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To: scion who wrote (10681)7/20/2007 7:16:49 PM
From: scion  Read Replies (1) | Respond to of 12518
 
07/20/2007 121 Objection Filed by U.S. Trustee (RE: related document(s)102 Application to Employ). (Williams, Rachelle) (Entered: 07/20/2007)
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Doc 121

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF KENTUCKY
LEXINGTON DIVISION
IN RE:
PLASTICON INTERNATIONAL, INC. CASE NO. 07-50934
DEBTOR CHAPTER 11
________________________________________________________________________
OBJECTION BY THE UNITED STATES TRUSTEE
TO APPLICATION OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ORDER AUTHORIZING THE EMPLOYMENT OF WISE DELCOTTO PLLC AS ATTORNEYS FOR THE COMMITTEE
________________________________________________________________________

Comes the U.S. Trustee, by and through the undersigned attorney, and hereby objects to the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Employment of Wise Delcotto, PLLC as Attorneys for the Committee (the “UCC Employment Application”). In support of this Objection, the U.S. Trustee respectfully states as follows:

NOTICE
Please take Notice that this Objection will be heard by the Court on July 9, 2007 at 10:45 a.m. in the U.S. Bankruptcy Courtroom, 100 E. Vine St., Third Floor, Lexington, KY 40507.

OBJECTION

1. On June 26, 2007 the U.S. Trustee reconstituted the Unsecured Creditors’ Committee (the “UCC”) in the Plasticon International, Inc. case. The U.S. Trustee has since disbanded the UCC in the related case, Pro Mold, Inc.

2. In the UCC Employment Application, the UCC seeks the representation of Laura Day DelCotto, who has formerly represented International Plastics, Inc. in a chapter 11 bankruptcy, which is a company also owned by James Turek, the principal in Plasticon International, Inc. These companies appear to have substantially the same assets. The representation occurred when Mrs. DelCotto was a partner in Stoll, Keenon, & Park, LLP, prior to the formation of her current firm, Wise DelCotto, PLLC.

3. In the alternative, the UCC seeks the representation of Dean Langdon, also of the firm Wise DelCotto, with the provision that an “ethical wall” will be created to keep Mrs. DelCotto from participating in the case.

4. Kentucky Rule of Supreme Court, Rule 3.130(1.9) provides:

A lawyer who has formerly represented a client in a matter shall not thereafter:
(a) Represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client consents after consultation;

(b) Represent a person in the same or a substantially related matter in which a firm with which the lawyer formerly was associated had previously represented a client (1) whose interests are materially adverse to that person; and
(2) about whom the lawyer had acquired information protected by Rules 1.6 and 1.9(c) that is material to the matter; unless the former client consents after consultation.

(c) A lawyer who has formerly represented a client in a matter of whose present or former firm has formerly represented a client in a matter shall not thereafter:

(1) use information relating to the representation to the disadvantage of the former client except as Rule 1.6 or Rule 3.3 would permit or require with respect to a client or when the information has become generally known; or
(2) reveal information relating to the representation except as Rule 1.6 or Rule 3.3 would permit or require with respect to a client.

5. The U.S. Trustee requests that a waiver be obtained by the Debtor for Wise Delcotto to represent the UCC in compliance with the Supreme Court Rules.

6. The U.S. Trustee also requests that the “ethical wall” be created, and that Mrs. Delcotto be prohibited from representing the committee or working on the case with Mr. Langdon, in order to ensure that no information is revealed about the debtor pertaining to the prior representation in violation of the Supreme Court Rules.

WHEREFORE, for the above reasons, the U.S. Trustee requests that the Application Authorizing the Employment of Wise Delcotto to represent the UCC only be approved after these Objections have been resolved.

