Today I was interviewed by the local FBI agent and local IRS agent. I asked them what they were trying to do with this Summit 1031 bankruptcy case where 200 people lost their money through the US Bankruptcy Court?
They said they don’t know about what goes on in the Bankruptcy Court. Only a few understand the bankruptcy law. That is not their forte. Besides, that is not what Congress is telling them to investigate. They were given the job to TARGET the Summit 1031 Principals, indict them, and seek restitution. They claim this is how they will find justice for the exchangers. They claim this is what the 200 victims are asking for.
Here is where I run into a wall over and over again because the math does not add up.
Summit 1031 Assets on 12/19/08 (Time of Filing Chapter 11 – Debtor In Possession Bankruptcy)
Cash $14 Million
Bond $10 Million
E&O $3 Million
Note Receivable Steve White $1.2 Million
Notes Secured by Real Property
and Summit Principal Real
Property Investments $11.5 Million
Summit Principal Interests’
In Business Interest $1 Million
Amount Summit Principals
Voluntarily Transferred to
BANKRUPTCY ESTATE $40.7 Million
Summit Settlement $16.8 Million
OK – So the Summit Principals transferred $40 Million in assets to the Bankruptcy Estate. Now, even though the $40 Million was all they had, they now owe $16.8 Million More.
So even though all the value EXISTS, nobody even acknowledges it. I said the money is there, it is in the Bankruptcy estate. They say that is not their expertise and it doesn’t matter if the money is in the bankruptcy estate, because the Exchangers are angry with the Summit Principals.
The agents I spoke to say that they know that the restitution will not come close to amounting to what is owed to the Exchangers, but they are SURE that is what the exchangers want. They want indictment and they want their money. So the IRS and the FBI say don’t you worry, we will indict and we will get restitution. What does this really mean?
I said do you know how long it will take to pay the exchangers back if your only TARGET is the Summit Principals who will be paying the price for a third time? The system is seeking restitution and assets over and over again from the same people. Each Summit Principal is around 55. They have about 10 years each of working age. Let’s say they each make $60k per year for 10 years – $600K times 4 worn out old guys equals $2.4 Million. Take away 33% for taxes = 1.6 Million. This won’t even come close to paying the Settlement they already owe to the Summit Bankruptcy Estate. It just makes a tiny dent. Oops, I forgot, they are going to jail, so never mind the 1.6 Million in restitution. Instead these guys are sitting in jail.
Is this the answer the FBI is giving the angry exchangers? Do they tell them where the money is? No, they don’t have anything to do with that money. The bankruptcy court has that money and that is really none of their business. They don’t work together to get your money back. They don’t even understand that you really would like your money back. They just understand you are angry.
I understand your anger. I wish the Summit Principals had been more forthcoming with me about what kind of risk they were subjecting me to. I thought I had solid partners in common real property interests, just like the other 105 innocent parties who are losing their property interests to the bankruptcy court. You thought your money was safe and sound at the bank. They should have been forthcoming with telling you what they were doing with exchanger monies. Their exchanger agreement said the monies were deposited into deposit accounts. They didn’t say that they were going to invest 25% of those funds in short-term real estate backed loans.
Who else wasn’t forthcoming with what they were doing with your money? Is the Government forthcoming with what they are doing with your money? Is Wall Street forthcoming with what they are doing with your money? Are the Banks forthcoming with what they are doing with your money? Is Kevin Padrickforthcoming with what he is doing with your money?
I have to say there are many organizations not being forthcoming about what they are doing with your money. Luckily for the Exchangers (sort of I guess) they have the FBI and the IRS making sure they take down the Summit Principals who were not forthcoming with what they were doing with your money.
Well what about the organizations that are not monitored by any agency?
Both the IRS agent and the FBI agent said they don’t know what organization monitors the Justice System. Apparently, we must voice our concerns with these HIGH POWER/HIGH PROFIT agencies via our Congressmen (Jeff Merkley and Ron Wyden). So I will write a letter describing the wrong doings I believe have been conducted in the name of justice.
Your anger with the Summit Principals just helps Kevin Padrick keep up the facade. While you jump on board the anger train, Kevin Padrick and Company (Obsidian Finance) and legal counsel, TonkonTorp have FREE REIGN on what to do with the $40.7 Million they have in assets the Summit Principals gave up to help pay you back.
By the time our FBI agents get through their investigation process, indictment process, the court proceedings, and whatever else is in the schedule of the ONE goal the FBI and IRS have to TARGET & INDICT. Somehow this is supposed to make you feel better about losing your money. In the meantime, I know Kevin Padrick has your money and is able to do whatever he wants with it. Our Justice System just willy nilly handed your money to a self-indulgent, self-interested, CORPORATE RAIDER.
And everyone is OK with this I guess. Problem is that there are many like Kevin Padrick in every organization and every system. Our MEDIA is not talking about this, our President is not talking about this, our Governing Agencies are not talking about this.
We spend a lot of time tearing people down in the media which keeps our focus on issues that aren’t really important in the big picture of harmony, being humanitarians, and righting the wrongs. Instead, our Media, has a hay day taking down people, like Tiger Woods because he is a human being. You forget how many years of beauty he brought to us with his amazing Golf Game. We don’t even remember this and this was his gift to us. When he needs us to be compassionate and forgiving, we throw him down the drain. I am ashamed of this behavior. This is not the American Way and it isn’t the HUMAN way. It is simply the F*d up way!!!
We put no value on their intent. We put no value on their desire to right their own wrong. We put no value to the victims losses. Our agencies take care of their own, help TARGET the ones they can get their hands on – mostly those of us who have no power and no money. Do we care?
The agents initially assume that I don’t care about the rights of you exchangers because I am screaming at the top of my lungs about where your money is and what the person who is in COMPLETE CONTROL of your money is doing. I suppose I come off angry, but I am not angry – I am passionate about righting the wrongs. I have lots of sadness around the many victims of all the money deception going on. If you are taking care of some one’s money you should do so with extreme care. Just like our Government should not be taking our tax dollars and dumping the funds into the same institutions that caused the economic collapse and we are OK with this?
Why aren’t we angry at the deception everywhere – on every level.
You know when everybody knows there is a problem, but nobody is talking about it. It reminds me of the big elephant in the living room of a dysfunctional family situation.
Well I didn’t love my visit with the IRS agent and the FBI agent because it showed me another level of our Nation’s brokenness. I left there a broken hearted. Why? Because we really have NO HOPE if we rely on our servants and our systems to protect us in any way, shape, or form. They have no idea how to protect the masses and I don’t believe they are working with your best interests in mind and there are CONFLICTS OF INTEREST everywhere you find MONEY.
There was a moment of clarity in all of this. If WE THE PEOPLE don’t start waking up to the betrayal that is everywhere then we will lose the war I think the Black Eyed Peas are singing about in their Where Is The Love? Song
What’s wrong with the world, mama
People livin‘ like they ain’t got no mamas
I think the whole world addicted to the drama
Only attracted to things that’ll bring you trauma
Overseas, yeah, we try to stop terrorism But we still got terrorists here livin‘
In the USA, the big CIA
The Bloods and The Crips and the KKK
But if you only have love for your own race
Then you only leave space to discriminate
And to discriminate only generates hate And when you hate then you’re bound to get irate, yeah
Madness is what you demonstrate
And that’s exactly how anger works and operates Man, you gotta have love just to set it straight
Take control of your mind and meditate Let your soul gravitate to the love, y’all, y’all
Makin‘ wrong decisions, only visions of them dividends Not respectin‘ each other, deny thy brother A war is goin‘ on but the reason’s undercover The truth is kept secret, it’s swept under the rug
If you never know truth then you never know love
Where’s the love, y’all, come on (I don’t know)
Where’s the truth, y’all, come on (I don’t know)
Where’s the love, y’all
I feel the weight of the world on my shoulder
As I’m gettin‘ older, y’all, people gets colder Most of us only care about money makin‘ Selfishness got us followin‘ our wrong direction Wrong information always shown by the media
Negative images is the main criteria
Infecting the young minds faster than bacteria
Kids wanna act like what they see in the cinema Yo’, whatever happened to the values of humanity Whatever happened to the fairness in equality
Instead of spreading love we’re spreading animosity Lack of understanding, leading lives away from unity That’s the reason why sometimes I’m feelin‘ under
That’s the reason why sometimes I’m feelin‘ down
There’s no wonder why sometimes I’m feelin‘ under
Gotta keep my faith alive till love is found
Now ask yourself
Where is the love (The love)
Where is the love (The love)
Where is the love (The love)
Where is the love (The love)
Where is the love, the love, the love?
Father, Father, Father help us
Send some guidance from above
‘Cause people got me, got me questionin‘
Where is the love (Love)
Sing wit me y’all:
One world, one world (We only got)
One world, one world (That’s all we got)
One world, one world
And something’s wrong wit it (Yeah) Something’s wrong wit it (Yeah) Something’s wrong wit the wo-wo-world, yeah
We only got
(One world, one world) That’s all we got
(One world, one world)
From Interview in Clip Below – At no point does anybody say this is wrong? Yes there was a handful who were an exception to this. They were yelling and screaming about this, but nobody listened.
I have been having a very healthy debate about how our Court system says it does this and does that to “protect us”. Yes, the legal documents say you have all these ways to achieve justice in our system. Well maybe I should offer this information to people. Sorry can’t do it. That would be like referring someone I don’t believe will do their job.
There is no motivation or checks and balances built into our Justice System, just like Wall Street, and just like our Government. I mean if you have a problem with how our government spends your money, what do you do about it? If you have a problem with a Judge, what do you do about it? If you have a problem with the people monitoring these systems, like the FBI and the IRS and the Supreme Court, where do you go? Will your voice be heard?Who will call them out on these “larger powers”?
Well I have experienced first hand that even if you have the TRUTH, all the DOCUMENTS, the INSIDER KNOWLEDGE, and the BRAINS to figure out what is not working, that the people who are supposed to serve us really serve themselves. They put blinders on to the fact that their actions will ultimately lead to – human suffering and great financial loss at the expense of a few large financial gain.
