[Another interesting document asking for a very rarely seen action. Of course, had I not gone here where I can work and make payments on the chapter 13 plan, I would likely have been in jail and since one can't work in jail they would have been in court asking to convert or dismiss on that grounds that I had no income. Another interesting thing is rushing the motion into Judge Whyte's court before the sentence has been done in Hemet. The third weird thing is their using the "silly to be in Riverside when the court is in Hemet" post after I have posted the joke response of this post. Of course, if this weird motion prompts the bankruptcy court to look into the abuse of process issues both in Hemet and in this case . . . .Keith Henson] Elaine M Seid, SBN 72588 MCPHARLIN, SPRINKLES & THOMAS LLP Ten Almaden Blvd., Ste. 1460 San Jose, CA 95113 Telephone: (408) 293-1900
Thomas R. Hogan, SBN 042048 Leslie Holmes, SEN 192608 LAW OFFICES OF THOMAS R. HOGAN Ten AlmadenBlvd., Ste 535 SanJose, CA 95113 Telephone: (408) 292-7600
Samuel D. Rosen, Esq. PAUL, HASTINGS, JANOFSKY & WALKER LLP 399 Park Avenue, 31st Floor H New York. NY 10022-4697 Telephone: (212)318-6000
Attorneys for Creditor RELIGIOUS TECHNOLOGY CENTER
[handwritten] C-01-20493 RMW UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Iin re H. KEITH HENSON, ) CASE NO.: 98-51326ASW-13 ) (Chapter 13) Debtor. ) )NOTICE OF MOTION AND ) MOTION TO WITHDRAW )REFERENCE PURSUANT TO )BANKRUPTCY RULE 50111; )MEMORANDUM OF POINTS )AND AUTHORITIES IN )SUPPORT THEREOF; ) DECLARATION WARREN MCSHANE
Date: Time: Ctrm:
TO DEBTOR H. KEITH HENSON AND HIS ATTORNEYS OF RECORD AND TO THE HONORABLE ARTHUR S. WEISSBRODT:
PLEASE TAKE NOTICE that on ________________, at __:__ a.m. or as soon thereafter as this matter may be heard in Courtroom ____ of the above-entitled Court, creditor Religious Technology Center ("RTC"), will and hereby does move the Court for
MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO 98.S1326ASW.13 [end of p.] 1 an order withdrawing the reference of debtor H. Keith Henson's ("Henson") Chapter 13 action to the United States Bankruptcy Court of this district. This motion is made upon the following grounds: 1. Withdrawal of the reference is appropriate because of unique, exigent circumstances which require timely relief to prevent further prejudice to this creditor and waste of judicial resources; and 2. Withdrawal of the reference is warranted where the Bankruptcy Court has made a number of statements which suggest bias and a lack of impartiality in favor of Henson and against RTC. Debtor Henson is a fugitive from justice, having been criminally convicted, on April 26, 2001, of violating California Penal Code § 422.6, for intimidating, threatening and oppressing Scientologists, including employees of creditor RTC, based upon their religious beliefs. Henson was to have been sentenced on May 16,2001 by the Superior Court of the State of California for the County of Riverside, but instead, fled the United States. A bench warrant has issued for Henson's arrest as a fugitive. As such, Henson is no longer entitled to maintain his action before the Bankruptcy Court nor may he be afforded its protection. Accordingly, RTC has prepared a motion to dismiss Henson's Petition based on the fugitive disentitlement doctrine. However, it has not filed that motion due to the pendency of a motion to disqualify Judge Weissbrodt which remains under submission. Thus, withdrawing the reference to the Bankruptcy Court is the only means by which RTC may obtain the relief to which it is entitled, without being subjected to undue delay or prejudice.
