1. 1
#4817-7614-7739
Jeffrey M. Tillotson, P.C. (jmt@lynnllp.com)
Texas Bar No. 20039200
Eric W. Pinker, P.C. (epinker@lynnllp.com)
Texas Bar No. 16016550
John Volney (jvolney@lynnllp.com)
Texas Bar No. 24003118
LYNN TILLOTSON PINKER & COX, L.L.P.
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile
ATTORNEYS FOR MATTHEW D. ORWIG, LIQUIDATING TRUSTEE
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
In re: § Chapter 11
§
FIRSTPLUS FINANCIAL GROUP, INC., § Case No. 09-33918-HDH
§
Debtor. §
______________________________________________________________________________
THIRD APPLICATION OF LYNN TILLOTSON PINKER & COX, LLP FOR
ALLOWANCE OF COMPENSATION AND FOR REIMBURSEMENT OF EXPENSES
INCURRED FROM SEPTEMBER 1, 2012 THROUGH APRIL 30, 2014
______________________________________________________________________________
NO HEARING WILL BE CONDUCTED ON THIS APPLICATION UNLESS A
WRITTEN RESPONSE IS FILED WITH THE CLERK OF THE UNITED
STATES BANKRUPTCY COURT, 1100 COMMERCE STREET, SUITE 1254,
DALLAS, TEXAS 75242, BEFORE 5:00 P.M. PREVAILING CENTRAL TIME
ON JUNE 27, 2014, (THE “OBJECTION DEADLINE”), WHICH IS AT LEAST
TWENTY-FOUR DAYS AFTER THE DATE OF SERVICE OF THIS
APPLICATION.
ANY RESPONSE MUST BE IN WRITING AND FILED WITH THE CLERK,
AND A COPY MUST BE SERVED UPON THE UNDERSIGNED COUNSEL
PRIOR TO THE DATE AND TIME SET FORTH ABOVE.
IF A RESPONSE IS TIMELY FILED, A HEARING MAY BE HELD WITH
NOTICE ONLY TO THE OBJECTING PARTY. IF NO RESPONSE TO THIS
APPLICATION IS TIMELY FILED, THE RELIEF SOUGHT HEREIN SHALL
BE DEEMED TO BE UNOPPOSED, AND THE COURT MAY ENTER AN
ORDER GRANTING SUCH RELIEF.
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Lynn Tillotson Pinker & Cox, LLP (“LTPC,” the “Firm” or the “Applicant”), special
litigation counsel to Matthew D. Orwig, the liquidating Trustee (“Trustee”) for the estate of
FirstPlus Financial Group, Inc. (the “Debtor”), files this Third Application of Lynn Tillotson
Pinker & Cox, LLP for Allowance of Compensation and for payment of Expenses Incurred from
September 1, 2012 through April 30, 2014 (this “Application”).
I. SUMMARY OF APPLICATION
By this Application, LTPC seeks approval for payment of its attorney’s fees in the
amount of $1,000,000.00, which reflects LTPC’s one-third contingency fee interest in the
Trustee’s settlement with Olshan Frome Wolosky LLP f/k/a Olshan Grundman Frome
Rozenzweig & Wolosky, LLP and David Adler (collectively “Olshan”), which has been filed for
approval by this Court pursuant to Bankruptcy Rule 9019. [Docket No. 1013]. In addition to its
contingency fee, LTPC requests reimbursement of its expenses incurred from September 1, 2012
through April 30, 2014 (the “Application Period”) in the amount of $2,958.01. The total amount
sought by LTPC in this Application is $1,002,958.01. For the reasons set out below, LTPC
respectfully requests that the Court grant this Application.
II. JURISDICTION AND VENUE
1. The Court has jurisdiction over the relief requested in this Application pursuant to
28 U.S.C. § 1334(a) and (b). Venue is proper in this District pursuant to 28 U.S.C. §§ 1408 and
1409(a).
2. The statutory predicates for the relief requested herein are 11 U.S.C. §§ 327-328
and 330 and Fed. R. Bankr. P. 2016.
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III. BACKGROUND
3. On June 23, 2009, FirstPlus Financial Group, Inc. (“Debtor”) filed its petition for
relief under Chapter 11 of the United States Code.
4. On July 24, 2009, the Court entered its Order appointing Matthew D. Orwig as
the Liquidating Trustee for the Debtor.
5. On April 29, 2011, the Trustee filed an application to employ LTPC as special
counsel to the Trustee in this Bankruptcy Case. [Docket No. 565].