You can literally scream and yell until you are blue in the face – NOBODY LISTENS. They are too busy making money. Why should they mess that up, even if they know that many will have great loss? We have leaders and people in power who lack social conscious because they are blinded by their paycheck. Some leaders don’t even know they are playing the game. Others know they are playing the game, but they have to continue to play the game to keep the empire they built in tact. Really not sure what their wealth has to do with serving WE THE PEOPLE??
How do WE THE PEOPLE protect ourselves from this betrayal and deceit?How do WE THE PEOPLE get heard? I would like to say take it to the Justice System, they will handle it, but I would be lying. I would be sending people with no hope and no money into the darkness of our NATIONS’ courtrooms so they can have less hope and less money.
By the time anyone does get anything through the Justice System, the damage has been long done. I mean we finally hear about the fall of our Financial Markets in 2010???They knew about this in 2006??? The dillusion is that the financial crises happened because of the fall of the real estate prices, but the truth is those prices were inflated by these risky mortgages. One links to the other that links to the other and so on.
Jeez People – Wake Up – Don’t you get it? If you don’t VOICE the wrongdoings and be a whistleblower of sorts, NO ONE ELSE WILL!!! You are the only one who can protect you. Why do we allow these people who care only about themselves to make all these STUPID choices for us? When are we going to STOP BELIEVING in the ILLUSION and start believing in what we all know in our HEARTS to be true? Are we scared? Are we weak? Are we wanting to hide from the horror of it?
Well I would say YES we are scared and yes we don’t want to see the horror, but weakness is just an excuse. We have all the tools and all the knowledge to have a voice, it is just making a decision to share that voice with the rest of the world.
Oneperson screaming is not near as effective as 100 people screaming right?
A few videos passed my email box today. Totally unrelated, but totally related.
The first was was really boring and without much value to me. It is a clip from a video that was taken on October 10, 2009. It is a video of Kevin Padrick letting someone fly his Robinson R44 Helicopter. It looks like these helicopters cost anywhere from $340,000 to $415,000, possibly more depending on the model. This model may be more expensive because it is a 4 seater.
I don’t know what other assets he has. I am sure I will find out on the World Wide Web over time.
October 10, 2009 was just after, he used extortion to get me to withdraw my objection to fees by stating in Doc 554 – Kevin Padrick’s Supplemental Response to his Response (Doc 551) that “The Trustee has further informed Ms. Studebaker through counsel that preparing for the hearing on September 15, 2009 will require substantial time and expense for the Trustee, and that the Trustee intends to seek an order from the Court requiring Ms. Studebaker to reimburse the Trustee for all the attorney fees and costs incurred in connection with the Response and the September 15th hearing. Ms. Studebaker-DeYoung has nevertheless refused to withdraw the fee objection.” At this time, I had know idea that if I didn’t withdraw the objection, that I would have to pay for all his time and expenses. Not that I was going to lose the Objection, just that I was even pursuing it was going to cost me loads of money so I better back off you know because I DON’T have loads of money. I mean by that time, they had exhausted my cash by tormenting my attorneys and I was broke so they broke me. No more objecting to outrageous fees.
You can’t hear anything because of the Helicopter noise, but it probably isn’t of much value.
At the end of the description, the author writes,”…Big thanks to Kevin Padrick for his generosity and sharing his knowledge and experience.”
OK – Well thanks Kevin for sharing your 1/2 Million helicopter with the helicopter club people. That is really generous. I can’t say enough about how this is helping those 306 people who have LOST EVERYTHING from wrongful use of your knowledge and your experience in Bankruptcy Law. At the same time you were sharing your experience and knowledge at the helicopter club, you were abusing your Bankruptcy Knowledge to take money from Victims of the economic collapse landing in the form of Summit Accommodators Inc. Chapter 11 Bankruptcy. Sure I could get generosity if you weren’t billing for “professional” and “liquidating trustee” and “bonus 15% for being so dam good at flying helicopters???” that will total $6.5 million according to you at a pre-settlement conference hearing. What the hell are you going to do with $6.5 Million of other peoples money? When are enough expensive flying gadgets enough? When are do you have enough houses? When do you have enough money?
Another video clip that came in today was a 60 Minutes interview with Michael Lewis. He had a serious of very interesting things to share on the economic collapse and how the players like Goldman Sachs who created the problem to enrich themselves were also the same company our government bails out. There is a mess in Wall Street, a mess in Washington DC, a mess in our Government Monitoring agencies, and a mess in our so-called justice system. Why do we have such a mess? Because the few with all the controls on all the money abuse these systems and make them a mess. They aren’t serving anyone but themselves.
So Smart, But So Greedy, So Blind, So Lost, So Sad…
I see your company is promoting Green, Obsidian Renewables – a Solar Farm Project in Christmas Valley Oregon. Don’t you think for one moment I am not doing the math. I am having a hard time coming up with why a 5 Megawatt system would cost $30 Million dollars? Any solar people out there? How much does each Megawatt cost? Another solar company told me about $1 Million per Megawatt which totals $5 Million. So why does your project cost $25 Million more???? Where is this money going? What kind of energy savings would warrant this kind of cost? Just seems to me this is another sales job that doesn’t add up.
Although intelligent, you are like the other smart money manipulators on Wall Street who can’t connect what they are paid to what they contribute. You have been able to delude yourself into thinking you deserve to get paid millions because you were at the right place, Bend Oregon, at the right time, Economic Collapse, with the right knowledge, Bankruptcy Law, to take full advantage of the liquid rich and property rich Summit 1031 Bankruptcy Estate. Problem is you didn’t tell the people who hired you, Summit Principals, that this was what you were going to do or they would have hired someone else to do the job because their GOAL was to payback those who were owed the money – The EXCHANGERS (creditors).
I know you like to say you are doing this very expensive work for the benefit of the creditors…More ILLUSION.
People assume that you are acting on behalf of these creditors because you coordinated the wrongdoings of your other bankruptcy buddy’s and they appointed you as Liquidating Trustee even though this was a big conflict with the Summit Principals and your old boss, Terry Vance (Original Chief Restructuring Office of this bankruptcy). I have been told by my attorneys that this Name, this Label means that you get to walk around with a white cloak on. Supposedly, as a liquidating trustee, you are to act with in the HIGHEST FIDUCIARY DUTY. What a crock! You only act for the $$$ in your pocketbook.
Do you disagree? If so, why not decrease your rates? Take the 15% of the table. I mean really what value did you create in this whole mess? I am stumped, how about you?
Kevin Padrick and I set the time of the presentation to be 10:00AM on 2/12/09.
I arrived at the Summit Bend offices around 9:45AM. I askedTerry Vance, the Chief Restructuring Officer of Summit Accommodators Inc Chapter 11 DIP (Debtor in Possession) Bankruptcy Case No. 08-37031-rld11.
THE MOTION TO APPOINT A TRUSTEE WAS BROUGHT UP AND GRANTED AT THE 2/11/09 HEARING, BUT AT THE END OF THE HEARING, TERRY VANCE WAS STILL IN CHARGE AS CHIEF RESTRUCTURING OFFICER. THE COURT AND US TRUSTEE’S OFFICE DIDN’T MOTION FOR THE APPOINTMENT OF KEVIN PADRICK UNTIL 2/13/09.
Upon arriving to this once thriving office space, I asked Terry Vance if we should be recording this presentation. He said, “What kind of recording device do you have?” I said, “a Webcam.” He Said, “Bring it in.”. I showed him the laptop with a webcam and he said I could set it up. I turned on the Webcam at 9:53 AM, Kevin was supposed to be there at 10AM. Ewan Rose and Ryan Norwood (Obsidian Finance Employees were already at the office rummaging through the files.
So, Again, I ask myself “Why am I being charged of a crime?”. Why is the Court Authorized CRO, Terry Vance, who authorized the recording not being called into Question? Why aren’t the Summit Principals who knew about the recording and my Step-Mom, Jan, the only other public interest who attended this presentation besides myself, being questioned and harassed by the local DA because Kevin Padrick said so. BECAUSE I AM A THREAT TO KEVIN PADRICK. BECAUSE WHEN I KEEP TELLING THE TRUTH ABOUT THESE WRONGDOINGS, HE HAS TO PROTECT THE $6.5 MILLION HE STANDS TO MAKE FOR HIS ROLE AS, FINANCIAL CONSULTANT TO THE CRO – OOPS I MEAN – INSTANT LIQUIDATING TRUSTEE. Not so sure what I did that was illegal. I recorded this presentation with Good Faith that it was a legal recording. I also posted it after having my attorney research it…meaning I posted it with Good Faith as well.
It isn’t really about the legality of the video? They don’t even investigate the matter. The Deschutes County DA’s office just listens to Kevin Padrick and when he says jump, they say how high. Oh Kevin the all powerfull attorney, are you used to everyone bending over for you? Sorry, but I don’t bend over for people that have no care for other human beings no matter how Powerful you perceive yourself to be. Yes, I used your favorite word – Perceive. Count how many times Kevin Padrick says the word Perception or Perceive at the Presentation…
BELOW ARE SOME HIGHLIGHTS FROM THE RECORDING OF THE “WAITING FOR KEVIN TO LAND HIS PLANE SO WE COULD FIND OUT WHAT THIS AMAZING PRESENTATION WAS ABOUT AND HOW OBSIDIAN FINANCE WAS GOING TO BRING VALUE TO THE SUMMIT BANKRUPTCY ESTATE” PART OF THE BANKRUPTCY PROCEEDINGS.
Stephanie: This has a camera on it. You need to leave this and tell them not to mind this. I already asked Terry and he said fine, bring it in.
Jan: OK
skip… Stephanie: So, do you think you could attend?
Terry: I can do anything I want [MEANING HE WAS IN CHARGE AT THE TIME]
Stephanie: I want to know if you want to attend.
Terry: Well, it’s going to be interesting.
Stephanie: I think it would be beneficial if you attended.
Mark: I think it keeps it real honest.
Terry: That’s an impossibility!
skip… Terry: Do you got it on now?
Stephanie: Yah.
Terry: So you’re just recording it right?
Stephanie: Yes.
skip…
Terry: He doesn’t drive, I don’t think.
Stephanie: He doesn’t?
Tim: He flies.
Terry: He flies.
