Results for: “pidgeon”
-
Chrysler Bankruptcy: Response to Appeal, Reply Filed
Attorney Leo C. Donofrio today posted an update on his site concerning the latest in the Chrysler Bankruptcy suit.
There is a PDF to Old Chrysler’s response to Donofrio/Pidgeon’s appeal and the subsequent reply brief.
-Phil
Email: phil [at] therightsideoflife [dot] com
Subscribe via RSS feed and/or email updates
-
Chrysler Bankruptcy: Motion Denied, To Be Appealed; Fraud Complaints To Be Made
After the Defendants made a footnoted accusation that the Plaintiffs in a Chrysler Bankruptcy case are so-called “birthers” (an accusation that is completely immaterial to the point of this case), one of the attorneys for the Plaintiffs, Leo Donofrio, of the firm Pidgeon and Donofrio, blasted Judge Arthur Gonzalez’ opinion on his denial order as being “a fraud on the Court, on the nation and on truth (Dianna Cotter also reporting):”
The entire case against the rejected Chrysler dealers revolved on one simple answer given by Fiat Executive, Alfredo Altavilla, when he was cross-examined by Dealer Counsel during the hearing to decide the fate of Chrysler. Every other witness testified that neither the US Government nor Fiat requested that Old Chrysler reject the 789 Dealer franchise contracts.
Without a request by the lender (the US Government) or the purchaser (Fiat), there was no sound business judgment in Old Chrysler killing off 789 franchises. This is because when a contract is rejected in bankruptcy, Section 365(g) of the Bankruptcy Code kicks in and gives those rejected dealers an unsecured creditor claim against the estate. In this case, it was undisputed that the claim would potentially reach one billion dollars.
Old Chrysler had a fiduciary duty to its other creditors not to burden the estate with this mammoth claim. However, had a key party sought rejection of those franchise agreements as a condition precedent to the deal closing then the Court might have been justified to approve the rejections. But no party ever testified that the dealer restructuring was a necessary condition precedent to the sale closing.
The New Chrysler management were free to trim the dealership network once they took over. After they owned the company, they could deal with the dealers as they liked and as would have been governed by State franchise laws which protected the dealers. And all of the evidence shows that Fiat was happy to take on the entire dealership network in the sale. The decision to kill off 789 dealerships was entirely the brain collapse of Old Chrysler’s management. Therefore, the issue to be decided by the Court was whether this decision was made in sound business judgment.
The entire dealer rejection issue then turned on whether the rejections were a condition precedent to the sale closing. If it was not a material issue to Fiat, and if Fiat’s executive testified that they were happy to trim the dealership network after the sale closed, then Old Chrysler should not have been allowed to reject the dealer contracts. The Bankruptcy Court – under Section 365(a) of the Bankruptcy Code – must approve the rejections for them to become effective.
Here is the exact testimony by Alfredo Altavilla of Fiat which the case turned on:
Q. If this transaction closes without an absolute requirement of a particular number of dealers that are being terminated, would Chrysler still go through with this deal — I mean, rather, would Fiat still go through with this deal?
A. The answer is that a restructure needs to occur. Whether it occurs before or after the closing of the deal is not a material difference.
(See May 27, 2009 Hearing Transcript at 352.)
It’s a very straightforward answer. Altavilla clearly testified that whether the dealer restructuring took place after the sale closed made no material difference to Fiat. Clearly, this man and his foreign company were not going to walk away from a deal where the American people paid the ENTIRE 20 plus billion dollar purchase costs just to hand it over to Fiat for free. Zippo nada zilch was paid by Fiat who were therefore in no position to demand 40,000 American jobs be lost and 789 dealerships be gutted. Fiat didn’t make that insane demand and the testimony above clearly shows this to be true.
But Judge Gonzalez decided he was going to usher in a new era ofjudicial ventriloquism by taking on a new role for his soiled robe. Gonzalez understood that the testimony needed for him to approve the rejection of 789 dealers (and loss of some 40,000 jobs) was nowhere to be found in the record of the case. So Judge Gonzalez – through the use of creative footnoting – made up his own testimonyand stuffed it into the mouth of Altavilla alla Edger Bergen and his dummy Charlie McCarthy. Seriously folks – the metaphor is so very appropriate.
Please compare and contrast Alatvilla’s testimony with Judge Gonzalez at Footnote 21 of the Gonzalez Rejection Opinion:
ALTAVILLA’S TESTIMONY
Q. If this transaction closes without an absolute requirement of a particular number of dealers that are being terminated, would Chrysler still go through with this deal — I mean, rather, would Fiat still go through with this deal?
A. The answer is that a restructure needs to occur. Whether it occurs before or after the closing of the deal is not a material difference.
THE JUDGE GONZALEZ OPINION AT FOOTNOTE 21
21 …Altavilla also responded affirmatively to a question regarding whether a dealership network needed to be restructured for the Fiat Transaction to close, stating that a “restructuring needs to occur.”
Altavilla never responded to any such question in the affirmative.Never, damn it. This is a fraud on the Court, on the nation and on truth. Any grammar school child can easily grasp that the witness clearly indicated restructuring was not a material difference to Fiat. And if it was not a material difference to Fiat, 789 dealers and 40,000 jobs could have been saved while your Government gifted this American auto institution to a foreign national conglomerate with your own taxes. That’s it in a nutshell, people.
Post continues below
Advertise on this siteIn our original Motion memorandum we gave Judge Gonzalez the benefit of the doubt and refrained from calling this fraud intentional – opting instead to allege only that the Court’s judicial ventriloquism exhibited a reckless disregard for the truth. But on Friday Feb. 5, 2010 Judge Gonzalez denied our Motion by issuing a 25 page Opinion(docket no. 6341 – public docket appears down today) which condoned intentional fraud on the part of Chrysler’s attorneys – Jones Day – who repeated multiple falsehoods in their Response Brief which we thoroughly dismantled in our Reply.
Furthermore, in not correcting the error of Footnote 21, Judge Gonzalez is now also guilty of intentional fraud as well. He’s chosen to defend Footnote 21 and in doing so he is simply lying to the American People which is obvious to any impartial observer of the facts. Footnote 21 is simply a lie by a partial Judge. It’s fraud plain and simple.
The Law Office of Pidgeon & Donofrio (site will soon be updated to include Leo Donofrio’s info) will be appealing to the Southern District of New York and we will be making multiple complaints to the New York Bar asking for sanctions against Jones Day and Judge Gonzalez.
Our lead client, James Anderer has been on Fox Business News about 40 times now and we are hoping to increase public awareness through the media of this fraud. The Chrysler story is only now truly being understood for the fraud against the American way that it is. Please stand with us as this battle is sure to intensify. The disease we are fighting is at the core of the intended destruction of this nation’s natural sovereignty.
