek an order that any attempt to set or carryout the

deposition of Stettin by the Defendants violates the automatic stay of 11 U.S.C. §362(a) or

alternatively undermines the purposes of the bankruptcy code and impedes the operation of the

bankruptcy process.

WHEREFORE, the Movants respectfully request the entry of an order: (1) staying,

pending further order of this Court, any deposition of, or further discovery from, Stettin or RRA,

because such deposition or discovery violates the automatic stay, or alternatively, because such

deposition or discovery is contrary to the purposes of the bankruptcy code; and (2) granting such

other relief as the Court deems just and proper.

I HEREBY CERTIFY that a true and correct copy of the foregoing was served via

Regular U.S. Mail, postage prepaid, fax, email and/or overnight delivery upon all parties on the

attached Service List this 17 th day of November, 2009.

Dated: November 17, 2009 Respectfully submitted,

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BERGER SINGERMAN, P.A.

Attorneys for Alleged Debtor

200 S. Biscayne Blvd., Ste. 1000

Miami, FL 33131

Telephone: (305) 755-9500

Facsimile: (305) 714-4340

By:

/s/

Jordi Guso

Paul Steven Singerman

Florida Bar No. 378860

Jordi Guso

Florida Bar No. 0863580

Isaac Marcushamer

Florida Bar No. 0060373

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EXHIBIT “A”

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EXHIBIT “B”

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Case 9:08-cv-80119-KAM

Case 09-34791-RBR

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

CASE NO. 08-CIV-80119-MARRA/JOHNSON

JANE DOE NO. 2,

 

Plaintiff,

vs.

JEFFREY EPSTEIN,

Defendant.

____________________________________/

Related cases:

08-80232, 08-80380, 08-80381, 08-80994,

08-80993, 08-80811, 08-80893, 09-80469,

09-80591, 09-80656, 09-80802, 09-81092

____________________________________/

ORDER

THIS CAUSE is before the Court on Defendant Epstein’s Emergency Motion for

Order of the Preservation of Evidence (D.E. #405).

The Court has reviewed the above-referenced Motion, which has been styled an

“Emergency” by counsel for Epstein, and agrees that based upon the substance of the

pleading and the nature of the relief sought, the Motion has been properly filed on an

emergency basis. By the Motion, Epstein moves for an order requiring the preservation

of all evidence relevant to the investment scheme referenced in the Motion and further

prohibiting the individuals at the RRA Law Firm from tampering, destroying or altering any

such evidence. Of the three attorneys contacted with respect to their position on the

motion and as to whether they agree to the relief sought or intend to file a response in

opposition, only one attorney, Mr. Bradley Edwards, could definitively state that he had no

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opposition to the relief sought in the Motion. The other two attorneys involved, Mr. Paul

Singerman and Mr. Kendall Coffee, have requested until Monday, November 16, 2009, in

which to state either their non-objection to the relief sought, or to file a response in

opposition to the Motion. Mr. Kendall Coffee has stated that he will agree to whatever

position ultimately taken by Mr. Singerman on the issue.

Accordingly, and in an effort to maintain the status quo until such time as the Court

rules on the Motion, it is hereby,

ORDERED AND ADJUDGED that said Motion for the Preservation of Evidence

(D.E. # 405) is GRANTED ON A TEMPORARY BASIS until Tuesday, November 17, 2009,

at which point the Court shall issue a final order on the Motion.

DONE AND ORDERED this November 13, 2009, in Chambers, at West Palm

Beach, Florida.

Case 9:08-cv-80119-KAM Case 09-34791-RBR Document 408 Doc 14 Entered Filed on 11/17/09 FLSD Docket Page 11/16/2009

LINNEA R. JOHNSON

UNITED STATES MAGISTRATE JUDGE

CC:

The Honorable Kenneth A. Marra

All Counsel of Record

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EXHIBIT “C”

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EXHIBIT “D”

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SERVICE LIST CASE NO.: 09-34791-BKC-RBR

Marianella Morales, Esquire

Alison W. Leht

Authorized Agent For Joining Creditors

Assistant United States Attorney

Avenida Francisco de Miranda

99 N.E. 4 th Street

Torre Provincial “A”