Stephanie: Oh, maybe he was flying back this morning.
skip… Stephanie: And Susan did agree with…I said that Terry has a working knowledge. He’s been working there (Summit) day in and day out trying to find out what’s going on here.
Jan: I mean that’s a slam dunk. He knows more…
Stephanie: She (Susan Ford) reiterated the same thing and no one seemed to have a problem except this Tennant group because they can’t get what they want
Terry: Exactly.
Stephanie: So now they want to just appoint a Trustee so that they can just to get things going.
Terry: You know it would have been a long time ago if they would have just gotten out of the way. Watch the Recording for yourself…
Part 1 – Waiting for Kevin Padrick to arrive by plane…
Part 2 – Waiting for Kevin Padrick to arrive by plane…Cont.
Oh what a great morning! I had a feeling something special was in store for me today. My Criminal Attorney who is defending me against the alleged crimes the Deschutes County DA’s office (led by Phil Duong (Assistant DA) is charging me with because Kevin Padrick said so!
ONE – The legal recording of the presentation the US Bankruptcy Judge Dunn approved on 02/11/09 at a hearing where they Wham Bam Thank You Mam, DECIDED TO APPOINT A LIQUIDATING TRUSTEE IN 40 MINUTES WHEN IT WASN’T EVEN ON THE AGENDA FOR THAT DAY.
TWO – The Good Faith Legal Posting of A Legal Video by an Bankruptcy Whistleblower.
Did my attorney email me about breaking these laws? No, not really, he told me “Stephanie, the prosecutor asked me to relay to you not to call Padrick’s wife. Definitely do not call anyone from his firm, nor their spouses.” Like how Padrick said not to CALL his wife. I didn’t call his wife, but he can just say that?
You see what happened was that someone emailed me what they thought was Kevin Padrick’s facebook page, but it wasn’t, it was Kevin’s wife, Karen Padrick’s Facebook page. I thought back to when I was playing phone tag with Kevin to schedule this Presentation Meeting. There was ONE MOMENT where I felt Kevin might be a have a heart. It was when he greeted his wife. This was one reason I thought he might be a decent person. When Kevin Showed His True COLORS on the BOULDER HOUSE REJECTED AND LOST 3 submissions of offer by the same buyer that would have produced $80K CASH IN THE Bank for the exchangers. But wait, the bankruptcy plan had not been confirmed so Kevin wasn’t going to get the bonus 15%. The buyer got sick of dealing with Obsidian Finance and left to seek another house to buy since there were plenty to choose from. This house has since gone back to the bank and was sold to someone else and Kevin Padrick/Obsidian Finance lost the Summit 1031 Exchanger’s $80K.
Often times I have pondered on what Mrs. Padrick must think. Does she even know what her husband does at work? I mean how many husbands do all this stuff and don’t include their spouse in the equation. If they would, we would have a much more peaceful planet.
So when I was sent Karen Padrick’s facebook page, I sent her a message. I said “Please Pray for your husband’s heart”. Then I added these blogs…
So I ask myself, by doing these blogs to VOICE the truth, I have received hate mail like you wouldn’t believe. I have an 8 Page letter and 30 or so emails and comments by the same person. Our Bend Police say can’t do a thing because the harasser didn’t say they want to kill me. I FEEL SAFE…
So why would my simple prayer message on Karen Padrick’s OPEN facebook be illegal? All I was doing was reaching out. Wait – Kevin Padrick didn’t say facebook message, he said “CALL“. Why doesn’t he have to provide proof of this call?
BIGGER QUESTION IS WHY IS PHIL DUONG ASSISTANT DA KEVIN PADRICK’S WHOOPING BOY. I MEAN WHO THE HELL DOES HE WORK FOR? DESCHUTES COUNTY OR KEVIN PADRICK?
Why is a little shout out to pray illegal?
The US Department of Justice, our Attorney General, the US Trustee, and the FBI scour my blogs, see all the evidence, and yet are doing nothing with regard to Kevin Padrick’s actions to pad his pocketbook at the expense of 200 victims and 106 Innocent investors. He likes to take their money, their retirement, their time, their name, and anything else he can get for a Steal.
Why can Kevin Padrick get away with being the end all be all word of Ponzi Scheme, Embezzlement, and Aiding and Abbetting without any REAL documentation and support for his false and misleading statements? Why with all the documentations, recordings, audios and loads of PUBLIC court documents do I get told to not send a prayer to Kevin Padrick’s wife in hopes she can help soften his heart so he doesn’t continue to harm others in the name of his riches.
Little did I know back in February 2009, that these coordinated actions of Judge Randall Dunn, Steve Hedberg, Jeanette Thomas, Annie Buell, Tom Stilley, Kevin Padrick, Susan Ford, Sussman Shank, Perkins Coie, Ms. Vivienne Popperl, Pamela Griffith, and Robert Miller (US Trustee 18th Region) was happening right in front of my eyes.
How could I have known? I had never stepped into a US Bankruptcy Hearing in my life nor did I ever expect to. What were they talking about? Hell if I know. Mostly all gibberish to me and probably 99% of you, who don’t live in these courtrooms, will have a difficult time understanding it until you dig in a bit deeper.
After a year of being harangued by some powerful attorneys like David Aman of Tonkon Torp and Kevin Padrick of Obsidian Finance, I have gained a whole bunch of insight into the workings of the US Bankruptcy Laws and how they Simply aren’t used for what their intended purpose. In fact, the parties who know this law, but have ultimate power, use it to flood their bank accounts and keep their team fed.
In the meantime, the victims and innocent parties get caught in the middle. Oh, you might be SAFE if you cower down to these manacing powers. If you don’t, however, they will stop at no end to take you down! Violate Rights…who cares. F* with their Life…who cares. Bankrupt them…who cares. Ruin their credit…who cares. Andrew Moore of the Bend Bulletin told me that no one will comment on record except for Kevin. I responded with, “Well what does that tell you? Everyone is scared. They don’t want to be Kevin Padrick’s Target. Kevin is talking because he has to protect his story. He has to create fall guys, he has to protect his $6.5 Million dollar score, and he has to keep the focus on the Summit Principals so he can get away with the money.
Well to no end will Kevin Padrick step off, in constantly preying on me and violating me he is making me stronger, faster, quicker and really more powerful – though he will never admit that. He is making me more compassionate, more willing to fight for these wrongdoings, and more poor so that I do this for no profit which makes it even more Powerful. I mean – What the hell – if I work for money, they will just take it RIGHT OR WRONG so where is the power in that illusion. Kevin Padrick – keep coming – keep coming – keep coming. You don’t scare me a bit. You will just step in your own mess with all your false statements as you try to SHUT ME UP!
The US Trustee is the one responsible for monitoring the bankruptcy courts to make sure no coordinated wrongdoings go on. He has been asleep at the wheel on this bankruptcy case and it looks like the US Dept of Justice in Fort Washington, Maryland have taken an interest. If you look below, they are google searching “Stephanie Studebaker” + “Robert Miller”. My name with Robert Miller’s name…weird huh, I mean who the hell am I and what do I have in common with Robert Miller?
It is seems like these parties who were called in to help, messed it all up for their own benefit.
You see…After the Principals spent the entire year of 2008 trying to solve the falling cash to short-term loan ratio in their exchanger fund investment portfolio on their own, they realized the problem was bigger than them. They looked for outside sources for help. One of these initial sources was Kevin Padrick. He made them think he could resolve the issue, otherwise they would not have hired him.
Now - You can see below what transpired next. I have been involved in this case for over a year and I have learned a great deal about our court systems. The biggest thing is that what has happened here in this Summit 1031 Chapter 11 bankruptcy is the same thing that is happening across our Great Nation. I mean what are the number of bankruptcies being filed? It is the thing to do right? Why? Because our own financial systems failed us. Who controls the financials systems? All those years of ballooned fair market values, stock prices, and stated loans confused Americans. It made them believe in the American Dream. Oh, but then the balloon pops. Who gets all the wealth back? Where does the money go? Where did your money go? I believe that the leaders of our nation and states are not bringing up these REAL ISSUES because they are the part of theses REAL ISSUES. They ignore them. They turn their heads to it. They hide it. Why doesn’t our President address this issue? President Obama, the people don’t care about your health insurance program, when they have to focus on food, shelter, and SURVIVING the Great Recession!!!
If the Democrats are making “unsavory” deals, then don’t you think the Republicans must be able to do the same? Does your vote count if unsavory deals are being made amongst our leaders? Would We The People approve of these unsavory deals? Why are We The People being monitored by video cameras? Don’t you see all the cameras everywhere? Why should the leaders who are supposed to serving US be able to do so without a public recording of it? If their meetings were always recorded, then they would have a hard time making unsavory deals, right?
Currently, I believe I am the only person who had the priviledge of an all day deposition in front of Tonkon Torp’s camera man. Now when I see some of the ridiculous questions I was asked to answer, I still get blown away by their blatant disregard for human rights.
I am the creator of this Summit 1031 Bankruptcy Blog. I am an Industry Insider as an accountant, real estate investor, and an LLC interest holder. I am also a Whistleblower and an Investigative Blogger. These new titles were made possible by simply recording and sharing the events that I was a part of with the victims of this bankruptcy proceeding.
I have sold this blog to Crystal L. Cox. You may know that she is an Investigative Blogger, Whistleblower and Industry Insider as a real estate broker. She stumbled on my blog and in doing so she has stumbled upon many other cases of Bankruptcy Corruption across our country. In fact, there are many who have lost everything to this mechanism our government has created as a perfect looting tool. The powers of people like, the attorneys, judges, US Trustees offices, and the politicians keep this highway robbery undercover. She has asked me to speak the whole truth so here we go…
Below is a story from a person who was a completely unbiased party –
“About the Summit Accomodators- Kevin Padrick Video
ABOUT the infamous Padrick meeting video, when I first viewed it I didn’t think it all that remarkable. Being ignorant of the facts at the time, I thought Kevin Padrick in this meeting, simply just gave a rundown of what he and his company, Obsidian Finance Group, had been up against in the month previous, and toward the end of the video it appeared that he pitched, with some practiced assurance I thought, how he and his company took pride in cleaning up distressed business situations. As I began to become aware of the facts and the chronology of events preceding and following this meeting, my perspective changed; I came to see this video in terms of a betrayal as demonstrated by Kevin Padrick’s defensive behavior toward the other parties around that table. I also came to see how this video could be viewed as an embarrassment to the members of Obsidian Finance Group, the attorneys and others working along with Padrick and even the U.S. Bankruptcy Court. The scene viewed from a more informed point of view, whether one is for or against Kevin Padrick, is not pretty. He is, in this performance, much like a house cat spitting up the canary’s feathers. The behavior he resorts to in the video, in regard to the others, is in my estimation, an unnecessary act on his part, but none the less a telling display of the low character he stooped to with his surreptitious behavior toward, what up to that point had been, his employer, Terry Vance, and by extension Summit’s Principals who were working their tails off to assist Terry in liquidating assets and wrapping up exchange business.