6. On May 12, 2011, the Court entered its order granting the application and
authorizing employment of LTPC. [Docket No. 572]. As relevant to this Application, the
Court’s Order authorized the Trustee to employ LTPC as Special Litigation Counsel to evaluate
and pursue claims against the former professionals, fiduciaries and others affiliated with Debtor.
The Order provided that LTPC would be paid (1) a reduced hourly rate up to a total of $25,000
to evaluate the potential claims and then (2) one-third of any net monetary recovery by the Estate
pursuant to a standard contingency fee arrangement if claims were pursued. The Order further
provided that LTPC would credit the estate for any payment made pursuant to the reduced hourly
arrangement in the event that LTPC recovered under the contingency fee arrangement, which
credit was taken when the Court approved LTPC’s Second Application. [Docket No. 572].
Under the Court’s order, all compensation for fees and expenses were made subject to Court
approval under section 330 of the Bankruptcy Code, the federal and local rules of bankruptcy
procedures, and other applicable guidelines and case law. LTPC’s Application is supported by
the Affidavit of John Volney attached as Exhibit A.
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A. Summary of Work Performed and Results Achieved.
7. In June 2011, the Trustee (represented by LTPC) filed Adversary Proceeding
No. 11-03397 against former professionals and others affiliated with Debtor, including Olshan.
After responding to and arguing Olshan’s first round of motions to dismiss, and after filing his
First Amended Complaint and responding to Olshan’s second round of motions to dismiss, the
Trustee reached a monetary settlement with Mr. Adler and Olshan Grundman on May 19, 2014.
On May 28, 2014, the Trustee filed his motion for order approving the settlement. [Docket
No. 1013].
B. Summary of Expenses Incurred.
8. In providing professional services to the Trustee, LTPC has incurred actual and
necessary expenses in satisfaction of which LTPC has advanced and disbursed funds, and for
which LTPC now requests reimbursement.1
As set forth in the invoice attached as Exhibit B, the
actual and necessary expenses incurred by LTPC on behalf of the Trustee during the Application
Period amount to $2,958.01. The expenses incurred by LTPC are charged at the actual cost by
LTPC on a pass-through basis, with no mark-up or profit by LTPC. The expenses sought to be
reimbursed include the following categories:
• Transcripts from Crim. Trial $1,954.00
• Westlaw/Internet Search Service $ 522.94
• Copies/Duplication Costs $ 287.70
• Postage $ 136.99
• Courier Charges $ 55.27
• Long Distance Telephone $ 1.11
Total: $2,958.01
1
The Trustee previously reimbursed some of the expenses requested here by check in July 2012. LTPC
refunded that amount to the Trustee upon determining that the reimbursement occurred without Court approval.
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The Invoice sets forth the date the expense was incurred or billed and the nature and
amount of the expense. No request is made for overhead expenses. The bulk of the expenses
sought to be reimbursed is related to obtaining transcripts of certain testimony from the parallel
criminal trial, which the undersigned counsel believed was necessary to successfully evaluate the
case for settlement. Copies were necessary to serve pleadings on various parties and to
disseminate documents to various interested parties as well as to prepare for the mediation
conducted with Olshan. Throughout this case, pleadings have been served on the parties in
interest. A copy service was used when it could provide services more cheaply than LTPC could
provide the same services in-house. Long distance phone calls were necessary to communicate
with various parties with interests in the case and in responding to requests for information from
various interested parties. LTPC incurred postage charges in connection with service of
documents on certain defendants who are not subscribers to the Court’s ECF system.
Computerized research has been utilized only when a professional believes that the benefits of
computerized research outweigh the cost of such research and that the costs will be less than
those incurred in utilizing more traditional research methods. Necessary computerized research
was extensive.
IV. RELIEF REQUESTED
9. By this Application, LTPC respectfully requests that the Court allow
compensation for professional services rendered by LTPC during the Application Period
pursuant to 11 U.S.C. § 330. In total, this Application requests allowance of compensation in the
amount of $1,000,000, along with expenses incurred during the Application Period of $2,958.01,
for a total requested allowance of $1,002,958.01.
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10. The Bankruptcy Code specifically authorizes the bankruptcy court to approve the
employment and compensation of special counsel on a contingency fee basis. 11 U.S.C.
§ 328(a); Daniels v. Barron (In re Barron), 325 F.3d 690 (5th Cir.2003) (“Under 11 U.S.C.
§ 330, attorneys’ fees are reviewed for their reasonableness after representation has concluded.