MEMORANDUM OF POINTS AND AUTHORITIES I. STATEMENT OF FACTS On April 5, 2001, Creditor RTC filed a Notice of Motion and Motion to Disqualfy Bankruptcy Judge Arthur S. Weissbrodt. pursuant to 28 U.S.C. §455(a). (A copy of that motion is attached hereto as Exhibit I and incorporated herein by reference.) Argument was heard on May3, 2001,and that motion reimains under submission. MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO. 98-51326ASW-13 [end of p.] 2 During this time, Henson was convicted, on Apnl 26, 200I, under the California hate crime statute, California Penal Code § 422.6, for intimidating, threatening and oppressing Scientologists, including employees of RTC, based upon their religious beliefs. Defendant was released on his own recognizance and was ordered to appear at the Riverside Superior Court for sentencing on May 16, 2001. (Declaration of Warren McShane "McShane Decl." [paragraph] 2, Ex. A.) On May 13, 2001, Henson, from Canada, publicly announced his fugitive status on the Internet: "I will not be in Riverside May 16. In fact I would have to be a complete idiot to be in Riverside May 16! Bon Soire! [sic] Eh? Keith Henson."
(McShane Decl., [paragraph] 3 Ex. B.)
On May 15, 2001, the eve of the sentencing hearing, Henson reiterated the above statements, making it clear he would remain in Canada and not return for sentencing. He also claimed he was entitled to seek political asylum from the Canadian government on the grounds that the United States and the State of California (by his criminal conviction) had persecuted him. (McShane Decl., [paragraph] 4, Ex. C.) When Henson failed to appear for his sentencing on May 16, 2001, the court revoked his personal recognizance status, filed an additional criminal charge arising from Henson's failure to appear (Penal Code § 1320), and issued a bench warrant without bail for his arrest. (McShane Decl., [paragraph] 5, Ex. D.) At this time, neither the Riverside County authorities nor Henson's criminal defense counsel know his precise whereabouts in Canada. Henson is a fugitive from justice, hiding somewhere in Canada, and subject arrest upon apprehension. Due to Henson's fugitive status, RTC prepared a Motion to Dismiss Debtor's Chapter 13 Petition Pursuant to the Fugitive Disentitlement Doctrine ("Motion to Dismiss"), which is attached as Exhibit 2. As described in that motion, Henson is no longer entitled to maintain his bankruptcy action. *Degen v. United Slates*, 517 U.S. 820,
MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO. 98-51326ASW-13 [end of p.] 3 116 S.Ct. 1777 (1996) (Federal courts have the inherent authority to "disentitle" a party from asserting a claim when he becomes a fugitive under the law.) However, this motion has not been filed with the Bankruptcy Court because, pursuant to the Local Rules, the motion would be heard by the Bankruptcy Court, despite the pendency of the motion for disqualification. Moreover, the filing of the Motion to Dismiss before the Bankruptcy Court could result in inordinate delays while Henson still, despite his fugitive status, continues to enjoy the protection of the Bankruptcy Court, to RTC's prejudice.
II. DISCUSSION WITHDRAWAL OF THE REFERENCE IS APPROPRIATE IN THIS INSTANCE
A. Withdrawal Of The Reference Is Appropriate Based Upon The Exigent H Circumstances Of Henson’s Flight From Justice. The District Court may withdraw, in whole or in part, any case or proceeding referred to the Banicruptcy Court for cause shown. 28 U.S.C. § 157(d); *Security Farms v. International Brotherhood of Teamsters, Chauffers, Warehousemen & Helpers*, 124 F.3d 999 (9th Cir. 1997). Good cause exists due to the unique circumstances of this case. Henson continues to enjoy the protection of the court under the bankruptcy law while he scoffs at the law as a fugitive outside the United States. Indeed, Henson has boasted how he can manipulate the Court and bankruptcy procedures by maintaining his plan payments from Canada, and thus avoiding the adverse consequences to his Chapter 13 plan that would necessarily be the result of his jail sentence. (Internet Posting dated May 15, 2001, Ex. E to McShane Decl.) Henson, having chosen to become a fugitive from justice, has now created circumstances where he is no longer entitled to seek relief through a Chapter 13 proceeding based upon the Fugitive Disentitlement Doctrine. (The doctrine is an equitable one which "limits access to courts in the United States by a fugitive who has fled a criminal conviction in a court in the United States." *Prevot v. Prevot*, 597.3d 556,562 (6th Cir.
MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO. 98-51326ASW-13 [end of p.] 4
1995), *cert. denied*, 516 U.S. 1161, 116 S.Ct. 1048 (1996). It has been uniformly and routinely used by district courts in civil cases to sanction or enter judgment against parties on the basis of their fugitive status. Id. at 564-65. The Ninth Circuit has held that that the disentitlement doctrine may be even more applicable to civil cases because a defendant’s liberty is not at stake, therefore less harm can come from the refusal to entertain his case. Conforte v. Commissioner, 692 F.2d 587, 589 (9th Cir. 1982)). However, the pendency of the motion for disqualification will cause delay in reaching an adjudication of the motion to dismiss, which greatly prejudices RTC, forcing it and the Court, to spend yet more time, money and resources, for a matter that may be concluded, fairly, justly and expediently for all concerned. Thus, good cause exists to withdraw the reference so that RTC's Motion to Dismiss under the Fugitive Disentitlement Doctrine can be ruled upon, possibly obviating any further delays, expenditures of time, money and resources on the part of the Court and the parties. B. The Bankruptcy Court Has Made A Number Of Statements Suggesting Bias And A Lack of Impartiality; Accordingly. Withdrawal Of The Reference Is Warranted. Where "non-frivolous questions" exist as to the existence of an appearance of impropriety, withdrawal of the reference is warranted. *Crown Leasing Corporation v. Johnson-Allan*, 70 B.R. 350 (E.D.Pa. 1987). In *Crown Leasing*, creditor moved to disqualify the Bankruptcy Judge, which the Bankruptcy Judge denied. On appeal, the District Court withdrew the reference based upon ". .. *numerous statements [the Bankruptcy Judge made] which could reasonably be interpreted as expressing strong personal views on the subject at hand*." *Crown Leasing*, at 351 (emphasis added). Here, the Bankruptcy Court has made a number of statements evidencing what could reasonably be interpreted as expressing strong personal views in favor of Henson and against RTC, including: 1. chastising RTC because it appears to the Bankruptcy Court to be spending more in legal fees than the amount of its creditor claim (Ex.l,at pp. 14-16);
MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO. 98-51326ASW-13 [end of p.] 5 2. criticizing RTC’s decisions regarding attorney staffing (*Id*. at pp. 17-21); 3. making statements questioning the "economic" value of RTC's religious scripture (Id., at pp. 21-23); and 4. openly favoring Henson based on what the court mischaracterizes as Henson's "advanced age"[1] (Id., at pp. 23-24). The Bankruptcy Court also injected itself into the settlement process, *sua sponte* prejudged the case, and gratuitously suggested a $ 10,000 settlement on the creditor’s claim of hundreds of thousands of dollars.[2] (*Id*., at pp. 5-7). Thus, just as in *Crown Leasing*, the presence of such "non-frivolous questions” on the issue of the Bankruptcy Court's bias against RTC "would best be served" by withdrawing the reference.
III. CONCLUSION
For the reasons set forth above, RTC respectfully requests that its motion to withdraw the reference be granted.
Dated: May 25,2001 Respectfully submitted,
LAW OFFICES OF THOMAS R. HOGAN
[signature] THOMAS R. HOGAN
Attorneys for Creditor RELIGIOUS TECHNOLOGY CENTER [1] Debtor Henson is 58 years old.
[2] RTC’s claim against Henson in the bankruptcy proceedings has sometimes been erroneously described as $75,000, only the amount of the jury award in the copyright infringement case. RTC's claim, however, also includes the costs taxed in the District Court, its costs on Henson's unsuccessful appeals, and the attorney fees awarded and to be awarded by Judge Whyte for the proceedings in the District Court under the Copyright Act. In all, RTC's claim in bankruptcy is several hundred thousand dollars.
MOTION TO WITHDRAW REFERENCE TO THE BANKRUPTCY COURT CASE NO. 98-51326ASW-13 [end of p.] 6 [Exhibit 1 to follow--25 pp.]