In re Raejean S. Bonham dba World Plus
Bankruptcy No. F95-00897
Unofficial Web Site
In a recent letter to BRA defense counsel, the trustee clarified
his settlement posture with regard to BRA claims. For the benefit of
BRA defendants who do not have attorneys, that settlement position is
set out here. To find out more about settlement, please contact:
Cabot Christianson
Bundy & Christianson
(907) 258-6016
Brad Ambarian, Esq
LANE POWELL SPEARS LUBERSKY
550 W. 7th Ave, Suite 1650
Anchorage, Alaska 99501
Re: Bonham Recovery Actions
Adv. Case No. F95-00897-168 HAR
Our File No. 2096
Dear Brad:
Thank you for your letter of January 13, 1998. Because your letter
raises issues common to the other BRA cases, I am taking the liberty
of copying the other main BRA defense counsel with your letter and
this reply.
The "100% of net gain plus 20% of invested funds returned"
settlement proposal is a shorthand way to describe the settlement
figure that will be acceptable to the trustee in the vast majority of
the BRA cases. However, there are a sufficient number of nuances and
qualifications to this general statement, that preclude the trustee
from making single, formula-driven, unconditional formal offer
applicable to all cases. The "100+20" concept should instead be
viewed as both (1) an invitation to offer which will be seriously
considered by the trustee; and (2) the basis upon which the trustee
will be making offers in the future.
Here are some of the factors that the trustee will consider in
evaluating or formulating such an offer:
- A BRA defendant making such an offer will need to be in
compliance, to the trustee's satisfaction, with outstanding
discovery requests and court orders.
- The BRA defendant and the trustee will need to agree on the
defendant's investment history, and on the correct figure for
funds invested and funds received. As you know, sometimes this is
an easy process and sometimes this is not so easy. I have supplied
you with a spreadsheet of all your clients, and while this
spreadsheet does not include cash transactions and does not catch
all name permutations (e.g. if Mary Smith marries and becomes Mary
Brown), the spreadsheet is a good starting place.
- With respect to investments in the form of cash as opposed to
check, adequate confirmation of such investment will need to be
made. For example, a $5,000 withdrawal of cash from a savings
account a few days before the date of a contract, will generally
be sufficient.
- Any settlement amount must be within the trustee's
court-approved guidelines set forth in docket #694. This means,
for example, that for defendants that received any preferences,
the settlement amount will be the higher of the "100+20" figure or
the preferences (net of Section 547(c)(4) subsequent advances).
- Each settling defendant will be permitted an allowed claim
against the estate equal to that defendant's net cash loss, after
giving effect to the settlement. Defendants may choose to give up
such a claim, but in that event will not receive any reduction of
the settlement amount.
- The trustee may choose not to settle with certain BRA
defendants on the "100+20" formula. Certain Bonham family members,
and certain defendants charged with special knowledge or deemed
particularly vulnerable on good faith grounds, may not be able to
settle on this basis. This excepted group is small and its members
generally obvious.
- In some cases (very few) where there have been previous
settlement discussions at lower figures than the "100+20" amount,
the trustee may settle in accordance with those previous
discussions.
Once the funds invested and received by a particular defendant are
straightened out, then any settlement offer, made now and in
accordance with the above guidelines, has a very high chance of being
accepted.
Let me know if this letter does not fully address your
questions.
Very truly yours,
BUNDY & CHRISTIANSON
/s/Cabot Christianson
Back to Unofficial World Plus Home
Page