Free Reply to Response to Motion - District Court of Arizona - Arizona

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Michael Simes (Arizona Bar No. 016021) MICHAEL SIMES, LLC 903 South Rural Road Suite 101--323 Tempe, Arizona 85281 Telephone: 480-699-3636 Facsimile: 480-659-2943 Email: [email protected] Website: www.MichaelSimes.com Attorney for Solinvest Group, Ltd.

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

) ) ) ) TECHNOLOGY SYSTEMS ) INTERNATIONAL, INC. , a Nevada ) Corporation; ) ) Debtor. ______________________________________ ) ) SOLINVEST GROUP, LTD., a British Virgin ) ) Islands entity; ) ) Plaintiff, ) ) v. ) ) TECHNOLOGY SYSTEMS ) INTERNATIONAL, INC., a Nevada ) Corporation; TSI ACQUISITION ) CORPORATION, formerly known as ) TECHNOLOGY SYSTEMS ) INTERNATIONAL, INC., an Arizona ) Corporation; ALANCO TECHNOLOGIES, ) INC., an Arizona Corporation; In re: Case 2:02-cv-02641-ROS Page 1 of 77 Document 14

United States District Court For the District of Arizona Case No. CV--02--2641--PHX--ROS United States Bankruptcy Court For the District of Arizona Case No. 2--03--21187--PHX--EWH United States Bankruptcy Court For the District of Arizona Case No. 2--04--00019--PHX--EWH United States Bankruptcy Court Fort the District of Arizona Case No. 2--05--07799--PHX--EWH

REPLY IN SUPPORT OF THE AMENDED MOTION FOR THE AWARD OF ATTORNEYS' FEES AND COSTS

Filed 01/19/2006

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) ) ) ) ) ) ) Defendants. ) ) ______________________________________ ) ) ) ) GREG OESTER and LYNDA OESTER, husband and wife; ) ) ) Third-Party Plaintiffs, ) ) v. ) ) EVERT EGGINK, ) ) Third-Party Defendant. ______________________________________ ) GREG OESTER and LYNDA OESTER, husband and wife; JOHN DOE I-X; JANE DOE I-X; ABC PARTNERSHIP I-X; and XYZ CORPORATION I-X;

Plaintiff Solinvest Group, Ltd., hereby respectfully replies in support of its Amended Motion for the Award of Attorneys' Fees and Costs, filed November 4, 2005 (Docket # 67) ("Motion"). This Reply is in response and opposition to both (i) the Objection to Amended Motion for Attorney Fees and Costs by Solinvest Group (Regarding Michael Simes), filed January 2, 2006

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(Docket # 74)("Response for Simes"); and (ii) the Objection to Amended Motion for Attorney Fees and Costs Rendered by Solinvest Group (Regarding Dennis Brovarone), filed January 2, 2006 (Docket # 75)("Response for Brovarone"). For the convenience of the Court, all defined terms in the Motion shall have the same meaning herein.

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The Response for Simes and Response for Brovarone (together, the "Response") was filed by Trustee Jill H. Ford, Chapter 7 Bankruptcy Trustee (the "Trustee"), on behalf of TSI. The Trustee assumed control of TSI in August 2005. See Motion, ¶ 99. The wrongful conduct of Attorney Proper, the attorney for the Old Board of TSI,

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continues. See Motion, at ¶¶ 63(A)--(B). On November 17, 2005, Attorney Proper filed with this Court the Motion for Extension of Time to File Response to Solinvest's Motion for the Award of Attorneys' Fees and Costs (Docket # 71)("Motion for Extension") which this Court granted in its Order, dated November 18, 2005 (Docket # 72). In the Motion for Extension, Attorney Proper represented both that he is the attorney for TSI and that he was seeking the extension of time on behalf of the Trustee. See Motion for Extension, at 1:5, 2:6--9, 2:25. Neither representation is true. Furthermore, the Motion for Extension interfered with the negotiations between Solinvest and the

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Trustee. Upon the request of this Court, Solinvest will submit evidence of these negotiations. Solinvest seeks an award of $1,377.26 in taxable costs and $299,625.30 in attorneys' fees from this Court. See Motion, at ¶¶ 112--113, 140. In compliance with the Reconsideration Order, of the $299,625.30 in total attorneys' fees sought by Solinvest, $213,537.82 in attorneys' fees were incurred in connection with matters related to this Court and $86,087.48 in attorneys' fees were incurred in connection with matters related to Bankruptcy Court. See Motion, at ¶¶ 141--143.

