You are on page 1of 7

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 1 of 7

UNITED STATES BANKRUPTCY COURT


SOUTHERN DISTRICT OF MISSISSIPPI
In re:
Fish & Fisher, Inc.,
Debtor.

)
)
)
)
)

James W. OMara as
Chapter 11 Trustee of
Fish & Fisher, Inc.,
Plaintiff,

)
)
)
)
)

Chapter 11
Case No. 09-02747-EE

Adversary No. _______________

v.
Renna Fisher and Jacqueline Williams,
Defendants.
ADVERSARY COMPLAINT
COMES NOW James W. OMara, as the Chapter 11 Trustee (Trustee) of Fish &
Fisher, Inc., and files this Adversary Complaint and respectfully represents as follows:
PARTIES
1.

The Trustee is the duly appointed and acting trustee for the Bankruptcy Estate

(Estate) of Fish & Fisher, Inc. (Debtor).


2.

Defendant Renna Fisher (Fisher) is an adult resident citizen of Jackson,

Mississippi, who may be served with process as permitted by law.


3.

Defendant Jacqueline Williams (Williams), and collectively with Fisher

Shareholders) is an adult resident citizen of Jackson, Mississippi, who may be served with
process as permitted by law.
JURISDICTION AND VENUE
4.

This adversary proceeding is one arising in the Chapter 11 case of Fish & Fisher,

Inc., Case No. 09-02747-EE, now pending before this Court.

This Court has jurisdiction

pursuant to 28 U.S.C. 157 and 1334, 11 U.S.C. 510, and Bankruptcy Rule 7001(1), (7) and
(8). This is a core proceeding under 28 U.S.C. 157(b)(2)(A), (B), (C) and (O).
PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 2 of 7

FACTS
Background Conduct
5.

In June 2009, Debtor received an arbitration award against L&T Construction,

Inc. (L&T) in the final amount of $1,362,967.64. That total amount of the arbitration award
(L&T Funds) was disbursed at the direction or with the approval of Shareholders, who were
also officers and directors of the Debtor, to or for the benefit of themselves or certain selected
creditors of themselves or the Debtor. At all relevant times, Shareholders knew that M&F Bank
and certain taxing authorities claimed perfected liens on the L&T Funds, but Shareholders
directed disbursement of the L&T Funds away from such lien claimants and selectively and
preferentially to themselves and various other parties.

Such conduct by Shareholders was

harmful to Debtors creditors and caused significant cost and expense to the Estate.
6.

After this Bankruptcy Case was commenced, Shareholders consciously and

systematically sought to conceal from third parties the fact that Fish & Fisher, Inc. was the
debtor in a bankruptcy case, even when such third parties were seeking to engage in transactions
with the Debtor. Such conduct by Shareholders was harmful to such third parties and the Estate.
As an illustration, Cahaba Disaster Recovery, LLC (Cahaba) filed its Motion [Dkt. #558] on
December 8, 2011 for allowance of an administrative expense claim, revealing for the first time
that it had made post-petition loans at the request of Shareholders and that Shareholders had
concealed the existence of the Bankruptcy Case. Such conduct by Shareholders contributed to
Objections [Dkt. #576 & #577] being filed to the Cahaba Motion.
7.

After the Trustee was appointed as Chapter 11 Trustee of the Debtor on July 13,

2010, Trustee promptly, diligently and continuously requested from the Shareholders access to
the books and records of the Debtor for review and analysis, but was consistently denied such
access by Shareholders and other employees of the Debtor who were under the direction of
Shareholders. After Shareholders ignored numerous deadlines set by Trustee for such access to
-2PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 3 of 7

books and records, Trustee sought and obtained entry of an Order [Dkt. #370] permitting the
Trustee to take possession of the Debtors office facility and contents, which occurred on
September 23, 2010, over the objection of Shareholders.