In contrast, Section 328 ... allows an attorney seeking to represent a bankruptcy estate to obtain
prior court approval of her compensation plan.”). As explained above, the Trustee (represented
by LTPC) filed suit against and then settled with Mr. Adler and his law firm for $1,000,000 in
cash. Upon approval of the settlement, the net monetary recovery to the Liquidating Trust will be
$3,000,000, with LTPC owed a contingent fee of $1,000,000.
11. To the extent that Court considers the factors listed in Johnson v. Georgia
Highway Express, Inc., 488 F.2d 714, 717–19 (5th Cir. 1974) (the “Johnson Factors”) in
evaluation LTPC’s requested contingent fee, those factors support the award.
12. The Time and Labor Required. LTPC’s fee was a contingent fee for the work
performed. LTPC provided its services efficiently to allow the Trustee to continue this
bankruptcy case without undue delay.
13. The Novelty and Difficulty of the Questions Presented. LTPC’s employment
required them to perform services within their area of expertise, namely litigating business tort
claims against Debtor’s former lawyer and his law firm.
14. The Skill Required to Perform the Services. LTPC believes that its skill in
litigating business tort claims such as the claims alleged against Mr. Adler and his firm
contributed substantially to the settlement.
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15. Preclusion of Other Employment Due to Acceptance of the Case. While
LTPC has devoted substantial time and effort to its representation of the Trustee in the adversary
proceeding, LTPC has not been precluded from accepting other employment.
16. The Customary Fee. The amount of compensation sought herein has been
computed pursuant to a customary contingent fee. The fee charged for LTPC’s services in this
case is equal to or less than the rates charged by other professionals of similar reputation.
17. Whether the Fee is Fixed or Contingent. LTPC’s fee is set according to
contingent, as previously approved by the Court.
18. Time Limitations Imposed by the Client or Other Circumstances. The best
interests of the creditors were served by pushing the case and settlement forward in order to
minimize expenses.
19. The Experience, Reputation, and Ability of the Applicant. LTPC submits that
it is respected for its skill in litigating business disputes. It is the Applicant’s belief that its
reputation is recognized and respected.
20. The “Undesirability” of the Case. Working on behalf of the Trustee in this case
has not been undesirable. However, LTPC’s fee is subject to approval by the Court and is
contingent upon a recovery.
21. The Nature and Length of the Professional Relationship with the Client.
LTPC worked with the Trustee throughout the existence of the adversary proceeding. LTPC had
no prior dealings with the Debtor or the Trustee.
22. The Amount Involved and the Results Obtained. The amount of LTPC’s
contingent fee is calculated pursuant to the methodology previously approved by the Court.
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V. COMPLIANCE WITH FED. R. BANK. P. 2016(a)
23. LTPC does not now hold or represent, and has not held or represented at any time
during the Application Period or otherwise, any interest adverse to the Trustee or the Estate with
respect to the matters for which it has been employed. LTPC is now, and has at all times
material hereto been, a “disinterested person” as that term is used and defined in the Bankruptcy
Code.
24. This is LTPC’s Third Application for payment of attorney’s fees and
reimbursement of expenses. LTPC received $250,221.80 in attorney’s fees and expenses
pursuant to its First and Second Applications.
25. No agreement or understanding exists between the Applicant and any other entity
for sharing of compensation received or to be received for services rendered in or in connection
with this Bankruptcy Case. Applicant shall not share or agree to share with any other entity the
compensation awarded in connection with this Application, if any.
26. No agreement or understanding prohibited by 18 U.S.C. § 155 has been made, or
will be made, by LTPC.
VI. NOTICE
27. A copy of this Application, together with exhibits, is being transmitted, inter alia,
(i) electronically by the Clerk of Court through the CM/ECF system to all parties receiving such
notice in this Bankruptcy Case and (ii) to the Office of the United States Trustee. A copy of this
Application without exhibits is being sent via regular United States mail, postage prepaid, to the
parties appearing on the master mailing matrix for this case. Accordingly, all parties entitled to
receive notice of this Application have received such notice. LTPC respectfully submits that no
additional notice of this Application is necessary under the circumstances.
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28. Any party that was not served with a copy of the exhibits to this Application
may obtain a copy of such exhibits by mailing a written request to the undersigned counsel
on or before the Objection Deadline set forth on the first page of this Application.
VII. PRAYER
BASED UPON THE FOREGOING, LTPC respectfully requests that the Court enter an
order in substantially the form of that attached hereto as Exhibit C:
i. granting this Application;
ii. allowing compensation for professional services rendered by LTPC as
special counsel to the Trustee during the Application Period in the total
amount of $1,000,000;
iii. allowing reimbursement of LTPC’s expenses in the amount of $2,958.01;
and
iv. awarding Applicant such other and further relief to which it may be justly
entitled.
