American court hearing recordings and interviews - Listen to the 8/14 bankruptcy hearing of Lonestar Taproot/Lonestar Dream/Poolin Technology #crypto

Episode Date: August 25, 2026

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Doug meeting for marching ground on behalf of the debtors. Good morning, Your Honor, Alex Andrews. On behalf of the debtors. Morning, Your Honor. Sarie Pekona, McVanman, Scotland, and Bowman, on behalf of creditor, Lynn Leigham. Good morning, Your Honor. Those on the Zoom? Good morning, Your Honor.

Fred Sandler, Patilski, Stang, Zillan Jones. On behalf of the newly formed committee, we were just selected by the committee late yesterday afternoon at 4 o'clock. I'm also joining me as my partner, Robert Feinstein, Your Honor. Good morning, Your Honor. And, Your Honor, Rachel Caracy from Porzio, Brambergen Newman, representing DBR Land, and with me, I have Aaron Power from Porter Hedges, lead counsel for DBR land. Good morning, Your Honor. Stephen Cohen from Wachtell Misery.

I'm counsel for the Stoking Horse Bitter-Tarbush-Kalup LLC. Good morning, Your Honor. Jeff Sponder from the Office of the United States Trustee. Good morning, Your Honor. Evan Lazarowitz, Robinson, and Cole on behalf of two creditors, Zan, Zanzing, Lou, and Yonjan. Good morning. So, Mr. Packman, before we get started, the court was able to review the most recent revisions to the retention orders. So I have reviewed them, and we are going to go, I assume, in agenda order, but I will lead it to you to kick us off. Sure, Your Honor. Thank you. So number one is the...

The debtor's application for entry of an order authorizing the employment and retention of Archer and Griner docket number 14, we received, well, there's no objection to that application, Your Honor. We did receive comments from the Mr. Sponder's office, and we addressed that in the order submitted. Does anyone wish to be heard with respect to number one on the agenda of the application for retention of general counsel? Okay. Hearing none, the court will grant the application and the court's minutes will reflect that with respect to, and before I go any further, just to avoid any confusion, the court's calendar number is not the same as the agenda number. So when you hear me referring to a number on the court's calendar, that's different than the agenda number, it's because there's a little bit of a difference. So for purposes of noting the court's minutes, you're going to hear me

referring to numbers associated with the court's calendar that don't correspond. I understand, Your Honor. I just dealt with this in a Texas bankruptcy for a year or so I get it. Okay. So the court's minutes will reflect that with respect to number two on the court's calendar, docket number 14, the application is granted, and the proposed form of order is acceptable to the court and will be entered. Thank you, Your Honor.

Second, Your Honor, we have the amended application for entry in order authorizing the employment and retention of Dufrain LLC as crisis managers and Michael Dufrain as Chief Restructuring Officer, effective as of the petition date, docket number 79. Your Honor, we finally have a committee and counsel, which we're glad is in the case because they're important part of the case, and I had a chance to speak with Mr. Sandler, Mr. Feinstein, I believe. Fine Stein, thank you. That led yesterday.

And one of the topics of the discussion was entry of this order, which has been scrubbed by the United States trustee's office, and we incorporated, I think we incorporated all of the requested, edits additions that Mr. Squander's office had. There's no objections, but... You know, the counsel for the committee would like a bit of time over the weekend to take a look at the provisions of the order. However, this morning, I did receive some language for Mr. Samler that really addresses the debtor's ability to terminate the CRO independently of the

Now, I think we already had some language suggested in the order to that effect. Their language is more expansive. It's agreeable to the debtor. I think they want to – I'm going to let them speak to it, but I think they want to run it by the committee before they sign off on it. Other than that, there's no objections to entry of that order. Okay. I think it makes sense to hear from Mr. Sandler on that point. Thank you, Your Honor.

And thank you, Mr. Packman. Yeah, so, Your Honor, the committee. was recently formed and as you heard, we were just selected. Yesterday I want to thank Mr. Packman and his team and Mr. Dufrein were getting on the phone with us

and speaking multiple times with us yesterday. We had concerns, not specific concerns, general concerns with two orders. One was the CRO order that's the one that we're talking about right now at document number 79 and then the

bid procedures generally. And we have no specific issue, but because we were just recently, like literally retained on the eve of this hearing, and we also have a committee whose members are Chinese citizens, and there's a huge time difference. We thought it made sense. We don't have any specific objections right now, so if the court wants to approve those two motions, subject to just the committee's right to review and comment on them over the weekend, that would be appreciated. And the thought is, well, if we have no issues on Monday or Tuesday, the debtors will let

the court know and the words just get entered on the docket. If we do have issues, obviously, we will try to work consensually to resolve them. And if we can't work to a resolution, then we would come back in front of your honor on those specific issues. I am pleased to say that after reviewing the, we worked pretty late into the night just trying to get up to speed, and on the CRO motion, the docket number 79, we thought there was some, I'll say I'll call it more clarifying language that would be appropriate just to make sure that the CR, the debtors can't just willingly terminate the CRO, and we agree with Mr. Packman. and there was language that arguably said that. We just thought for the abundance of caution.

There should be clarifying language. We don't, because of the time difference, Your Honor, we said that language to Mr. Packman this morning. We are committing at this point. My guess is that they are sleeping. And so we'll run it by the committee, but hopefully that will resolve docket number 79. And then on the big procedures,

we haven't yet gone through that. follow the same procedure through that as well, Your Honor. Thank you, Mr. Sandler. And I'll just note that the court is mindful of the fact that the committee was just constituted and your firm was very recently selected. And so the court very much appreciates the diligence of you being able to review these things and be able to comment on them here today. I totally understand the tight time frame and having your input,

even if it's still subject to. to confirm with your client is, I think, very helpful to moving these things forward. So I thank you for that. Great. Thank you, Your Honor. Ms. Lacona, do you wish to be heard with respect to the, with respect to the Dufrein? Yes, I would just ask that I, if the edits can be circulated

to me as well, since they're apparently edit to me to an order that I've not seen, I would like to weigh in if necessary. I assume that that is not objectionable to Mr. Packman. No, Your Honor. Thank you, Your Honor. Okay. Does anyone else wish to be heard with respect to the application for retention of the CRO? Your Honor, this is Jeff Sponder from the Office of the United States Trustee.