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The Trustee concedes that Solinvest is entitled to the award of $1,377.26 in taxable costs by failing to oppose it in the Response. Solinvest seeks an award of all its attorneys' fees from this Court under four distinct and alternative legal theories. First, pursuant to the terms and conditions of the Promissory Note. Second, as a compensatory civil contempt sanction against TSI under FRCP Rule 11. Third, as a compensatory civil contempt sanction against TSI under 28 U.S.C. § 1927. Fourth, as a

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compensatory civil contempt sanction against TSI under the inherent authority of this Court. See Motion, at ¶ 115. The Trustee concedes that Solinvest is entitled to the award of all of its attorneys' fees as a compensatory civil contempt sanction against TSI under the inherent authority of this Court by

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failing to oppose it in the Response. See Motion, at ¶¶ 136--138. The Trustee also concedes that Solinvest is entitled to the award of all of its attorneys' fees as a compensatory civil contempt sanction against TSI under 28 U.S.C. § 1927 by again failing to oppose it in the Response. See Motion, at ¶¶ 134--135. The Trustee also concedes the facts supporting the award of all of the attorneys' fees incurred by Solinvest as a compensatory civil contempt sanction against TSI by failing to oppose them in the Response. More specifically, first, the Trustee concedes that TSI had no available

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defenses in this matter and, therefore, unreasonably and vexatiously multiplied these proceedings by intentionally refusing either to appear and defend itself in this matter or to timely settle this matter. See Motion, at ¶¶ 4, 7, 8, 15, 42, 43. Second, the Trustee concedes that Attorney Proper intentionally interfered with the execution of the Writs of General Execution from this Court by the United States Marshall. See Motion, at ¶ 17. Third, the Trustee concedes that Attorney Proper made false statements to this Court in attempt to wrongfully interfere with Solinvest enforcing the Judgment.

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See Motion, at ¶¶ 22, 25. Fourth, the Trustee concedes that TSI intentionally refused to comply with the Revised Turnover Order of this Court. See Motion, at ¶¶ 29, 36. Fifth, the Trustee concedes that TSI used the wrong procedural mechanism to obtain bankruptcy protection in order to prevent this Court from finding it in contempt of the Revised Turnover Order. See Motion, at ¶¶ 28, 31, 33, 34. Sixth, the Trustee concedes that Attorney Proper made false statements to this Court regarding his wrongful conduct and the wrongful conduct of the Old Board of TSI following the First Bankruptcy. See Motion, at ¶ 79. Seventh, the Trustee concedes that Attorney Proper misappropriated $74,377.98

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from the bankrupt estate of TSI. See Motion, at ¶ 87. Eight, the Trustee concedes that Attorney Proper and the Old Board of TSI engaged in a stock scheme to wrongfully retain control of TSI, defraud the bankrupt estate of TSI, and interfere with the Settlement Agreement. See Motion, at ¶¶ 64, 66, 88. Surprisingly, this list is not comprehensive. Furthermore, the Trustee's concession to

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many of these acts of wrongful conduct is irrelevant; the Special Advisor to the Bankruptcy Court already determined them. See Motion, at ¶ 86. Nonetheless, the Trustee argues that compensatory civil contempt sanctions should not be imposed against TSI because Solinvest failed to identify "specific wrongful conduct." See Response, at 3:14--3:15. The Trustee also concedes that the imposition of compensatory civil contempt sanctions against TSI is mandatory by failing to oppose it in the Response. See Motion, at ¶ 130. However, this concession allows the Trustee to avoid the most difficult issues in the Motion. For

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example, if this Court does not impose civil contempt sanctions in this matter, then why would attorneys be honest and candid to this Court? See Motion, at ¶ 137. Why would attorneys not cross--the--line and commit reckless and bad faith acts or disregard court orders? See Motion, at ¶ 135. Why would parties not bring and maintain unfounded actions or defenses for bad faith,

vexatious, wanton or for oppressive reasons? See Motion, at ¶ 136. Finally, why would nonbankrupt parties not seek bankruptcy protection as a litigation tactic to delay or avoid paying their lawful

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obligations? See Motion, at ¶ 138. These are the issues for which the Trustee has no answers. Solinvest hereby voluntarily withdraws1 its request for the award of all of its attorneys' fees as a compensatory civil contempt sanction against TSI under FRCP Rule 11 because