Understand that this battle is as important a fight as this nation will ever see. It will define whether we are going to allow the judicial branch to openly lie to our faces. If no court will overturn Gonzalez here, it’s the end of truth, justice and the American way forever. This judicial fraud will become the template for a new tomorrow where your children will have no protection of law.
Leo Donofrio and Steve Pidgeon represent 76 former Chrysler dealers.
See my highlighted coverage in my Chrysler Bankruptcy category.
-Phil
Subscriptions -=- Twitter: @trsol -=- email: phil [at] therightsideoflife [dot] com
Photo courtesy Examiner.com
-
Chrysler Bankruptcy: Donofrio: Defense Distracting Over "Psychoanalyzed" Birther Allegations
Sunday, January 24, 2010 Update:
Attorney Leo Donofrio has posted this story on his site as well as a trackback to this posting…
—-
In what is a blogosphere exclusive, attorney Leo Donofrio, in conjunction with attorney Stephen Pidgeon, have filed a Response to Debtor’s (Defense’) Objection to Reconsider the Court’s Objection.
Update: Lead Plaintiff James Anderer is set to be on the CBS Evening News this evening and (last-minute cut, per Mr. Anderer) on Fox with Neil Cavuto on Monday.
Update: This particular bankruptcy suit — originally broke by Portland Civil Rights Examiner’s Dianna Cotter – involves 76 ex-Chrysler dealers who believe that the Judge involved with the case, Robert J. Gonzalez, committed an unintentional fraud by misinterpreting Fiat’s executive, Alfredo Altavilla’s statement that restructuring had to occur before the Fiat purchase of Chrysler could occur. However, Mr. Altavilla never actually stated that restructuring had to occur before the deal could close. In his rejection Opinion, Judge Gonzalez made it appear as if Mr. Altavilla did testify that rejections were necessary for the deal to close.
Here’s the actual testimony:
Please review the actual testimony of Altavilla (May 27, 2009 Hearing Tr. at 352) which is referred to in both Footnotes 18 and 21 of the Court’s Rejection Opinion:
Q. If this transaction closes without an absolute requirement of a particular number of dealers that are being terminated, would Chrysler still go through with this deal — I mean, rather, would Fiat still go through with this deal?
A. The answer is that a restructure needs to occur. Whether it occurs before or after the closing of the deal is not a material difference.
The following is the Defense’ OBJECTION OF DEBTORS AND DEBTORS IN POSSESSION TO AMENDED MOTION OF CERTAIN DEALERS TO RECONSIDER THE COURT’S JUNE 9, 2009 REJECTION ORDER AND JUNE 19, 2009 REJECTION OPINION:
The following is the Plaintiff’s RESPONSE TO DEBTOR’S OBJECTION TO MOTION TO RECONSIDER THE COURT’S JUNE 9, 2009 REJECTION ORDER AND JUNE 1 REJECTION OPINION:
Post continues below
Advertise on this siteAs Leo Donofrio pointed out in an email to The Right Side of Life, the Defense decided to inject a bit of Alinsky-ite tactic by specifically referencing Messr. Donofrio’s and Pidgeon’s past litigation concerning presidential eligibility as the basis for why they have waited to bring such a petition now (Defense’ Objection, page 8, paragraph 13):
13. Because the Movants offer no explanation whatsoever for their election not to appeal or for their extended delay in bringing their Motion (13), they have failed to meet their burden.
The referenced footnote on the same page reads as follows:
Given their extreme lateness and the absence of any new development in the record or law, it is unclear what has motivated the Movants’ sudden change of heart and request for relief at this late juncture. Although the Debtors have no independent knowledge of these matters, the Debtors have taken note of certain public statements connecting the Motion to a crusade involving the Movants’ counsel to challenge Barack Obama’s legitimacy as President of the United States. For example, one report has stated:
Birthers are launching yet another scheme to challenge President Obama’s legitimacy as President of the United States. The scheme involves a legal maneuver known as “quo warranto,” a prerogative writ requiring the person to whom it is directed to show what authority he has for exercising some right or power (or “franchise”) he claims to hold. This new attempt to get at Obama is a circuitous affair, centering on the Chrysler bailout, and Obama’s authority to use Troubled Asset Relief Program funds to bail out Chrysler. Former Chrysler dealers who lost their businesses as part of the restructuring of the automobile company are filing a legal challenge to that restructuring in bankruptcy court. . . . The attorneys of record are . . . Leo Donofrio . . . and Stephen Pidgeon.
Michael Stone, Quo Warranto: Return of the Birthers, EXAMINER.COM, http://www.examiner.com/x-4383-Portland-Progressive-Examiner~y2009ml2d9-Quo-warranto-Return-of-the-Birthers (last visited January 6,2010); see also Bob Unruh, Closed Chrysler Dealers to Drive Obama’s Eligibility, WORLDNETDAILY, Dec. 8, 2009, http://www.wnd.com/index.php?fa=PAGE.view&pageld=l18403 (last visited January 10, 2010) (“Two lawyers have joined forces to assemble a case challenging in U.S. bankruptcy court the federal government’s . . . bail out [of] Chrysler and in doing so may have created a scenario that finally will bring to a head the issue of Barack Obama’s eligibility to be [P]resident.”)
The corrected link for the Michael Stone piece is http://www.examiner.com/x-4383-Portland-Progressive-Examiner~y2009m12d9-Quo-warranto-Return-of-the-Birthers.
In his response, Leo Donofrio states the following (Plaintiff’s Response, pages 3-4, beginning second full paragraph):
Finally, before we begin our legal argument in response to Debtors’ Objection, we draw the Court’s attention to Page 8, Footnote 13 of Debtor’s Objection memorandum. In that Footnote, Debtors’ Counsel improperly attempts to psychoanalyze the motivations of our clients in bringing the Motion to Reconsider by making reference to news reports which discuss non-related Constitutional causes which have absolutely nothing to do with the Motion before the Court. Footnote 13 is an entirely improper attack upon Movants’ and their Counsel by way of reference to controversial lawsuits which Movants’ Counsel have been involved with. Such distractions serve no purpose before this Court other than to distract, confuse, and delay justice by throwing dirt in the Court’s eyes. Our Motion pointed out that the Government never requested dealers be rejected and so this Footnote serves no purpose other than to muddy the waters in which this Court must now swim. We request this Footnote be stricken and that Debtors’ Counsel be required to resubmit their memorandum without it.
Furthermore, if Debtors’ Counsel has not comprehended the true motivation for this Motion, we would remind them that our clients lost their businesses when the Debtors instituted Project Tiger and ripped our clients’ livelihood from them along with approximately 40,000 community jobs during this most difficult recession. Our clients are suffering. Their communities are suffering. That suffering is directly motivating this Motion. Should the Rejection Opinion be reversed, our clients will find relief from that suffering.