For me, the most revealing thing about the video was the last thing I learned- that this meeting in Bend was compelled by the Bankruptcy Judge a day earlier in Portland. The Judge had learned, from a last minute appearance by one of Summit’s representatives at a court hearing, that Padrick had not been keeping Summit’s owners and the court approved Chief Restructuring Officer (CRO) informed of his actions. Actions that included Padrick’s apparently self initiated and unauthorized actions with the creditors. A little background: the CRO, Terry Vance, was contracted by Summit Shareholder’s (owners) as a part of a “debtor in possession” bankruptcy. This person, approved by the court, is in charge of all affairs related to Summit’s Chapter 11 bankruptcy, including the contract with the financial consultants, in this case Obsidian Finance Group and Kevin Padrick. In other words, for all intents and purposes, at this meeting and from the time Padrick and his Obsidian FinanceGroup had been contracted a month or so earlier, Terry Vance was Kevin Padrick’s boss. Kevin, it turned out, and as shown on the video, was an untrustworthy employee who had some time earlier, perhaps even from day one, made it his job to usurp his boss, disregard his contractual obligations and find his own way within the bankruptcy system, with his knowledge as a former bankruptcy lawyer, to gain the best position he and his company could to take financial advantage of this unfortunate situation. Simply put, Kevin Padrick and Obsidian Finance were Bankruptcy Profiteering.
The meeting, authorized by Judge Dunn, was to be presented by Padrick to his CRO boss and Summit’s owners as a recap of Padrick’s (unauthorized) meeting(s) with the creditors, it is important to remember, at that point Padrick, who had been initially contacted by the Summit’s owners prior to to the bankruptcy filing, and now managed under contract to the CRO was not in any way beholden to the creditors, other than promises he made them behind his employers back. In fact by contract, Padrick’s and Obsidians role was to assist in liquidating assets, in order for Summit to pay back exchangers/creditors under the Chapter 11 reorganization agreement. His role at the time was not to meet with the creditors, throw his employers under the bus and then back over them again when they complained. If the person from Summit hadn’t of scrambled and jumped a last minute flight over the Cascades to Portland to see what was going on, this unscrupulous employee would have gotten his boss fired and had his unwanted contract made irrelevant (which he succeeded in doing) and the people he screwed wouldn’t have heard the backup signal for what it was.
No wonder in the video, one of the first thing heard from Kevin is his voice crying,
“Depose me then.”
A comment that took the CRO and Summit’s owners by surprise (they’d merely asked, what’s up?),
I don’t believe an actual recap of Padrick’s meeting with the creditors happened (if he had treated the creditors to the same charm he displays in the video, I doubt Padrick would have gained enough favor to collect gas money for his ride home, let alone be nominated by the creditors for the Trustee position). It is interesting to note; the only way to compare meetings would be to compare records of both meetings. The closest thing to a record of Padrick’s court compelled meeting with the CRO and Summit’s owners is the video. Justice would be served, if by means of discovery in a complaint Padrick lodged with Deschutes County against the video’s existence, that a transcript(s) of Padrick’s meetings with the creditors in the month prior to this meeting were compelled to be produced- to see by comparison if Padrick was in compliance with the Bankruptcy Court’s wishes in providing information on what he presented to the exchanger/creditors.
At the time of the meeting neither any representative, nor the CRO, nor any of Summit’s owners were, as far they knew, in an adversarial relationship with Padrick. They were, as shown in the video, clearly a bit mystified by the lack of communication to accorded to them on Padrick’s part. To their knowledge, he and his company were supposedly working on Summit’s behalf to assist in liquidating Summit’s assets- nothing more. The video was made as far as the CRO and Summit’s owners and their representatives knew, as much to record their comments in regard to each other’s relationship to working toward liquidation of real estate assets and full payment to the creditors, as it was to pin down Padrick to what he had been doing the past month in behalf of this endeavor. The CRO and the owners were at this time, in their minds, still all working with each other toward this end- including Padrick under the CRO’s charge- all the parties, as evidenced by the video, were still on the same team. In other words, no body by making this video was implicitly trying to trap nobody. It was Padrick’s defensive demeanor during that meeting that first gave an indication to the CRO and Summit’s owners of his newly revealed disposition as not being in concert with their plans to execute this bankruptcy and pay off the creditors.
Later, when the totality of Padrick’s subterfuge and ultimate ambition toward gaining the lucrative Trustee position was revealed to the CRO and Summit’s owners, then was the negative impact of his behavior to them understood. They felt (and still do) that Padrick purposely crashed this business, a business that with his cooperation could have been crash landed instead. A scenario where all exchanger/creditors would have been paid already. It was in retrospect, a few weeks after this meeting, that an animosity toward Padrick did arise. Where upon the video, made of that critical meeting, was reviewed in a completely different light.
From my vantage point, absent the eventual revelation of facts in this story, the video could just as well have been made into a marketing tool for Padrick and Obsidian Finance. To an initiate of this story, like I once was, where Kevin allows himself to speak, the words sound convincing; as one puts the pieces together over time, a discovery is made; those sentiments are constructed on a ruse, his premises are fabricated to support an argument he doesn’t and perhaps can’t really believe in, and from the actions he has taken since in regard to ridiculously accusing Umpqua Bank for improprieties in its business dealings with Summit, one has to suppose that he was not completely honest with the creditors in their meetings either. The facts and the truth they represent, is for Padrick in his unscrupulous ascendancy to the role of Trustee in this case, a big problem. Discovering these facts with a need to reconstruct the truth, for the rest of us, is what makes this video so important to this story.“
*Frank Israel*
In the other bankruptcy corruption cases, the money was all gone by the time anyone had evidence to prove the looting had occurred. As a CPA, I find it absurd that this bankruptcy system has absolutely no accountability built into it. They simply name a trustee and give him or her all the power to loot for many years and tell the creditors and the debtors that it is in everyones best interests’ to give uptransparency and accountability so that the court can make this move quickly so the creditors get paid back.
You are probably assumming that I just have some sort of vendetta. Well I don’t. I just don’t like it when someone says they are working in the best interests’ of the creditors, but their actions show otherwise. Pretty simple right! You promise to take care of my creditors, then your actions should support this. Don’t you all feel deceived when someone says they are going to help you and then they kill you. It goes a step further, they don’t service their clients in an accountable fashion. When you listen to the audio, look to yourself and see what you see. What if you were the 200 exchangers that have NO VOICE? What if you were the principals of the debtor who were looking for help to pay creditors back and instead got Kevin Padrick? This is a problem that is much much bigger than this little story here. There are many United States Citizens who are suffering from the aftermath of these asset rich bankruptcies. That is the Bigger Issue. For our Nation to ignore this we are lying to ourselves about the ability for our Government to protect our money and our rights. I think it is more focused on their inability to protect our money and our rights.
How many creditors have even been contacted by Obsidian or Kevin Padrick? How much information have you been given on this case? In The 1031 Tax Group, LLC bankruptcy case, the Trustee sends out newsletters and lots of other information to this bankruptcy estate’s creditors…See for yourself and go to http://trustee1031taxgroup.com/
Why doesn’t the Summit 1031 bankruptcy trustee have to do the same? Why aren’t they required to be this transparent? Why are the creditors sitting out there with relatively NO INFORMATION. In fact, this Summit blog has more information than any given by Kevin Padrick to date.
I have to give you credit Andrew Moore for ending the article with the TRUTH…
“Bend resident Jack Robson, a creditor who initially lost roughly $50,000, says he thinks the return would be greater if there weren’t so many attorneys involved. But he’s not upset with Summit, he said.
“At the end of day, some people have lost a good portion of their retirement, and that sucks, but there is no malice involved in my experience,” Robson said. “They made poor decisions, and certainly who would have thought this would have been a possible outcome?””
A ton has happened since my last post which I will share with you now. However, I think we need to first pay attention to the timeline and sequence of events…
1/1/08 – Summit 1031 held approximately $100 Million in exchanger funds. Of this $100 Million, approximately $73 Million was in Cash and $27 Million was in the form of Short-Term loans to various LLC’s holding real property. These LLC’s had many investors (106 to be exact). Andrew Moore from the Bend Bulletin repeatedly says they had 100 or so LLC’s. Well you would think an investigative reporter would get the real numbers right? Can’t blame poor Andrew, he is influenced by the power and money of Kevin Padrick, so he reports what Kevin Padrick wants the people to hear. There were only 30 or so LLCs holding real property that Summit Principals had an interest in. The other LLC’s they keep referring to were set up to do reverse exchanges. The Summit Principals had ownership interest in these LLC’s only as Qualified Intermediaries (QI). Meaning these LLCs held exchanger properties only. A separate LLC is set up for each reverse exchange. This is common practice for QI’s who facilitate reverse exchangers. A separated LLC is needed for each reverse exchange. So we are really only talking about 30 LLC’s. All these LLCs had multiple members. The LLC’s were liable for the short-term loans from Inland and understood they were responsible for interest and payoffs. Many of the loans Andrew Moore Mentioned in his most recent reporting were all paid back with interest. Why doesn’t Mr. Andrew Moore report this? Well Kevin Padrick wants the public to think these monies went out and never came back in…then you will stay mad at the Summit Principals.
DID YOU KNOW KEVIN PADRICK WAS, EFFECTIVELY, HIRED BY SUMMIT PRINCIPALS PRIOR TO SUMMITS FILING CHAPTER 11 BANKRUPTCY ON 12/18/08?????