I had the same concern as Ms. Placona that any changes or revisions to the order be circulated also to the United States Trustee with the United States Trustee reserving all rights. Thank you, Your Honor. Thank you. Mr. Packman, do you have any issue with circulating the proposed order to Mr. Sponder? Of course not, Your Honor. Mr. Sponder even worked. I know he'll say he did, but I know he worked through his vacation. So absolutely not. That doesn't surprise me to hear that. Thank you for that, Mr. Sponder. So with respect to agenda item number two, which is number six on the court's calendar,

the court's minutes will reflect that the application for retention is granted with an order to be submitted. Thank you, Your Honor. Your Honor, that brings us to number three on the agenda, which is that and that application for entry of an order authorizing the employment and retention of UN and Basel, LSC, Singapore Insolvency Council, effective as of the petition date, that's docket number 17. There's no objections to that. There was some supplemental information that was submitted and in connection with that

application and the order revisions were from the United States Trustee's Office. Your Honor, Mr. Sponder did send us some typo-type revisions, nothing substantive to a few of these orders, so we'll be submitting new orders. We'll copy everyone involved. Okay, great. And just for my own, just curiosity, has there been a proceeding initiated in Singapore at this juncture? Is that yet to be done? The Chapter 15 was filed by Unan Basel. and it has just been noticed to the creditor matrix this week.

Okay. Yes. Does anyone else wish to be heard with respect to agenda item number three, the application for attention of Singapore Disolvency Council? Okay. So with respect to agenda item number three, which is also item number three on the court's calendar, the court's minutes will reflect that the application is granted.

and the proposed order accompanying the application will be entered. Thank you, Your Honor. Item four on the agenda is data-res amended application for an order authorizing the employment and retention of Perchman-Carlson Associates. That's Veritaw Global. As administrative advisor, effective as a petition date, that's the same summary, Your Honor. the UST, Mr. Sponder's office had some comments to the order. We incorporated those into the proposed order to the extent that there was a miscellaneous stray issue that Mr. Sponder pointed out with the order.

We'll resubmit that as well. But other than that, there's no objections. Okay, so the version of the order that was submitted to chambers this morning that there... I don't know that that... I'll have to ask my colleague because my colleagues is... the order of the people over the orders. I think it was like 7.14 a.m. was the Yeah, Your Honor, Alex Andrews for the debtors.

Mr. Sponder sent us a short list of typos and things that, non-substantive comments subsequent to my email this morning submitting those orders. So we'll clean those up in recent. Does anyone else wish to be heard with respect to agenda item number for the retention application for Verita? with respect to agenda item number four, which is number five on the court's calendar, the court's minutes will reflect that the application is granted and an order is to be submitted. Thank you, Your Honor. Number five on the agenda is debtor's application for entry of an order,

authorizing the employment and retention of McCarran-Weir and Sherwood PC as oil, gas and mineral counsel effective as of the petition date docket number 24. Your Honor, there haven't been any objections to that application. We did make some changes, as I've said, to the proposed order based on comments for the United States Trustees Office and filed some supplemental materials that Mr. Spontor's office wanted us to file in connection with the complex case procedures. Other than that, we'd ask for entry of the order, Your Honor, unless you have questions about that retention. I do not so and and again this is just for clarifying the courts minutes does there need to be those additional changes still need to be made I'm not sure on that one

there is but again I'll defer to my the keeper of the orders Alex Andrews on behalf of the debtor sorry I'm yes I would I would reserve all of them so that we can make sure there's no more typos and I don't remember which one specifically but there were a handful okay so I'll just assume that's the case for Yeah, yeah. Okay. Does anyone else wish to be heard with respect to agenda item number five? Okay, the court's minutes will reflect that with respect to agenda item number five, which

is number four on the court's calendar. The application for retention of McCarn where and Sherwood is granted and a proposed order is to be submitted. Thank you, Your Honor. Number six on the agenda, Your Honor, is the notice and debtors motion for entry of an administrative fee order. establishing procedures for the allowance and payment of interim compensation and reimbursement of expenses of professionals retained by order of this court

and granting relief or other relief. Docket number 25. We did incorporate requested revisions to that order as well, Your Honor, from the United States Trustee's Office. If there's anything further, we'll take care of that. I have not received any objections to entry to that order. Thank you, Mr. Packman. Does anyone else wish to be heard with respect to the administrative fee order motion number six on the agenda? Okay, hearing no objection with respect to agenda item number six, which is number eight on the court's calendar.

The court's minutes will reflect that the motion is granted and an order is to be submitted. Thank you, Your Honor. Your Honor, number seven is, I am not going to read this entire title into the record, Your Honor, unless you want me to, but it essentially is the debtor's motion. motion for entry of the bid procedures order and approving bid procedures and notice in this case. We do have an objection from Mr. Liang, who's counsel is here, and adjoinder. And a joinder. So would you like to address the objections first, or would you like to have me to hear from the objecting parties or if there's any presentation that you would like to make.

Well, to get into that. So, Your Honor, let me, yeah, I'd like to talk about the motion itself first, just for a bit. And also I think, you know, probably we should take into account what, not probably, we should take into account what the, what committee council has already voiced on the record about the order and wanting to review that. But before I get to the objection, we have now. submitted the first-day declaration of Mr. Dufrein in support of this motion. We have submitted the declaration of Mr. Dufrain, specifically in support of the motion in response to the objection of Mr. Liang. And we also have the declaration of Mr. Dufrain in support of the settlement of the informal objection of DBR land.

that was lodged with the debtors. So, Your Honor has three declarations in support of the subject motion. Now, if Your Honor prefers, I could go through a proffer on the record. It's essentially going to be repeating, mostly, what's in Mr. Dufrein's declarations. Your Honor, I think if we can admit the declarations in support, if that's even required here, We could do that instead. Mr. Dufrain is here, if anyone has any questions for him. But I leave it to the discretion of the court how the court wants to proceed.

Do any parties have any objection to the admission of Mr. Dufrin's declaration subject to their ability to question him if desired? No objection, Your Honor. No, Your Honor. Okay. So the court will admit the declaration. of Mr. Dufram. Thank you, Your Honor.

So would that include the DBR declaration as well? I mean, Mr. Dufrain's declaration in support of the settlement of DBR's? Yes, I mean, I think that that presents different issues that we're going to need to get into that are separate from the bid procedures. But yes, we'll admit that declaration. I'm not sure how we can go ahead with approving that today, the settlement. but I will we'll get into that and I'll admit his declaration. Your Honor, I thought you might ask me about that.

Okay. So, Your Honor, if I understand the object, well, let me ask, let me do it this way. Does counsel want to present the objection first before I respond? Well, no, I would, I would, I mean, it's your motion, so I leave it to the court. If the court has questions on what you're asking for, I'm happy to address my objection, and then you can respond to me, but I don't... Well, I don't want to make their argument because I don't agree with their argument.

So, you know, I... It doesn't... What it does is it addresses alleged claims that an individual creditor has, or thinks he has, that date back many years. And it doesn't specifically go to any real issue with the big procedures.

There's some references to certain aspects of the bid procedures, you know, marketing. What did the CRO do? Is the CRO independent? But all of those matters have been addressed in Mr. Dufrain's declaration, as well as the declaration of Mr. Sitt on behalf of Thor, Calip LLC, the buyer. And so, you know, if we admit those declarations, Your Honor, I think we've addressed the generalized objections that have been assertive to the bid procedures motion. In other words, what was the process that was filed?