If the Trustee had not conceded that Solinvest was entitled to an award of all of its attorneys' fees as a compensatory civil contempt sanction against TSI, then Solinvest would have argued that even though it did not satisfy the "technical" safe harbor requirements of FRCP Rule 11(c)(1)(a), an exemption to this requirement would be appropriate because of the unique procedural and factual history in this matter. Heary Bros. Lightning Prot. Co. v. Lightning Prot. Inst., 287 F. Supp. 2d 1038, 1081 (D. Ariz. 2003 (Opinion by Judge Silver); cf. Patelco Credit Union v. Sahi, 262 F.3d 897, 913 Case 2:02-cv-02641-ROS Page 5 of 77 Document 14 Filed 01/19/2006 Page 5 of 14

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the Trustee has conceded that Solinvest is entitled to an award of all of its attorneys' fees as a compensatory civil contempt sanction under both 28 U.S.C. § 1927 and the inherent authority of this Court. See Motion, at ¶¶ 132--133; see also Response for Simes, at 2:21--3:15. Solinvest makes this voluntary withdrawal to promote judicial economy and accelerate the final determination of this

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matter. Solinvest is also entitled to an award of its attorneys' fees pursuant to the Promissory Note. This award is mandatory because it is made pursuant to the terms and conditions of the contract between TSI and Solinvest. Because the award under this theory is mandatory, the only issue before this Court is the award of a reasonable amount of attorneys' fees to Solinvest. See Motion, at ¶¶ 121--123. To determine this reasonable amount, this Court must consider the four factors established by the Schwiger Court. See Motion, at ¶ 125.

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In the Response, the Trustee argues that this Court should apply the wrong law. More specifically, the Trustee argues that this Court should determine the reasonable amount of attorneys' fees to award to Solinvest under Arizona Revised Statute § 12--341.01. See Response for Simes, at 4:1. This is the wrong law.2 The award of the reasonable amount of attorneys' fees in this matter is governed by contract, not statute. See Motion, at ¶ 122. In addition to applying the wrong law in the Response, the Trustee argues that this

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Court should apply an analytical framework that is misleading. More specifically, the Trustee has created its own custom framework with "four time blocks" to analyze what it considers to be a

(9th Cir. 2001)(Compliance with the "safe harbor provisions" of FRCP Rule 11 is not mandatory in all circumstances.). This unique history includes the fact that TSI first raised the issue of sanctions under FRCP Rule 11 in this matter. See Comprehensive Supplement, at ¶ 24. Furthermore, the one and only case cited by the Trustee in the Response, In re Nucorp Energy, Inc., 764 F.2d 655 (9th Cir. 1985), has no application to this matter and does not support the argument that it is cited for. See Response for Simes, at 4:2--4:3. Page 6 of 77 Document 14
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reasonable amount of attorneys' fees to award to Solinvest. See Response for Simes, at 4:13. This framework is misleading because, for example, Block 3 covers the "time spent during the bankruptcy case" which spans from December 9, 2003, to December 24, 2003. See Response for Simes, at 7:7-- 7:15. The Trustee goes on to argue that all attorneys' fees incurred by Solinvest in Block 3 were

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incurred in connection with matters related to the Bankruptcy Court. See Response for Simes, at 7:17--7:19. However, Block 3 would include the attorneys' fees incurred by Solinvest in connection with matters related to this Court such as the Motion to Withdraw and the Joint Status Report. See Motion, at ¶ 32; see also Joint Status Report, filed July 1, 2004 (Docket # 40). Furthermore, many of the specific numbers and amounts cited by the Trustee within this framework are wrong. For example, the Trustee argues that Solinvest incurred $95,475.00 in attorneys' fees in connection with only the First Bankruptcy when in fact Solinvest incurred $86,087.48 in attorneys' fees in connection

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with all matters related to the Bankruptcy Court. See Response for Simes, at 7:15; see also Motion, at ¶ 143. Returning to the Schwiger factors, the first factor is the qualities of the advocate. See Motion, at ¶¶ 125(a), 126. The Trustee concedes that Solinvest satisfied this factor for the attorneys' fees it incurred from Attorney Simes in connection with matters related to this Court. See Response for Simes, at 5:7--5:8. However, the Trustee argues that Solinvest did not satisfy this factor for the

