Irving H. Picard v. Saul B. Katz et al

Filing 135

DECLARATION of DANA M. SESHENS in Support re: 79 MOTION for Summary Judgment.. Document filed by Charles 15 Associates, Charles 15 LLC, Charles Sterling LLC, Charles Sterling Sub LLC, College Place Enterprises LLC, Coney Island Baseball Holding Company LLC, Estate of Leonard Schreier, FFB Aviation LLC, FS Company LLC, Fred Wilpon Family Trust, Arthur Friedman, Ruth Friedman, Iris J. Katz and Saul B. Katz Family Foundation, Inc., Judy and Fred Wilpon Family Foundation, Inc., Amy Beth Katz, David Katz, Dayle Katz, Gregory Katz, Howard Katz, Iris Katz, 157 J.E.S. LLC, Air Sterling LLC, BAS Aircraft LLC, Jason Bacher, Bon Mick Family Partners LP, Bon-Mick, Inc., Brooklyn Baseball Company LLC, C.D.S. Corp., Michael Katz, Saul B. Katz, Todd Katz, Katz 2002 Descendants' Trust, Heather Katz Knopf, Natalie Katz O'Brien, Mets II LLC, Mets Limited Partnership, Mets One LLC, Mets Partners, Inc., Minor 1 (REDACTED), Minor 2 (REDACTED), L. Thomas Osterman, Phyllis Rebell Osterman, Realty Associates Madoff II, Red Valley Partners, Robbinsville Park LLC, Ruskin Garden Apartments LLC, Saul B. Katz Family Trust, Michael Schreier, Deyva Schreier Arthur, See Holdco LLC, See Holdings I, See Holdings II, Sterling 10 LLC, Sterling 15C LLC, Sterling 20 LLC, Sterling Acquisitions LLC, Sterling American Advisors II LP, Sterling American Property III LP, Sterling American Property IV LP, Sterling American Property V LP, Sterling Brunswick Corporation, Sterling Brunswick Seven LLC, Sterling Dist Properties LLC, Sterling Equities, Sterling Equities Associates, Sterling Equities Investors, Sterling Heritage LLC, Sterling Internal V LLC, Sterling Jet II Ltd., Sterling Jet Ltd., Sterling Mets Associates, Sterling Mets Associates II, Sterling Mets LP, Sterling Pathogenesis Company, Sterling Third Associates, Sterling Thirty Venture LLC, Sterling Tracing LLC, Sterling Twenty Five LLC, Sterling VC IV LLC, Sterling VC V LLC, Edward M. Tepper, Elise C. Tepper, Jacqueline G. Tepper, Marvin B. Tepper, Valley Harbor Associates, Kimberly Wachtler, Philip Wachtler, Bruce N. Wilpon, Daniel Wilpon, Debra Wilpon, Fred Wilpon, Jeffrey Wilpon, Jessica Wilpon, Judith Wilpon, Richard Wilpon, Scott Wilpon, Valerie Wilpon, Wilpon 2002 Descendants' Trust, Robin Wilpon Wachtler. (Attachments: # 1 Exhibit BB, # 2 Exhibit CC, # 3 Exhibit DD, # 4 Exhibit EE, # 5 Exhibit FF, # 6 Exhibit GG)(Seshens, Dana)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------- x
:
IRVING H. PICARD,
:
:
Plaintiff,
:
:
11-CV-03605 (JSR)(HBP)
:
- against :
SAUL B. KATZ, et al.,
:
:
Defendants.
:
:
------------------------------- x
SUPPLEMENTAL DECLARATION OF DANA M. SESHENS
IN FURTHER SUPPORT OF DEFENDANTS’
MOTION FOR SUMMARY JUDGMENT
I, Dana M. Seshens, declare, pursuant to 28 U.S.C. § 1746, that the
following is true:
1.

I am a partner with the firm of Davis Polk & Wardwell LLP,

attorneys for Defendants. I submit this supplemental declaration in further
support of Defendants’ motion for summary judgment.
2.

