United States Securities and Exchange Commission v. Holzhueter, Loren et al
ORDER granting 351 Quarterly Motion for Attorney Fees. Signed by District Judge James D. Peterson on 8/11/17. (jat)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
UNITED STATES SECURITIES AND EXCHANGE
ISC, INC., d/b/a INSURANCE SERVICE CENTER, and
THE ESTATE OF LOREN W. HOLZHUETER,
HONEFI, LLC, ARLENE HOLZHUETER, and
The Court has reviewed the Quarterly Fee Application for the period from April 1,
2017, through June 30, 2017, of: (I) Michael S. Polsky, Esq., Court-Appointed Receiver for
ISC, Inc., Honefi, LLC, and the Life Insurance Proceeds; (II) Beck, Chaet, Bamberger &
Polsky, S.C. as Counsel to the Receiver; and (III) Wadsworth Whitestar Consultants, as
Consultant to the Receiver (the “Quarterly Fee Application”) submitted by the Receiver,
Beck, Chaet, Bamberger & Polsky, S.C. (“BCBP”) and Wadsworth Whitestar Consultants
(“WWC”). Pursuant to the Court’s receivership order, Dkt. 196, the $200,000.00 Phase I
set-aside is reserved for fees and costs incurred in performing Phase I tasks, and the court will
award the miscellaneous case administration fees from the Phase II funds.
With that in mind, IT IS ORDERED that:
1. Pursuant to this Court’s Order Appointing Receiver dated October 20, 2016,
Dkt. 196, Michael S. Polsky, Esq., (the “Receiver”) was duly appointed to serve as
Receiver for ISC, Inc. (“ISC”), Honefi, LLC (“Honefi”), and the proceeds from the
policies insuring Loren W. Holzhueter’s life (the “Life Insurance Proceeds”)
(collectively, the “Receivership Estate”), effective October 20, 2016.
2. Pursuant to the Order Appointing Receiver and the Orders Approving the
Receiver’s Motions to Employ BCBP and WWC entered January 31, 2017, and
June 1, 2017, the Receiver has retained the attorneys and other professionals of
BCBP and WWC (collectively, the “Retained Personnel”) to assist him in
performing his duties as Receiver.
3. Before filing, the Receiver submitted the Quarterly Fee Application to the
Securities and Exchange Commission (the “Commission”) for review, as required
by the “Billing Instructions for Receivers in Civil Actions Commenced by the U.S.
Securities and Exchange Commission” (the “SEC Billing Instructions”).
4. During the Subject Quarter, the Receiver and BCBP devoted 816.2 hours and
WWC devoted 64.5 hours to the performance of necessary and valuable services
on behalf of the Receivership Estate which were in the best interests of the
beneficiaries of the Receivership Estate.
5. Based upon the time, nature, extent, and value of the services performed by the
Receiver and the Retained Personnel, the responsibilities assumed by the Receiver,
the rates charged by the Receiver and the Retained Personnel, the results achieved
to date and the costs of comparable services, the compensation for services
rendered and reimbursement of expenses sought in the Receiver’s Quarterly Fee
Application are reasonable, necessary, and commensurate with the skill and
experience required for the activities performed.
6. The fair value of services rendered by the Receiver and BCBP during the Subject
Quarter is $268,459.82. This amount includes $27,239.00 for services rendered
and $880.85 for expenses incurred in connection with the Phase I Distribution
(the “Phase I Fees”). This amount also includes $236,079.00 for services rendered
and $4,260.97 for expenses incurred in connection with the Phase II Distribution
(the “Phase II Fees”).
7. The fair value of services rendered by WWC during the Subject Quarter is
$20,537.30. This amount includes $19,775.00 for services rendered and $762.30
for expenses incurred in connection with Phase II Fees.
8. Pursuant to the Order Appointing Receiver and the SEC Billing Instructions, the
Receiver is authorized to pay the interim Phase I Fees for the Subject Quarter to
the Retained Personnel, subject to a 20% holdback, from the Life Insurance
Proceeds, up to $200,000.00 in aggregate. During the Subject Quarter, BCBP
incurred $28,119.85 in Phase I fees and expenses. But the Court will not
authorize the Receiver to pay those fees in full from the Life Insurance Proceeds.
By the Court’s count, it has already awarded $184,469.72 in Phase I Fees, paid at
80%, or $147,575.77. See Dkt. 238 and Dkt. 268. The Court will not award fees
in excess of the $200,000.00 Phase I cap. So the Court will authorize a final Phase
I fee award of $15,530.28, to be paid at 80%, or $12,424.22. BCBP may collect
its balance—$12,589.57, to be paid at 80%—from the Phase II proceeds.
9. Also pursuant to the Order Appointing Receiver and the SEC Billing Instructions,
the Receiver is authorized to pay the interim Phase II Fees for the Subject Quarter
to the Retained Personnel, subject to a 20% holdback, from ISC and Honefi assets
and/or sale proceeds. Specifically, the Receiver is authorized to pay $202,343.63
($252,929.54, paid at 80%) to BCBP and $16,429.84 ($20,537.30, paid at 80%)
to WWC from ISC and Honefi assets and/or sale proceeds.
Entered August 11, 2017.
BY THE COURT:
JAMES D. PETERSON
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