Petition for Writ of Certiorari — Clean Air Car Service & Parking Branch Three, LLC, Petitioner v. Clean Air Car Service & Parking Branch Two, LLC, et al.

Supreme Court briefSep 19, 2025

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Case No. 25IN THE SUPREME COURT OF

THE UNITED STATES

______________________

Clean Air Car Service & Parking Branch Three, LLC,

Clean Air Car Service & Parking Corp., Operr Service

Bureau, Inc., Operr Technologies, Inc., and

Kevin S. Wang,

Petitioners,

Clean Air Car Service & Parking Branch Two, LLC.,

Operr Plaza, LLC.,

Respondents.

On Petition for a Writ of Certiorari to the United States

Court of Appeals for the Second Circuit

______________________

PETITION FOR A WRIT OF CERTIORARI

___________________

JOE ZHENGHONG ZHOU, ESQ.

Counsel of Record

Law Offices of Joe Zhenghong

Zhou & Associates, PLLC

136-20 38th Avenue, Suite 10H

Flushing, NY 11354 USA

Tel: (718) 539-7098

joezhoulaw@gmail.com

QUESTIONS PRESENTED

There are two issues presented for review:

(1) whether the Bankruptcy Court has subject

matter jurisdiction over a bankruptcy petition under 28

U.S.C. § 157 and 28 U.S.C. § 1334, filed by an allegedly

managing member on behalf of a bankruptcy debtor,

while the petitioners raised an independent claim

under the Rooker-Feldman doctrine and 28 U.S.C. §

1738 that the alleged managing member is a bad-faith

transferee under U.C.C. § 9-617 and its Official

Comments in a U.C.C. Article 9 sale; and

(2) if so, whether the independent claim disputing

the ownership of the bankruptcy debtor constitutes an

adverse claim sufficient to defeat a buyer’ good-faith

purchaser status under 11 U.S.C. § 363(m) in a

bankruptcy sale for the bankruptcy debtor’s property.

PARTIES TO THE PROCEEDING

Petitioner Clean Air Car Service & Parking Branch

Three, LLC is Appellant below, and Clean Air Car

Service & Parking Corp., Operr Service Bureau, Inc.,

Operr Technologies, Inc., and Kevin S. Wang are also

appellants below but listed as Creditors and Plaintiffs

in the captioned title below.

Respondents Clean Air Car Service & Parking

Branch Two, LLC, and Operr Plaza are Appellees

below.

iii

CORPORATE DISCLOSURE STATEMENT

Pursuant to Supreme Court Rule 29.6, Petitioners

disclosed the following:

There is no parent corporation or public corporation

that owns the interested parties Clean Air Car Service

& Parking Branch Three, LLC, Clean Air Car Service

& Parking Corp., Operr Service Bureau, Inc., Operr

Technologies, Inc., 10% or more of their stock.

RELATED PROCEEDING

Court in Question: Court of Appeal for the Second

Circuit (“Second Circuit”).

Case caption: In re: Clean Air Car Service & Parking

Branch Two, LLC, Debtor. Clean Air Car Service &

Parking Branch Three, LLC, Appellant, IV - CVCF

NEB I TRUST; IV -CVCF NEB REO, LLC; Clean Air

Car Service & Parking Corp.; Operr Technologies Inc.;

Operr Service Bureau Inc.; Kevin S. Wang, Creditor,

Plaintiffs, v. Clean Air Car Service & Parking Branch

Two, LLC, Debtor-Appellee, Operr Plaza, LLC, JointAdministered-Debtor-Appellee.

The Consolidated appeals with Docket No. 24-1742

(L), 24-1743 (Con), 24-1738 (Con.) were appealed from

the Orders of United States District Court, Eastern

District of New York (“Eastern District Court”).

Judgment was entered on May 15, 2025 and Order for

rehearing from the panel and en banc was entered on

June 25, 2025.

TABLE OF CONTENTS

QUESTIONS PRESENTED ............................................ i

PARTIES TO THE PROCEEDING .............................. ii

CORPORATE DISCLOSURE STATEMENT ......... iii

RELATED PROCEEDING ............................................. iv

TABLE OF CONTENTS .................................................... v

TABLE OF AUTHORITIES .......................................... viii

PETITION FOR A WRIT OF CERTIORARI ............. 1

OPINIONS BELOW ............................................................ 1

JURISDICTION .................................................................... 2

STATUTORY PROVISIONS INVOLVED ................. 3

FACTUAL AND PROCEDURAL HISTORY............. 3

A. Background information for the disputes ............... 3

B. Disputes in New York State Court proceedings ... 5

C. Proceedings in the Bankruptcy Court and sales of

Respondents’ assets under 11 U.S.C. 363(m) ......... 7

D. Appeals before the District Court ............................... 9

E. Appeal before the Second Circuit ............................. 10

REASONS FOR GRANTING THE PETITION ..... 11

A. The Second Circuit’s rulings in determining the

Bankruptcy Court has subject matter jurisdiction

over the bankruptcy petitions failed to follow this

Court’ precedents, created conflict among the

Courts of Appeals over the scope of the RookerFeldman doctrine and 28 U.S.C.S. § 1738, which