We're questioning that. Well, we've fully addressed that now. And Mr. Dufrein's here, but he'd be reiterating what's in those declarations. Over 300 buyers interested, multiple NDAs. You know, I think we're over 30, 40 I think we're at right now. A $52 million total stalking horse bid after months of a marketing process in a data room that was maintained by Archer and Griner, so I know, Your Honor, who's accessed the data room. and there's been many interested parties.

So we're not here today for approval of the sale. We're here today to set bid procedures so that the auction can move forward in a timely fashion. I think we've brought up this option issue, Your Honor. I mentioned it at the first day hearing. We detailed it in the declarations, and we made it known why it's so important to stay with this timeline because the power, Your Honor, at Tarbush is independent of the property.

And that's essentially why we're in this settlement with BBR. Pursuant to the APA on Tarbush, that power is going to be relocated to an adjacent 600-plus-acre property that actually we believe anyway, we're told, meets the requirements of TNMP, Texas, New Mexico power for reconnection of the power. And the power is valuable here, Your Honor. The power has real value, that contract has real value. TNMP's willingness to allow the power to move within a five-mile radius is valuable. So what did we do? Through Mr. Dufrein, who has spent countless, countless days and hours for months as CRO, not only on tasks related to the debtor's operations and window, but on this sale.

Through his efforts, and maybe some of mine, we were able to procure for an assignment for the debtor of an option contract on this 600 adjacent. property that actually is owned individually by a Mr. Lindsay and it's acceptable to TNMP for reconnection of the power. That option expires come heck or high water on September 30th. He will not extend it. So what did we do? The CRO with assistance from, you know, others, looked at other properties. And TNMP, has power authority over properties that are on, I don't know if it's east or west,

but it's on this side of the main road. And then there's another power company other side. So all of the properties that might be within a five-mile radius that are on the other side of this divider line are not subject to TNMP. So they're automatically out. So we did go to other, Mr. Dufrain did go to other property owners in the vicinity and the required radius of this particular adjacent property track owned by Mr. Lindsay.

And it does seem that Mr. Lindsay's tract is the only track that really works here. And so we absolutely cannot, these state, the creditors cannot afford to lose that option. We had this conversation with committee council last night. and said, initially, we're not willing to move anything today. But then, of course, as a professional courtesy, I said, it's fine. Take a look at the bid procedures order. If there's anything of concern there, let us know. It's very standard.

It's been vetted by the United States' trustee's office, Mr. Sponder, and his colleague, Rachel Ward. And they had few comments. They added pretty much committee consultation rights throughout. the order and the bid procedures, which we of course have no issue with. We hope to work hand in hand with the committee in this case. So having said all that, I'll get back to the objection. We are not here today to adjudicate an individual creditor's claim. If this creditor has a claim and there's a claim's objection, that will be adjudicated at some point.

And, you know, Your Honor, beyond that, I mean, the allegations of fraud are completely unsubstantiated. substantiated. The extent they're directed against the debtors, it's hearsay, it's innuendo, and it's not supported. So we sent out discovery notices to Mr. Leyen's counsel, as well as to Mr. Zhang, who submitted a supporting certification, and we're going to take depositions, Your Honor, in September, if we get to the motion for the Chapter 11 trust state. We're not here today on that. and I know we touched on it a bit in our papers, but we're here today on a very important procedural timetable, which, if disrupted, could jeopardize the option,

which in turn is going to jeopardize the transfer of the power and our sale to our stocking horse and our auction. So, you know, I could go on at length here. I mean, again, these are the big procedures. We're not seeking approval of the sale today. any party can come in and object to the sale based on the market wasn't tested, the price isn't fair. But I think we've established the parameters to allow the stocking horse to at least set the bid, which is it's an arm's-length transaction. Mr. Sitz, declaration is clear.

There's no prior relationship between this buyer and the debtors. they've substantiated that they have the wherewithal to perform from a monetary perspective and importantly, from a qualification perspective because the buyer, at least as, the buyer as to the tarbush power, most likely buyout, but definitely as to the tarbush power has to qualify.

It has to meet certain criteria, which this stalking course we believe meets. So for all those reasons, Your Honor, I reserve my right to respond to any arguments from counsel. We asked that the court approved the bid procedures today, subject to the committee's right to review the order and provide any comments over the weekend. Thank you, Mr. Packman. Before I hear from counsel for Lynn Liang, I want to just hear briefly from Mr. Sandler just to confirm that, you know, as discussed by Mr. Packman, that that is kind of the point. process that the committee is on board with and there aren't any other issues that the

committee has in terms of approving the procedures today. Your Honor, I lost part of what you said because it looks like you went on mute. Oh, sorry. So I just, Mr. Seller, I'd appreciate just before I hear from Ms. Placcona, just confirming the committee's position with respect to entry approval of the bid procedure subject to review of the order before entry? Your Honor, that's correct. Just like with the CRO order is the same process. We will review it later today over the weekend, gather comments over, if any, over to Mr.

Pacman and his team try to work through those issues. Hopefully we will, cautiously optimistic we will if there are any issues. And if not, then we would come back in front of your. Your Honor. But we have no problem with the sale moving forward because we realize because of the option that the sale really should move forward. So with that, Your Honor, I'm happy to answer any questions. I don't have any responses yet on the substance of the big procedures, but like I said, we'll go through them over the weekend. Thank you, Mr. Sandler. You gave me the information I was looking for. Your Honor, did you want me to address the DBR, so the DBR settlement of the informal objection is a very important part of bid procedures approval. Do you want me to address that after we get past?

I'm happy to address it now if you'd like to just deal with that issue. Okay. And here's my concern. I reviewed the proposed stipulation, and, you know, my understanding is essentially that it's resolving a dispute as to the proposed stipulation. and you know my understanding is essentially that it's resolving a dispute as to ownership of certain property and the debtor is going to pay 1.5 million dollars to DBR out of the sale proceeds and also incur potential indemnification obligations. You're asking for entry of that order under Rule 1919.

The concern I have is I don't have, I see anything about that resolution that, that strikes me as unreasonable. However, other parties haven't had notice of this. And I know you're claiming that this is a resolution of an unfiled objection, but that's really invisible to the creditor universe. They don't know that there was this potential resolution, and they haven't been noticed of the terms.