Mr. Donofrio goes on to say in his email that the only thing the Plaintiffs said about the government in the Motion was that they (the government) did not ask that the dealers be rejected, suggesting that the premise of the dealership losses — as described in the first paragraph of this posting — is based on the Court’s apparent misstatement of key testimony (Plaintiffs’ response, page 4).
Mr. Donofrio lays out the case for “misstatement” versus “misinterpretation” on page 6 of the Plaintiffs’ response:
Debtors’ allegation that we have taken issue with the Court’s interpretation of this testimony is misplaced. It’s not that we take issue with the Court’s interpretation of testimony, it’s that we take issue with the Court’s misstatement of the testimony. Footnote 21 makes it appears as if the witness stated that restructuring needed to occur for the sale to close. The answer is parsed after the word “occur”. But the very next sentence (as properly described in Footnote 18) continues the response to the very same question. There was no intervening question. It’s all part of the same Q & A. Footnote 21 therefore improperly supplements the record. This is not merely ”fact finding” as Debtors’ Counsel has alleged, this is fact making which is improper in the extreme and exhibits a reckless disregard for the truth.
Furthermore, the record of the case is absolutely devoid of any specific testimony which opposes the fact that no relevant party ever requested dealers be rejected. But Footnote 21 gives the fraudulent appearance that Altavilla’s testimony provides just such a request. It doesn’t. The witness testified that whether restructuring occurred before or after the closing was not a “material difference”. Those words are direct, unambiguous and perfectly responsive to the time sensitive question asked on cross- examination. The core issue before this Court was whether the purchaser required that the seller restructure the dealership network as a condition precedent to the deal closing. Since the record is clear that no other party (US Government, Canadian Government or VEBA/UAW) requested dealer rejections, then without the purchaser making such a request, there was no sound reason for the Debtor to reject the dealers if the purchaser was willing to close the deal without dealers having been rejected.
In my non-attorney view, the idea that the Defense would literally invent a basis for the rationale of why the Plaintiffs are coming forward at this point based on completely unrelated issues is indefensible and is very similar to the modus operandi of many “opposition” commenters on this blog. Really, it is akin to saying that one is incapable of holding a particular viewpoint because said petitioner has exhibited views that are considered unconventional, esoteric or out of the mainstream (in some cases, even worse pejorative-sounding language).
While it is true that Messrs. Donofrio and Pidgeon have already announced their intentions to file a quo warranto petition in the District of Columbia, that fact is judicially irrelevant to this case and deals with a completely unrelated issue. In fact, this site has already documented the fact that the Chrysler bankruptcy petition will be resolved based solely and completely upon the dealers’ wishes, which, in theory, could involve a settlement (which would fly in the face of the concept that somehow presidential eligibility has any basis for pushing forward on a Chrysler bankruptcy case).
I think Mr. Donofrio is exactly right in his response. Psychoanalysis, as he puts it, has absolutely no bearing in attempting to divine the intents of the petitioners, as the Defense has tried to construe things. In other words, such mind-reading is the equivalent of essentially saying, “Well, all that the petitioners are really trying to do is get rid of the President, and you know that’s the basis for this move. Besides, don’t the dealers whom they represent know that these two attorneys are really nothing but BIRTHERS??? Come on. Someone who thinks like that couldn’t possibly have a reasonable point in all of this.”
Again, how rescuing ex-Chrysler dealerships from alleged wrongs that might have been done by the Judiciary has anything to do with presidential eligibility is completely beyond me.
Updated commentary: Why would the Defense wish to bring up unrelated issues for this petition if they had a strong case against the Plaintiffs? Up to this point I dismissed the idea of there being conspiracies shielding this President from questions regarding his past as being fantasy. However, I am not so sure about this any more. The opposition would only go ad hominem in this way if they were running out of rhetorical ammunition with which to defend themselves.
Look for additional coverage coming soon from Dianna Cotter as well as ThePostEmail.com.
Update: ThePostEmail recently posted on this story.
See my highlighted coverage in my Chrysler Bankruptcy category.
Cross-posted at FreeRepublic.com.
-Phil
Subscriptions -=- Twitter: @trsol -=- email: phil [at] therightsideoflife [dot] com
Photo courtesy Examiner.com
-
Chrysler Bankruptcy: Pidgeon, Donofrio Granted Pro Hac Vice; Responses Due January 15
On Monday, January 4, Attorneys Stephen Pidgeon and Leo Donofrio requested that the bankruptcy Court in the Southern District of New York admit them pro hac vice; this request has been granted:
Steve Pidgeon and I were admitted today – Pro Hoc Vice – to practice before the Bankruptcy Court (Southern District of New York) for the Chrysler case. See docket numbers 6192 and 6193.
Responses to our Rule 60 Motion (docket number 6132) are due January 15, 2010.
Here are the respective docket entries:
See the following links regarding the eligibility saga:
- The background:
- The questions:
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
-
Pidgeon Responds to Beck's "Birther" Comments
To provide full context for this story, WorldNetDaily reported yesterday that radio host and Fox News Channel commentator Glenn Beck mocked so-called “birthers” and suggested that Mr. Obama is using the eligibility issue to his benefit:
“There’s always games being played behind the scenes at a talk radio show,” Beck said. “Rush has always called them seminar callers. But instead of being coy with the seminar callers or with you, I’m just going to expose the game that is going on. Today there is a concerted effort on all radio stations to get birthers on the air.”
“I have to tell you, are you working for the Barack Obama administration?” Beck scoffed. “I mean, that’s the dumbest thing I’ve ever heard.”
The ongoing dialogue then spun off into ridicule as Beck caricatured those who question the sitting president’s eligibility with straw-man arguments reminiscent of jibes made by Obama’s apologists in other news outlets.
Beck defined birthers as people who believe Obama was born in Kenya or other foreign country, was raised as a Manchurian candidate and somehow brainwashed Hillary Clinton into not exposing his fraud. According to Beck’s running joke, birthers believe someone – maybe Obama’s KGB “control” – preemptively placed Obama’s birth announcement in 1961 Hawaiian newspapers with a “roadmap” of getting an African man into office.
As for Obama producing a long-form birth certificate to actually prove his place of birth, Beck questioned, “Why do that when these people ['birthers'] are so discrediting themselves?”
WND goes on regarding the actual questions concerning the eligibility issue, taking note that Mr. Obama could have, in fact, been born in Hawaii (for all anyone knows), but would still have been, at birth, a British subject.