The office contents contained

surprisingly few books and records, with a noticeable absence of bank account statements and
records and of accounts payable or receivable information. Subsequent requests by the Trustee
to Shareholders for access to any other of Debtors books and records likewise were ignored.
Through diligent searches, Trustee later learned of certain records having been delivered by
Shareholders to an accountant and to a payroll provider, but efforts by the Trustee to gain access
to such records were declined by the persons in possession of such records unless the
Shareholders consented, and after numerous requests for such consent, the Shareholders
declined. The Trustee must now resort to discovery activities in various Adversary Proceedings
in this Case to gain access to such records.
8.

Soon after the Trustees appointment in July 2010, the Shareholders became very

uncooperative with the Trustees efforts to perform his duties and to administer the Estate, with
the result that the Trustee obtained authority to conduct Rule 2004 Examinations of both
Shareholders. The Trustee made reasonable and good faith efforts to schedule the Examinations
at times and places agreeable to Shareholders, but those efforts were continually subverted and
resulted in unreasonable postponements by Shareholders. Finally, an Examination of Fisher was
commenced on January 28, 2011 and recessed by mid-afternoon, to be continued at a mutually
agreeable time, but Fisher declined thereafter to be examined.

Then, an Examination of

Williams was commenced on March 17, 2011 and recessed by early afternoon at her request, to
be continued at a mutually agreeable time, but Williams declined thereafter to be examined.
Such conduct by Shareholders significantly delayed and interfered with the Trustees efforts to
learn about and analyze the Debtors accounts receivable, accounts payable, assets, preference
and other claims, and proofs of claims.
-3PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 4 of 7

9.

Before the Trustees appointment, the Debtor had entered into a dirt-construction

contract with Mississippi Power Company (MPC Contract) and had begun work thereon
approximately June 30, 2010. That work continued through completion of the contract on
approximately October 30, 2010, during which time the Shareholders were directly in charge of
the work and performance by the Debtor. Throughout the time the Debtor was working on the
MPC Contract, Shareholders and the employees they supervised provided financial reports to the
Trustee and continuously reported to the Trustee that performance of the MPC Contract would
result in a significant profit to the Debtor and Estate. However, upon completion of the contract
by the Debtor, the total remaining to be paid to the Debtor from the MPC Contract was
$355,127.00 and the aggregate amount of unpaid subcontractors and DIP loan were $709,132.09.
In effect, the MPC Contract for the original amount of $849,990.00 had resulted in a loss to the
Debtor and Estate of $354,005.09.
10.

In reviewing the Debtors office contents after obtaining possession thereof as

described above, the Trustee discovered documents relating to repair work performed postpetition by Debtor on a Vicksburg apartment owned by Drummond Street LLC, d/b/a River Oaks
Apartments (Drummond), which had previously been concealed by Shareholders from the
Trustee. Upon further investigation and interviews with representatives of Drummond, the
Trustee did confirm that Drummond had not previously been aware of this Bankruptcy Case, that
such work had been performed by the Debtor, and that the total sum of $80,000 had been paid by
Drummond to the Debtor by two checks, both of which had been endorsed by Williams payable
to PC Trucking, with none of the work or the funds having been reported in the Bankruptcy
Case.
11.

A valuable asset of the Debtor and Estate has been and is the Debtors cause of

action against Toyota Motor Engineering & Manufacturing North America, Inc. pending in the
United States District Court for the Southern District of Mississippi, Jackson Division (Toyota
-4PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 5 of 7

Litigation), which is more particularly described in the Motion To Approve Compromise And
Settlement Of Toyota Litigation filed in this Bankruptcy Case [Dkt. #567]. Before and after
appointment of the Trustee in this Bankruptcy Case, various settlement negotiations were
conducted among the parties to the Toyota Litigation, in the form of private discussions,
mediation conferences with a private mediator, and settlement conferences with a U. S.
Magistrate Judge.

Throughout said negotiations, the positions and actions taken by the

Shareholders delayed and interfered with a settlement agreement being reached and resulted in
unnecessary costs to the Estate and a lower settlement amount than would have been achieved
for the Estate had such positions and actions taken by the Shareholders not occurred.
12.

Other illustrations exist of inequitable, harmful conduct by Shareholders during

this Bankruptcy Case.


Administrative Expense Claim
13.