And so given the fact that we're talking about, you know, over a million dollars coming out of the estate to settle this, my concern is that someone can come back and say, well, wait a minute, you know, we didn't, we didn't get notice of this. Rule 1919 requires 21 days notice subject to maybe an application to shorten an emotion. And so I just think from a notice perspective, I would have real concerns about, you know, even if I were inclined to enter that today, whether or not it was properly noticed and parties had an opportunity to object. Now, I understand that the substance of the resolution certainly will inform the economics of the sale transaction, no doubt about it. But why is the answer not simply to, as part of the sale process and the bidding process, disclose that this is what the debtor has agreed to subject to court approval so that bidders are not in the dark that, okay, well, it's contemplated.

subject to court approval, you know, this is an excluded asset and just disclosed. I mean, there's all kinds of hypotheticals and unknowns that go into a sale process that, you know, until the sale is actually approved, you know, you don't have the benefit of knowing you have an order approving it. But just from a procedural perspective, how is it that you can invoke 1919 to, it's essentially an ex parte order at this point? I know Mr. Dufrain's declaration was filed late yesterday afternoon, but that doesn't even include a copy of the proposed order. I don't know if you've had a chance to discuss it with the committee, but even if the committee is on board with it,

I am worried about the ability of other parties to be heard from a due process perspective. So that's where I'm struggling with here with that. And it's not because I think I'm looking at this proposal in it in any way strikes me as unreasonable, but that's why other parties should have the opportunity to weigh in. Yes, Your Honor. So, first of all, just for clarification purposes as to the substance of the proposed settlement transaction, DBR is to receive a payment at closing or on the payment date, I guess whichever first occurs, of $1.5 million. There remains to be seen how much of that is going to be paid by the debtor's estate. We'll talk to our stocking horse about that. One of the issues, well, one of the issues is the settlement of the dispute over who owns the equipment,

settlement over termination of the surface use agreement, but also our stocking horse needed or needs, up to nine months after closing, to remove one of the key pieces of the, of course. here that is on the Targlish property, which is the substation. And yes, this is all in Mr. DeFrain's declaration. So I just, and there's other equipment there that would be removed as well. So part of this settlement involves consideration for those nine months. That's all I'm going to say about that for today, Your Honor. We have to talk a bit with our stocking horse.

This went right up until the deadline here, Your Honor, to get these papers in. in. We've been negotiating with DBR for months, and fortunately we were able to come to this resolution. Your Honor, I understand the noticing issue. To the extent that the court's not inclined to approve this order as a settlement of an individual creditor's claim and objection, and formal as it may be to the bid procedures. I mean, they're saying in this agreement, DBR, we agree that on these terms and additions, we will not dispute the sale of these items at Tarbush.

And so I don't know what the dispute would be here where an individual creditor is compromising its claim. So I hear you, Your Honor, and I guess, to the extent that Your Honor believes we have to notice, we'll have to do that on short notice because this is a critical part of not only the bid procedures approval, but it's a critical part of the auction process, which if you approve the bid procedures, Your Honor, is on September 10th.

And I think Your Honor mentioned it, but the buyers deserve to know what they're buying with some certainty, not subject to later approval of... Right, which is why I think it would be essential that this is wrapped up before the sale hearing. Yes. But I don't see why this necessarily is a gating issue before bid procedures can be approved.

And just, again, not to be overly technical, but procedurally, there's not actually a request, there's not a motion, there's not an application before me. So I don't know how, procedurally I would even have a procedural hook to enter an order of approving that settlement and my understanding from mr. Dufrein's declaration is that the state court litigation there was a dispute as to ownership and so this is not just a creditor compromising their claim it's the estate compromising its

claim to property and saying well No, we said this is ours. Now the estate is saying we're basically relinquishing that right. And again, this is not in any way me weighing in on the merits of that as opposed to just that this is this is not simply a resolution of an objection to bid procedures. This is this is substantive and it hasn't been disclosed to creditors. So I understand the need to get these things resolved, but I also would be very concerned about actually creating more problems than we're solving by a creditor saying well wait a minute you know we we don't we don't agree that the debtors should waive its right to this

property we don't think that the payment of 1.5 million dollars is appropriate I just don't know what's out there and creditors just need to have it's a disclosure issue so again I think that this is the terms of this settlement are certainly straightforward enough that I I don't see why it can't be teed up on an to shorten notice but I think just we want that protection to know that no one can come in and upset the Apple cart because this this wasn't properly set up I mean we're relying on rule 199 will 909 only exists in the context of a motion being filed and we just we don't understood your honor I mean we do have a hearing on August 20th we could notice it up

for that date but I think you know DVR needs to weigh in I'm sure the committee would like to spend a bit of time looking at this as well. So I'm not, I'm certainly not arguing with Your Honor's logic. And if Ms. Perisi wants to weigh in on any of this, I'm happy to hear her from her to get DBR's perspective on the procedural issues. Thank you. Yeah. Yeah. Thank you, Your Honor. Thanks for Mr. Packin. I think you did a good job of setting it out for the court and the parties. I think, Your Honor, while I understand your concern and perhaps it could be as simple as removing the 1990

reference in the stipulation itself. But the way that I review this consent order and resolution is that there really is sort of a reservation of rights for all parties built into the stipulation itself, which is why I didn't necessarily have the same concern. And I say that because the debtor isn't necessarily obligated to pay the million, or I think it's a million or $1.5 million. It's the debtor has the option to pay that money, and if the debtor pays that money, and if the abides by the terms of the stipulation and consent order, then our client is, you know,

providing certain releases and providing certain aspects, including, you know, not filing an adversary related to a property of the estate dispute. So the way that I view it is the debtor can proceed to the sale, and someone may object, let's say a purchaser comes in and says they want to abide by all the terms of our stipulation, and the debtor is going to pay the million and a half dollars, a party can come in and say they don't believe that that's prudent or that's, you know, an exercise of the debtor's business judgment for whatever reason. So the way that I look at this is that this is sort of a skeleton and a shell and, you know, putting the train on the tracks for a purchaser to come in and for the debtor and the purchaser to abide by those terms.

And if they do, then DBR will reciprocate with the aspects, you know, embedded into the stipulation. And if not, then all rights reserved, including my clients. So again, while I, I, I, I, I, I, I, I hear your honor, and I think, you know, Mr. Packman's team and our team had a bit of that but reaction as well. I think because there's still an option for parties to come in and see that, you know, a purchaser may be coming in and ultimately abiding by the terms of that consent order, which would lead to X or they're not, which would lead to Y. So, and again, the Y, so to speak, is sort of the status quo, which is we reserve all rights

and we can proceed in accordance with our beliefs that, you know, the property is not property of the estate. So that's DBR's position, and we, in line with that, we believe we would be proceeding under local rule 19-4, which is, you know, at this point, this is a resolution between us, between the debtors, but with all sorts of contingencies and outs. The debtor doesn't have to, you know, abide by the terms. And if they don't, DBR reserves its right to proceed in accordance with. you know, a dispute regarding property of the estate. So I'll leave it up that, Your Honor.