Regardless, Mr. Beck is clearly in the minority in his negative characterizations of those of us who question Mr. Obama’s bona fides. Numerous high-profile individuals have specifically regarded the issue as legitimate and worthwhile, including the following list of personalities:
- Rush Limbaugh (3 times)
- Sean Hannity
- Sarah Palin
- Elizabeth Cheney
- Lou Dobbs
- Steve Malzberg
- Lynn Samuels
- Camille Paglia
- Jonah Goldberg
- Rep. Bill Posey
- Rep. Nathan Deal
- Rep. Louie Gohmert
- Rep. Roy Blunt
- Former Rep. Tom DeLay
However, the strongest retort, to date, has come from attorney Stephen Pidgeon, one of a number of lawyers who pushed the eligibility issue in the Judiciary and who has currently teamed up with attorney Leo Donofrio in representing Chrysler dealers regarding the car company’s bankruptcy proceedings and the quo warranto statute.
In a letter that is making its rounds across the blogosphere, Mr. Pidgeon blasted Mr. Beck for his “ill-informed” stance (h/t AmericanGrandJury):
Dear Mr. Beck:
You are ill-informed on the “birther” issue. Barack Obama, by his own admission, was a British subject at birth. He has never denied having a Kenyan father, who himself was a British subject as a Kenyan native. This is easly established under the British Nationality Act of 1948. He is therefore disqualified to run for the office of the President, because the office is not available to subjects of other governments. The issue is very simple, and very obvious. Obama himself admitted that he wasn’t a natural born citizen when he debated Alan Keyes in 2004.
Let’s see you deal with this one. There is nothing “nutty” about it, and it doesn’t depend on whether his maternal grandmother tried to cover up a foreign birth in Hawaii by placing newspaper notices. It is as plain as your face. BHO is a foreign national first, and an American secondarily, if at all. That is why he thinks there are 57 states; why he doesn’t understand the constitution; why he wants to give us Britain’s health care system (it’s all in the teeth, don’t you know); why he thinks Interpol should have greater authority in the US than US law enforcement; etc. He is a British subject and has no business holding the office of POTUS.
If you think you can overlook this constitutional crisis as not part of the Rubicon, you are mistaken. One constitutional overlook breeds another and the next thing you know, the financial industry is nationalized, the auto industry is nationalized, the health care industry is about to be nationalized, and the energy industry will soon be nationalized.
Ultimately, it is all going to be okay, because socialism only lasts until other people’s money (OPM) runs out, and binge spender BHO has spent all the money we have and all the money we will ever have for the next several generations. He spent all of this before he got his socialist healthcare on the table. He and his wife have partied like Eddie Murphy in The Distinguished Gentleman (1992) since taking office, while he has busied himself with overthrowing the constitutional republic, establishing a new Islamic empire worldwide, disarming and crippling America, and unilaterally dividing Israel and Jerusalem. The only budget constraint for Obama is ink and paper (and he is working his way around that) and his foreign policy advisor appears to be “mirror, mirror on the wall”. He has bankrupted the nation, which the sleeping Oprah watchers are now discovering for the very first time. The reality of the bankruptcy will hit home with gusto in 2010. Not only will we suffer with 30% unemployment, a complete collapse of real estate, and a complete collapse of the dollar, we will also suffer the slings and arrows of dramatic military defeats, as we let this foreigner steer the ship of state. Most Americans have no idea how bad it is going to get.
As for Obama: he will be one of history’s most reviled figures – on a par with Nero – as a fool who couldn’t even understand that when he denigrated the United States, he was destroying the very state upon which his safety and his legacy depended. He will suffer dramatic defeat in Afghanistan and Iraq – it will not be like Viet Nam, and his name will be tarred with it. It will be more like the disastrous defeat of Xerxes at Salamis, or the Ottomans at Sisek, or the Moors at Tours; a game changing defeat that will forever cement the destiny of the republic known as the United States of America. Obama will join the other names in history who suffered cataclysmic losses in the lands of Magog.
His legacy? A communist, collectivist fool, brainwashed by red diaper doper babies haunting the halls of ivy league academia whose agenda was to bring back the failed Bolshevik revolution worldwide, who brought his fully bloomed ignorance to power illegally in the US because of the needs of his narcissistic ego, whose illegitimacy caused the US to go bankrupt and to suffer its worst military setbacks in the history of the nation in just a few short months. History will marvel at the foolishness of Americans, and historians will wonder how we as a people could have allowed this to happen. Then, of course, historians will ultimately conclude that the demise of the greatest nation the world had ever known happened because the watchdogs whose duty it was to warn Americans of such possibilities – the so-called news media – conspired with foreign powers and global financial criminals to destroy America from the inside, as a result of their cowardice, malevolence and silence.
Glen Beck: a media persona who simply could not bring himself to utter the truth about Obama – that he is a usurper, holding the presidency illegally and unconstitutionally, because he is without a legal birthright. Let us never forget who shirked their duty to tell the truth in these last hours, and let us not allow history to forget.
STEPHEN PIDGEON
See the following links regarding the eligibility saga:
- The background:
- The questions:
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
Photo courtesy WND
-
Chrysler Bankruptcy: Motion to Reconsider Filed; FBN Video
Monday, January 4, 2010 Update:
Attorney Leo Donofrio posted an update with a FoxBusiness.com video (going to the video’s link brings up a rather rough transcript where Messrs. Donofrio and Pidgeon are specifically referenced).
—-
Following up on a continuing story regarding the Chrysler bankruptcy rulings, attorneys Leo Donofrio and Stephen Pidgeon filed a Rule 60 Motion to Reconsider on behalf of 21 Chrysler dealers on December 25:
The public may view the documents by visiting the following URL
http://www.kccllc.net/chryslercommittee
Then click “Court Documents” (on the left hand side of the page) —
The entire docket will come up. The Omnibus Motion to Reconsider is Docket number 6132. It was filed on 12/25/09 at about 11:15 PM ET. Steve and I have also entered Pro Hac Vice motions: docket number 6130 for Steve and 6131 for me.
The documents are listed in the docket as representing “South Holland Dodge”, but in the papers Island Jeep (James Anderer) is listed as lead Movant. 21 dealers are listed in the actual papers filed with the court.
To view the documents in the court system, click “images” at the far right of the docket entry and you will see the following links to documents:
The memorandum has also been uploaded to SCRIBD
http://www.scribd.com/doc/24515184/Memorandum-Supporting-Motion-for-Reconsideration
The Post & Email published an accurate report on the 26th.
As mentioned in the above quote, because Messrs. Donofrio and Pidgeon are not currently registered to practice law in New York City, it was essential that they filed motions for pro hac vice:
Latin for “for this occasion” or “for this event,” (literally, “for this turn” [1]) is a legal term usually referring to a lawyer who has not been admitted to practice in a certain jurisdiction but has been allowed to participate in a particular case in that jurisdiction.
Dianna Cotter at the Examiner.com who had originally broke this story further reports that additional dealers have petitioned the Court regarding this issue:
As was expected, several more dealers have joined in the suit as well. Docket number 6137 was filed today, 12/29/2009 Motion for Relief from Stay to Allow Appeal to Continue filed by Randyl Meigs on behalf of Tommy Manuel Chrysler – Jeep, Inc.. with hearing to be held on 1/21/2010 at 10:00 AM at Courtroom 523 (AJG) Responses due by 1/14/2010. The Debtor in this case is the old Chrysler.
