06/14/2011 112 Opposition /Objection to Trustee's Motion For Approval and Notice of Compromise of Controversy Filed by Kevin E Mangum on behalf of Creditor YA Global Investments, LP f/k/a Cornell Capital Partners, LP (related document(s) 103 ). (Mangum, Kevin) (Entered: 06/14/2011)
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8. After Kidd breached the Settlement Agreement, YA Global attempted to collect monies owed by Kidd to it. In those efforts, YA Global discovered that Kidd became the owner of 3.5 million shares of stock in JBI, Inc. f/k/a 310 Holdings, Inc. (“JBI”) in August or September of 2009 (the “JBI Shares”).[l] At that time, Kidd was the Chief Executive Officer and President of DoMark International, Inc. (“DoMark”). Kidd acquired the JBI Shares from DoMark — along with $150,000.00 in cash — in exchange for “any and all debt owed to Kidd for expenses, advances, or loans” by DoMark to Kidd. Attached hereto as Exhibit C is a copy of DoMark International’s Form 8-K filed with the Securities and Exchange Commission dated November 30, 2009.
9. In addition, a Schedule 13D “General statement of acquisition of bene?cial ownership” (the “Schedule 13D” was filed on behalf of Kidd with the Securities and Exchange Commission. Kidd electronically signed the Schedule 13D and certi?ed the accuracy of the information contained in the filing. In the Schedule 13D, Kidd represented, among other things, “[0]n September 10, 2009, R. Thomas Kidd acquired 3,500,000 shares of 310 Holdings, Inc.” and that “R. Thomas Kidd had sole power to vote and dispose of each of the 3,500,000 shares of 310 Holdings, lnc. beneficially owned by him.”
[1] When JBI, Inc. was known as 3 I0 Holdings, Inc. it used 'TRTN.OB as its ticker symbol. When it changed its name to JBI, Inc., it changed its ticker symbol to JBII.PK.
10. Upon information and belief, Kidd maintains a brokerage account, account number NXM-073675 with Maxim Group, LLC (“Maxim Account”). Also upon information and belief, the JBI Shares were deposited into the Maxim Account. At year end 2009, the Maxim Account has a value of $l8,985,054.14. Id. The June 30 2010 statement indicates the Maxim Account had a value of $3,102,820.17.
11. On August 20, 2010, YA Global moved before the Honorable Maurice J. Gallipoli, J.S.C., of the Superior Court of New Jersey, Hudson County for an Order to Show Cause with Temporary Restraints (“Order”). On that same day, Judge Gallipoli signed the Order and set a September 1, 2010 hearing date. The Order temporarily enjoined and restrained Kidd from selling, transferring or moving any assets maintained in his Maxim Account. Kidd and his attorney, Mr. Lanigan, were served with complete sets of the moving papers and the Order at their respective Florida addresses on August 23rd.
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34. In paragraph 6 the Trustee agrees to use his “best efforts” to prohibit YA Global from taking any improper actions to seize possession, custody, or control over the Maxim Account or assets contained therein in contravention of the automatic stay and the tenancy-by-the-entireties exemption asserted by [the Debtor] of such assets by this Agreement pending approval by the Bankruptcy Court or the automatic stay is otherwise in effect. (See Stipulation of Settlement @ ¶ 6). The Trustee goes further on to state that he will use his best efforts in communicating with the Maxim Account representatives as necessary to prevent YA Global from engaging in “any such improper actions”. (See Stipulation of Settlement @ ¶ 6 ). YA Global argues the Trustee has no such powers. (See, Xenerga, Inc. Id.)
35. In paragraph 7 the Trustee attempts to outline, or justify, the compromised payment of $50,000.00 from the Maxim Account while waiving and releasing various claims in sub-paragraphs (a), (b), (c), (d),(e),(g), (h) and (i). [8] YA Global objects to paragraph 7 because every single claim that the estate is willing to waive and release “ or irrevocably abandon” to the Debtor or Dr. Kidd are assets never disclosed in the Debtors original petition.
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