Thank you, Ms. Breesie. And look, I was trying to come up ways of, you know, how is there a way that, you know, can approve this. But again, if we are relying on Rule 19-4, you know, that specifically says in the 2024 comment that consent order can only be used when every affected party is a party to the consent order. And so here, because we're also,

as part of the stipulation is a relinquishment by the estate of a claim to this property I don't see how this is solely just an issue between DBR and the debtor and also there's no even if this could be approved as a consent order you know there's that there's that there's that 9019 that four hasn't been followed here there was no application in lieu of motion there's no you know the local you know certification of consent wasn't done here and so I don't see any reason why the debtor and DBR can't stipulate amongst themselves that this is the path they're going to go down but if you

want to bind if you want an order from the court just at a minimum like this this proposed stipulation has never seen the light of day on the docket so it's I'm just concerned about kind of the ex parte no nature of it without it having been filed in the sense of not even treating this as a consent order under under Rule 1924 which which permits an ex parte submission of a proposed order but there's also kind of a local form that needs to be complied with and so I just again I am more concerned with making sure this gets done the right way rather than the quick way but again I'm not in any way expressing of you that you know this this sounds like a bad deal but I

would also be interested in hearing from from mr. Sponder in terms of whether or not his office has had a chance to review this or has a position thank you your honor Jeff Sponder from the office United States trustee as mr. packman mentioned I've been away for two weeks I I have worked on vacation, but to the extent that I was able to actually review this until just now, no. So, but even if I had reviewed it last night or this morning, I would have the same conclusion, which was your conclusion, Your Honor, that parties and interest and predators should be aware of a settlement, which this is, under 1990 or under the local world, 1919-4, either way. and have an opportunity to understand what it is and objective, if anyone deems necessary. Thank you, Your Honor.

Thank you, Mr. Sponder. Mr. Sandler, do you wish to be heard on this? I do, Your Honor. Just very brief. Like, you know, again, you know, we're kind of in the dark on this because of the recent appointment. We haven't had a chance to review this. It sounds like there are a lot of, I'll say, contingencies with the stipulation. Again, we haven't seen it.

It's for a sizable amount, not coming at this with any prejudice or judgment whatsoever. But I think I heard Mr. Packman suggests that maybe we could get this heard, say, on the 20th, when there's already a hearing. It could be noticed out, you know, today or over the weekend, give parties an opportunity to review it on short notice. this and we could come back on Friday when we're going to be here in any event. Thank you, Mr. Sandler. And again, look, I personally think that this is a big achievement and progress in terms of moving this case ahead. So I'm not suggesting that I expect this to be a controversial motion, but I think it is important that we check the right boxes so that this is beyond anyone claiming that I prematurely approves this.

So I see Ms. Corrice wishes to weigh in again, so I'm happy to hear from you. I was going to defer to her, Your Honor. No, thank you, Your Honor. And apologies. I would have liked to be there in court today, but I'm actually in Texas today, so I apologize. I'm dialing in remote. I think the 20th would be great, and I think that's extraordinarily important for our client

to get this improved as quickly as possible. So we appreciate Mr. Sandler. As you know, we do a fair amount of committee work as well. So I appreciate the evening before appointment, and I appreciate you agreeing to that sort of expedited timeline. I will just also mention, for the record, Your Honor, and I don't think I've seen it yet. And I apologize, Mr. Packman. I did email you this morning, but I know you were probably already in court. We did have one modification to the BIT procedures order, which is important and sort of connects to our stipulation.

and we haven't seen, I know it's going to be circulated, but I just want to make sure to put on the record that we did include one reservation of rights line item within the order. And so we'd like to see that. And as long as that's included, I think, you know, we'll be okay and comfortable with getting that 1919 on file very quickly and hopefully approved next week. Okay.

That makes sense to me. So, again, you know, I'm not... Thank you, Your Honor. Deciding anything, but I think the timetable work. talking about, you know, getting this hurt on short notice for the 20th, I do think is the way to go on this. Your Honor, as long as provided DBR's on board, we're on board with that. I think it makes sense to get it out there and have the committee take a look at it as well. Thank you.

And, again, Mr. Sandler and Ms. Preci, I appreciate, you know, both of your flexibility in getting this done. And I have no doubt, Ms. Preci, the hard work that went into getting this done. And so, you know, hopefully we can bring it to the finish line promptly. So thank you. Thank you, Your Honor. So with that, Ms. Placona, would you like to just get into your objection to the bid procedures in response to Mr. Packman? I would get into it, Your Honor. Sarie Placona, McManam and Scotland, and Bowman, on behalf of creditor Lynn Liang.

Can you hear me? Okay. I can hear you, yes. All right. Your Honor, before I saw my argument, what's interesting is something that you asked, Mr. Packman, You asked if he applied to Singapore to approve the Chapter 11 proceeding. The case was filed on July 22nd. The application for the Singapore to approve the Chapter 11 proceeding was not filed until August 6 or August 9th, and it was not until after I brought this to the attention of the debtors,

which questions a lot of concerns that my client, other clients, one that sits on a committee, who I do not represent but submitted a certification of from Mrs. Zhang, have questions about transparency. My client, I will go into the bidding procedures, but my client is the holder of an interim arbitration award in Singapore, and nowhere was elicited on the debtor's petitions. The schedules have not been filed yet. Nowhere in a first aid declaration,

and again, not until I brought this up and even asked Mr. Packman about it and did not get a response to it, and then a few days ago, we get a notification of the filing. There is, to my understanding, a hearing next week in Singapore to address it, I'm obviously not going to appear in that, but my client will address it there. With that being said, Your Honor, I'm going to address the bidding procedures.

Thank you. Can I just one question at the outset? I just wanted to ask and get your take on Ms. Blakona. So your client is a creditor of pooling technology, correct? Correct. Is it – we're talking about bidding procedures with respect to the sale of the Lone Star U.S. entities. Is it your position that your – client is also a creditor of those entities?

I probably have to go back in check. I don't know if he's a direct creditor of those entities, but I do think that his objections and his concerns are fair enough to fall over into the bidding procedures that affect those entities that are now joining the administrative with pooling. Okay. It's not a claim objection as opposed to what Mr. Packman says. clients not opposed to a sale. He just wants a maximum value, you know, a value maximizing sale, excuse me. We oppose moving forward with the bidding procedures before creditors, and to my dismay,

I understand the creditors committee looked at it last night, which is impressive and great. I would love to know that the creditors committee could maybe answer some of my client's questions and Mr. Zang's questions. I'm not sure if Mr. Sandler had a chance of people, Mr. Zang, considering the time change, have sufficient information to determine whether the proposed sale and the process, is fair, transparent, and the best interests of the estate. Again, I ask, how do we know if the assets are fair value and whether any other assets were transferred? And I continually bring this same team up, relying on the debtor's principal

who has to give the information to the CRO and is presented to Debtors' counsel, and there's a lot of allegations about transparency and truthfulness of Mr. Pan. The debtor characterizes the objection as an attempt to derail the sale process. It's not. The court is being asked to approve bidding procedures governing the disposition of substantially all the assets of the estate before creditors have seen complete schedules and before meaningful investigation has occurred into substantial pre-petition transactions and whether assets, other assets, I should ask, are available to supplement the assets being sold to increase the sale

value. And before, again, until last night, the creditors committee had a meaningful opportunity to evaluate the transaction and discuss it with all the committee members. The central issue is transparency. The debtors repeatedly state that approval of bidding procedures is not approval of the sale. True, technically. However, as a practical matter, approval of bidding procedures places significant momentum behind a proposed transaction and establishes the framework under which all future bidding will occur.