She further reported that the general purpose for the motion could be summed up according to the following:
Attorney Donofrio has confirmed a report in the Post and Email as accurately depicting the basis of their case:
Altavilla had testified that the dealers’ agreements need not be rejected prior to the sale be formalized; but Judge Gonzales mistakenly related it thus in his ruling. The Memorandum of the movants explains this in detail, the crucial part of which responds to Judge Gonzales’ footnote, in which he says:
“Altavilla also responded affirmatively to a question regarding whether a dealership network needed to be restructured for the Fiat Transaction to close, stating that a “restructuring needs to occur.”
The Memorandum responded to this:
The record indicates by clear and convincing evidence that this assertion by Judge Gonzalez is unequivocally false. It gives the appearance of judicial ventriloquism concerning the most important issue related to the Rejection Motion. Without this alleged affirmative response, the record of the case lacks any evidence whatsoever suggesting rejection of the dealership agreements was ever requested by Fiat, the US Government or the United Auto Workers as a condition precedent to the deal closing.
Footnote 21 parses, “restructuring needs to occur” by ignoring the very next sentence of the very same answer given by Altavilla. And the complete answer made it perfectly clear that restructuring did not need to occur before the sale closed.
Wherefore, after a detailed analysis, the Movants request Gonzales’ order be vacated (i.e. canceled):We respectfully submit that the averment by Judge Gonzalez in Footnote 21 of the Rejection Opinion has caused the judicial machinery to work in an alien and wholly improper manner by subverting a clear response by a key witness as to the most important issue before the Court. Judge Gonzalez, in taking this action, has caused the appearance of impartiality to be disturbed by reckless disregard for the truth. The record of the case should not be allowed to remain so defiled. Accordingly, we request complete relief from the Rejection Order.
Here is a copy of the memo supporting the Motion:
Memorandum Supporting Motion for Reconsideration-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
-
Donofrio on IPPT v. Chrysler: TARP and Dealers; FBN Anderer Video
Wednesday, December 16, 2009 update:
While attorney Leo Donofrio had posted further commentary on the reaction to IPPT v. Chrysler based on a rebuttal by Bankruptcy Expert Lawrence D. Loeb, today he posted the following YouTube video where lead Plaintiff James Anderer spoke about upcoming litigation I’ve been covering here at The Right Side of Life (skip to 2:25 and especially 4:10 for the money quote):
—-
In a previous posting, I had pointed out that IPPT v. Chrysler could be a harbinger of things to come with Messrs. Donofrio and Pidgeon now representing numerous Chrysler dealers in to-be-filed petitions, including for quo warranto.
Today, with the Supreme Court’s decision to grant a writ of certiorari on the Indiana Pension Fund (docket) — thereby allowing the high Court to issue a summary judgment order both vacating (to render void and not precedent-setting) and remanding (sent back) the case back to the US Court of Appeals, 2nd Circuit and dismissing as moot — Mr. Leo Donofrio posted the following commentary, clarifying that the Chrysler dealers would still push forward with litigation:
ANALYSIS OF US SUPREME COURT’S RULING in POLICE PENSION TRUST, ET AL. V. CHRYSLER LLC, ET AL by Leo Donofrio, Esq.
While today’s ruling by the US Supreme Court is bad for the Indiana Pension Fund, it does not adversely effect our clients (a group of former Chrysler dealers lead by James Anderer) in any way. Our clients were never part of that appeal and the legal issues raised by the Indiana Pension Fund are vastly different from the issues we will raise. This decision today is somewhat helpful to our case in that by vacating the lower court’s judgment, the US Supreme Court has stripped the prior Court of Appeals ruling of having any precedential effect on our clients.
The US Supreme Court has wisely ordered the 2d Circuit Court of Appeals to vacate its judgment below and therefore any precedent that might have been set as to the Indiana Pension Fund’s lack of standing to challenge the use of TARP funds has been set aside by the US Supreme Court. This was a very wise choice by the SCOTUS. Had they simply denied certiorari without vacating the 2d Circuit’s ruling, precedent would have been set. But since that ruling has been vacated, the TARP issue is still very much fair game.
The TARP issue is not related to our pending filing in the Bankruptcy Court, but it will be part of our Quo Warranto action in the DC District Court.
The SCOTUS today gave guidance on this issue by making reference to its prior decision in – United States v. Munsingwear, Inc., 340 U.S. 36 (1950), wherein it was held:
The established practice of the Court in dealing with a civil case from a court in the federal system which has become moot while on its way here or pending our decision on the merits is to reverse or vacate the judgment below and remand with a direction to dismiss. [] That was said in Duke Power Co. v. Greenwood County, 299 U. S. 259, 299 U. S. 267, to be “the duty of the appellate court”.
That procedure clears the path for future relitigation of the issues between the parties and eliminates a judgment review of which was prevented through happenstance. When that procedure is followed, the rights of all parties are preserved; none is prejudiced by a decision which in the statutory scheme was only preliminary.
So, the first paragraph above sums up today’s SCOTUS action perfectly. They vacated the Court of Appeals decision and remanded with an instruction to dismiss the appeal for mootness. The second paragraph above explains the rationale.
MOOTNESS ISSUE
I anticipate a plethora of improper interpretations on this mootness issue in relation to our clients’ rights. So it’s important to explain what the Indiana Pension Fund was asking the upper courts to do. It was essentially asking that the sale of Chrysler (Old Car Co) to Fiat (New Car Co) be invalidated.
But the Indiana Pension Fund failed to provide the upper courts with a legal argument worthy of circumventing Section 363(m) of the Bankruptcy Code which states:
(363m) The reversal or modification on appeal of an authorization under subsection (b) or (c) of this section of a sale or lease of property does not affect the validity of a sale or lease under such authorization to an entity that purchased or leased such property in good faith, whether or not such entity knew of the pendency of the appeal, unless such authorization and such sale or lease were stayed pending appeal.
This section provides that even if there is a reversal on appeal of an authorization for this kind of sale (known as a 363 transaction), unless the purchaser can be shown to not have acted in good faith, the validity of the sale cannot be reversed. This provision protects a good faith purchaser from having the deal ripped out from under him.The Indiana Pension Fund has not challenged the sale on appeal by alleging that Fiat purchased Chrysler in bad faith. The following is from the Indiana Pension Fund’s petition for certiorari to the US Supreme Court:
The Indiana Pensioners acknowledge that in the absence of a finding of bad faith, section 363(m) of the Bankruptcy Code proscribes undoing the sale of Chrysler’s assets, and do not now seek such relief.So, the Indiana Pension Fund waived its right to argue that Fiat purchased in bad faith and they got slammed to the mat today as a result. As to this issue, the Bankruptcy Court originally stated:
Further, there are no allegations regarding Fiat’s conduct in this transaction that would raise any issue as to the purchaser’s good faith. Thus, New Chrysler is a good faith purchaser pursuant to § 363(m) of the Bankruptcy Code.The sale was authorized by Judge Gonzalez in the Bankruptcy Court for the Southern District of New York on June 1, 2009. And the protections of 363(m) – as to the purchaser – kicked in at that precise moment. The statute indicates that the mootness issue relates back to the date the sale was authorized (not the date the sale closed).