Around 12/7/08 – Kevin Padrick meets with Summit Principals – Well yes they did. Kevin Padrick was recommended to one of the Principals by a Bend Developer as a guy who could help solve Summit’s proplems. You see Kevin Padrickmet with the Summit principals in early December 2008. By talking with the Summit Principals about this meeting, it looks like Kevin was more than willing to help them with their liquidity crisis. Kevin Padrick said his company, Obsidian Finance Group, LLC, specialized in helping save distressed businesses like Summit Accommodators, Inc. Good news right? Kevin Padrick said he had financial partners with DEEP POCKETS who would help fund the short-term liquidity issues. At this meeting, Summit Principals explained the business of short-term lending, told Kevin Padrick about the properties they were willing to hand over and about the $14 Million of cash that was in the Summit bank account. At no time during this meeting did Kevin Padrick even mention the words fraud, ponzi scheme, embezzlement, or illegal.
After this meeting with Kevin Padrick, the Summit Principals approached Summit 1031’s bankrupcty attorneys, Sussman Shank, with the possibility of contracting with Obsidian Finance since Padrick assured the principals that he and Obsidian Finance would be the best has helping distressed businesses. Sussman Shank agreed that it would be a good idea to contract with Kevin Padrick and his company. However, the contract should be signed after a Chief Restructuring Officer is put into place (after they filed bankrupcty). Sussman Assured the Principals that Padrick and Obsidian would work directly for the CRO. Seems to me Kevin Worked more directly with Sussman Shank and Perkins Coie than Terry Vance…What do you think?
12/18/08 Summit 1031 filed for Chapter 11 bankruptcy - DIP “debtor in possession” reorganization. In this type of bankruptcy a Chief Restructuring Officer is named and he is the “acting boss” of the reorganization to pay back the exchangers. It wasn’t until the bankruptcy was filed and Terry Vance was named CRO, that the official contract to hire Obsidian Finance Group, LLC was signed by Terry Vance and Kevin Padrick.
The Summit Principals were advised by Sussman Shank that a Chapter 11 DIP bankruptcy would be ideal. Sussman assured the principals that this form of bankruptcy would provide a little more time than a Chapter 7, enough time to liquidate the illiquid assets in an orderly manner to, hopefully, get the exchangers/creditors paid back in full. This effort would alow the Principals to aid the CRO in every way possible to accomplish this goal.
Sussman’s Susan Ford also instructed the Principals to transfer approx $250,000 from certain accounts and to wire it out of a specific account. Ford did not want it to appear that Sussman’s legal fees were coming out of exchanger funds. Ford told the Principals that the $250,000 wold be more than enough to cover the entire legal cost of the bankruptcy. I know that as of 05/15/09 the attorney fees amounted to almost $2 Million. This estimate is just slightly off.
12/19/08 – end of December 2008 – Summit Principals gathered all the information and willingly gave it to there supposed saviors, Obsidian Finance Group.Ewan Rose, said thanks, we will get you our proposal within the week. No proposal was ever delivered.
Early February – Kevin Padrick makes a presentation to the Creditors’ Committee. What? Thought they were supposed to be getting the proposal to the CRO and Principals, NOT the creditors??? Jeez this stuff is so confusing.
2/11/09 – Summit 1031 Bankruptcy Hearing where Creditors’ Committee is pushing to replace Terry Vance as CRO with Kevin Padrick as CRO. Lucky for Kevin Padrick, at this hearing Judge Randall Dunn’s idea to resolve the matter at hand is to appoint a liquidating trustee. It wasn’t until yesterday that I received the legal document from The 1031 Tax Group, LLC case that says, “The appointment of a chapter 11 trustee is an extraordinary measure“. After going back and listening to the audio from this hearing, it seems to me that this appointment of a chapter 11 trustee was originally presented by Judge Randall Dunn.
Kevin Padrick has stated in his declaration under penalty and perjury that Doc 551 “8. Ms Studebaker-DeYoung has also posted on her website what appears to be an audio recording that she made during an official court hearing proceeding, in violation of Court local rules”
“Judge Dunn – Let’s talk about the joint motion of the debtor and the official committe of unsecured creditors to substitute Obsidian Finance Group LLC for Mr. Vance as Chief Restructuring Officer and I have a limited objection from the US Trustee, requesting some additional time to see if this is the proper road or whether I ought to be appointing a chapter 11 trustee and I have a middle ground suggestion for the parties consideration and we may not get there today…WHY DON’T WE APPOINT OBSIDIAN AS TRUSTEE????
Ms. Vivienne Popperl (attorney for US Trustee) – Sorry your honor but that is a decision for our office to make.
Judge Dunn – I understand that so I am throwing it out as something that you should consider.
Ms. Vivienne Popperl – We will certainly consider that, but at this time we’re very concerned about who is really directing this case. At the moment it appears to be the professionals.
Judge Dunn – It does appear that way, there’s no question the professionals are directing this case. There’s no one else in the driver’s seat.
Ms. Vivienne Popperl – Which is why we need a trustee and that is why we request a little extra time to get a motion and appropriate memorandum before the Court and we certainly will consider Obsidian, but we will consider other candidates as well.
Judge Dunn – Well, well, that’s fine, but I’m not sure I need additional memorandum. I think that needs to be discussed with debtor’s counsel and Obsidian and the committee and see where we come out. I understand why you would move for appointment under section is it 1112, whatever section and I’ll ??? with that. But I think the parties should talk and do what makes sense here, but certainly if the creditors’ committee has evaluated Obsidian’s work to date and their potential for future work…that’s going to weigh strongly in the Courts consideration in terms of the interests’ of creditors and I do agree that we need someone clearly in control of the ship of state?? that is functioning in effect as a trustee would so in the absence of further direction I really would like to see Obsidian named as chapter 11 trustee, but I leave that for the parties to argue out.
Ms. Vivienne Popperl – Well then would the Court entertain an oral motion directing the US Trustee to appoint a chapter 11 trustee or do we need to file a written motion?
Judge Dunn – Well I want to hear from the parties and their respective positions on that, but I don’t want to trample on the US Trustee’s office perogatives either so if you would be offended by such an order based on an oral motion, I’m not going to do it, but I just am suggesting that it makes sense to consider it. Mr. Padrick’s here…Is Obsidian opposed to serving in the position officially as chapter 11 trustee.
Kevin Padrick – No Your Honor subject to the parties desires.
Judge Dunn – Right so that’s something I want the parties to talk about and consider because frankly at least my review of the situation with respect to the case as to what’s going on…having Obsidian functioning officially in the position of chapter 11 trustee solves a multitude of problems, but what do I know?”
Steve Hedburg(Lead Attorney at Perkins Coie and worked under Kevin Padrick at Miller Nash back in the day)- Steve Hedberg seems up to helping out with the appointment of Obsidian no matter what others’ concerns are due to the vote on the creditors’ committee. This committee is only made up of about 5% of the creditors. Did the group of creditors understand the ramifications of converting to a liquidating trust? Steve Hedberg rambles on about how creditors are voting for Obsidian no matter what guidelines are followed Obsidian will be trustee.
I can’t even spend the energy typing the rest of this now. BUT I did run into another interesting tidbit of discussion between Ms Vivienne Popperl and Judge Dunn…
Cont. Transcript…
“Ms Vivienne Popperl – Your Honor I’d just like to bring to the courts attention that the Court had been granted an oral motion. I want to make sure that the Court feels comfortable having done it with no notice because 1104(a) does say that a request of a party in interest or the United States trustee, and after notice and a hearing, the court shall appoint a trustee – WELL THAT DIDN’T HAPPEN NOW Did it? They act as if they are following the procedures, but they willy nilly throw them out the door when they don’t fit their agenda. Is this what they mean by Highest Fiduciary Duty.
§ 1104. Appointment of trustee or examiner
(a) At any time after the commencement of the case but before confirmation of a plan, on request of a party in interest or the United States trustee, and after notice and a hearing, the court shall order the appointment of a trustee—
(1) for cause, including fraud, dishonesty, incompetence, or gross mismanagement of the affairs of the debtor by current management, either before or after the commencement of the case, or similar cause, but not including the number of holders of securities of the debtor or the amount of assets or liabilities of the debtor; (didn’t apply to Summit, unless they are talking about Sussman Shank, Obsidian Finance and Terry Vance??)
(2) if such appointment is in the interests of creditors, any equity security holders, and other interests of the estate, without regard to the number of holders of securities of the debtor or the amount of assets or liabilities of the debtor; or (this is very arguable)
(3) if grounds exist to convert or dismiss the case under section 1112, but the court determines that the appointment of a trustee or an examiner is in the best interests of creditors and the estate. (doesn’t look like it applies to Summit) Based on the huge amount of legal fees the appointment would cost.
Click here to see Document from The 1031 Tax Group, LLC – Okun case for appt trustee in place of DIP. It also says “The appointment of a chapter 11 trustee is an extraordinary measure” and that it “should be the exception, rather than the rule”. “The decision to appoint a chapter 11 trustee is a factual determination entrusted to the discretion of the bankruptcy judge”.
I bet the US Department of Justice knows this proceeding did not follow the legal procedures.
After listening to this circle of players go on and on about replacing the Chief Restructuring Officer, Terry Vance, with Obsidian as Trustee. Seems everyone is in agreement right? Only Brian Steven’s attorney, Foraker seems to be mind boggled by the happenstance of this hearing. Is there a reason Foraker removed himself from teh case shortly thereafter? Was he scared to be part of the Ruse?
Who was representing the Debtor? Who was representing the 200 creditors? They decided this in a matter of moments and they seemed to all really like the idea. Why follow any procedures? Who cares about who is doing the job? Who cares about anybody? Seems like they are having a good time entertaining themselves with how do you get Obsidian in Control of the Estate and the Assets???? For my common sense brain this is So Confusing.
In Sharon Steel Corp “the standard gives the…. court discretion to appoint a trustee when doing so would serve the parties’ and estate’s interests”. In Ionosphere Clubs, Inc. the standard for appointment of a trustee should be…… “facilitation of a reorganizatoin that will benefit both the creditors and the debtors”.
