In Re Ez Pay Services, Inc.

389 B.R. 776, 21 Fla. L. Weekly Fed. B 371, 2008 Bankr. LEXIS 1832, 2008 WL 2497331
CourtUnited States Bankruptcy Court, M.D. Florida
DecidedFebruary 5, 2008
Docket3:06-bk-2474-PMG
StatusPublished
Cited by1 cases

This text of 389 B.R. 776 (In Re Ez Pay Services, Inc.) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Ez Pay Services, Inc., 389 B.R. 776, 21 Fla. L. Weekly Fed. B 371, 2008 Bankr. LEXIS 1832, 2008 WL 2497331 (Fla. 2008).

Opinion

*777 ORDER ON TRUSTEE’S MOTION TO HOLD JAMES DISTLER IN CONTEMPT OF COURT, FOR SANCTIONS AND TO COMPEL APPEARANCE

PAUL M. GLENN, Chief Judge.

THIS CASE came before the Court for hearing on November 16, 2007, to consider the Motion to Hold James Distler in Contempt of Court, for Sanctions and to Compel Appearance. (Doc. 560). The Motion was filed by Robert Altman, as Chapter 7 Trustee.

The Trustee seeks to depose Dr. James Distler for the purpose of examining his prepetition transactions with the Debtor.

In the Motion currently before the Court, the Trustee seeks the entry of an Order finding Dr. Distler in contempt of Court and imposing sanctions against Dr. Distler “due to his failure to appear and testify at multiple scheduled depositions.” (Doc. 560, p. 1). The Trustee also seeks the entry of an Order compelling Dr. Dist-ler to appear and testify at a deposition pursuant to the Federal Rules of Bankruptcy Procedure.

Background

Dr. James Distler (Distler) is the husband of Debbie Distler, the Chief Executive Officer of the Debtor, EZ Pay Services, Inc. In the Trustee’s Motion to hold Distler in contempt, the Trustee states that “[t]he Trustee’s investigation of the conduct of the Debtor reveals that Dr. James Distler, DDS received more than $1,000,000.00 from the Debtor, pre-petition.” (Doc. 560, ¶ 1).

On November 7, 2006, the Trustee filed a Motion to Compel James Distler to Turnover Property to the Chapter 7 Trustee, which included a request for the turnover of account information concerning any and all transfers received directly or indirectly from the Debtor. (Doc. 143).

On November 9, 2006, the Trustee served a Notice of Taking Deposition Duces Tecum on Distler. The Trustee also served Distler with a Subpoena in a Case under the Bankruptcy Code. (Doc. 184, Exhibit A). Pursuant to the Notice and Subpoena, Distler’s deposition was scheduled for November 22, 2006.

Distler did not appear for the deposition on November 22, 2006.

On November 30, 2006, the Trustee filed a Motion to Hold James Distler in Contempt of Court, for Sanctions and to Compel Appearance. (Doc. 184).

On December 11, 2006, Debbie Distler filed a written Response to the Motion on behalf of Distler. (Doc. 200).

A hearing was scheduled on the Motion for February 26, 2007. (Doc. 211).

On March 5, 2007, following the hearing, the Court entered an Order on the Motion to Hold James Distler in Contempt. (Doc. 261). In the Order, the Court noted that Distler failed to appear at the hearing conducted on the motion, and found “the excuses presented on behalf of Dr. Distler, as to why he failed to appear at the scheduled deposition, not to be credible.” Consequently, the Court determined that Dist-ler was in contempt of court, but withheld the imposition of sanctions at that time. The Court ordered Distler to appear for deposition on March 19, 2007, or at some other time mutually agreed by the parties. (Doc. 261).

On March 11, 2007, Bruce A. Minnick, Esquire, as counsel for Distler, filed a Notice of Unavailability of Deponent and Motion to Continue the Deposition of Dr. James Distler until April 10, 2007. (Doc. 270). The Notice and Motion stated that Distler was in the State of Washington receiving medical treatment, but that he *778 intended to return to Jacksonville the first week of April, 2007.

On March 12, 2007, the Court entered an Order Denying the Motion to Continue Deposition of Dr. James Distler, and again directed Distler to appear at the deposition on March 19, 2007. (Doc. 272).

Distler did not appear for the deposition scheduled for March 19, 2007.

On March 18, 2007, one day before the scheduled deposition, Distler filed an Emergency Motion for Relief from Two Orders. (Doc. 293). On March 19, 2007, Distler filed a Motion for Reconsideration and for Immediate Relief from Two Orders. (Doc. 294). Distler’s two Motions are virtually identical, and seek relief from the Orders requiring Distler to appear at the deposition scheduled for March 19, 2007.

Distler attached two documents to the Motions. First, he attached a letter dated March 14, 2007, signed by Dr. Hrayr K. Shahinian, Director of the Skull Base Institute in California. According to the letter, Distler had undergone successful surgery for a pituitary tumor on July 17, 2006, and had experienced significant hormonal imbalance difficulties afterward, but was expected to improve in the following months. Second, Distler attached the Curriculum Vitae of Dr. Shahinian to the Motions.

A hearing was conducted on Distler’s two Motions on March 29, 2007. Distler was represented at the hearing by Bruce Minnick, Esquire. Distler’s attorney represented that Distler was out of the State of Florida, that he would return to the State in early April, 2007, and that he was unable to attend a deposition “until sometime in early April.” (Transcript, March 29, 2007 hearing, p. 16). When asked if Distler would be available for deposition between April 10 and April 30, Distler’s attorney responded: “My present understanding is yes.” (Transcript, p. 17).

On April 6, 2007, the Court entered an Order on James A. Distler’s Two Alternative Motions for Relief from Two Orders. (Doc. 325). In the Order, the Court found that Distler is a material witness in the case, and that the Trustee “should be allowed to depose Dr. Distler under circumstances that do not impair Dr. Distler’s health.” The Order further recited that “[cjounsel for the Trustee and counsel for Dr. Distler agreed to cooperate and to work together toward scheduling Dr. Dist-ler’s deposition between April 10 and April 30, 2007, at a time and place that is convenient for Dr. Distler and other persons involved, and is appropriate under these circumstances.” Finally, the Order provided that if the parties were not able to agree on the time and place for the deposition, the deposition would be held at a specific time and location on April 30, 2007.

On Saturday, April 28, 2007, two days before the scheduled deposition, Distler filed a Motion for Protective Order. (Doc. 356). In the Motion, Distler generally alleges that he has a serious medical condition, and that there are less stressful methods for the Trustee to obtain the information sought.

On April 29, 2007, Distler filed a Notice of Filing Confidential Medical Records under Seal. (Doc. 358).

Distler did not appear for the deposition on April 30, 2007. A telephone hearing with the Court was conducted on that day on an emergency basis. (Doc. 366). Bruce A. Minnick, Esquire, participated in the hearing on behalf of Distler. At the hearing, Minnick represented to the Court that he had not communicated with Distler in three weeks and that he did not know where Distler was, even though he knew that Distler was aware of the deposition *779 scheduled for that day. (Doc. 366, Transcript, p. 14).

On May 2, 2007, the Trustee filed a Response in Opposition to Distler’s Motion for Protective Order and a Request for Sanctions. (Doc. 361).

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Bluebook (online)
389 B.R. 776, 21 Fla. L. Weekly Fed. B 371, 2008 Bankr. LEXIS 1832, 2008 WL 2497331, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-ez-pay-services-inc-flmb-2008.