Creditors are entitled to understand the basis for the process before the court approve it. There are still questions and concerns about who established evaluation metrics, what methodology was used, the due diligence performance, how the stalking horse was considered, any other potential strategic buyers that were contacted, whether there are relationships direct or indirect between the debtors and the proposed purchaser, whether valuable assets and causes of actions

have been adequately investigated and preserved, and most critically, it's obviously the debtor had provided the financial information to the CRO to market the assets. How do we know what was provided and, if anything, was held back? The debtor's response is essentially trust the process. Respectfully, creditors are entitled to more than assurances.

The debtors point to the efforts of the CRO and state that approximately 30 NDAs were executed and multiple indications of interest were received. But that doesn't answer the question that the creditors are asking. It doesn't explain why there's been no meaningful discussion regarding investigation of claims and potential other assets. It doesn't explain the basis for valuation. Creditors in this case, like every other case, are entitled to due process, which requires an opportunity for the creditors to review sale transaction and the bidding procedures, any questions that

arise there under. One of my primary concerns is that the case involves a cryptocurrency business with allegations involving substantial missing assets and pre-petition transfers. The focus appears directed almost entirely towards closing a sale rather than investigating whether additional value may be recovered for creditors through estate causes of actions. Are there other crypto assets anywhere in any account? The debtors argue that any claims can be investigated later. Respectfully, later is too late for a cryptocurrency case.

Creditors should not be forced to choose between a fast sale and informed oversight. The court should know what assets exist, what claims may exist, and whether a committee believes a proposed process adequately protects unsecured creditors before the estate is pushed down a sale path. The debtors also argue that delay will destroy the value because of the option that expires on September 30th. The court has been presented largely with the debtor's own characterization of that urgency, and what creditors are requesting is not months of delay. Perhaps it's a week, maybe it's 10 days.

We're asking for a reasonable opportunity for a creditors committee to become functional, review the transaction, discuss this with committee members, understand the stalking horse selection process, review valuation assumptions. Most importantly, the concern is not held by my client alone. Mr. Zhang, who I do not represent for clarity. submitted a certification in support of this motion, and there was also adjoined by two other creditors. Bankruptcy sales are intended to maximize value and foster confidence in the process. Confidence comes from transparency, and confidence comes from meaningful participation.

At this moment, there is no confidence in the transparency. We respectfully requesting the court deny the bidding procedures, or at least in a minimum, adjourn the hearing to permit the creditors committee. petition time to discuss these questions and concerns with the committee members and other unsecured creditors. So I just want to sum up the concerns to my bidding procedures and some sort of generic concerns. And I want to make sure I'm going to have an opportunity to address the chapter trustee motion separately, right? I'm just focusing entirely on the bidding. Yeah, we'll deal with the scheduling of the trustee motion after we deal with the bid procedures. Thank you, Your Honor. So again,

there were false statements made to the court on the petition, not like, but we'll deal with the not listing, litigation, arbitration awards, then it gets corrected weeks later, so there's an issue of transparency. My understanding is that the debtor's agreements with his customers call for any disputes to be submitted to arbitration in Singapore. The debtor has avoided that process and is now forum shopping to have the process be selected through a Chapter 11 in the U.S. while avoiding arbitration in Singapore. There's a question of pre-petition transfers of assets, question of jurisdiction. There was a statement by the CRO that there are financial records

that were destroyed by the Chinese government. My client seriously questions that statement, considering that Poulin was a Singapore company and its financial records were governed by Singapore law. And of the understanding that one of the other creditors, 2022 transaction records are still available and displayed in the pool and app. So it questions the availability of other financial records that were, quote, destroyed or not destroyed and still exist.

And lastly, I think that the CRO's independence is truly not independent. He's hired by the debtor. debtor hand selected the CRO. And I do think, again, not part of this argument, but either a Chapter 11 trustee or an examiner is necessary here. Or at least, again, the committee to have some oversight in some of the concerns that I raised. Thank you, Your Honor. Thank you, Ms. Polcona. Mr. Packman, do you wish to respond? Yes, sir.

The committee has asked for the weekend to have counsel look at the order, and we have agreed. So that's all I have on that one. I suppose if the committee has any other issues, they'll address it with me, and then we'll be back here. But that's where we are with the committee right now. I heard a lot of stuff there, Your Honor, most of it, which is irrelevant to the bid procedures. And if Your Honor wants me to get into the he said, she said, and the hearsay and what are facts and what are counsel's opinions and all that today, I will. But I don't think it's appropriate for this hearing. So what I did hear relevant, I guess, to the bid procedures is we question the process leading up to the stalking horse.

Your Honor, I mean, I'll hear this weekend from the committee, but Mr. Dufrin's declaration is pretty detailed here as to the process. And what he did to vet. seven, it's actually seven, I think it says five prospective stalking horse bidders, but it was seven. And so, Your Honor, if you require additional testimony, I mean, I can put Mr. DuVran on the stand and we can go through the stalking horse bidders, I don't think that's appropriate either for a bid procedure hearing, and frankly, I don't know that that's conducive to the

sin process and the option to get into what other bidders who were lower, some substantially, than our stocking horse, or whether there was another bidder who was close to the stocking horse. I mean, that would be unusual for a bid procedure, sir, Your Honor. But I think the detail that is in the declaration is not just generalizations from Mr. Dufray. He went through exactly what he did here, which I think is commendable, Your Honor. I mean, I live this every day. I know how hard he worked and I know how difficult this process was to get to this stalking horse.

So, you know, again, it's generalizations. It doesn't go to the actual process itself. And, you know, Your Honor, if we put that off, for a week or so, what's going to be different? Because the committee is going to examine this and they're going to get back to us on it. What would really change? What would change for the worse is that buyers get cold feet. And those looking into the data room are wondering, well, what exactly is going on here? Are we going to have an auction on September 10th?

We're selling, with the exception of the power contracts, we're selling hard assets, Your Honor. We're not selling causes of action. That's specifically excluded. We filed our APA amended exhibits. Chapter 5 is not included, causes of action, not included, tort claims not included. So I don't understand that point. This is a sale of hard assets and power. That's what the buyers won, Your Honor.

And there's no reason to delay the process from what I've heard. Any examination that's going to be done as to what happened five, six years ago when Poolin was shut down by the Chinese government. Crypto businesses were shut down by the Chinese government. That is going to be a discussion we're going to have with the committee. That's going to be a discussion that may go on for a bit. And there may be forensic people that want to look at the records to the extent there are records. Counsel stands here today and says, well, I've heard that there are records.

Okay. Maybe there are, maybe there aren't, but that's counsel. I'm not going to make those arguments, Your Honor, because what I understand is that the Chinese government seized assets, valuable assets of Poland years ago when it shut crypto trading down and records. And that's what we know today. So they can test all these aspersions on Mr. Pan, the principal, through counsel. This is coming from one creditor. Maybe there's creditors on the committee that have a different viewpoint.