has "so far departed from the accepted and usual

course of judicial proceedings" ................................... 11

B. The Second Circuit’s rulings on the status of a good

faith purchaser created Circuit conflicts in

determining whether the dispute over the

bankruptcy debtor’ ownership constituted an

adverse claim sufficient to defeat the status of a

good faith purchaser in the bankruptcy sale under

11 U.S.C. 363 (m) which "has not but should be

settled by this Court" .................................................... 23

C. The subject matter jurisdictional nature and

determination of good faith purchaser status under

11 U.S.C. § 363(m) are all important federal

questions, which warrant granting certiorari

because only this Court has the highest authority

to interpret the meaning of statutory language de

novo when it has different interpretations or

understanding from the lower courts ..................... 27

D. This case presents an ideal vehicle to hear a case

with “national significance” recurring in its nature

and “could have precedential value” for further

defining Bankruptcy Court jurisdiction and

determining good faith purchaser status in the

bankruptcy sale while the disputes tied to U.C.C

Article 9 sale but also it will promote “the policy of

not rewarding those that do not act in good

faith”.................................................................................. 30

CONCLUSION .................................................................... 37

APPENDIX A, Second Circuit Court Order

(June 25, 2025) ....................................... 1a

APPENDIX B, Second Circuit Summary Order

(May 15, 2025) ........................................ 3a

APPENDIX C: District Court Memorandum and

Order (June 24, 2024) ....................... 13a

APPENDIX D: District Court Memorandum and

Order (June 24, 2024) ........................15a

vii

APPENDIX E: District Court Memorandum and

Order (June 24, 2024) ....................... 19a

APPENDIX F: District Court Memorandum and

Order (March 13, 2024) .................... 25a

APPENDIX G: District Court Memorandum and

Order (March 28, 2024) .................... 35a

APPENDIX H: Bankruptcy Court Order

(February 8, 2024) ............................. 45a

APPENDIX I: Bankruptcy Court Order

(February 8, 2024) ............................... 68a

APPENDIX J: First Dept. of N.Y.S. Court Order

(May 2, 2024) ....................................... 91a

APPENDIX K: New York County Court Order

(August 20, 2021) ............................... 94a

APPENDIX L: New York County Court Order

(July 22, 2021) ..................................... 98a

APPENDIX M: Statutory Provisions

28 U.S.C. § 157 ..................................102a

APPENDIX N: Statutory Provisions

28 U.S.C. § 1334 ...............................106a

APPENDIX O: Statutory Provisions

11 U.S.C. § 363(m) ............................109a

APPENDIX P: Statutory Provisions

28 U.S.C. § 158 ...................................110a

APPENDIX Q: Statutory Provisions

28 U.S.C. § 1257 ................................116a

APPENDIX R: Statutory Provisions

28 U.S.C. § 1738 ................................117a

APPENDIX S: PEB Commentary No. 22

(August 24, 2020) ..............................118a

viii

TABLE OF AUTHORITIES

Cases

Page (s)

Arizonans for Official English v. Arizona,

520 US 43, 73 [1997] ............................................................................ 2

Boone v. Chiles,

35 U.S. 177, 210, 10 Pet. 177, 9 L.Ed. 388 (1836) .................... 25

Butner v. United States,

440 U.S. 48, 55, 99 S. Ct. 914, 59 L. Ed. 2d 136 (1979) .......... 24

Chen v. Geranium Development Corp.,

663 N.Y.S.2d 288, 290, 243 A.D.2d 708, 709 (N.Y. App. Div.

1997) ....................................................................................................... 16

CITGO Asphalt Ref. Co. v. Frescati Shipping Co.,

589 U.S. 348, 374, 140 S. Ct. 1081, 1098 (2020) ...................... 15

Colon v. Coughlin,

58 F.3d 865, 870 n.3 (2d Cir. 1995) ................................................ 19

DB Capital Holdings, LLC v. Aspen HH Ventures,

LLC,

B.A.P. 10th Cir. Dec. 6, 2010 ........................................................... 12

Delaware v. Texas,

No. 111 Original, 1992 ...................................................................... 14

District of Columbia Court of Appeals v. Feldman,

460 U. S. 462, 103 S. Ct. 1303, 75 L. Ed. 2d 206 (1983) ......... 17

Doran v. Salem Inn,

422 U.S. 928 S. Ct. 2561 (1975) ..................................................... 18

Doyle v. Icon, LLC,

135 A.D.3d 642, 24 N.Y.S.3d 602 [1st Dept. 2016] .................. 13

Ex parte McCardle, 7 Wall.