Therefore, even if authority for the sale could have been reversed on the grounds of illegal use of TARP funds or a finding that Old Chrysler acted in bad faith, absent a showing that Fiat acted in bad faith – or that the sale had been stayed pending appeal – the sale could not be invalidated due to the protections of 363(m). Hence, appealing the sale was held to be moot because the SCOTUS interpreted that the relief sought by the Indiana Pension Fund could not be accomplished without invalidating the sale. I will explain this in more detail below. But first we need to examine the original stay issued by the 2d Circuit Court of Appeals and thereafter extended by SCOTUS because this is what will puzzle many commentators the most.
THE STAY ISSUE
The Indiana Pension Fund appealed to the 2d Circuit Court of Appeals and a stay pending appeal was issued by that court on June 2d, 2009. Therefore, at first glance it appears that 363(m) would not render a successful appeal moot in this case since the statute makes an exception that sale authorizations can be held invalid on appeal if the original sale authorization had been stayed pending appeal. But, on June 1st 2009, Judge Gonzalez did not stay his sale authorization pending appeal. It was only stayed on June 2d by the Court of Appeals.
Therefore, by the time the Indiana Pension Fund came to the 2d Circuit Court of Appeals on June 2d, 2009, according to 363(m), the issue as presented by the Indiana Pension Fund was moot because it did not allege that the purchaser (Fiat) acted in bad faith.
This is why the SCOTUS remanded the case back to the 2d Circuit Court of Appeals with an instruction to vacate their original judgment and dismiss the appeal as being moot. It doesn’t matter that back on June 2d the Court of Appeals issued a stay and that the stay was extended by SCOTUS for a few days. After proper briefing on the issue and time to study the law, SCOTUS correctly determined that in order for an appeal such as this to not be moot under 363(m) – absent a bad faith purchaser – the court issuing authorization for the sale would have been required to also stay their own sale authorization at the time such authorization was issued, which did not happen here. Judge Gonzalez did not order the sale stayed pending appeal on June 1st.
The Indiana Pension Fund understood the power of 363(m) and tried a novel effort to circumvent it in their SCOTUS brief by arguing that the relief they requested wouldn’t amount to an invalidation of the sale. But it appears that the SCOTUS did not agree the incredible relief requested could be granted without unwinding the sale.
The Indiana Pension Fund was asking that VEBA (United Auto Workers Union et. al.) return to the estate a $4.6 billion dollar note and common stock. But this would have effectively changed the entire sale drastically and it appears that SCOTUS saw this as an invalidation of the sale. Such invalidation is not authorized under 363(m). VEBA is now a 55 percent owner of New Chrysler and any attempt to circumvent their deal would have negative effects on the purchaser in that VEBA would have to begin negotiations with all parties again and the sale would certainly be invalidated by effect notwithstanding the lack of a court order stating as much.
So, I agree with SCOTUS that the relief requested by the Indiana Pension Fund would have amounted to an invalidation of the sale. However, the Indiana Pension Fund was correct to point out that legal precedent exists for other aspects of the sale proceeds to be redistributed upon a proper showing of cause. Relief associated to the direct cash payment of $2 billion dollars to Chrysler’s first lien lenders would not have an effect on the validity of the sale as that money and its distribution has nothing to do with the purchaser (Fiat/New Chrysler) and does not concern the assets purchased. Unwinding that distribution is not protected by 363(m). Regardless, the Indiana Pensioners have already been given their share of those funds at 29 cents on the dollar.
I do not wish to reveal our litigation strategy going forward. Our clients were not part of the Indiana Pension Fund appeal and the issues we will raise are vastly different and pertain to other sections of the Bankruptcy Code and applicable case law not mentioned in this analysis. We also believe that the Indiana Pension Fund failed to identify a nexus of bad faith necessary to their case not being moot. We do not plan on making the same mistake.
Leo C. Donofrio for the Law Office of Pidgeon and Donofrio
December 14, 2009, 1:56PM
The SCOTUSblog had a similar legal analysis on the IPPT v. Chrysler case, per se:
In the Chrysler bankruptcy case (Indiana State Police Pension Trust, et al., v. Chrysler LLC, et al., 09-285), the Court vacated a Second Circuit Court ruling that had endorsed the use of a reorganization-bypass method — a quick sale of assets — in order to save a failing company. Three investment trusts for workers in Indiana contended that the lower court ruling enabled Chrysler to make an end-run around the requirements of a Chapter 11 reorganization.
Both the Obama Administration and the new Chryler opposed the three trusts’ appeal, contending that the Chrysler sale to the Italian automaker, Fiat, was now final, and thus could not be unscrambled. (The deal actually closed on June 10, a day after the Supreme Court had refused to block it temporarily pending an appeal.) On Monday, the Justices, in a summary order, vacated the Circuit Court ruling, and told the lower court to “dismiss the appeal as moot.” That nullified the Circuit Court ruling as a precedent on the bankruptcy law issue.
Troubled corporations have made increasing use of the quick-sale option — under Section 363 of the Bankruptcy Code — and thus have avoided the more investor-protective provisions of Chapter 11. The Indiana trusts’ appeal sought to block that avenue, and, in the Chrysler deal in particular, sought to force the United Auto Workers and an autoworkers’ benefit fund to return to the bankruptcy estate of the old Chrysler firm a $4.6 billion note and common stock they received as part of the Chrysler-Fiat deal, which was financed with public funds from the U.S. and Canadian governments.
See the following links regarding the eligibility saga:
- The background:
- The questions:
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
Photo courtesy ABCNews
-
Cheney on Obama: Treason; PPP Confirms Sentiment; TSA did What?
The LonelyConservative.com blog reported that former Vice President Dick Cheney ratcheted up the rhetoric against the Obama Administration by saying that they are giving “aid and comfort” to the enemy:
Former VP Dick Cheney isn’t letting up on his criticism of President Obama. He told Politico the president is projecting weakness and more Afghans will turn to the Taliban if they believe the US is going to cut and run from Afghanistan. But his harshest criticism was of the decision to try terrorists in civilian courts.
“One of their top people will be given the opportunity — courtesy of the United States government and the Obama administration — to have a platform from which they can espouse this hateful ideology that they adhere to,” he said. “I think it’s likely to give encouragement — aid and comfort — to the enemy.”