Date: June 3, 2014 Respectfully submitted,
/s/ John Volney
Jeffrey M. Tillotson, P.C. (jmt@lynnllp.com)
Texas Bar No. 20039200
Eric W. Pinker, P.C. (epinker@lynnllp.com)
Texas Bar No. 16016550
John Volney (jvolney@lynnllp.com)
Texas Bar No. 24003118
LYNN TILLOTSON PINKER & COX, L.L.P.
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile
ATTORNEYS FOR MATTHEW D. ORWIG,
LIQUIDATING TRUSTEE
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CERTIFICATE OF SERVICE
The undersigned hereby certifies that a true and correct copy of the above and foregoing
document has been served either via ECF on counsel of record or via first class United States
mail, prepaid, on the attached Limited Service List on June 3, 2014.
/s/ John Volney
John Volney
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11. ERIN MARIE SCHMIDT
OFFICE OF THE U.S. TRUSTEE
1100 COMMERCE ST., RM. 976
DALLAS, TX 75242
SECURITIES & EXCHANGE COMMISSION
c/o ROSE L. ROMERO, REG. DIRECTOR
BURNETT PLAZA, SUITE 1900
801 CHERRY STREET, UNIT 18
FORT WORTH, TX 76102
MATTHEW D. ORWIG
CHAPTER 11 TRUSTEE
JONES DAY
2727 NORTH HARWOOD STREET
DALLAS, TEXAS 75201-1515
PETER FRANKLIN, DOUG SKIERSKI
FRANKLIN SKIERSKI HAYWARD,
10501 N CENTRAL EXPY, STE 106
DALLAS, TX 75231
ARKADIY GRINSHPUN
7909 BUSTLETON AVENUE
PHILADELPHIA, PA 19152
GARY B. FREEDMAN
7909 BUSTLETON AVENUE
PHILADELPHIA, PA 19152
INTERNAL REVENUE SERVICE
SPECIAL
PROCEDURES - INSOLVENCY
P.O. BOX 21126
PHILADELPHIA, PA 19114
OLSHAN GRUNDMAN FROME
ROSENZWEIG &WOLOSKY LLP
PARK AVENUE TOWER
65 EAST 55TH ST.
NEW YORK, NY 10022
PATTON BOGGS
ATTN: CASS WEILAND, ESQ.
2000 MCKINNEY AVE, SUITE 1700
DALLAS, TEXAS 75201
HULSE & STUCKI
ATTN: JAY R. STUCKI
2912 WEST STORY ROAD
IRVING, TX 75038
BASHEER GHORAYEB
JONES DAY
2727 NORTH HARWOOD STREET
DALLAS, TEXAS 75201-1515
DOWNEY BRAND LLP
427WEST PLUMB LN.
RENO, NV 89509
JAMES W. PUZEY
LAW OFFICES OF JAMES W. PUZEY
P.O. BOX 70172
RENO, NV 89570
FIRSTLINE MORTGAGE v.RUTGERS
C/O ROBERT JOHNSON LAW CORP
34197 PACIFIC COAST HIGHWAY
STE 100
DANA POINT, CA 92629
SECORE &WALLER, LLP
ATTN: WAYNE M. SECORE
FOUR FOREST
12222 MERIT DR., #1350
DALLAS, TX 75251
JOHN CLARSON
4200 RANIER COURT
FORTH WORTH, TX 76109
BUCKNO LISICKY &COMPANY
ATTN: TONY BUCKNO
1524 LINDEN STREET
ALLENTOWN, PA 18102-4251
RUTGERS INVESTMENT
3965 PHELAN BLVD, # 209
BEAUMONT, TX 77707-2232
PATRICK JOHN HETHCOAT
1365 WAYNE WAY
SAN MATEO, CA 94403-1565
ROBERT O’NEAL
324 N. 23RD STREET
BEAUMONT, TX 77707
ANGELA DODD
SECURITIES AND EXCHANGE COMM
175 WEST JACKSON BLVD
SUITE 900
CHICAGO, ILLINOIS 60604
GEORGE H. TARPLEY
COX SMITH MATTHEWS INC.
