Case 07-10416-KJC

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UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE ----------------------------------------------------------------------x In re: NEW CENTURY TRS HOLDINGS, INC., a Delaware Corporation, et al.,1 Debtors. ----------------------------------------------------------------------x

Chapter 11 Case No. 07-10416 (KJC) (Jointly Administered) Re: D.I. 11127

THE NEW CENTURY LIQUIDATING TRUST’S OBJECTION TO HELEN GALOPE’S MOTION DEMANDING FURTHER DISCLOSURES The New Century Liquidating Trust (the “Trust”), by and through Alan M. Jacobs, as its Bankruptcy Court appointed Liquidating Trustee (the “Trustee”), respectfully submits this objection (the “Objection”) to Helen Galope’s Motion Demanding Further Disclosures [D.I. 11127] (the “Motion”) and responds to the Motion as follows: BACKGROUND 1. On December 27, 2012, Galope filed a motion requesting that the Court recuse

itself from this case [D.I. 11043] (the “Recusal Motion”). By the Recusal Motion, Galope asserts that the Court has (i) “abdicated it’s role to serve justice”, (ii) has shown “bias towards the Borrowers-Creditors-Litigants, and only services the Liquidating Trust and his masters . . .”, and (iii) denied Galope her due process rights. See Recusal Motion, p. 10-12. On January 11, 2013, the Trust filed a response to the Recusal Motion [D.I. 11050] (the “Recusal Response”).

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The Debtors are the following entities: New Century Financial Corporation (f/k/a New Century REIT, Inc.) (“NCFC”); New Century TRS Holdings, Inc. (f/k/a New Century Financial Corporation); New Century Mortgage Corporation (f/k/a JBE Mortgage) (“NCMC”); NC Capital Corporation; Home123 Corporation (f/k/a The Anyloan Corporation, 1800anyloan.com, Anyloan.com); New Century Credit Corporation (f/k/a Worth Funding Incorporated); NC Asset Holding, L.P. (f/k/a NC Residual II Corporation); NC Residual III Corporation; NC Residual IV Corporation; New Century R.E.O. Corp.; New Century R.E.O. II Corp.; New Century R.E.O. III Corp.; New Century Mortgage Ventures, LLC (d/b/a Summit Resort Lending, Total Mortgage Resource, Select Mortgage Group, Monticello Mortgage Services, Ad Astra Mortgage, Midwest Home Mortgage, TRATS Financial Services, Elite Financial Services, Buyers Advantage Mortgage); NC Deltex, LLC; NCoral, L.P.; and New Century Warehouse Corporation.

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2.

On March 12, 2013, Galope filed Helen Galope’s Motion Demanding Disclosures

of Interest of Counsel Mark S. Indelicato’s and Trustee Alan M. Jacobs’s and All Other Trustee Counsels in the Immeditae Abandonment and Destruction of Documents and Their Relations with the Unsecured Creditor’s Committee, A.K.A. The Plan Advisory Committee [D.I. 11098] (the “Original Disclosure Motion”). On March 28, 2013, the Trust filed its response to the Original Disclosure Motion [D.I. 11117](the “Original Disclosure Response”).2 3. On April 2, 2013, Galope filed the instant Motion in support of the Recusal

Motion. By the Motion, Galope demands for the Court to produce (i) financial disclosures for 2006 through 2013, (ii) disclosures on “lobster dinners with Counsels for the Trust and other Counsels, symposia/seminars/recognition participated in by or in honor of, Hon. Judge Kevin J. Carey, where Counsels for the Trust and/or other Counsels served as host or sponsors”, and (iii) “other activities/social gathering conducted with Counsels outside of the Court” (collectively, the “Court Disclosures”). By the Motion, Galope also demands that the Trust produce financial disclosures for 2006 through 2013 for “the Trustee and of the Trust Counsels from any and all associations with the creditor banks that comprise the Unsecured Creditors Committee or the Plan Advisory Committee, or any other associations with said creditors . . . as required per Rule 2014(a) and Rule 2019 of the Federal Rules of Bankruptcy Procedure” (the “Trust Disclosures”). OBJECTION 4. By the Motion, Galope, in an attempt to bolster her Recusal Motion, demands

disclosures from the Court, the Trustee and the Trustee’s counsels and implies that the Court, the Trustee and the Trustee’s counsels have a conflict of interest. The Motion should be denied

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All capitalized terms not defined herein shall have the meaning ascribed to them in the Original Disclosure Response.