Courts have considered several factors including “the benefits derived by the appointment of a trustee, balanced against the cost of appointment”.
It seems to me this was a rather rash decision and it was happening no matter what happened at this hearing. What are your thoughts? Was this already decided before the hearing began OR What???
Did you think that was it??? No there is more…
As you can hear for yourselves, the Judge says we can have this presentation…
I worked out the schedule with Kevin Padrick & the Summit Principals to hold the Presentation at the Summit Bend Office at 10:00AM on 2/12/09. Kevin Padrick was an hour late to the presentation. There was much discussed about the bankruptcy proceedings during this hour of waiting amongst some other fun chatter. I forgot I had the camera on the webcam for the duration of Kevin Padrick’s tardiness. There is no way I could have scripted the discussions and events that occurred. I like that it is an accurate representation of what what going on at that point in time and how there was a HUGE disconnect between what Terry Vance and the Summit Principals knew and what the Portland courtroom was basing motions and orders on. Why weren’t Terry Vance and Summit Principals able to have their own say about appointing a Chapter 11 Trustee. Susan Ford did not represent Terry Vance, she just spoke for him.
There is some talk about Sussman’s ability to serve as counsel to the Obsidian as Trustee. Why is there not a conflict of interests for the Debtor’s Attorney, Sussman Shank, to serve as counsel for the Liquidating Trustee, Kevin Padrick??? Seems a slight conflict, but what do I know.
The Hearing was on 02/11/09. We had the presentation on 02/12/09.
The night of 2/11/09 I researched on the internet about this type of situation where I ran across the recording of court authorized meetings that were semi-public (Since Judge Dunn said all interested Parties would be interested in this presentation and from this, I believed I was able to determine that it was a semi-public meeting. You can record a semi-public meeting if the camera equipment was not concealed. I did not conceal the camera equipment.
Kevin Padrick reported my so-called “illegal recording” to the Bend Police department in July 2009, just after he noticed it was on the Summit Blog. After some investigation and checking with my attorney we found out the investigation was going nowhere.
On January 5, 2010 I received notice that I was being charged with 2 misdemeanors of “illegal communication” related to the recording and the divulging of this recording.
Besides the fact that the investigation is stale, there are a few issues that seem fishy regarding why the DA incorrectly filed this claim.
A. The officer thought I told him, in July 2009, that I set up the recording computer in the “middle of the conference table”. The officer apparantly next thinks he found an inconsistency because he said it was readily apparent that I set up the device on the “back counter behind the Summit Principals.”
I think the officer erred twice here.
1. The device was facing Obsidian (the three people who are complaining (Kevin Padrick, Ewan Rose, & Ryan Norwood) – thus it was unconcealed, even by the officer’s standard.
2. The officer did not follow me (comprehend me (understand the importance of what I was saying)) when he interviewed me 4 months after the recording, in that he did not correctly quote me where I told him how the computer was set up. My own package of evidence should have jogged his memory.
B. Padrick, Rose, and Norwood were the only individuals interviewed by the officer besides me.
It seems that an unbiased officer (or rather an officer that was not being harangued by some powerful attorneys) would have interviewed Terry Vance and the other 5 people who saw where I set up the computer.
It looks like the first Deschutes County Deputy, likely contacted by Obsidian Finance, probably closed his investigation without criminal finding against me. Obsidian next pushed the Bend Police officer to follow up over 5 months after Padrick’s initial complaint. Next, the officer passed the buck (not a common practice) to the District Attorney’s office without a citing or closing the case. Next, because the District Attorney’s office (who also probably initially declined the case) to follow up. In other words, in all likelihood, at every step of the process, Obsidian had to resurrect the case, that otherwise would have remained closed, by pressing things.
Don’t pass up clicking the links below they tell the rest of the story.
Part 1
Transcription
Part one:
Tim: The big thing is that you get the sound not so much the picture.
Stephanie: Ok, and so is it.
Brian: Is Kevin not coming here?
Tim: No, he’s coming here.
Stephanie: He’s just running late.
Tim: Ewan and Ryan are here already.
Stephanie: Here. Jan. Jan.
Stephanie gives the camera to Jan.
Brian: My attorney, two days ago, said it is a done deal. Obsidian is going to be – and start working on a relationship here. I was like; I mean what a change yesterday.
Tim: They made that change.
Mark: Well, I kind of got a little bit of the same thing…yah know. I just said, I am not in favor of these guys, I don’t trust them. I don’t trust them a bit. They are expensive as hell. They haven’t shown us one thing and he’s (Bankruptcy Attorney) kind of giving me the, “O.K, well I could say that”, yah know, “Are you sure you want me to say that?” (Mark to the attorney). You guys are screwing us anyway on everything, so whatever.
Stephanie: But the main thing is that the Judge can decide, right? So he (Judge Dunn) has the ear of the committee right now and the committee wants these guys (Obsidian), so unless there’s some good reason why…
Tim: Yeah, and we just need to be very objective in our analysis of it and…
Stephanie: Yes, we can’t be. Yah know…it’s just gotta be…here’s the deal and look at this in the business way of why it will not work or why it would work.
Mark: I think unless they got something…I don’t know what they could have.
Stephanie: But the $100,000 is considered a retainer that you guys paid so it’s not gone and it would go towards whatever or it would be refunded. I asked the Judge!
Brian: Well most of it’s gone.
Mark: Most of it’s gone.
Stephanie: Most of it’s gone already?
Mark: Yah, they’re going to get paid. They’ve already agreed.
Brian: It’s was like $60, probably like $80 now.
Tim: Oh, do you know that?
Brian: I heard them say $60 and after this hearing, this meeting here and you’ve got three guys here, yah know
Mark: Yah, that thing is not going away.
Jan: Well is it like anything else? Upfront they say what all this is going to cost so that at the end you’re not going, ok that’s the bill? Where is it that you can…?
Mark: They need to do a budget. How do you do it without a budget?
Jan: …say give us an estimate?
Stephanie: The thing is so…Vivienne is going to…I need to contact Vivienne with our concerns and what things we have today ASAP so that is our only focus – K?
Mark: Do you have Obsidian’s agreement? I meant to grab it…
Brian: I bet you I do?
Brian leaves the room
Tim: I have it. Just one copy of it, but.
Mark: That’s ok; I just need it for…
Stephanie walks around the table.
Tim: I mean this is all we have is kind of this outline…it’s very little detail.
Mark: No, no, no their…Oh, oh yah, yah…that’s what I want.
Jan: Brian’s got something he is holding…
Brian comes in
Stephanie: This has a camera on it. You need to leave this and tell them not to mind this. I already asked Terry and he said fine, bring it in.
Jan: OK
Mark: Is it really pointed in the right direction.
Jan: So this is taping now?
Stephanie: Yah, it’s taping now.
Brian to Tim: You know what I don’t like about this agreement…was just this one paragraph here about. That they are supposed to be engaged by the company and giving us…
Stephanie: Brian can you sit over there?
Brian: Do I get to be on TV that way?
Stephanie: No, do you want to be on TV?
Brian: No.
Jan: We want them to be on?
Stephanie: Yes.
Jan: Ok. Steph, do you want to sit here and I can sit?
Stephanie: No.
Mark: Make sure Lane sits there.
Brian Leaves
Jan: Tim’s very calming.
Stephanie: Yah, I know.
Tim. But yah know, when I am on the edge, when I flip over, I’m not pretty.
Laugh
Tim: Mark’s probably seen me a couple oft times, but yah know, I can go on a rant pretty easy.
Mark: I don’t mind it if it’s not directed at me. When it’s directed at me, I don’t really like it that much.
Laugh – Stephanie Leaves
Mark: This is the paragraph that concerns the hell out of me.
“It is not one of OFG’s right to be paid from the Summit Estate for all matters not directly related to the assets such as general services, tax related services, including claims mitigation and claims and distribution calculations. Further, all services not directly related to the collection of the assets such as providing testimony, responding to subpoenas and other forms of discovery participating at the request of the advisory committee and any other groups and sub-groups of creditors in identification of third-party claims shall be OFG’s standard.”
Terry Vance Comes In
Mark: And my question is – What’s the budget there? You must have estimated what this is going to be.
Jan: Yeah get the number, what’s it gonna cost?
Mark: That could be a huge number, but I am still saying, just by landing this job at 15%, doing nothing but listing all this with realtors. If you say the cash proceeds are $10 Million, it’s almost $1 Million bucks for doing nothing. They don’t have to do anything. It’s already whatever it’s worth. It’s built in. Just for accepting the offers. Terry, if I’m in jail on August 14th, are you going to call and wish me a happy birthday?
Terry Laughs
Mark: You should.
Terry: Send you the proverbial cake?
Mark: Yah
Stephanie: So, do you think you could attend?
Terry: I can do anything I want
Stephanie: I want to know if you want to attend.
Terry: Well, it’s going to be interesting.
Stephanie: I think it would be beneficial if you attended.
Mark: I think it keeps it real honest.
Terry: That’s an impossibility!
Mark: Laugh, ok…
Terry: Maybe it will improve my perspective.
Jan: Do you think somebody needs to be writing anything?
Stephanie: I am. I’m typing.
Mark: I am too.
Terry: Do you got it on now?
Stephanie: Yah.
Terry: So you’re just recording it right?
Mark: You being here it just helps with accountability.
Jan: Enough people are here listening.
Mark: Is Kate (Brian’s daughter) coming? Did they invite Kate?
Kate Enters
Stephanie: She is trying to find me.
Kate: Oh, there you are.
Kate gives Stephanie Coffee
Stephanie: Thank you.
Jan Leaves
Terry: Who are we waiting for?
Tim: Kevin, I think?
Stephanie: Kevin. He said he was caught in Sunriver due to the snow.
Mark: Apparently, he is not very experienced in snow.
Stephanie: Or maybe…he might have been driving back this morning. I couldn’t tell.
Terry: He doesn’t drive, I don’t think.
Stephanie: He doesn’t?
Tim: He flies.
Terry: He flies.
Stephanie: Oh, maybe he was flying back this morning.
Mark: Maybe, there’s fog down there.
Tim: Quite often.
Mark: That could be. Seriously!
Stephanie: He said 10. Oh it’s 10.