1201 ELM ST., #3300
DALLAS, TX 75270
LAURIE SPINDLER HUFFMAN
LINEBARGER GOGGAN BLAIR &
SAMPSON, LLP
2323 BRYAN STREET, SUITE 1600
DALLAS, TX 75201
JAMES P. HANSON
5824 COLD WATER DRIVE
CASTRO VALLEY, CA 94552-1807
ERIC A.LIEPINS
ERIC A.LIEPINS, P.C.
12770 COIT ROAD, SUITE 950
DALLAS, TEXAS 75251
MICHAEL A. MCCONNELL
KELLY HART &HALLMAN PC
201 MAIN STREET, SUITE 2500
FORT WORTH, TEXAS 76102
RONALD J. MILLER
772 WESTRAY DR.
WESTERVILLE, OH 43081
JERRY C. CARTER
JENKINS & CARTER
501 HAMMILL LANE
RENO, NV 89511
NATHAN JENKINS
JENKINS & CARTER
501 HAMMILL LANE
RENO, NV 89511
DANIEL J. SHERMAN
SHERMAN & YAQUINTO, LLP
509 N. MONTCLAIR AVENUE
DALLAS, TEXAS 75208
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12. LEPERCQ CORPORATE INCOME FUND
C/O DAVID F. STABER and CLAYTON D.
KETTER
AKIN GUMP, ET AL., LLP
1700 PACIFIC AVE., #4100
DALLAS, TX 75201
DUSTIN L. PAYNE, ATTORNEY
6777 CAMP BOWIE BLVD., SUITE 215
FORT WORTH, TEXAS 76116
WILLIAM MAXWELL
C/O WILLIAM MAXWELL, PLLC
1300 MCGOWAN
HOUSTON, TX 77004
DANIEL P. ELMS, HEATHER H. JOBE
BELL NUNNALLY &MARTIN LLP
1400ONE MCKINNEY PLAZA
3232 MCKINNEY AVENUE
DALLAS, TEXAS 75204-2429
JAMES HANSON
C/O DANIEL J. SHERMAN
SHERMAN & YAQUINTO, L.L.P.
509 N. MONTCLAIR AVENUE
DALLAS, TX 75208-5498
DERREL LUCE
LAW OFFICE OF DERREL LUCE
4600 BOSQUE BLVD., SUITE 2B
WACO, TEXAS 76710
BOWNE OF DALLAS, L.P.
C/O GAIL B. PRICE, BRONWEN PRICE
2600 MISSION ST., #206
SAN MARINO, CA91108
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EXHIBIT
A
20. 1
#4811-1954-2299
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
In re: § Chapter 11
§
FIRSTPLUS FINANCIAL GROUP, INC., § Case No. 09-33918-HDH
§
Debtor. §
ORDER ALLOWING THIRD APPLICATION OF
LYNN TILLOTSON PINKER & COX, LLP FOR ALLOWANCE OF
COMPENSATION AND REIMBURSEMENT OF EXPENSES
FOR THE PERIOD FROM SEPTEMBER 1, 2012 THROUGH APRIL 30, 2014
Came on for consideration this _____ day of _______________, 2014, the Third
Application of Lynn Tillotson Pinker & Cox, LLP for Allowance of Compensation and
Reimbursement of Expenses (the “Application”) filed on June 3, 2014 [Docket No. ___]. After
due notice and hearing, this Court having considered such Application, the representations of
Lynn Tillotson Pinker & Cox, LLP and all matters on file, the Court finds and concludes that the
fees and expenses set forth in the Application are reasonable and necessary and good cause exists
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for the allowance thereof. The Court finds that all necessary parties were served with notice of
the Application, that no further notice need be given, and that no objection or responsive
pleading was filed. It is therefore,
ORDERED that Lynn Tillotson Pinker & Cox, LLP be and hereby is awarded Attorney’s
Fees in the amount of $1,000,000.00 representing its contingency fee interest of the Liquidating
Trust’s settlement with Olshan Frome Wolosky LLP f/k/a Olshan Grundman Frome Rozenzweig
& Wolosky, LLP and David Adler. It is further
ORDERED that Lynn Tillotson Pinker & Cox, LLP be and hereby is awarded
Reimbursement of Expenses in the amount of $2,958.01. It is further
ORDERED that the Trustee is hereby authorized to pay Lynn Tillotson Pinker & Cox,
LLP the amount of $1,002,958.01 as third interim payment.
### END OF ORDER###
Order drafted by:
John Volney (jvolney@lynnllp.com)
Lynn Tillotson Pinker & Cox, LLP
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile
Attorney for Matthew D. Orwig,
Liquidating Trustee for the Estate of FirstPlus Financial Group, Inc.
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