In my role as counsel for Defendants, I was involved in and

responsible for Defendants’ response to the Trustee’s discovery requests in this
action, including, but not limited to, the production of documents. As a result, I
am personally familiar with the facts set forth herein.
3.

Per order of this Court, discovery in this action concluded on

January 13, 2012.
4.

On January 17, 2012, this Court issued an opinion and order

denying the Trustee’s motion for entry of a final judgment and for certification of

interlocutory appeal. Picard v. Katz, No. 11 Civ. 3605, 2012 U.S. Dist. LEXIS
5143 (S.D.N.Y. Jan. 17, 2012). Pursuant to that opinion and order, the Court also
reinstated Count 9 of the Trustee’s Complaint, which, in relevant part, seeks
recovery of subsequent transfers pursuant to 11 U.S.C. § 550(a). Id. at *21-22.
5.

On January 20, 2012, the parties held a telephone conference with

the Court wherein the Court permitted limited discovery regarding the reinstated
subsequent transfer claims.
6.

On January 20, 2012, the Trustee sought additional discovery on

these claims with respect to twenty-two individuals and entities that had been
reinstated as Defendants on Count 9 (the “Reinstated Defendants”). The
Reinstated Defendants are alleged to have received subsequent transfers during
the relevant two-year period under 11 U.S.C. § 548(a)(1)(A), but are not alleged
to have received any initial transfers during that time.
7.

The Trustee’s additional discovery requests sought documents

and/or communications “concerning any Transfer(s) or any Subsequent
Transfer(s)” to the Reinstated Defendants and specifically sought bank statements
for each such Defendant for 2007 and 2008.
8.

Defendants agreed to provide 2007 and 2008 bank statements for

any Reinstated Defendant that had them reasonably accessible. Between January
24, 2012 and February 3, 2012, Defendants produced all such bank statements,
with the exception of one individual’s bank statements produced on February 8,
2012. Defendants represented to the Trustee that any Reinstated Defendant for

2

which bank statements were not produced either did not have a bank account or
had no reasonably accessible bank records for the years in question.
9.

The parties also met and conferred several times so that

Defendants could apprise the Trustee of the progress of their document collection
and production, given the February 9, 2012 filing deadline for the Trustee’s
opposition to Defendants’ motion for summary judgment, and so that Defendants
could apprise the Trustee of the results of their diligence into any other potentially
responsive information they could provide.
10.

As a result of their diligence, Defendants determined that a

significant number of the Trustee’s subsequent transfer claims could not be
sustained because no monies were transferred as the Trustee had alleged.
Defendants informed the Trustee of this determination on February 1, 2012 and
offered sworn testimony, or another acceptable form of evidence, to support their
representation. Counsel for the Trustee took Defendants’ offer under advisement,
but never responded.
11.

Since the parties’ meet-and-confer on February 1, 2012, the parties

have had no further discussions regarding subsequent transfer discovery.
12.

Attached hereto as Exhibit BB is a true and correct copy of

excerpts from the Bankruptcy Rule 2004 deposition of Peter Stamos, dated
August 19, 2010.
13.

Attached hereto as Exhibit CC is a true and correct copy of

excerpts from the deposition of Basil Stamos, dated January 3, 2012.

3

14.

Attached hereto as Exhibit DD is a true and correct copy of

excerpts from the deposition of Michael Katz, dated December 9, 2011.
15.

Attached hereto as Exhibit EE is a true and correct copy of

excerpts from the deposition of Leonard Labita, dated November 22, 2011.
16.

Attached hereto as Exhibit FF is a true and correct copy of excerpts

from the Bankruptcy Rule 2004 deposition of Saul B. Katz, dated August 4, 2010.
17.

Attached hereto as Exhibit GG is a true and correct copy of

excerpts from the Bankruptcy Rule 2004 deposition of Mark Peskin, dated July 29,
2010.
Dated: New York, New York
February 16, 2012
s/ Dana M. Seshens
Dana M. Seshens

4