Respectfully submitted,
OFFICE OF THE U.S. TRUSTEE
RICHARD CLIPPARD, REGION 8
_______/s/Rachelle Williams_____
BY: RACHELLE WILLIAMS
TRIAL ATTORNEY
100 E. Vine Street, Suite 500
Lexington, KY 40507
(859)233-2822

CERTIFICATE OF SERVICE
This is to certify that a copy of the foregoing Objection was served electronically upon Robert Brown, attorney for the Debtor; all members of the Unsecured Creditors’ Committee; Dean Langdon and Laura Day DelCotto; and all parties requesting electronic notice on this 20th day of July, 2007.
/s/ Rachelle Williams
Rachelle Williams



To: scion who wrote (10681)7/20/2007 7:30:14 PM
From: scion  Respond to of 12518
 
07/20/2007 120 Motion to Shorten Time to For Debtor Plasticon International, Inc. to Respond to Document Production Requests Filed by Pro Plas LLC, John P. Murphy III Revocable Trust No. 1, 10315 LLC and John P. Murphy, filed by Pro Plas LLC. (Attachments: # 1 Proposed Order) (Smotkin, Howard) (Entered: 07/20/2007)
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Doc 120

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF KENTUCKY
LEXINGTON DIVISION

In re: ) Case No. 07-50934
) Chapter 11
PLASTICON INTERNATIONAL, INC., )
)
Debtor. )

MOTION TO SHORTEN TIME FOR DEBTOR PLASTICON INTERNATIONAL, INC. TO RESPOND TO DOCUMENT PRODUCTION REQUESTS FILED BY PRO PLAS LLC, JOHN P. MURPHY III REVOCABLE TRUST NO. 1, 10315 LLC, AND JOHN P. MURPHY

Creditors Pro Plas LLC, a Missouri limited liability company; John P. Murphy III Revocable Trust No. 1; 10315 LLC, a Missouri limited liability company; and John P. Murphy (collectively “the Murphy Entities”), file this their Motion to Shorten Time for Debtor Plasticon International, Inc. to Respond to Document Production Requests Filed by Pro Plas LLC, John P. Murphy III Revocable Trust No. 1; 10315 LLC, and John P. Murphy (“Motion”) and in support thereof respectfully state to the Court the following:

1. The Court has jurisdiction pursuant to 28 U.S.C. §1334 and 28 U.S.C. §157 and the Local Rules for the United States District Court for the Eastern District of Kentucky.

2. On May 16, 2007 Debtor Plasticon International, Inc. (“Debtor PLNI”), filed its Voluntary Chapter 11 Petition for Relief in the United States Bankruptcy Court for the Eastern District of Kentucky, Lexington Division (“Court”)

3. Debtor PLNI continues to operate its business and manage its financial affairs pursuant to Sections 1107 and 1108 of the Bankruptcy Code.

4. One or more of the Murphy Entities are secured creditors of Debtor PLNI.

5. On June 15, 2007, the Murphy Entities filed their Motion for Relief from the Automatic Stay seeking to foreclose of the assets in which they hold a security interest with respect to Debtor PLNI’s subsidiary Pro Mold, Inc.

6. Shortly thereafter on June 22, 2007, Creditor Pro Plas, LLC filed its Motion for Relief from the Automatic Stay (“MFRFAS”) in the PLNI bankruptcy case.

7. A preliminary hearing was held on the MFRFAS on July 12, 2007.

8. A final hearing on the MFRFAS is set for August 30, 2007.

9. In connection with the MFRFAS and also Debtor Pro Mold’s Motion to Use Cash Collateral, the Murphy Entities served deposition and document production subpoenas on various individuals and entities.

10. In addition, on July 12, 2007, the Murphy Entities issued Requests for the Production Documents to Debtor PLNI and Pro Mold, Inc., in the Requests for Production of Documents to Debtor PLNI, the Murphy Entities asked that the documents be produced on July 20, 2007.

11. In subsequent discussions, both on and off the record at the Preliminary Hearing on July 12, 2007, counsel for Debtor PLNI and counsel for the Murphy Entities agreed to extend the date by approximately one week for certain depositions and for document production.

12. Depositions of various entities and individuals in Lexington are now scheduled to begin on July 30, 2007 and continue through August 3, 2007.

13. An additional deposition is scheduled for August 14, 2007.

14. The Murphy Entities, to properly prepare for these depositions request that Debtor PLNI produce the requested documents by July 26, 2007 at 3:00 p.m. at the offices of Greenbaum Doll & McDonald, PLLC, 300 West Vine Street, Suite 1100, Lexington, Kentucky 40507.