Here is what the Constitution says is the definition for “aid and comfort” to the enemy (Article III, Section 3, in part):
Section. 3. Treason against the United States shall consist only in levying War against them, or in adhering to their Enemies, giving them Aid and Comfort. …
The liberal Public Policy Polling organization has tracked that 20% of voters and 35% of Republicans support impeaching the President (h/t ThePostEmail.com):
Finally 20% of voters, including 35% of Republicans, support impeaching Obama for his actions so far. I’m not clear exactly what ‘high crimes and misdemeanors’ they are using to justify that position but there may be a certain segment of voters on both the right and the left these days that simply think the President doing things they don’t agree with is grounds for removal from office. I don’t think Obama has a lot to worry about on that front.
In reality, there may be more to be concerned about than even KSM — such as when the Transportation Security Administration (TSA) “inadvertently” leaks highly-sensitive documents (tsa-screening.zip; h/t AtlasShrugs, AmericanThinker, ABCNews):
Please put down any beverage you may be consuming and lock up all sharp objects in the house before reading this.
The Transportation Security Administration “inadvertently” released a document on its website that gives a blueprint for terrorists on how to beat our airport security measures.
This document doesn’t hint around. It spills the beans on exactly what terrorists might do to circumvent TSA airport security to bring bombs on board or other weapons.
Brian Ross and Matt Hosford broke the story for ABC News:
In a massive security breach, the Transportation Security Administration (TSA) inadvertently posted online its airport screening procedures manual, including some of the most closely guarded secrets regarding special rules for diplomats and CIA and law enforcement officers.
The most sensitive parts of the 93-page Standard Operating Procedures manual were apparently redacted in a way that computer savvy individuals easily overcame.
The document shows sample CIA, Congressional and law enforcement credentials which experts say would make it easy for terrorists to duplicate.
The improperly redacted areas indicate that only 20 percent of checked bags are to be hand searched for explosives and reveal in detail the limitations of x-ray screening machines.
[...]
“This manual provides a road map to those who would do us harm,” said Collins. “The detailed information could help terrorists evade airport security measures.” Collins said she intended to ask the Department of Homeland Security how the breach happened, and “how it will remedy the damage that has already been done.”
[...]
The document contains a list of items for which screening is not required including wheelchairs, footwear of disabled individuals, casts and orthopedic shoes.The redacted portions also indicate which law enforcement personnel are specially screened or exempt from some screening procedures, and indicate what requirements they must meet to be eligible for special screening.
…As you know, the Obama administration has determined that we are not at war. Good thing for whoever is responsible. Do you think that “inadvertent treason” would be an affirmative defense?…
It would be very difficult to overhype this story. This isn’t just a disaster. It has the potential to absolutely destroy domestic air travel – if the MSM bothered to cover it. We’ll see what the spin will be as the day goes on.
Whether it is through a grand jury, the ballot box, quo warranto, or merely persuading public opinion, at some point, one must say:
Stop.
We know you don’t like America, Mr. Obama; you’ve done more than enough apologizing for our great nation to demonstrate that. But these actions about which your Administration must ultimately be held accountable must stop.
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
Photo courtesy ABCNews
-
Eligibility Update: Hannity: "Can We See Your Birth Certificate?"; Grand Jury to Fitzpatrick: No
First, the country’s most listened-to talk radio show host Rush Limbaugh brought up the eligibility question. Then, Salon.com columnist and feminist Camille Paglia broached the issue. More recently, She Who Would Be President ™ faced the question head-on. And now talk radio show host and Fox News commentator Sean Hannity similarly dove in, backing WorldNetDaily’s right to question Mr. Obama’s bona fides (h/t WND):
WASHINGTON – Sean Hannity today defended Sarah Palin’s recent comments about Barack Obama’s constitutional eligibility for the presidency and WND’s pursuit of the story.
He said the question about his original, long-form birth certificate has still not been answered.
“What was so wrong in saying that, ‘Can we see your birth certificate?’ … We were told early on that, in fact, somebody else had looked at it and confirmed that it was legitimate. So, I mean, what was wrong with people saying, ‘Wait a minute. You know what? In light of the fact of where your, your father came from, et cetera, uh, let’s just make sure that this is a legitimate birth certificate’? … It was not asked by the mainstream media. It was asked by places like WorldNetDaily, who, I think, were just doing due diligence considering it’s a constitutional mandate. … I think a lot of people were just afraid to ask the question.”
CitizenWells presents the actual conversation via YouTube:
The Post & Email has further commentary here.
I think that, while such questioning — or at least the “allowance” for such questioning — on the part of high-profile political commentators has been a long time in coming, I do believe that Mr. Hannity is exactly right when he says that there is a lot of fear in questioning Mr. Obama. Since no original documentation has ever been produced concerning this man’s background, the fear of the unknown is greatly enhanced, especially by those who fully support the President. Not only this, but since a situation of questioning a President’s legitimacy has never formally occurred in the history of the republic, nobody really knows how the results of an official determination would transpire.
And like Mr. Limbaugh, I appreciate the fact that — at least in the sound bite — Mr. Hannity seems perfectly comfortable in facing the issue squarely, especially in light of a caller who clearly could not care less about fully enforcing the Constitution, no matter who’s in office. Further, it would appear that Mr. Hannity has not bought into the allegations that somehow the FactCheck.org blog is qualified to either declare by inference that Mr. Obama is qualified for office or that they are the arbiters of determining exactly what information and how much of it is required to substantiate those qualifications (or potential lack thereof).
In related news, opposition commenter “Sue” mentioned that The Advocate and Democrat reported that the Monroe County, Tennessee grand jury rejected LTCDR Fitzpatrick’s plea to indict Mr. Obama of treason:
Despite a brief media frenzy, indictments sought against President Obama, a grand jury foreman and an assistant district attorney were not returned by the Monroe County grand jury.
Walt Fitzpatrick has been seeking to indict President Barack Obama on treason charges, but the grand jury failed to grant his request. Grand jury proceedings are kept secret until indictments are handed down, and when the December session for Monroe County was released, neither the president’s name nor Gary Pettway or Jim Stutts was on the list.
See the following links regarding the eligibility saga:
- The background:
- The questions:
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
Photo courtesy ThePostEmail
-
Donofrio, Pidgeon on Quo Warranto; IPPT v. Chrysler at SCOTUS on TARP
Wednesday, December 9, 2009 update:
The Post & Email reported yesterday that the Supreme Court has scheduled a Conference this Friday for Indiana Police Pension Trust v. Chrysler (docket):
The action, whereby the U.S. Treasury, without authorization by Congress, used TARP funding to force Chrysler LLC into a debtor-client relationship, and then in using that to practically control the corporation in bankruptcy pleadings has raised several constitutional and legal issues on the action.
