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UNITED STATES BANKRUPTCY COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION

IN RE: DELTA PRODUCE, L.P., Debtor

Case No. 12-50073-LMC (Chapter 11) JOINTLY ADMINISTERED

PACA TRUST CREDITORS McCARRON GROUPS MOTION TO QUASH RULE 2004 EXAMINATION REGARDING ATTORNEYS FEES

COME NOW PACA Trust Creditors Coosemans Houston, Inc., Eagle Eye Produce, Inc., Mecca Farms, Inc., and Texas Sweet Potato Distributing, LLC (collectively, the McCarron Group), through undersigned counsel, and move this Court for an order quashing the Principal of the Debtors Notice of Intent to Take Rule 2004 Examination of Diana M. Geis, local counsel for the McCarron Group. In support thereof, the McCarron Group states as follows: I. INTRODUCTION The attorneys for PACA Trust Creditors are not bound by the Principal of the Debtors intended Rule 2004 examination and deposition of attorneys because the notice was filed without first obtaining leave of Court. Further, the attorneys fees sought by the

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PACA Trust Creditors were submitted for review by the Court pursuant to a Court Order and are considered sums owing in connection with the transaction. Whether the fees are reasonable is a question for the Court. Moreover, Principal for the Debtors notice of intent to examine will needlessly add further costs by increasing the attorneys fees of the McCarron Group and all other PACA Creditors who are subject to this deposition, which in turn will increase the liability of Debtor. All billing statements supporting the fee requests have been

submitted in support of the fee claims, along with the Declaration of Blake A. Surbey. See Docket No. 299. Deposing the attorneys that submitted declarations and itemized billing statements is unnecessary and not proper, and the notice of intent to examine is so unreasonable as to amount to harassment. II. FACTUAL BACKGROUND On August 23, 2012, this Court granted Special Counsels Motion recognizing PACA Creditors right to recover attorneys fees. (Docket No. 287). On October 2, 2012, the Principal of the Debtor, Walter Scott Jensen (Jensen), filed his Omnibus Objections to PACA Trust Creditors Applications for Attorneys Fees, claiming that PACA Trust creditors are unsecured creditors and, therefore, not entitled to attorneys fees. (Docket No. 331). On October 5, 2012, the McCarron Group filed a response to Jensens Omnibus Objection, arguing that PACA Trust Creditors are not unsecured creditors because PACA Trust assets are not part of the bankruptcy estate; and further, under the PACA, attorneys fees are considered sums owing in connection with the transaction, and therefore these fees become part of the PACA trust creditors PACA
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trust claim. (Docket No. 335). On October 9, 2012, Jensen filed a Notice of Intent to Take Rule 2004 Examination (Notice of Intent) to Depose Diana M. Geis and other counsel for PACA Trust creditors on October 25, 2012. (Docket No. 339). On October 22, 2012, Diana M. Geis contacted Randall A. Pulman, counsel for Jensen, in the hopes of resolving this dispute and requesting that Mr. Pullan withdraw the Notice of Intent; Ms. Geis and Mr. Pullman were unable to resolve this dispute. II. LEGAL ARGUMENT A. The Notice of Motion is Procedurally Defective

Jensens Notice of Intent is procedurally defective because Jensen failed to obtain leave of court. Pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure, a court may order the examination of any entity on motion of any party in interest. Fed R. Bankr. P. 2004 (emphasis added); In re Table Talk, Inc., 51 B.R. 143, 145 (Bankr. D. Mass. 1985); In re Wilcher 56 B.R. 428, 434 (N.D. Ill 1985) (party requesting 2004 examination must show good cause). Jensen has not filed any motion with the Court requesting Rule 2004 examination. quashed as procedurally defective. B. PACA Claimants Are Entitled to Attorneys Fees Therefore, Jensens Notice of Intent should be