WHEREFORE, the Murphy Entities respectfully request that this Court enter an order
shortening the time for Debtor PLNI to respond to the Murphy Entities Document Production Requests and to produce the requested documents on July 26, 2007 at 3:00 p.m. at the offices of Greenbaum Doll & McDonald, PLLC, 300 West Vine Street, Suite 1100, Lexington, Kentucky 40507.

STONE, LEYTON & GERSHMAN
A Professional Corporation
By:
E. Rebecca Case, EDMO #2800
Howard S. Smotkin, EDMO #4407
7733 Forsyth Boulevard, Suite 500
St. Louis, Missouri 63105
(314) 721-7011
(314) 721-8660 Facsimile
erc@stoneleyton.com
hss@stoneleyton.com
Attorneys for John P. Murphy III Revocable
Trust No. 1; Pro Plas LLC; 10315 LLC, and
John P. Murphy, III, individually

CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the foregoing document has been served electronically in the method established under CM/ECF Administrative Procedures Manual and the Local Court Standing Order dated July 25, 2002, on the Debtor’s Attorney and the U.S. Trustee on this 20th day of July 2007.



To: scion who wrote (10681)7/20/2007 8:23:03 PM
From: scion  Respond to of 12518
 
07/20/2007 122 Objection Filed by Pro Plas LLC (RE: related document(s)102 Application to Employ). (Attachments: # 1 Continuation of Main Document) (Case, E.) (Entered: 07/20/2007)
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Doc 122 pages 1 to 5

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF KENTUCKY
LEXINGTON DIVISION

In Re: ) Case No. 07-50934
) Judge William S. Howard
PLASTICON INTERNATIONAL, INC ) Chapter 11
)
)
Debtor. )
)
PRO PLAS LLC’S RESPONSE TO THE APPLICATION OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ORDER AUTHORIZING THE EMPLOYMENT OF WISE DELCOTTO PLLC AS ATTORNEYS FOR THE COMMITTEE
AND
PRO PLAS LLC’S OBJECTION TO THE APPLICATION OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ORDER AUTHORIZING THE APPROVAL OF RETAINER

Pro Plas LLC, a Missouri limited liability company (“Pro Plas”), files this its’ Response to the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Employment of Wise Delcotto PLLC as Attorneys for the Committee and its’ Objection to the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Approval of Retainer (“Response to WD’s Employment Application” and “Objection to WD’s Request for Approval of Retainer”) and in support thereof states the following:

1. Pro Plas has no objection to the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Employment of Wise Delcotto PLLC as Attorneys for the Committee (“WD’s Employment Application”).

2. Pro Plas does object to the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Approval of Retainer (“WD’s Request for Approval of Retainer”).

3. Paragraph 9 of the WD Employment Application and Request for Approval of Retainer stated the following:
“Upon information and belief, Debtor’s counsel has requested a prepetition retainer of approximately $55,000.00 to be held as collateral security throughout the duration of their representation of the Debtor. WD requests that the Court approve a similar arrangement for Committee counsel, including a $25,000.00 retainer to be deposited upon approval of Committee counsel employment, which funds will be held in escrow by WD pending further orders of the Court. WD has advised the Committee that unless acceptable arrangements are made for approval of a retainer carve-out from Debtor’s cash flow, WD cannot undertake this representation.”

4. Debtor Plasticon does not have funds for a “retainer carve-out from Debtor’s cash flow.”

5. According to the Pro Mold, Inc. Disbursement Journals that are attached hereto and incorporated herein as Exhibit “1”, “2” and “3”, Debtor Pro Mold has transferred the following amounts to Debtor Plasticon since June 22, 2007 for management fees:

Date Amount
a. June 22, 2007 $ 7,500.00
b. June 29, 2007 $ 7,500.00
b. July 6, 2007 $ 7,500.00
c. July 10, 2007 $ 7,500.00

Total $30,000.00

6. According to counsel for Debtor Pro Mold and Debtor Plasticon, Debtor Plasticon directed Debtor Pro Mold to pay these management fees to Debtor Plasticon “out of necessity because Debtor Plasticon had no money to pay its’ payroll.”