An amicus curiae brief was filed with this case in October, including the involvement of a number of advocacy groups and at least one leading constitutional scholar:
- Washington Legal Foundation
- Allied Educational Foundation
- Cato Institute
- George Mason University Foundation Professor of Law Dr. Todd J. Zwycki
Previously, a request before the Court for a stay of the bankruptcy action was denied in July.
Basically, any action taken on this case could be a harbinger for how any further Chrysler bankruptcy proceedings or quo warranto actions could be interpreted by the Court in this matter.
The question is raised: Did the Treasury Department act unconstitutionally in the manner in which it dispositioned certain federal monies?
Tuesday, December 8, 2009 update:
Attorneys Leo Donofrio and Stephen Pidgeon recently spoke with Bob Unruh at WorldNetDaily.com (h/t @KatyinIndy):
As part of the demand for information about the authority used, Donofrio confirmed, there will be questions about Obama’s eligibility to be president. Donofrio contends that since by Obama’s own admission his father never was a U.S. citizen, Obama was born a dual citizen. The framers of the Constitution, he argues, did not consider a dual citizen to be a “natural born citizen” as required for the presidency.
The burden, then, would shift to Obama and his administration officials to document their constitutional authority for their decisions and their handling of taxpayer money.
If the president cannot document his eligibility to occupy the Oval Office, his presidential task force had no authority to act at all, the case contends.
Pidgeon told WND the plaintiffs in the case are the former Chrysler dealers, and their interests will be paramount.
The goal is “to get them restored,” he said, and “put them back where they were before their contracts were rejected.”
“Our clients are not in this action as ‘birthers,’” he said, citing a term used for people who question Obama’s constitutional eligibility. “Our clients are here to seek redress for wrongs.”
But the case may open doors that have been closed in other disputes over Obama’s eligibility. Most previous cases, at one point or another, have been dismissed because the plaintiffs do not have “standing” – they have not suffered direct injury for which they have a reasonable expectation of seeking redress.
In the case of the dealers, they have suffered financial loss because of circumstances that developed with the government’s intervention in the auto industry.
Original story below the dashed line.
—-
In a Right Side of Life exclusive, I had reported (based on this Portland Civil Rights Examiner posting by Dianne Cotter) that attorneys Leo Donofrio and Stephen Pidgeon have, in fact, gotten together and have been retained by lead Plaintiff James Anderer and other Chrysler dealers to appeal on damages incurred in the Chrysler bankruptcy sale.
Further, the concept of quo warranto — an ancient “prerogative writ” — has been confirmed by Devvy Kidd’s recent telephone conversation with Mr. Donofrio as a petition by which he and Mr. Pidgeon will be challenging the Obama Administration under three counts.
According to Ms. Kidd’s interview, while § 16-3501. Persons against whom issued; civil action states the following:
A quo warranto may be issued from the United States District Court for the District of Columbia in the name of the United States against a person who within the District of Columbia usurps, intrudes into, or unlawfully holds or exercises, a franchise conferred by the United States or a public office of the United States, civil or military. The proceedings shall be deemed a civil action.
She was able to confirm with Mr. Donofrio that the above section is a bit of a “catch-all:”
Leo points out that the statute not only applies to eligibility, but also to the unlawful “exercise” of authority via public office. At the common law, quo warranto was not only used to challenge usurpation of office but also to challenge illegal government actions and the current quo warranto statute was written as a catch all in this regard. So Leo and Steve will bring two counts under 3501, eligibility and illegal use of Government funds. The second count refers to the use of TARP funds to facilitate the Chrysler Bankruptcy sale.
An important aspect of potential “specific injury” may not have been had by creditors, but dealers face substantially greater particular harm:
The 2d Circuit Court of Appeals dealt with this issue as raised by creditors of Chrysler in an appeal of the Sale transaction to which the dealers were not a party. In that decision, the Court of Appeals stated that the issue raised “interesting and unresolved issues”, but the appellants did not have standing based upon their limited injuries. The Chrylser dealers have the requisite injury – loss of their frnachises – to meet the standing requirements. They will raise the issue in the quo warranto petition before the DC District Court.
And it looks like those TARP monies could also play a part in the filings:
You may recall that former Treasury Secretary Paulson refused to use TARP funds to bail out the auto industry indicating that to do so was not proper under the statute. A Congressional bill to allow TARP funds to be used for that purpose failed in the Senate, but the Obama administration went forward with it anyway.
Donofrio and Pidgeon also plan a third quo warranto count based upon 16-3521(2) of the quo warranto statute…
Here’s what § 16-3521. Persons against whom issued; civil action (2) states:
A quo warranto may be issued from the Superior Court of the District of Columbia in the name of the District of Columbia against -
…
(2) one or more persons who act as a corporation within the District of Columbia without being duly authorized, or exercise within the District of Columbia corporate rights, privileges, or franchises not granted them by law in force in the District of Columbia.
The proceedings shall be deemed a civil action.
As Ms. Kidd puts it:
In other words, the actions taken by the government were an illegal exercise of corporate authority. The government has acted as a political agent (acting as board of directors) against corporations using taxpayer money to restructure the auto industry under their vision.
In the posting, Mr. Donofrio emphasizes that he and Mr. Pidgeon represent the best interests of the dealers, leaving open the possibility of a settlement.
In reference to the bankruptcy deal, Messrs. Donofrio and Pidgeon shared with me that, per a recent article by Neil Roland of Automotive News, the House is crafting a new bill for the rejected dealers:
WASHINGTON — House leaders crafted a bill over the weekend that would provide third-party arbitration for rejected General Motors Co. and Chrysler Group dealerships using criteria more favorable to dealers than those proposed by the automakers last week.
The legislation, which is being forwarded to Senate leaders for consideration, would allow dealers who want to appeal their closures to “present any kind of relevant information during the arbitration,” a copy of the new bill shows.
The arbitrator is directed to consider the dealer’s experience, past profitability, current economic viability and the demography and geography of the local market, the legislation says.
“The arbitrator shall balance the interests of the covered dealership, the covered manufacturer and the public and shall decide, based on that balancing, whether or not the covered dealership should be reinstated,” the bill says.
Nevertheless, both attorneys say that the proposed legislation would not satisfy their client’s needs and that they will be moving forward with litigation. “Unless the legislation returns our clients to their franchise agreements as they were in effect prior to the Chrysler Bankruptcy,” they said, “we will be forced to press on in the courts.”
In other news related to Mr. Donofrio, his Hawaiian UIPA requests are on hold as he focuses on the above.
See the following links regarding the eligibility saga:
- The background:
- The questions:
-Phil
Subscriptions -=- Twitter: @trsol -=- Facebook (TRSoL) -=- Facebook (Rightside Phil)
TRSoL News (semi-automatically-generated headlines every day): News.TheRightSideOfLife.com
Photo courtesy BrightCove