Fighting Kaplan

The documents on Equitatus’ blog are worth reviewing.  In the end, Kaplan and his firm will likely be representing Maribel & Walter.  While it costs us money (that we don’t have) every time papers are filed and court appearances occur, we gain a deeper insight into the affairs of the entities and the individuals, which is highly beneficial.  Transparency benefits us.

UPDATE:  Forgot to mention that a mailing arrived yesterday from Kaplan.  Yesterday was, of course, June 7, 2011.  The enclosure was the “Notice of Chapter 11 Bankruptcy Case, Meeting of Creditors, & Deadlines form stating, amongst other items, that the Meeting of Creditors was taking place on June 6, 2011.  Talk about proper noticing…we can’t believe a word Kaplan says.  This, of course, makes him no different from his clients.

4 thoughts on “Fighting Kaplan

  1. I spoke with Attorney’s Brower and Brown today after the hearing.

    I learned that the Judge granted the motion subject to Mr. Kaplan filing another declaration and doing a conflict check within his firms past client of any creditor on the creditors list that has a claim greater than $100,000.

    Ms. McGee and Mr. Kaplan had reached that agreement prior to the hearing.

    Mr. Brown said his motion based on the fact that a preference was given by Walter to Kelly in paying his legal bills and the fact that Kelly is also a creditor was not enough at this time to block the appointment of Kaplan. He did indicate that the judge advised Kaplan that if through later development on information as to the nature and source of funds to pay Kellys
    legal bills from June 2010 to May 10 2011 that he might find there was a preference and require Kelly to pay those back to the estate. Also if it was developed that the source of the funds used were Bar-K or REL and either of those entities were found to be represented by Kaplan then he would consider those facts in a later motion.

    Mr. Brower’s motion was denied because he did not have a declaration or other evidence for the Judge to consider. He wanted to remind everyone that his case is going to trial this next week and to come the first day for opening statements where he will explain to the jury the theory of his case. Mr. Brower also said that Mr.Kaplan is going to have to explain the source of the $400,000 settlement funds that went through the Kaplan/Ng trust account from some settlement.
    He thinks it was from B-4 settlement of the airport case in Hawaii.

    Ms Green was at the hearing and according to Mr. Brower and Brown was concerned about Kaplan holding $100K in a retainer account to bill against and then having Walter keep replenish it. She thought this would be improper because it put Kaplan in a superior position to pay his administrative cost as opposed to the Creditor Committee who has no war chest to pay its experts. I don’t really understand this but that’s what I was told.

    • I agree with Ms. Green’s point. Running a case is very expensive. That is why most investors can’t afford to sue. If Kaplan is allowed to have an open account that is replenished as needed, he can spend millions of dollars on staff, consultants, experts, analysis, or whatever he’s allowed to use, to make his client look innocent. Money is no object.

      From what it sounds like, the attorney for the creditor’s committee won’t get paid until the case settles. I don’t how long it can be strung along–months? years? It sounds like that firm would have to pay their staff, hired experts, etc., and wait to get that back, plus all of the hours Ms. Green spends on this case are hours she isn’t billing to clients who might yield payment sooner. Eventually they will get paid, but how much money can the firm be expected to float, and for how long? Considering the complexity of the case and how many victims there are, it can run into the hundreds of thousands, and I wouldn’t be surprised if it went over a million.

      This is why a lot of good cases never get heard.

      • Yes. I confirmed the following this afternoon:

        The $473,410.32 that went through the Kaplan/Ng trust account on
        November 16, 2010, was the property of Bar-K, Inc. This money was
        the payoff on the judgment in the Hawaii airport case after the judgment
        was affirmed by the Court of Appeal. We have discussed the Hawaii
        airport case before.

        Bar-K’s attorneys, not Kaplan, took their fee off the top and then the
        remainder $473,410.32 was sent to Kaplan. Kaplan’s firm took $83,000
        as part of their retainer and returned the rest, $390,410.32, to Bar-K
        (Kelly Ng).

  2. Follow the link to the pdf audio file of the 23 minute hearing on Kaplan’s motion to
    represent Walter Ng. Read the directions on my blog on who to open the file.
    The same directions are contained on the face of the document, but in small print.

    Don’t forget to look at Tracy Green’s Application to represent the Creditors Committee posted last night.

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