Free Motion for Disbursement of Funds - District Court of Colorado - Colorado

Case 1:01-cv-00645-JLK

Document 150

Filed 01/31/2007

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 01-cv-645-JLK SECURITIES AND EXCHANGE COMMISSION Plaintiff, v. KENNETH ROY WEARE a/k/a ROY WEAVER, J&K GLOBAL MARKETING CORPORATION, and AAA-AUCTION.COM, INC., Defendants.

MOTION FOR PAYMENT OF RECEIVER'S FEES AND EXPENSES

Patten, MacPhee & Associates, Inc., the Court-appointed Receiver, by and through its attorney, hereby moves the Court for an order approving payment in the amount of $36,631.56 for the Receiver's fees and expenses during the three-month period from October 1, 2006 through December 31, 2006, from funds held in the registry of the Court under this case name and number. In support thereof, the Receiver states as follows: 1. As set forth in the Receiver's Fifth Application for Fees and Expenses (including

exhibits and attachments), attached hereto, the Receiver's employees expended a total of 194.8 hours, for which the Receiver seeks payment in the amount of $25,205.00. In addition, the Receiver incurred out-of-pocket expenses in the amount of $11,426.56 during the period of time covered by its fee application, for which it seeks reimbursement.

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2.

The Receiver's fees and expenses were reasonable and necessary to the performance

of its duties set forth in the Court's Order Appointing Receiver dated October 26, 2005. 3. As noted in Paragraphs 7 through 9 of the attached fee application, the amounts

requested by the Receiver for both professional fees and expenses now exceed the Receiver's initial estimate of such fees and expenses set forth in its September 23, 2005 proposal in response to the SEC's request for proposals ("RFP"). For the Court's convenience, a copy of the Receiver's September 23, 2005 proposal has been attached to the Receiver's fee application as Exhibit C. 4. As discussed more fully in Paragraphs 10 through 19 of the attached fee application,

assumptions initially made by the Receiver with respect to the integrity and reliability of the data contained in the databases provided by the SEC that have proven invalid, the large number of foreign investors here, the nature and structure of the Defendants' fraudulent schemes, and the significant passage of time from the investment of monies by potential claimants to the appointment of a receiver have all contributed to the Receiver's increased fees and costs. 5. At the present time, the Receiver is in the midst of receiving claims from investors

and evaluating the validity of those claims. The Receiver estimates its fees and out-of-pocket expenses, going forward, will total between $40,000 and $60,000, and remains committed to providing high-quality professional services while keeping its future fees and expenses within that estimated range. 6. Pursuant to D.C.COLO.LCIVR 7.1.A, the undersigned has conferred with counsel

for the SEC regarding the matters set forth in this motion and the attached fee application, and the SEC has expressed no objection to the request for fees and expenses set forth in this motion.
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7.

Counsel for the SEC previously advised the Receiver that the Court's order approving

payment of the Receiver's fees and expenses should include language stating that such amounts are to be paid first from interest earned, rather than from principal. WHEREFORE, the Receiver respectfully requests that the Court enter an order granting this motion and directing the Clerk of the Court to pay $36,631.56 to the order of Patten, MacPhee & Associates, Inc., drawn first from the interest portion of the funds held in the registry of the Court under this case name and number. DATED this 31st day of January, 2007.

s/ Michael D. Burns Michael D. Burns, #11631 1775 Sherman Street, Suite 2900 Denver, Colorado 80203 Telephone: (303) 296-2900 FAX: (303) 296-4475 E-mail: [email protected] Attorney for Receiver

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Filed 01/31/2007

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CERTIFICATE OF SERVICE I hereby certify that on January 31, 2007, I electronically filed the foregoing MOTION FOR PAYMENT OF RECEIVER'S FEES AND EXPENSES with the Clerk of the Court using the CM/ECF system, which will send notification of such filing to the following e-mail addresses: Leslie J. Hughes [email protected] Christine J. Jobin [email protected] Thomas J. Krysa [email protected],[email protected] and I certify that I have caused to be mailed a copy of the foregoing to the following non CM/ECF participant (individually and as agent for J&K Global Marketing Corporation and AAAAuction.com, Inc.) via U.S. mail, postage prepaid: Kenneth Weare 84168-198 FCI Terminal Island Federal Correctional Institution 1299 Seaside Avenue Terminal Island, CA 90731

s/ Michael D. Burns Michael D. Burns, #11631 Attorney for Receiver 1775 Sherman Street, Suite 2900 Denver, Colorado 80203 Telephone: (303) 296-2900 FAX: (303) 296-4475 E-mail: [email protected]