Mr. Zhang sent me an email last night. I haven't had a chance to look at it yet. I need to have those conversations with committee counsel. He's on the committee. I don't know that the committee supports a Chapter 11 trustee, Your Honor, and maybe Mr. Zhang has an issue. I don't know all these things. What I do know, Your Honor, is if we don't know.

delay the bid procedures, it's going to severely impact the sale. And that option is important. We're not making it up. Thank you, Your Honor. Thank you. Does anyone else wish to be heard with respect to the bid procedures motion? Yes. Yes, Your Honor.

If I may, Stephen Cohen for the Thoracall of the stalking horse bidder. First off, I support in full the promise paid by Mr. Packman and his efforts to get the bid procedures motion teed up. for today. And as far as the objector's comments, there is absolutely zero evidence, and there's to support the suggestion that there's anything other than a complete arm's length transaction, relationship between my client as the stalking horse better and the estate. There's no direct or indirect prior relationship, and we have the affidavit declaration for Mr.

Sitt, the principal. of the stocking horse bidder to verify just that. Moreover, the delay of the 930 expiration date of the option is a very meaningful and important part of the purchase process. My client has been working long and hard at great expense together with the help of Mr. Dufrane to try to deal with the mineral rights surface use issues and the moving the transmission lines. So even a delay of a day would materially impact our ability to get the conditions satisfied in order to close on time. And for all those reasons, and those set forth by debtor, we respectfully request that the court decide this motion today without further delay. Thank you.

Your Honor, there's one thing I did forget. When I asked, Your Honor, if we could move in the declarations of Mr. Dufrain, I forgot about Mr. Sitt and his declaration. So I asked that that be moved into evidence as well. That was submitted in support of the bid procedures. Does anyone have any objection to the declaration in support of the bid procedures being admitted into evidence? Okay, that definition? Okay, the declaration will be admitted.

Thank you, Your Honor. I don't have anything else unless Your Honor has further questions. No, just for the sake of the good order, is there, I've heard from Mr. Cohen, is there anyone else on the Zoom that wishes to be heard with respect to the bid procedures motion? Okay. Having reviewed all the pleadings as well as the statements of counsel on the record, subject to one minor modification, which I want to get into, the court will approve the bid procedures motion and overrule the objection. I am primarily concerned with the September 30th option expiration, which I think, as Mr. Sattler recognizes, is critically important here. Chapter 11 cases are not often filed in ideal circumstances, and timing is not always ideal for creditors, but the goal needs to be maximizing value while also preserving all creditors' rights.

I am not suggesting that the issues raised by Ms. Placona are not issues that need to be dealt with, but what I'm ultimately left with is that approval of the bid procedures will ultimately not prejudice any issues with respect to substantive objections to the sale, with respect to any other issues that any other creditor wants to make in terms of taking up issues and asking for relief. So I do not believe that it would be appropriate to delay the timetable that's set forth in the bid procedures motion and the fact that counsel

for the committee is subject to their right to review, the order and comment, the fact that they are on board with moving ahead. on this timetable is very persuasive to me and for that reason we were going to move ahead with with the bid procedures order being entered the one in this is a minor issue mr. Packman that I want to just address the in terms of what the current time the current timeframe is going to be that you're not filing the proposed sale motion until the 11th

and then the 16th would be the objection deadline. What I would like to do is it doesn't necessarily have to be an exhibit to the bid procedures order if you think that'll make it too lengthy. But what I want you to do is file, docket and serve the current version of the proposed sale order. And then what you would file and serve on the 11th would be a red line showing any changes. And the reason I want to do that is because, you know, as you well know, there's lots of bells and whistles in a sale order that don't necessarily even get picked up in the motion, which is to summarize what's in the order. So just so there's no parties coming in saying that, you know, they didn't have adequate time to review the sale order. I would like to just have that, have that docketed and served.

and so that you're still able to have the time to end, the 916 objection deadline. I'm not as concerned with the five-day period to lodge a substantive sale objection as long as there's a red line that filed, that shows the changes that were made from the version that was documented following approval of the bid procedures order. Do you have any issue with that? No, you're right. Okay. So with respect to item number seven on the agenda, which is also number seven on the

calendar, the court's minutes will reflect that the motion for entry of bid procedures is granted and that in order is to be submitted. Thank you, Your Honor. Your Honor, I think it's the last item on the agenda is scheduling of the Liang motion for appointment of a Chapter 11 trustee. I mentioned earlier, Your Honor, on the record that our office on behalf of the debtors had served document production and deposition notices on Mr. Liang's counsel. I believe we preliminarily set his deposition, I want to say September 23rd and Mr. Zhang's deposition for 22nd?

24th. 23rd and 24th. 23rd and 24th. Your Honor, my suggestion would be that we enter into some sort of a scheduling order. If this is going to be a truly contested proceeding, which I suppose it's going to be, we'll try to have discussions to dissuade Mr. Liang from pursuing this, but of failing that we're going to take his deposition and we're going to get to the bottom of some of these allegations that he's making and so there's a hearing on

October 20th that's a scheduled hearing I don't know if we want to schedule that as a plenary date or whether we want to schedule that as a intermediary date but I I let me just check with this Paterson I thought it was October 21st that's the omnibus hearing date and then we have Is that correct? Okay, so I don't think the 20th is a date that we had. I'm sorry, Your Honor. 21st. Okay. Whether we're ready at that point, I don't know what Discovery and Mr. Liang's attorneys are going to want, I guess, remains to be seen. Okay. Ms. Palcona, what I want to hear from you

regarding scheduling? I mean, I was waiting to serve Discovery until when we get the date. And respectfully, I did reach out to Mr. Packman to try and avoid having the court get involved in scheduling and I did not get a response. I was trying to work this out without belaboring the court with, you know, a minor issue. But I'll defer to the court on scheduling. I'm not sure if you want me to give you an argument why I think there needs to be a trustee, why I think it needs to be expedited. I obviously filed it on short and time.

You've heard some of my concerns. I didn't put all of them on the record. I'm happy to go through them. I don't want to waste the time's court. But we're looking for it to be heard on an expedited basis. I think in October is too far out. But again, I'll defer to the court on that. Well, so here's the thing.

Had I granted the motion to short notice, I ultimately think that that wouldn't necessarily work in your client's favor because you need to make a record. And so arguments and a declaration from your client are not evidence that can support grounds to appoint a Chapter 11 trustee. So I don't question the fact that your client does feel strongly that a Chapter 11. 11 trustee should be pointed, but there's significant factual issues that are disputed here that need to be worked out and there needs to be a record.