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attorneys' fees it incurred from Attorney Simes in connection with matters related to the Bankruptcy Court and that Attorney Simes "should have associated himself with competent counsel." See Response for Simes, at 7:27--8:1. This argument by the Trustee directly contradicts the facts in this matter. Attorney Simes was the lead attorney for Solinvest both before this Court and the Bankruptcy Court and brought to the Bankruptcy Court his comprehensive knowledge of the procedural and factual history in this complex matter. Furthermore, the results produced by Attorney Simes were successful, including, first, the fact that the First Bankruptcy was resolved in less than one year and

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provided for the payment of the "full amount" of the Judgment to Solinvest. See Motion, at ¶¶ 50, 51. Second, Solinvest caused the First Bankruptcy to be resolved in compliance with the twin--goals set for it by this Court in the First Stay Order. See Motion, at ¶¶ 44, 45, 51. Third, Solinvest actually received full payment of the Principal Amount and the post-judgment interest of the Judgment from

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the Bankruptcy Court. See Motion, at ¶ 96, 97. Fourth, the one and only position taken by Solinvest at the start of the First Bankruptcy proved to be correct. See Motion, at ¶¶ 44, 102. The Trustee also argues that Solinvest did not satisfy the first Schwiger factor for all the attorneys' fees it incurred from Attorney Brovarone. More specifically, the Trustee argues that Solinvest cannot be awarded the fees of Attorney Brovarone because he is not admitted to practice law before this Court or the Bankruptcy Court. See Response for Brovarone, at 2:1--2:13.

However, this argument by the Trustee contradicts the law. There is no admission requirement for a
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fee award because even a nonlawyer, such as a law clerk or a paralegal, may have their fees awarded. Aries v. Palmer Johnson, Inc., 153 Ariz. 250, 261, 735 P.2d 1373, 1384 (App. 1987). Next, the Trustee argues that Solinvest cannot be awarded the fees of Attorney Brovarone because his time records are inaccurate and inadmissible. See Response for Brovarone, at 2:24--3:2. However, this argument contradicts both the law and the facts in this case. See Motion, at ¶ 146. The second Schwiger factor is the character of the work. This factor analyzes in part

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the difficulty, the intricacy, the responsibility, and the time and skill required of the attorney in a matter. See Motion, at ¶¶ 125(b), 127. The Trustee argues that Solinvest failed to satisfy this factor for all the attorneys' fees it incurred because this was a "simple breach of contract action." See Response for Simes, at 4:5. Again, this argument contradicts the facts in this matter. Solinvest will rely on both the institutional knowledge of this Court and the 146 paragraphs of the Motion to demonstrate that it has satisfied this factor rather than perform an excessive, redundant and unnecessary analysis.

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The Trustee also specifically argues that Solinvest did not satisfy the second Schwiger factor for all the attorneys' fees it incurred from Attorney Brovarone. Here the Trustee argues that all the work of Attorney Brovarone was "duplicative and without value or benefit" to the work of Attorney Simes. See Response for Brovarone, at 2:20--2:21. However, this argument again

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contradicts the facts in this case. Solinvest relied on the advice and counsel of Attorney Brovarone for eight years before it hired Attorney Simes and continued to do so after hiring Attorney Simes. Furthermore, Attorney Brovarone interviewed and hired Attorney Simes on behalf of Solinvest. Finally, Attorney Brovarone and Attorney Simes worked together to produce a successful outcome for Solinvest in this matter. See Motion, at ¶ 117; see also Brovarone Affidavit, at ¶ 10; see also Simes Affidavit, at ¶ 13. The third Schwiger factor is the work actually performed. See Motion, at ¶¶ 125(c),

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128. Solinvest satisfied this factor by providing a detailed procedural and factual history in the Motion and supporting the Motion with the Simes Affidavit and the Brovarone Affidavit. To dispute this factor the Trustee should have submitted "controverting affidavits" rather than merely making factually unsupported and misleading arguments. See Local Rule 54.2(f). The fourth Schwiger factor is the results obtained. See Motion, at ¶¶ 125(c), 128. The satisfaction of this factor by Solinvest is not in dispute. The Trustee concedes that Solinvest

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"received payment of 100% of its claim." See Response for Simes, at 4:7. However, this is a minor overstatement by the Trustee because Solinvest has not yet been awarded and received payment of its attorneys' fees and costs in this matter. All of the attorneys' fees incurred and actually paid by Solinvest are reasonable and, therefore, should be awarded by this Court under the Promissory Note. Solinvest has demonstrated this by satisfying all four Schwiger factor which means that this Court need not give undue weight to any one factor in making its reasonableness determination. See Motion, at ¶¶ 125, 145, 146.

