[Stan has the cult's number. The world would be a much better place with more lawyers like Stan and fewer like Rosen. hkh]

Stanley A. Zlotoff, State Bar No. 073283
Attorney at Law
300 S. First St. Suite 215
San Jose, CA 95113

Telephone (408) 287-1313
Facsimile (408) 287-7645

Attorney for Debtor

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

In re:

H. KEITH HENSON,

Debtor.

Chapter 13

Case No.: 98-5-1326 ASW-13 U.S.D.C. No. C02-0320/JW Date: July 19, 2002 v

Time: 9:00 AM / Court: 8, 4th Floor

DEBTOR'S RESPONSE TO MOTION TO WITHDRAW REFERENECE AND HELENA KOBIN'S MOTION TO INTERVENE

BACKGROUND

The motions by Religious Technology Center (RTC) and Helena Kobrin are frivolous and made in bad faith, and the court should consider imposing sanctions.

Last year RTC moved the district court for withdrawal of reference and for a writ of mandate to disqualify Judge Weissbrodt. These motions were addressed to Judge Whyte who denied them both (See Declaration of Stanley A. Zlotoff). Having failed before Judges Weissbrodt and Whyte, RTC apparently hopes for a better deal, from Judge Ware who presumably knows nothing of the 4-year history of this case.

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The irony of RTC's attempt at forum shopping is that if its motion is successful, then the result will be a delay in the trial oŁ debtor's Chapter 13, as trial has been set to commence on September 27, 2002. (See Order of July 18, 2002 attached to Zlotoff's Declaration).

The fact of the matter is that RTC has itself by virtue of its overkill tactics been largely responsible for the undue delays of debtor's confirmation trial (See Judge Weissbrodt's Order filed July 8, 2002, attached to Zlotoff's Declaration).

Helena Kobrin would have this court believe that Judge Weissbrodt by fiat barred her from fully participating in debtor's case. In fact RTC consented to such treatment (see order from Hearing re Debtor's Motion for Protective Order and see Judge Weissbrodt's Order of July 8, 2002, both of which are attached to Zlotoff's Declaration).

WITHDRAWAL OF REFERENCE IS INAPPROPRIATE

In determining whether the district's court's power of permissive withdrawal of reference pursuant to 28 USC Section 157 (d) should be exercised,

"The district court may withdraw ...any case or proceeding referred [to the bankruptcy court] on its motion or on timely motion, of a party motion of a party, for cause shown. In determining whether cause exists, a district court should consider the efficient use of judicial resources, delay and costs to the parties, uniformity of bankruptcy

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administration, the prevention of forum shopping, and other related factors.

Security Forms v. International, brotherhood of Teamsters,

124 F3d 999, 1008 (9th, 1997) ."

" A district court considering whether to withdraw the reference should first evaluate whether the claim is core or non-core, since it is upon this issue that questions of efficiency and uniformity will turn."

In re Orion Pictures Corp, 4F3d 1095 , 1101 (2nd, 1993) .

28 USC Section 157 (A) , (H) (L) and (O) define a core proceeding as consisting of

(A) matters concerning the administration of the estate; and

(B) allowance or disallowance of claims; and

(I) determination as to the dischargeability of particular debts; and

(L) confirmation of plans; and

(O) other proceedings affecting the liquidation of the assets or the adjustment of the debtor --- creditor ... relationship,

Orion Pictures, cited with approval, by Security Forms, Id., goes on to say that:

"...hearing core matters in a district court could be an inefficient allocation of judicial resources given that the bankruptcy court generally wall be more familiar with the facts and issues'. Thus once a district court makes the core/non-core determination, it should weigh questions of efficient use of judicial resources, delay and costs to the parties, uniformity of bankruptcy administration, the prevention, of forum shopping, and other related matters."

Id. At 1101.

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Debtor Keith Henson has before the bankruptcy court only a garden variety Chapter 13 case. Religious Technology Center (RTC) is a creditor and filed a claim. It objected to confirmation and filed a motion to dismiss the case. Debtor may elect to convert to Chapter 7 which would possibly invoke questions of dischargeability.

While the case remains a Chapter 13, Debtor has, pursuant to his Plan, been making monthly payments to a Chapter Trustee. It should be noted that this Trustee does not object to confirmation of the Debtor's Plan.

The litany of matters pending before the bankruptcy court are thus entirely "core".

If the case proceeds as a Chapter 13, there are cutting edge bankruptcy issues affecting the uniformity of bankruptcy administration: for example, as this case has dragged on for four years, the question of whether post-petition appreciation of Debtor's residence belongs to the bankruptcy estate would become an important confirmation issue of first impression. It would also become an issue of first impression if the case were converted to Chapter 7 (see 11 USC Section 348 (f)).

Both in connection with the "good faith" test. of Chapter 13 confirmation and chapter 7 dischargeability, there would be an issue whether a technical copyright violation constitutes a willful and malicious injury as defined by In re Geiger, 523 U.S.

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57 (1998) which was recently interpreted by In re Su, 290 F.3d 1140 (9th, 2002) .

RTC'S HIDDEN AGEMA

RTC is not really interested in the legal issues at stake here; rather, they are simply a means to the end of crushing the Debtor. Vexing an RTC dissenter with excessive and burdensome if not frivolous litigation is part of the RTC agenda. Its known as "fair game" and is described in Church of Scientology vs Wollersheim, 42 Cal. App 4th, 628, 641-z (1996) .

"The cult, according to written policy, thrill use any means legal ox illegal to subvert and frustrate judicial process against them, and will willingly and knowingly abuse judicial process in order to attack perceived enemies.

See also, e.g. Church of Scientology vs. Armstrong, 232 Cal App 3d 1060, 1062 (1997.). See also Judge Whyte's order of September 29, 1998, attached to Zlotoff's Declaration, where at p.2, line 21, Judge Whyte opined that:

"RTC was extremely aggressive throughout the litigation and did far more than was necessary to prosecute its case against an individual who represented himself until shortly before trial. RTC was also guilty of trying to present evidence and actually presenting some evidence at trial without objection that had little to do with the issues but was apparently designed to try and make Henson look like a crackpot."

Judge March, Bankruptcy Judge of the Central District was given a taste of this case when RTC traipsed down there to

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depose Debtor's daughter, Amber, regarding her college expenses and the ownership of three paintings worth less than $10,000.

Attached to Zlotoff's Declaration are pertinent parts of the transcript of a motion for protective order requested by Amber, in which Judge March remarks:

"I don't think I've even seen a Chapter 13 docket that ran 34 pages in this district. I was amazed when we requested the docket from the Northern District of California and they faxed down 34 pages of their docket from the clerks office, and I don't think I've ever seen a Chapter 23 case where so many people have had either 2004 exams or depositions taken. It's --- it's absolutely amazing," (p.20)

"I think in light of the history or this case that is reflected in the docket of the N.D, of Cal, which T take judicial notice of, and is reflected in the motion, that there have been a lot of long contentious and duplicative discovery in depositions taken, and that therefore, it was appropriate to move this court for a protective order." (p. 24)

CONCLUSION

The motions of RTC and Helena Kobrin should be denied.

Dated 07/26/02 (signed) Stanley A. Zlotoff ATTORNEY FOR DEBTOR

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