On December 20, 2011, Shareholders filed their Motion For Administrative

Expense Claim [Dkt. #573], claiming that they were entitled to have an administrative expense
claim allowed in this Case in the amount of $775,000.00. On the same date, Shareholders filed
their Proof of Claim [Claim #36], duplicating their claim that they were entitled to have an
administrative expense claim allowed in this Case in the amount of $775,000.00. Reference is
hereby made to said Motion and Proof of Claim.
14.

On January 4, 2012, the Trustee filed his Trustees Objection To Fisher And

Williams Motion For Administrative Expense Claim [Dkt. #595] and his Objection To
Allowance Of Claim #36 Of Renna Fisher And Jacqueline Williams [Dkt. #594], in both of
which the Trustee objected to and denied entitlement of Shareholders to any allowance or
payment of any administrative expense claim. Reference is hereby made to both said Objections.
15.

In their said Motion and Proof of Claim, Shareholders provided wholely

inadequate information or details of the basis for the $775,000 administrative expense claim and
-5PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 6 of 7

attached thereto no documentary evidence thereof. On December 20, 2011, the same date said
Motion and Proof of Claim were filed, the Trustee made a written request to Shareholders
attorney for an itemization and backup for the $775,000 claim, to which no reply has been
received by the Trustee.
COUNT I
SUBORDINATION OF ALL CLAIMS OF SHAREHOLDERS
16.

Trustee hereby incorporates and realleges all matters contained in the preceding

paragraphs 1 through 15.


17.

The actions and conduct of Shareholders referred to above were intended to

and/or had the result of hindering, delaying, disrupting, frustrating, and interfering with the due
and timely administration of the Estate and were harmful to the Estate and Creditors and other
interested parties. It would be inequitable to other Creditors to allow Shareholders to be paid
anything from the Estate before all other allowed claims are satisfied.

As permitted by

Bankruptcy Code 510, any and all claims of Shareholders, if allowed, should be equitably
subordinated to all other allowed claims and treated as Class 4 Claims in accordance with the
confirmed Trustees Amended Plan of Liquidation [Dkt. #496].
COUNT II
MONETARY RECOVERY AND SANCTIONS FROM SHAREHOLDERS
18.

Trustee hereby incorporates and realleges all matters contained in the preceding

paragraphs 1 through 17.


19.

The actions and conduct of Shareholders referred to above, and especially their

asserting the unsubstantiated and unfounded claims in their Motion and Proof of Claim #36, also
had adverse economic effects on the Estate, by, among other things, causing significant costs and
expenses to the Estate. The Estate is entitled to recover a monetary judgment from Shareholders
as compensation for such adverse economic effects and reimbursement of such costs and
-6PD.5896472.1

12-00001-ee Dkt 1 Filed 01/05/12 Entered 01/05/12 17:22:18 Page 7 of 7

expenses, along with other sanctions, with the amount of all of which to be determined by the
Court as fair and just under the circumstances.
PRAYER
WHEREFORE, PREMISES CONSIDERED, Trustee prays (1) that any and all claims of
Shareholders for administrative expense claims be denied and disallowed, but if any of
Shareholders claims are granted and allowed, then that any such allowed claims be subordinated
to all other allowed claims of creditors and treated as Class 4 Claims under the confirmed
Trustees Amended Plan Of Liquidation [Dkt. #496] herein; (2) that the Estate have judgments
against Shareholders, jointly and severally, for the amounts of attorney fees and other costs and
damages suffered by the Estate on account of the wrongful conduct of Shareholders during this
Bankruptcy Case, together with interest thereon; and (3) that Trustee be granted such other and
further relief and sanctions against Shareholders as is just.
THIS the 5th day of January, 2012.
Respectfully submitted,

PHELPS DUNBAR LLP


BY:

-7PD.5896472.1

/s/Tommie W. Allen___________________
James W. O'Mara MS #3929
B. Lyle Robinson MS #100015
Tommie W. Allen MS #103619
4270 I-55 North
Jackson, Mississippi 39211-6391
Post Office Box 16114
Jackson, Mississippi 39236-6114
Telephone: 601-352-2300
Telecopier: 601-360-9777
omaraj@phelps.com
robinsol@phelps.com
allent@phelps.com