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The Trustee takes a shotgun approach to attacking the reasonableness of the attorneys' fees incurred and actually paid by Solinvest. Not only does the Trustee apply the wrong law and a misleading analytical framework in the Response, it fails to take a rifle approach to this issue by identifying with "specificity all disputed issues of material fact and . . . each and every disputed time

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entry or expense." Local Rule 54.2(f). For example, the Trustee blasts away at the attorneys' fees incurred and paid by Solinvest in connection with (a) the Complaint, see Response for Simes, at 5:9, fn. 2, see also Motion, at ¶ 1, (b) the Motion for Default, see Response for Simes, at 5: 9--5:11, see also Motion, at ¶ 7, (c) the Motion for Turnover, see Response for Simes, at 6:13--6:16, see also Motion, at ¶ 16, (d) the Reply to Turnover, see Response for Simes, at 6:17--6:22, see also Motion, at ¶ 24, (e) the Motion for Contempt, see Response for Simes, at 6:23--6:26, see also Motion, at ¶ 28, (f) the Response to Strike, see Response for Simes, at 9:15--9:22, see also Motion, at ¶¶ 71--72,

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and (g) the Motion, see Response for Simes, at 9:1--9:8. Even though a shotgun was the wrong weapon, the Trustee would sometimes identify a specific issue. For example, the Trustee argues that this Court should not award attorneys' fees related to researching the Arizona Bulk Sales Act (Arizona Revised Statutes § 47--6101 et. seq.) and the Arizona Uniform Fraudulent Transfer Act (Arizona Revised Statutes § 44--1001 et. seq.). See Response for Simes, at fn. 2. However, violation of the Arizona Bulk Sales Act and the Arizona Uniform Fraudulent Transfer Act were

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respectively the third and fourth counts in the Complaint. See Complaint, at ¶¶ 64--94. Another example is that Trustee argues that this Court should not award attorneys' fees related to the "proxy deal" because they were "not related to collection" of the Judgment. See Response, at 9:9--9:14. However, the efforts of Solinvest in the "proxy deal" resulted in the Settlement Agreement which would have resolved nearly all of this matter in February 2005. See Motion, at ¶ 66. A final example is that the Trustee argues that this Court should not award attorneys' fees incurred in connection with "litigation before the Federal District Court in Nevada."See Response for Simes, at 9:15--9:17.

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However, although not only did Solinvest not appear or participate in the litigation before the Federal District Court in Nevada, it was required to explain to this Court how this litigation, and the wrongful conduct of Attorney Proper and the Old Board of TSI, related to the Settlement Agreement in the Response to Strike. See Motion, at ¶¶ 64(B), 66, 71, 72.

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Solinvest seeks this Court to award it all of the attorneys' fees including the attorneys' fees it incurred in connection with matters related to Bankruptcy Court. The Trustee concedes that this Court has the legal authority3 to award Solinvest all of its Bankruptcy Court related attorneys' fees by failing to oppose it in the Response. See Motion, at ¶¶ 119--120. Although the Trustee does not dispute this legal authority, it argues that this Court already decided not make this award in the Reconsideration Order. See Response for Simes, at 2:2--2:20, 7:17--7:18. The Trustee's

interpretation of the Reconsideration Order is wrong. In the Reconsideration Order this Court held
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that it would not award Solinvest its Bankruptcy Court related attorneys' fees under 11 U.S.C. § 503(b)(3)(D). However, Solinvest does not seek this award under this bankruptcy statute, it seeks it as a compensatory civil contempt sanction against TSI. See Motion, at ¶ 119. Furthermore, if this Court does not award Solinvest its Bankruptcy Court related attorneys' fees then it will encourage the nonbankrupt to wrongfully seek bankruptcy protection as a litigation tactic to avoid paying their lawful obligations. See Motion, at ¶ 138. Finally, it would be a waste of judicial resources to require

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the Trustee and Solinvest to relitigate this issue before the Bankruptcy Court now that the issue has been fully briefed to this Court.