Mark: Well you guys…do you just feel like nothing is true in life after A-Rod? Can’t trust anybody!
Jan Enters
Tim: Baseball, its.
Mark: Miguel Tahatta pleads guilty to lying about his teammate using steroids.
Tim: I think America’s passtime needs to become Lacrosse
Terry: Yep.
Tim: Much premier sport.
Terry: Yep.
Jan: And the Phelps thing just makes me so mad.
Tim: Baseball has effectively de-throned themselves as America’s pastime.
Terry: They sure as hell have, haven’t they? They’ve pretty well killed themselves.
Mark: But you know.
Terry: And I thought Selig comments were really stupid.
Tim: I never thought him to be much of a leader.
Mark: Who Selig. Yah, he sure gets paid a lot of money for leaving an all star game in a tie.
Terry: No kidding.
Mark: You can’t do that. Yah, you know….I don’t know. You gotta just go we’re cleaning this up. You gotta take that error and just go we can’t count this error or anybody…
Terry: Who the hell cares? I mean realistically. How do you know Babe Ruth wasn’t on something rather than just the bottle?
Tim: Cigars and bottle.
Laugh
Terry: Exactly.
Tim: Because they didn’t have synthetic steroids then.
Mark: I don’t think I’d care if it didn’t make such a significant difference in their performance. I mean all of a sudden, these guys are hitting 70 or whatever home runs a year and stuff.
Jan: Laughs
Mark: You can take these guys and look at them and go Ok this isn’t right.
Terry: Who’s that character from the Denver, Broncos? Oh a Romanosky…Jesus…I mean he was one of the first, I think?
Tim: Was he?
Mark: I think all the Steelers were and they’re all dead. That’s what you get.
Brian and Stephanie Enter
Tim: Don’t leave the Raiders out of that discussion.
Mark: No, no.
Stephanie: He’s running another 10-15 minutes late.
Stephanie picks up the laptop and is working on it
Mark: You know what they are doing today…this is just mind boggling. The South Carolina detectives…they’ve arrested 8 people.
Jan to Stephanie: So this thing has a camera on it…oh yah…there we are.
Part Two
Stephanie sets camera up on back counter and situates it.
Mark to Stephanie: So you think…I mean Vivienne is a pain in the ass!
Stephanie: I think she’s OK. I mean she came and searched me out.
Mark: But, but Vivienne…whispering…
Stephanie: The only thing I am concerned about is that it is taking so much time already.
Mark: It’s taking so much time. I am going to put that back on Susan (Susan Ford of Sussman Shank). I mean it’s like you haven’t even set up a Conduit for us to transfer assets. In fact, you said no.
Terry: Well part of the reason for that was to make sure there was some stipulation or agreement by the creditors’ committee. That they weren’t just going to start attaching everything. That’s all part of the 105 Injunction.
Mark: So was there any talk yesterday about the whole Tennant thing.
Terry: That’s where the biggest problem is in terms of blocking this whole mess. As far as I’m concerned it came right out of the creditors’ committee, of which, Obsidian has been totally responding to the creditors’ committee.
Mark: Right.
Stephanie: Right, but the Judge seemed to say that unless you guys…basically the creditors’ committee convinced that Obsidian will do the job they say they are going to do and they’ve given them a presentation and they had a vote.
Mark: I talked to one of them…well I didn’t but that one (creditor – Rolland Andrews) – Scott (Scott Adams) said he was going “At that presentation they gave us some bull shit. They are expensive as hell. I don’t even understand what all these people want.” He’s on the creditors’ committee and he sees it.
Stephanie: So anyhow, we have to figure out a way to get this (whole mess) into the right hands if we can.
Jan: Seems like the person or the party who’s spent the most time actually hands on knows the most and should be…
Stephanie: And Susan did agree with…I said that Terry has a working knowledge. He’s been working there (Summit) day in and day out trying to find out what’s going on here.
Jan: I mean that’s a slam dunk. He knows more…
Stephanie: She (Susan Ford) reiterated the same thing and no one seemed to have a problem except this Tennant group because they can’t get what they want
Terry: Exactly.
Stephanie: So now they want to just appoint a Trustee so that they can just to get things going.
Terry: You know it would have been a long time ago if they would have just gotten out of the way.
Mark: How come no one brings this up at the hearings?
Terry: I don’t understand that.
Mark: Why do we have attorneys who sit there and can’t even bring it up as an issue?
Jan: It makes you feel like you should be present at all of this stuff if it’s in Portland.
Stephanie: Well that’s why I think…I don’t know…be there because when I went there the attorneys did bare minimum for you guys.
Tim: How long was the hearing, yesterday?
Stephanie: An hour and…
Terry: Did they even address the injunction?
Stephanie: K what’s what’s…No. I don’t think so.
Terry: The original reason for that meeting or the hearing yesterday was to rule on the injunction…
Tim: To extend it.
Terry: Well extend the TRO and figure out whether…
Stephanie: They did it. They did do an extension of the TRO. Then they talked…the only things that they had on there was that and whether to get you (Terry) out and Obsidian in.
Terry: Well I guess the extension was the TRO. I’m not sure of the injunction.
Mark: You know Bob (Bob Vanden Bos – Mark’s bankruptcy attorney) calls me up yesterday and says, “Well I need to know if you agree to extend the injunction or not. What do you want me to do?” Do I have a choice Bob? “Well if you say no, they’ll just do this and that.” Why are you wasting your time calling me and asking me anything?
Tim: He has to sign it.
Mark: I know it’s just a ridiculous conversation we’re having right now. I get tired of you asking me all this shit that I don’t have a choice on.
Stephanie: Well so anyhow he gave me something to sign that would give me power of attorney to do whatever
Tim: Who, Bob Vanden Bos?
Mark: Well I’m not sure that’s a good thing.
Laugh
Terry to Mark: You gave her power of attorney?
Tim: Now we have a whole different worry.
Laugh
Stephanie: He’s all – “Are you sure you want this job?” I said, well I don’t know.
Tim: I got a whole new worry now.
Stephanie: Whatever.
Mark: Yah at the next hearing we’ll have the Santa Rosa police there going “Let me tell you about this one.”
Stephanie: Hey, if I wouldn’t have gone there yesterday this would have gone through the Trustee (US Trustee) quick and you guys have no say.
Jan: And what’s it looking like to them when nobody is there to…I mean does it look like…well I guess they don’t care and their not.
Tim: Why can’t we get better advice from our attorneys?
Jan: It’s frustrating that way.
Mark: I mean we pay them a lot of money and…
Stephanie: When Bob called me back after I told him why I need to be there (at the hearing) and he said “OK” and he got off the phone and he talked to Summit’s bankruptcy attorneys and they said “It wouldn’t be a good idea she comes…they are going to choose Obsidian anyway. There’s just no way.” I said you know I have been told…
Mark: Susan is such a…she can be pushed around.
Stephanie: It was the guy attorney.
Tim: Oh, Tom (Tom Stilley)
Mark: Tom
Stephanie: I said – Ok I have been told several times by attorneys what will and will not happen and I don’t believe that they always know and so I am going to go down there and
I want to at least be there present so that if there is a chance and something happens, great, but if nothing happens then I don’t lose anything.
Jan: You have to try.
Mark: I think there is a pattern of what they tell you is going to take place…they’re wrong every time so why do we…
Tim: They’re guessing and they control things in a controlling environment.
Stephanie: My experience is with attorneys is they always tell you what is bad that is going to happen and sometimes it does and sometimes it doesn’t.
Terry: Do you have considerable experience?
Mark: Yah, there you go Terry. Good question.
Stephanie: That’s why I’m not scared to go over there.
Tim: Terry, don’t go there.
Laugh
Mark: You don’t want it to get dark.
Laugh
Tim: You know I did this stuff with the trucking company that filed bankruptcy, we used Barry at Sussman Shank and he said, “I understand there wasn’t a criminal aspect and I understand there wasn’t the amount of money”
Mark: Well let’s bring Barry back.
Tim: He said “You go and you explain openly to everybody where you’re at and what you’re trying to do and that you’re doing the best that you can. If anyone has questions for your attorney, have them call me.” I think my retainer for their services was $5,000 and he gave me $250 back when it was all done. Granted it wasn’t the scope of all this, but it’s…what diffused a lot of people was me saying look I’m not running away, I’m doing everything I can to take care of this problem and you know you can fight it but al it’s going to do is throw us in bankruptcy. Well, of course, we are already in bankruptcy but it seems to me like that face and saying…
Mark: Nobody knows that we’re not running away.
Terry: And because the Judge quoted directly from my affidavit at the previous hearing regarding…then and he asked both the creditors’ committee and Susan and Tom, “Why the hell we can’t get something done. It says right here…Mr. Vance said right here that the debtor…all of the principals are cooperating to the best of their ability and they’re willing to make every effort.”
Stephanie: And they reiterated that yesterday too.
Mark: But that’s who they aught to be asking…Susan…because I just don’t believe she takes charge of this. She gets moved around by everybody and I even saw it that day with Vivienne where she just buckles.
Stephanie: She did do an OK job presenting and she validated the points I had brought up as far as you (Terry) and the work you’ve done. She reiterated it with the Judge. She kind of supported me up there when I wasn’t yah know but…I don’t know. I don’t know what their job is exactly to do.
Mark: Their job is just to get paid.
Tim: I think that’s another reason why we have to be there, if not for ourselves, it also holds her accountable, but it also gives her something to support instead of just going with whatever direction things seem to be going.
Mark: I think you’re right. I think it holds her accountable while we’re there.
Stephanie: And the Judge seemed to want to get this resolved quickly. Like sooner than this date..they set a court date for the 20th…Umm…
Mark: It’s the end of the extension of the TRO.
Stephanie: Right, but he wants to figure out the trustee deal prior to that except for Wednesday.
Terry: Except for Wednesday?
Stephanie: He’s gone Wednesday or something.
Mark: You know one of my biggest fears is that…like in these LLC’s…that all of our partners who are innocent parties to this whole thing just get run over. That’s just a huge concern to me.
Terry: Run over by?
Mark: By whoever the Trustee is…they just go into these LLC’s and they want you to just sign your rights over and then we get control and we do whatever we want. I just want someone with the best results…
Terry: Well isn’t that defined in the operating agreement, though?