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because Galope fails to identify any valid legal basis to support her entitlement to the relief requested. A. The Demand for the Various Court Disclosures Are Irrelevant to the Recusal Motion___________________________________________________________ 5. Galope contends that she is entitled to the Court Disclosures pursuant to the

Ethics in Government Act of 1978 (5 U.S.C. Appx. § 101, et seq.). Motion, p. 1. However, the Ethics in Government Act neither confers standing upon individuals, like Galope, to demand disclosures, nor obligates Judicial Offers, such as this Court, to respond to such demands. Accordingly, there is no legal basis for Galope to seek the Court Disclosures. 6. Further, the Court Disclosures are wholly irrelevant and unnecessary to the

Recusal Motion. By seeking the Court Disclosures, Galope inappropriately seeks personal information from this Court, which have no relationship, rational or otherwise, to the Recusal Motion. Accordingly, this Court should not be required to respond to the demand for the Court Disclosures. B. The Demand for the Various Trust Disclosures is Without Merit 7. By the Motion, Galope is once again seeking impermissible irrelevant disclosures

from the Trustee and his counsels under the guise of Rules 2014(a) and 2019 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”). Galope (and others) has made

substantially similar requests as set forth in her Rule 2019 Motion [D.I. 10767] and the Original Disclosure Motion, and the Trust restates and re-alleges all arguments stated in its response to the Rule 2019 Motion [D.I.10846] and in the Trust’s Original Disclosure Response. Notably, the Court denied the Rule 2019 Motion holding that Bankruptcy Rule 2019 is inapplicable to compel the Trustee, the Trustee’s counsels, the Plan Advisory Committee, and the Plan Advisory

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Committee’s counsels to produce information requested by Galope. See April 25, 2012 Tr., 34:25-35:5; see also Rule 2019 Order [D.I. 10876]. 8. Similarly, Bankruptcy Rule 2014(a) is inapplicable as it only applies to the

retention of professionals under section 327 of the Bankruptcy Code, not the retention of professionals under a court-approved trust agreement. As per the Modified Confirmation Order, Modified Plan, and Trust Agreement, the Debtors transferred their assets to the Trust, and the Trustee and the Trustee’s counsels were properly retained in accordance with those Courtapproved documents. See Modified Confirmation Order, ¶¶ 23, 42; Modified Plan, Art. 8.F.3, Art.8.I.1; Trust Agreement, §§ 1.4, 3.2(s). Further, even if Bankruptcy Rule 2014(a) applies, the Trustee’s counsels disclosed any and all conflicts in their retention applications, each of which were approved by the Court. See Application for Authorization to Retain Hahn & Hessen LLP as Co-Counsel for the Official Committee of Unsecured Creditors [D.I. 549]; Application of the Official Committee of Unsecured Creditors of New Century TRS Holdings, Inc., et al. for an Order Authorizing the Committee to Retain and Employ Blank Rome LLP as Its Co-Counsel Pursuant to 11 U.S.C. § § 328 and 1103 and Fed. R. Bankr. P. 2014 Nunc Pro Tunc as of April 9, 2007 [D.I. 550]. 9. Accordingly, the Trustee and the Trustee’s counsels should not be required to

respond to the demand for the Trust Disclosures.

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WHEREFORE, the Trust respectfully requests that (i) the Motion be denied, and (ii) such other or further relief be granted as is deemed just and proper. Dated: April 5, 2013 BLANK ROME LLP

By: /s/ Alan M. Root David W. Carickhoff (No. 3715) Alan M. Root (No. 5427) 1201 Market Street, Suite 800 Wilmington, Delaware 19801 (302) 425-6400 - Telephone (302) 425-6464 - Facsimile - and HAHN & HESSEN LLP 488 Madison Avenue New York, New York 10022 (212) 478-7200 - Telephone (212) 478-7400 - Facsimile Attn: Mark S. Indelicato, Esq. Edward L. Schnitzer, Esq. Nicholas C. Rigano, Esq. Co- Counsel for the New Century Liquidating Trustee

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