If there is any question whatsoever regarding the authority of this Court to award Solinvest all of its attorneys' fees incurred in connection with this matter including the attorneys' fees it incurred in connection with matters before the Bankruptcy Court, then this Court should withdraw the reference of this matter from the Bankruptcy Court. See Motion to Withdraw, at ¶ 2. Page 11 of 14 Document 77

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Solinvest seeks this Court to award it all of the $86,087.48 in attorneys' fees it incurred and actually paid in connection with matters related to Bankruptcy Court. See Motion, at 143. The Trustee concedes that the First Bankruptcy and the Second Bankruptcy were not filed in good faith. See Motion, at ¶¶ 35, 94. The Trustee also concedes that Attorney Proper and the Old

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Board of TSI engaged in substantial wrongful conduct before the Bankruptcy Court. See Motion, at ¶¶ 48, 74, 75, 86--88, 95, 104. Nonetheless, the Trustee argues that the amount of Bankruptcy Court related attorneys' fees that Solinvest seeks is "excessive." See Response for Simes, at 8:6. The Trustee goes on to concede that a reasonable amount of Bankruptcy Court related attorneys' fees to award Solinvest is $17,217.50 (i.e. $86,087.48 x 20% = $17,217.50). See Response, at 8:9.

However, this Court should not award Solinvest an amount less than all of its Bankruptcy Court related attorneys' fees because the Trustee (a) fails to adequately explain or justify its reduction

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request, (b) completely ignores in the Response such items as the Special Advisor's Report, the Second Bankruptcy, and all the wrongful conduct of Attorney Proper and the Old Board of TSI, and (c) concedes that Solinvest was successful in its efforts before the Bankruptcy Court. The Trustee also wants this Court to ignore the fact that Solinvest repeatedly tried to settle this matter with TSI in order to avoid or minimize the amount of attorneys' fees that it incurred but that TSI refused to settle this matter which forced Solinvest to incur the attorneys' fees that it did.

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See Motion, at ¶¶ 4, 7, 15. This Court should award Solinvest all of the attorneys' fees and costs it incurred and actually paid in this matter based only upon the Motion, the Response and this Reply. A hearing on the fee issue is not required. See Motion, at ¶ 118. Nonetheless, the Trustee requests without explanation or justification that this Court both set an evidentiary hearing on this issue and be allowed to present expert testimony at this hearing. See Response for Simes, at 10:6--10:8. Because

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there are no "serious disputes involving material issues of fact that comprise the award," an evidentiary hearing should not be set. Local Rule 54.2(h). This Court should not excuse the Trustee's lack of a good understanding of the factual or procedural history in this matter. The Trustee had four full months (i.e. September through

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December of 2005) between taking over TSI and filing its Response to become familiar with this matter. Furthermore, this failure further proves the argument that only this Court has the global perspective necessary in this matter to award Solinvest all of its attorneys' fees and costs it incurred and actually paid in this matter. See Motion, at ¶ 120(F). Finally, Solinvest request that this Court award it five thousand dollars and no cents ($5,000.00) as a reasonable amount of attorneys' fees that it will incur in connection with this Reply. RESPECTFULLY SUBMITTED this 19th day of January, 2006.

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MICHAEL SIMES, LLC /Michael Simes/ . Michael Simes Attorney for Solinvest Group, Ltd.

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ORIGINAL ELECTRONICALLY FILED this 19th day of January, 2006 with: Clerk of the Court United States District Court District of Arizona Sandra Day O'Connor Court House 401 West Washington Street Phoenix, Arizona 85003 COPY mailed this 19th day of January, 2006 to: Jeffrey M. Proper Jeffery M. Proper, PLLC 3550 North Central Avenue; Suite 1200 Phoenix, Arizona 85012 Telephone: 602-235-9555 Facsimile: 602-235-9223

COURTESY COPY hand-delivered this 19th day of January, 2006 to: Clerk of the Court United States District Court District of Arizona Sandra Day O'Connor Court House 401 West Washington Street Phoenix, Arizona 85003 The Honorable Roslyn O. Silver United States District Court District of Arizona Sandra Day O'Connor Court House 401 West Washington Street Phoenix, Arizona 85003 Telephone: 602-322-7520 Facsimile: 602-322-7529

Paul Sala Allen & Sala, P.L.C. 1850 North Central Avenue Suite 1150 Phoenix, Arizona 85004 Telephone: 602-256-6000 Facsimile: 602-252-4712

COURTESY COPY mailed this 19th day of January, 2006 to: The Honorable Eileen W. Hollowell United State Bankruptcy Court District of Arizona 110 South Church Avenue Tucson, Arizona 85701 Telephone: 520-620-7500 x 262 Facsimile: 520-620-7467

/s/ Michael Simes

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