84297082
Arthur S. LinkerJeff FriedmanMerritt PardiniKATTEN MUCHIN ROSENMAN LLP575 Madison Ave.New York, NY 10022Telephone: (212) 940-7007Facsimile: (212) 940-7134
Attorneys for Plaintiffs David Rubin and Henry Lan,Solely in their capacity as the Receivers for TheConsumers Trust, and The Consumers Trust.
David L. Barrack FULBRIGHT & JAWORSKI L.L.P.666 Fifth AvenueNew York, New York 10103Telephone: (212) 318-3000
Attorneys for Plaintiffs The Official Committeeof Unsecured Creditors of The Consumers Trust
UNITED STATES BANKRUPTCY COURTSOUTHERN DISTRICT OF NEW YORK– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – xIn re:THE CONSUMERS TRUST,Debtor::::– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – xDAVID RUBIN and HENRY LAN, solely in their capacity asthe Receivers for THE CONSUMERS TRUST, and THEOFFICIAL COMMITTEE OF UNSECURED CREDITORSOF THE CONSUMERS TRUST, as the LegalRepresentatives of THE CONSUMERS TRUST, and THECONSUMERS TRUST,Plaintiffs,- against –ADRIAN ROMAN, JUSTIN ROMAN, NICHOLASROMAN, EUROFINANCE S.A., CONSUMERPROMOTIONS, INC., CP PROMOTIONS, LTD., JAMESRIGSBY, AARON J. RACINE, MONACO, SANDERS,GOTFREDSON, RACINE & BARBER, L.C., GRAHAMJAYNES and GT ENTERPRISES,Defendants.::::::::::::::::::
Chapter 11Case No. 05 – 60155(REG
)
ADVERSARY NO.07-03138 (REG)
– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – x
ORDER GRANTING PLAINTIFFS’ MOTION FOR DEFAULT JUDGMENTAND SUMMARY JUDGMENT AGAINST DEFENDANTSADRIAN ROMAN, JUSTIN ROMAN, NICHOLAS ROMAN,EUROFINANCE S.A. AND CP PROMOTIONS, LTD.
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2Upon the Notice of Motion and Motion of David Rubin and Henry Lan, solely in theircapacity as the Receivers for The Consumers Trust (“TCT”), and the Official Committee of Unsecured Creditors of TCT, as the Legal Representatives of TCT, and TCT, as LiquidatingDebtor (collectively, the “Plaintiffs”), dated May 29, 2008, for a default judgment, pursuant toBankruptcy Rule 7055, and summary judgment, pursuant to Bankruptcy Rule 7056, againstdefendants Adrian Roman, Justin Roman, Nicholas Roman, Eurofinance S.A., and CPPromotions, Ltd. (“the Defendants”), together with the affidavits of service thereof upon theDefendants; the Defendants not having answered or otherwise responded to the Complaint andbeing in default, and not having responded to the Motion or appeared at the hearing thereof; theCourt having reviewed the Complaint, Affidavits of Service, Clerk’s Entries of Default, Noticeof Motion, Motion, Statement of Facts as to Which There is No Genuine Issue to be Tried,Declaration of Jeff J. Friedman, and Declaration of David Stephenson, together with the exhibitsthereto; and the Court having determined that there is no genuine issue as to any material factand that Plaintiffs are entitled to judgment against the Defendants as a matter of law; the Courthereby finds and concludes as follows:
Findings of Fact
1. TCT was formed under the laws of England, pursuant to a trust deed dated March25, 2002 between Euro, as settlor, and Richard Caplan, Wesley Harrison, Andrew Davis, andDennis Bonley, as trustees (collectively, the “Trustees”). Euro was TCT’s sole residual equityholder at all times relevant to this proceeding. See Ex. 6;
1
Complaint ¶¶ 12, 28 (Ex. 1).
2
________________________
1
References in the form “Ex. __” or “Exs. __” are to the exhibits attached to the Declaration of Jeff J. Friedman, submitted in support of Plaintiffs’ motion.
2
The Defendants have not answered or otherwise responded to the Complaint, their time toanswer or otherwise respond has expired, and they are in default. Adversary No. 07-03138,Docket Entries 31–35. As a result, this Court treats the factual allegations contained in theComplaint as true.
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32. TCT was used by Defendants as the vehicle to operate a deceptive consumer salespromotions scheme known as the Cashable Voucher Program (the “Program”). Exs. 7, 8;Complaint ¶ 27-28, 31-32.3. Plaintiffs David Rubin and Henry Lan (the “Receivers”) are Receivers for TCT’sproperty, including its property located in the United States and Canada. Rubin and Lan wereappointed as Receivers for TCT by an order of the High Court of Justice of England and Wales(the “High Court”), dated November 14, 2005. Ex. 9 at ¶ 1; Complaint ¶ 13, 49.4. Plaintiff The Official Committee of Unsecured Creditors of The Consumers Trust(the “Committee”) was appointed by the Office of the United States Trustee in accordance with11 U.S.C. § 1102, on December 29, 2005. Pursuant to TCT’s Second Amended Joint Plan of Liquidation (the “Plan”), confirmed by the United States Bankruptcy Court for the SouthernDistrict of New York (“Bankruptcy Court”) on October 24, 2007, the Receivers and theCommittee have standing as Legal Representatives of TCT to bring this adversary proceeding.Plan §§ 5.3-5.4 (Ex. 4); Complaint ¶ 16.5. Roman, the founder of Euro, has masterminded consumer sales promotionsschemes for the better part of the past two decades. Exs. 28 at 1, 55; Complaint ¶¶ 27-29.6. Roman’s most recent scheme was TCT. Roman controlled all aspects of TCTand, together with the other defendants, ran its day-to-day operations. Ex. 10 at 3-6; Complaint ¶¶ 59-60.7. Through TCT, Roman created and implemented the Cashable Voucher Programand played a significant role in other aspects of the Program such as marketing and promotions.Ex. 10 at 3-6; Racine deposition at 89 (Ex. 12); Wertheimer deposition at 30, 70-72, 74 (Ex. 13);Complaint ¶ 60.
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