Stephanie: It is.
Mark: Well yah but my attorney is going…well no you know there’s operating agreements…I pointed out…
Stephanie: But their going to get in default.
Mark: I pointed out that like on Smith Brothers…if I assign it, I don’t have any ownership. I want to ask Kevin specifically about Smith Brothers…I’m going to ask him about Century Drive Mobile Home Park…If he knows that if we assign our interests’ that it immediately puts them in default.
Stephanie: I asked him about that and he kind of pushed it aside, but said that “There are ways to deal with that.” So I want to know exactly what ways you say there are to deal with that because he says, “The seller doesn’t always get the property.” How do they not when you’re in default?
Mark: When I look at Century Drive Mobile Home Park…it’s like ok…put it on the market…can we get anything for it? Why are you putting it at risk if we’re cooperating…just leave it where it’s at…let’s see if we can sell it for an amount to get some money to the creditors.
Tim: And preserves the interests’ of our partners.
Mark: Right, right.
Kevin Enters
Kevin: Hi gentleman and ladies.
Stephanie: Hi. Come on in. Those are your seats. I will get the rest of the men. Ran into ice and fog?
Kevin: Yes.
Stephanie: That’s always a challenge.
Kevin: I had to get the plane out of Aurora. Umm. Ok so who are we meeting with?
Tim: Well I think the four principals will be here and this is Jan Neuman, Mark’s wife.
Jan: Mark’s wife.
Kevin: OK.
Tim: And then Stephanie Studebaker, Mark’s daughter, who was at the hearing yesterday and spoke on our behalf I guess.
Kevin: K.
Long Pause
Kevin: Terry do you have a minute?
Terry: Yep!
Kevin Exits with Terry
Long Pause- Stephanie Enters
Stephanie: Brian’s missing in action. (Laugh) I don’t know where he is.
Tim: He needs to come in and this meeting needs to get started.
Mark: He’s hard to track.
Jan: He was just in his office with Kate just a minute ago.
Stephanie Exits
Mark: He was lost in an airport for over two hours.
Ewan: You know one of our, both of our principals have the same issues.
Ryan: They are not the easiest guys to find.
Mark: That’s one of my best stories. I gave up looking for him so I went to the bathroom. All of a sudden I heard a cell phone ring and he answers it in the stall next to me.
Laugh
Long Wait and Chatter
Stephanie, Kevin, and Terry Enter
Stephanie: So we have to organize the meeting…in order to have Terry here right now we have to organize this meeting into two parts…One part is an interview…
Stephanie: And we can have Terry here in on that…
Kevin: No, No…for neither or those parts. I just got done saying that…for neither of those parts. If you want to ask questions about what we’re doing in the case, I’m happy to have that with everybody.
Stephanie: Ok. That’s what we’re doing first.
Kevin: If you have a question about that, but if you want to do an interview or have a presentation. I want to do that separately.
Stephanie: Ok. So that part we’ll do second. The first will be whatever you just said we could do with Terry.
Kevin: If you have questions about what we’re doing in the case, I’m happy to answer them.
Stephanie closes door
Stephanie: Ok, who wants to start with questions about the case?
The courts stringently examine transactions between people involved in fiduciary relationships toward one another. Particular scrutiny is placed upon any transaction by which a dominant individual obtains any advantage or profit at the expense of the party under his or her influence. Such transaction, in which Undue Influence of the fiduciary can be established, is void.
Virtually any act of persuasion that over-comes the free will and judgment of another, including exhortations, importunings, insinuations, flattery, trickery, and deception, may amount to undue influence. Undue influence differs from duress, which consists of the intentional use of force, or threat of force, to coerce another into a grossly unfair transaction. Blackmail, Extortion, bad faith threats of criminal prosecution, and oppressive Abuse of Process are classic examples of duress.
What do you think? Could this be a case of undue influence? Below are some Summit 1031 Bankruptcy Deposition Questions & Answers…
Question – Would you agree there’s a potential benefit to making sure exchanges closed to try to mitigate any harm that might be suffered?
Answer – Yes, we wanted exchanges closed, and that’s what we thought we were hiring Kevin Padrick for. In fact, I had some communication with John Tanna very early on, and I told him about Kevin — he was trying to get ahold of Terry Vance. I said to talk to Kevin because he’s going to try to get these exchanges done. One of the promises that we believe he made to us was he had financial partners to bring in and bridge this liquidity problem and that he would concentrate on getting these exchanges closed as quickly as possible. And mitigating damages. And that’s what we wanted to get the money paid back to the creditors. We wanted the damages mitigated.
Question – Were there steps that you think could or should have been taken to mitigate damages that were not?
Answer – Yes. I mean, right off the bat, no one would answer phone calls from exchangers. You know. Susan Ford — you know, it just sticks in my mind all the time is its like a sales presentation to do a bankruptcy. I’ve had some other attorneys go, I’m not sure you got the right advice on this bankruptcy. And I had some doubts in my mind.
But sitting back and looking now, I don’t think — I think the real estate market was just heading that way and was going to continue. It wasn’t like a bad winter. It was just gong to continue that way. But I was very frustrated with Sussman Shank because Susan Ford had a comment — and I’ll never forget — was that “the day you declare bankruptcy, everything will be transparant and you’ll se it will be better.” I couldn’t undertand why Sussman Shank weren’t talking to exchangers. “Oh, we don’t have time to.” And so that just made the fear of exchangers just that much more.
We feel like we were told not to talk to anybody; exchangers, nobody. We weren’t supposed to do anything. We finally started talking to them, and Lane talked to a lot of them, tryng to get things done. I think the reverse exchanges just could have been done — done very easily. I don’t uderstand what the problem was with those.
Question – What are the specific steps you think should have been taken to close exchanges more quickly and mitigate damages?
Answer – I really think that a cooperateve effort would have moved things a lot quicker — especially on the reverse exchanges. I’m frustrated that we couldn’t help. And helped with mitigating the costs. And exchangers were calling us when, you know, like I had one exchange I could have finished and I was just — so scared from kind of the, don’t do anything. Exchangers begging me. Can you just please sign this deed. You know. And it’s like I didn’t know what to do. I’d never been through anything like this.
I guess the other thing was — Kevin — led us to believe that he was bringing financial partners with deep pockets, and that he could bring in some money in the interim. That was the last I heard of it.
Question – When was that in a meeting that he told you that, or was it in writing?
Answer – His sales pitch.
Question – And when was that?
Answer – The first time we met with him.
Question – Wa that at your offices down in Bend?
Answer – Yes.
Question – Who was there?
Answer – I think we were all there, all the principals.
Question – Who was there with Mr. Padrick; anyone?
Answer – Just him?
Question – So it was just the five of you there?
Answer – Right.
Question – Was Mr. Vance there?
Answer – No. It was before we declared bankruptcy.
Question – And how did that meeting come about?
Answer – Bill Smith told Lane that he knows this guy in Sunriver, and that he would know how to liquidate the property quickly and could provide help.
Question – Did he send you anything in writing or hand you anything in writing, a proposal, anything like that? Even an e-mail.
Answer – I don’t know. There’s this contract, and I’ve looked at it. It was like Sussman Shank saying you’ve got to sign this and get it back. Like incredible pressure to sign everything. It’s almost like you don’t have time to look at it, you’ve got to sign it. We’ve got this deadline here and you don’t know what you’re doing – just doing what people — what attorneys tell you.
Question – Sussman wanted you to sign the contract with Mr. Padrick, is that — just making sure I understood your testimony correctly. They were pressuring you to sign it?
Answer – So we met with them, and we talked to Sussman about it. Kevin. And then they came back and said: Oh, yeah, he’d be good. We agree with you. Or whatever. But what I’m saying, signing things, I just remember there were a number of things I had to sign. It was always the pressure, like this has to be signed now. You know. And that was one of the documents. So…
Question – Now, you had a meeting with Mr. Padrick, and you and Rose and Terry Vance and others at the Summit offices?
Answer – Right.
Question – Were you aware that that meeting was being videotaped?
Answer – Yes.
Question - How did you become aware of thate?
Answer – Well, just because it was being set up and there was some discussion between Terry and Stephanie.
Question – What do you recall about that discussion?
Answer – I don’t recall the exact discussion.
Question – Was it set up behind you in the conference room?
Answer – Well, like I was sitting — Kevin was kind of sitting here. It’s a shorter table. And it was – it was right on the back table. It’s a much smaller room than this.
Question – Would it have been obvious to somebody sitting there, in your mind, that it was being videotaped?
Answer – I wasn’t looking at it. I don’t think I ever looked at the camera during the meeting. I was completely shocked when Kevin made his comment about the notes. And that was, like, why would you be worried about anyone taking notes if, you know, what — it was just shocking to me that I couldn’t write — you know, he didn’t want me to write notes, which told me he had something to hide. You know. That’s when all sorts of bells and whistles start going off. It’s like why would he be so freaked out about someone writing a note.
An individual in whom another has placed the utmost trust and confidence to manage and protect property or money. The relationship wherein one person has an obligation to act for another’s benefit.
A fiduciary relationship encompasses the idea of faith and confidence and is generally established only when the confidence given by one person is actually accepted by the other person. Mere respect for another individual’s judgment or general trust in his or her character is ordinarily insufficient for the creation of a fiduciary relationship. The duties of a fiduciary include loyalty and reasonable care of the assets within custody. All of the fiduciary’s actions are performed for the advantage of the beneficiary.
Courts have neither defined the particular circumstances of fiduciary relationships nor set any limitations on circumstances from which such an alliance may arise. Certain relationships are, however, universally regarded as fiduciary. The term embraces legal relationships such as those between attorney and client, Broker and principal, principal and agent, trustee and beneficiary, and executors or administrators and the heirs of a decedent’s estate.
A fiduciary relationship extends to every possible case in which one side places confidence in the other and such confidence is accepted
A fiduciary relationship extends to every possible case in which one side places confidence in the other and such confidence is accepted; this causes dependence by the one individual and influence by the other. Blood relation alone does not automatically bring about a fiduciary relationship. A fiduciary relationship does not necessarily arise between parents and children or brothers and sisters.