Jensens Notice of Intent states that he will depose the attorneys regarding the reasonableness and necessity of the attorneys fees [the claimants] seek to recover. (Docket No. 339). But whether PACA trust creditors are entitled to attorneys fees is a question of law to be resolved by the Court. See Country Best v. Christopher Ranch, LLC, 361 F. 3d 629, 632 (11th Cir. 2004) (finding attorneys fees and interest are
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recoverable as sums owing in connection with the transaction provided that that buyers and sellers have bargained for in their contracts.); May Produce Co v. East West Imps. Inc., 2009 U.S. Dist. LEXIS 117076 (N.D. Tex. Dec. 15, 2009). And, whether a PACA creditors Claim for Attorneys Fees submitted pursuant to this Courts Order are reasonable is a question of fact that can be resolved by this Court and Special PACA Counsel. The PACA does not impose a reasonableness requirement regarding attorneys fees, as attorneys fees are collectible assuming they are contractually negotiated. See Ruby Robinson Co. v. Kalil Fresh Marketing, Inc., 2009 U.S. Dist. LEXIS 96366, at *7-8 (S.D. Tex. Oct. 16, 2009) (finding that contractually negotiated attorneys fees are sums owing in connection with the transaction, even in the bankruptcy context). There is ample factual record from which to determine how fees were calculated and ultimately whether they were reasonable, as PACA Creditors Claims for Attorneys Fees include the dates of work, the hours worked, the rate charged, and a description of the work performed. It is unclear, therefore, what these depositions can achieve other than unnecessarily increase the fees and costs associated with recovering as beneficiaries of the PACA trust. Jensens Notice of Intent merely appears to be intended to harass in the hopes of convincing PACA trust creditors to withdraw their legitimate claims for attorneys fees. C. Jensens Notice of Intent to Take Rule 2004 Examination is Harassment

Rule 2004 cannot be used to harass. Snyder v. Society Bank, 181 B.R. 40 (N.D. Tex 1994); In re Table Talk, 51 B.R. at 145 (Bankr. D. Mass. 1985) (It may not be used for purposes of abuse or harassment and it cannot stray into matters which are not
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relevant to the basic inquiry.) (citing In re Mittco, Inc., 44 B.R. 35, 36 (Bankr. E.D. Wis. 1984)). As noted above, the PACA Trust Creditors Claims for Attorneys Fees present ample basis on which to evaluate the reasonableness of the attorneys fees requested. No amount of inquiry by Jensen will resolve whether the fees are recoverable under the PACA. Any deposition under these circumstances is dilatory and serves only to harass PACA Creditors that legitimately submitted claims for attorneys fees. WHEREFORE, for the foregoing reasons, the McCarron Group moves to quash Debtors Notice of Intention to Take Rule 2004 Examinations of attorneys for PACA Trust Creditors regarding attorneys fees.

Respectfully submitted this 22nd day of October, 2012.

By: /s/ Diana M. Geis Diana M. Geis, Esq. State Bar No. 14069700 Curl & Stahl, P.C. 700 N. St. Mary's Street, Suite 1930 San Antonio, Texas 78205 (210) 226-2182 (210) 226-1691 Fax dmgeis@curlstahl.com

and

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By: /s/ Blake Surbey Blake A. Surbey, Esq. McCarron and Diess 4530 Wisconsin Avenue, NW Suite 301 Washington, DC 20016 (202) 364-0400 (202) 364-2731 Fax bsurbey@mccarronlaw.com Pro Hac Vice Counsel for Coosemans Houston, Inc., Eagle Eye Produce, Inc., Mecca Farms, Inc., and Texas Sweet Potato Distributing, LLC

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CERTIFICATE OF CONFERENCE I certify that by phone conversation on October 22, 2012, I conferred with Randall A. Pulman, counsel for Walter Scott Jensen, regarding the substance of this motion to quash his 2004 Examination directed to myself. We were not able to resolve this dispute; thus necessitating filing the subject motion to quash.

By: /s/ Diana M. Geis Diana M. Geis, Esq.

CERTIFICATE OF SERVICE I hereby certify that on October 22, 2012, I electronically filed the foregoing with the Clerk of the Court using the CM/ECF system which will send a notice of electronic filing to all parties of record.

By: /s/ Blake Surbey Blake A. Surbey, Esq.

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