So I don't see how even if I were inclined to hear this on an expedited basis that the necessary fact-finding and discovery would be able to occur, particularly in light of the fact that we have a sale process that's going to be going on. And I assume that, you know, your client, you know, may wish to take an active role in, you know, the litigation of the ultimate approval of the sale. I also think that absent that logistical and pragmatic issue, I think that based on my ruling, approving the bid procedures, I, in my mind, the issues that you are raising and the concerns that you are raising are presenting, are present. notwithstanding the process of the sale as mr. Packman noted this is a sale of hard assets There's a CRO that has been working diligently to get this process in place we have a committee and so I

I don't see grounds for appointment of a chapter 11 trustee to necessarily determine whether or not a sale is appropriate and your client has the opportunity to make any objections to the sale that they deem appropriate. And so I just don't think that a determination of the Chapter 11 trustee motion is necessary on a short timetable, particularly when you reserve all rights to make whatever substantive objection to the sale that you deem appropriate, including if you think that there was some taint

to the sale based on the, you know, the allegations that you make in your trustee motion. But at the end of the day, I think it's important that if we're going to go ahead and have a contested Chapter 11 trustee motion, it's critically important that we have an adequate record and that I can actually make findings based on that record rather than argument. And so I think it makes the most sense for the parties to focus on the sale process between now and September 18th and not have a intervening trustee motion. to distract the parties from that. And again, in the meantime, I don't see how that is in any way prejudicial to your client in terms of the merits of any Chapter 11 trustee motion. So unless you think that, you know, there's a specific problem with the October 21st date,

I think that that is, you know, certainly a reasonable timeframe. But I see that Mr. Sandler also has his hand up and wishes to be heard. So let me hear from you, Mr. Sandler. Thank you, Your Honor. Just very briefly. First of all, we'd like to be included in any negotiations over dates because, obviously, an investigation like this takes up a lot of the state's resources when a lot of what is, maybe almost everything that is being asked for in the Chapter 11 trustee motion can be

accomplished by a committee conducting its investigation, which the committee will be doing. So we don't want to see duplication of efforts here. And also, we think that as of right now, this moment, we're trying to maximize value into the estate. And so we really believe that there needs to be an emphasis on the cell process. And that also takes up a lot of resources. And as, you know, the court noted, I think Mr. Packman, whether, you know, and we confirmed, I confirmed this morning, is that no causes of actions

are being sold, that this is only sale of our assets. So, you know, rights are preserved, people can investigate whatever claims are out there. And certainly the committee intends to conduct a fulsome investigation, here, Your Honor. But we do want to be part of any negotiation on, on dates to make sure those dates are appropriate, and that we are proceeding down the path that will be value maximizing for these states. Thank you, Mr. Sandler. And you anticipated what my parting comments were going to include, which is to just mentioned to Ms. Placona, obviously, at the time you filed your motion, we did not have a

committee appointed yet. We now have a committee with a very experienced committee council. And so I obviously are free to pursue the trustee motion, but I was planning on encouraging you to work with committee counsel because you know we're the the potential role for a Chapter 11 trustee that you envision very much you know overlaps with the investigatory role of the committee so I would encourage you to you know work with committee counsel to see you know whether or not the concerns that you have can be addressed through the committee's own

investigation as opposed to appointment of a Chapter 11 trustee but again free to pursue whatever release you think is appropriate for your client but I think that makes total sense for you to coordinate with committee counsel and to see if whether or not the issues can be addressed or even narrowed based on the participation of an experienced committee council here your honor I'm more than happy to and I'm sure there can do just as good as a job I'm not looking to waste resources or the state's resources so I'll defer to the court on the scheduling I look forward

working with committee council and hopefully a lot of my clients questions and concerns can be addressed since they were not addressed prior thank you your honor can I raise a point yes mr. Sadano I apologize your honor for jumping up when my colleague was addressing the issues Anthony Sedano please the court your honor your honor our concern really is because of the nature of this business we're dealing with cryptocurrency doing with Bitcoin Ethereum and it's other cryptocurrencies I frankly don't understand. We don't know, you know, where those went, where they are. They're being moved around today. Now, we'll work with the committee and hopefully work with

the debtor to understand where the money went once it came in. As I understand this business, and I don't completely understand it, money was deposited into the debtor, not as an investment, almost as a holding company or like a bank. But now the money, I think, is gone. And we don't know if it's being moved as you and I speak now, through the air, somehow how Bitcoin and other crypto gets moved. So that was really our initial concern. Yes, we could pursue causes of action.

We can look at causes of action. Those are in the past. We were concerned about what's happening right now at this minute because of the crypto nature of this business, Your Honor. And I just wanted to make that comment. and I apologize for jumping up, Your Honor. Thank you. No, apologies necessary, Mr. Stano.

Your Honor, I'll keep it very, very brief. The operations of Lone Star Dream ceased on July 10th. That's all I have to say on that. So I... That's the allegation. Okay, so I... No, they're not, they stop business. Well, Your Honor, I understand, I do understand the point, Mr. Sadano,

but at the end of the day, I think that, the potential appointment of a Chapter 11 trustee, you know, three weeks from now versus a month from now, I think that I don't see the benefit of basically having estate resources be focused on litigating a trustee motion when really the main event and the value maximizing event of this case is going to be to move forward with the, with the $316. So in light of the fact that, you know, we have sworn declarations regarding the cessation of the debtor's crypto business and that there is none of, no crypto assets are the subject of the sale motion. I don't see that as a reason to, you know, in any way expedite or move up the timing of a Chapter 11 trustee motion, particularly in light of my original point, which is that, arguments or arguments, but the merits needed to be determined on a factual record, which needs to be established, and that's not something given what's alleged here and what's

disputed here that's, you're going to have the ability to really make that record, you know, in that short amount of time, given the timing of the sale motion. Mr. Packman? Thank you, Your Honor. Will the October 21st date be a plenary date? Should we be preparing for a trial on that date or should we have that as an intermediary date and the parties report back how it's going? Yeah, I think that makes sense. So we'll set it for actual merits of the motion to be heard on the 21st.

But obviously, depending on where things are with discovery and whether or not there's any type of resolution or narrowing of the issues, you know, we can certainly, you know, treat the 21st, you know, rather than the actual trial date as as more of, you know, kind of a procedural holding date. But I think we kind of should wait to see, you know, where things are when we're, you know, probably, you know, closer to, you know, a couple weeks out in terms of, you know, where things stand and what, what the parties expect to be ready to go forward with. Thank you, Your Honor. I think that covers it for today. I don't think we're missing anything. We'll get those revised orders in, Your Honor, and then we'll be back to you on Monday.

Okay, one just housekeeping issue I wanted to note for everyone in the courtroom and on the Zoom. So when we're back on August 20th next week, that's going to be part of our normal calendar. So the Zoom for the 820 date is, the normal zoom link on my chamber's page rather than the pool-in-specific webinar link. So for next week, you know, just it's the regular generic zoom link that will be using for that hearing rather than the pool-in-specific webinar.

Understood, Your Honor. Thank you for your time today. Okay. Thank you all parties for your presence and your argument. Thank you, Your Honor. Thank you, Your Honor. So just with respect to... Ms. Patterson for respect to the scheduling.