7. If Debtor Plasticon has no money to pay its’ payroll, Debtor Plasticon has no money to pay a $25,000 retainer to the attorney for the Official Committee of Unsecured Creditors.

8. James Turek, Sr. reported to the Court on or about May 22, 2007 that Debtor Pro Mold had a written management agreement with Debtor Plasticon that provided for Debtor Pro
Mold to pay Debtor Plasticon $25,000 per month.

9. The Court instructed Debtor Pro Mold to produce a copy of the written management agreement.

10. As of this date, no written management agreement has been produced.

11. Pro Plas LLC, a Missouri limited liability company; John P Murphy III Revocable Trust No. 1; 10315 LLC, a Missouri limited liability company; and John P. Murphy III (‘the Murphy Entities”) and Debtor Pro Mold entered into the Agreed Order on Debtor’s Amended Emergency Motion to Use Cash Collateral (“Agreed Emergency Cash Collateral Order”), a copy of which is attached hereto and incorporated herein as Exhibit “4”.

12. On June the Court signed and the Clerk entered the Agreed Emergency Cash Collateral Order.

13. Attached to the Agreed Emergency Cash Collateral Order was the budget.

14. The budget does not include a line item for the payment of a management fee by Debtor Pro Mold to Debtor Plasticon.

15. The Agreed Emergency Cash Collateral Order states the following:

“E. Debtor shall not make any expenditures or incur any obligations relating to non budgeted items including capital improvements, without the prior written approval of the Murphy Entities, unless the Court orders otherwise with notice to the Murphy Entities and an opportunity to object.”

“F. Debtor Pro Mold’s emergency or interim use of the cash collateral shall be and is hereby conditioned upon Debtor Pro Mold’s compliance with the Interim Budget incorporated herein by reference and the following pursuant to 11 U.S.C. §363(e)…”

16. The Murphy Entities have not given written consent to Debtor Pro Mold to pay the management fees listed above to Debtor Plasticon and have notified counsel for the Debtors on several occasions that the Murphy Entities do not consent to these payments by Debtor Pro Mold.

17. Debtor Pro Mold has not filed a motion and requested authorization from the Court to pay management fees to Debtor Plasticon.

18. The parties signed an Agreed Order Setting Aside Order Scheduling Hearing (“Second Agreed Order”), a copy of which is attached hereto and incorporated herein as
Exhibit “5”.

19. The Court signed and the Clerk entered the Second Agreed Order on June 26, 2007.

20. Debtor Pro Mold continues to violate the Agreed Emergency Cash Collateral Order and the Second Agreed Order.

21. Debtor Plasticon has asserted it has no money to pay its payroll and thus should have no money to pay a $25,000 retainer to WD.

WHEREFORE, Pro Plas LLC requests that the Court:

a. approve the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Employment of Wise Delcotto PLLC as Attorneys for the Committee;

b. deny the Application of the Official Committee of Unsecured Creditors for Order Authorizing the Approval of Retainer; and

c. grant Pro Plas LLC such other and further relief as the Court deems just and proper.

STONE, LEYTON & GERSHMAN
A Professional Corporation
By: /s/ E. Rebecca Case
E. Rebecca Case, EDMO #2800
Howard S. Smotkin, EDMO #4407
7733 Forsyth Boulevard, Suite 500
St. Louis, Missouri 63105
(314) 721-7011; (314) 721-8660 Facsimile
erc@stoneleyton.com; hss@stoneleyton.com
Attorneys for John P. Murphy III Revocable Trust
No. 1; Pro Plas LLC; 10315 LLC, and John P.
Murphy, III, individually

CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the foregoing document has been served electronically in the method established under CM/ECF Administrative Procedures Manual and
the Local Court Standing Order dated July 25, 2002, on the Debtor, the Debtor’s Attorney, the Office of the United States Trustee and to all parties who filed a Notice of Appearance electronically and/or first class, postage prepaid U.S. mail on this 20th day of July 2007.
/s/ E. Rebecca Case
E. Rebecca Case