7 th Floor

Piso 8

Miami, Florida 33132

Caracas, Venezuela

Phone: (305) 961-9176

John H. Genovese, Esquire

Robert F. Elgidely, Esquire

Theresa M.B. Van Vliet, Esquire

Genovese Joblove & Battista, PA

Bank Of America Tower at International Place

Fax: (305) 536-7599

Alison.Lehr@usdoj.gov

Stuart A. Rosenfeldt, Esquire

Rothstein Rosenfeldt Adler, PA

  • 401 East Las Olas Boulevard

100

S.E. 2 nd Street

Suite 1650

Suite 4400

Fort Lauderdale, Florida 33301

Miami, Florida 33131

Phone: (305) 349-2300

Jeffrey R. Sonn, Esquire

Fax (305) 349-2310

Sonn & Erez, PLC

Broward Financial Center

Kendall Coffey, Esquire

  • 500 E. Broward Boulevard

Coffey Burlington,

Suite 1600

Office in the Grove

Fort Lauderdale, Florida 33394

 

Penthouse

Phone: (954) 763-4700

2699 South Bayshore Drive

Fax (954) 763-1866

Miami, Florida 33133

Office of the US Trustee

The Honorable Herbert M. Stettin

51 Southwest First Avenue

One Biscayne Tower

Suite 1204

 

Suite 3700

Miami, Florida 33130

Two South Biscayne Boulevard

Miami, Florida 33131

Thomas Tew, Esquire

Tew-Cardenas, LLP

John G. Bianco, Esquire

Four Seasons Tower

John M. Mulli, Esquire

15th Floor

 

Tripp Scott

1441 Brickell Avenue

110

Southeast Sixth Street

Miami, Florida 33131-3407

Fifteenth Floor

Fort Lauderdale, Fl. 33301

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Conrad & Scherer, LLP

  • 633 South Federal Highway

Fort Lauderdale, FL 33301

Tel: 954-462-5500

Michael D. Seese, Esq.

Hinshaw & Culbertson, LLP

Special Asst. U.S. Attorney

IRS District Counsel

1000 S. Pine Island Rd., Ste 340

Plantation, FL 33324-3906

The Honorable Eric H. Holder, Jr.

Attorney General of the U.S.

1 E Broward Blvd Ste 1010

950

Pennsylvania Avenue, NW Room 4400

Ft Lauderdale, Florida 33301

Washington, DC 20530-0001

Tel: 954.4677900

Fax: 954.4671024

Honorable Jeffrey H. Sloman,

Acting U.S. Attorney

Internal Revenue Service

99 NE 4th Street

Centralized Insolvency Operations

Miami, Fl 33132

P.O. Box 21126

Philadelphia, PA 19114

Daniel Mink

Ovadia Levy

Internal Revenue Service

c/o Renato Watches, Inc

Special Procedures - Insolvency

14051 NW 14th Street

7850 SW 6th Court

Sunrise, Florida 33323

Plantation, FL 33324

Tel.: (954) 423-7300

William George Salim, Jr.

Fax.: (305) 982-5406

Moskowitz Mandell & Salim

800

Corporate Dr Ste 510

Special Asst. U.S. Attorney

Fort Lauderdale, Florida 33334

P.O. Box 9, Stop 8000

Tel: 954.4912000

51 SW 1st Avenue, #1114

Fax: 954.4912051

Miami, Fl 33130

Fax: (305) 530-7139

USI

Attn: Anthony Gruppo

Grant J. Smith, Esq.

200

West Cypress Creek Road

Rothstein Rosenfeldt Adler, P.A.

Suite 500

  • 401 East Las Olas Blvd

Fort Lauderdale, FL 33309

Suite 1650

Tel: 954-607-4000

Fort Lauderdale, FL 33301

 

Marc Nurik, Esq.

United Healthcare

Rothstein Rosenfeldt Adler, P.A.

Dept. CH 10151

401

East Las Olas Blvd

Palatine, IL 60055

Suite 1650

 

Fort Lauderdale, FL 33301

Mark Bloom, Esq.

Greenberg Traurig, LLP

Robert D. Critton, Esq.

1221 Brickell Avenue

Burman, Critton, Luttier & Coleman

Miami, FL 33131

303

Banyan Blvd., Suite 400

T 305.579.0500

West Palm Beach, FL 33401

F 305.579.0717

rcrit@bclclaw.com

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