506, 514 (1869) ..................................................................................... 28

Exxon Mobil Corp. v. Saudi Basic Indus. Corp.,

544 U.S. 280, 292, 125 S. Ct. 1517, 1526-27 (2005) ... 18, 22, 23

Franchise Servs. of N. Am., Inc. v. United States Trustee,

891 F.3d 198, 208 (5th Cir. 2018) .................................................. 12

Grogan v. Garner,

498 U.S. 279, 286, 111 S. Ct. 654, 659, 112 L.Ed.2d 755

(1991) ...................................................................................................... 30

GASH Assocs. v. Rosemont,

995 F.2d 726, 728 (CA7 1993) ........................................................ 22

Hager v. Gibson,

108 F.3d 35, 39 (4th Cir. 1997) ................................................. 11, 12

Hamer v. Neighborhood Housing Servs. of Chicago

583 U. S. 17—138 S.Ct. 13, 17-18, 199 L.Ed.2d 249

(2017) ...................................................................................................... 29

Hill v. Coca-Cola Bottling Co.,

786 F.2d 550, 552-53 (2d Cir. 1986) ............................................. 19

In re Gucci,

126 F.3d 380, 390 (2d Cir. 1997) .................................................... 16

In re Rodgers,

333 F.3d 64, 68 (2d Cir. 2003) ......................................................... 25

Kaufman v. Eli Lilly & Co.,

65 N.Y.2d 449, 455, 492 N.Y.S.2d 584, 588, 482 N.E.2d

63 (1985) ................................................................................................ 19

Keenihan v. Heritage Press, Inc.,

19 F.3d 1255, 1258 (8th Cir. 1994) ................................................ 11

Kremer v. Chem. Constr. Corp.,

456 U.S. 461, 482, 72 L. Ed. 2d 262, 102 S. Ct. 1883 (1982) ...18

Lewis v. Manufacturers National Bank,

364 U. S. 603, 609 ............................................................................... 24

Noel v. Hall,

341 F.3d 1148, 1165 (9th Cir. 2003) ....................................... 18, 22

N. Star IP Holdings, LLC v. Icon Trade Servs., LLC,

710 F. Supp. 3d 183, 202 (S.D.N.Y. 2024) .................................. 14

Matsushita Elec. Indus. Co. v. Epstein,

516 U.S. 367, 373, 134 L. Ed. 2d 6, 116 S. Ct. 873

(1996) ...................................................................................................... 18

McLearn v. Cowen & Co.,

48 N.Y.2d 696, 422 N.Y.S.2d 60, 61, 397 N.E.2d 750 (N.Y.

1979) ....................................................................................................... 19

Migra v. Warren City School District,

465 U.S. 75, 81, 79 L. Ed. 2d 56, 104 S. Ct. 892 (1984) .......... 19

MOAC Mall Holdings LLC v Transform Holdco LLC,

143 S Ct 927, 936 [2023] ................................................................... 29

Moccio v. N.Y. State Office of Court Admin.,

95 F.3d 195, 200 (2d Cir. 1996) ....................................................... 19

Parsons Steel, Inc. v. First Ala. Bank,

474 U.S. 524-525 S. Ct. 768 (1986) ................................................18

Platte Valley Bank v. Tetra Fin. Grp., Ltd. Liab. Co.,

682 F.3d 1078, 1086 (8th Cir. 2012) ............................................. 14

Precision Instrument Mfg. Co. v. Auto. Maint. Mach.

Co.,

324 U.S. 806, 814-15, 65 S. Ct. 993, 997-98 (1945) .................. 35

Price v. Gurney,

324 U.S. 100, 106, 65 S. Ct. 513, 516 (1945) .............................. 11

Rapillo v. CitiMortgage, Inc.,

at *8 (E.D.N.Y. Mar. 5, 2018) ......................................................... 14

Reed v. Goertz,

598 U.S. 230, 234-35, 143 S. Ct. 955, 960-61 (2023) ............... 17

Reynolds v. Springer Service Station, Inc.,

542 N.Y.S.2d 256, 257, 151 A.D.2d 466, 467 (N.Y. A.D.

1989) ........................................................................................................ 16

Rooker v. Fidelity Trust Co.,

263 U. S. 413, 44 S. Ct. 149, 68 L. Ed. 362 (1923) ............. 17, 18

Skinner v. Switzer,

562 U. S. 521, 532, 131 S. Ct. 1289, 179 L. Ed. 2d 233

(2011) ...................................................................................................... 17

SR Constr., Inc. v. Hall Palm Springs, L.L.C.

65 F.4th 752, 760-61 (5th Cir. 2023) ...................................... 25, 27

Stern v. Marshall,

564 U.S. 462, 495, 131 S. Ct. 2594, 2616 (2011) ....................... 24

Travelers Casualty & Surety Co. of America v. Pacific

Gas & Elec. Co.,

549 U.S. 443, 451, 127 S. Ct. 1199, 167 L. Ed. 2d 178

(2007) ...................................................................................................... 24

Trump v. J.G.G.,

145 S. Ct. 1003,1015-16 (2025) ............................................. 35

United States v. Corrick,

298 U.S. 435, 440 (1936) ..................................................................... 2

United States v. Yazell,

382 U.S. 341, 356, 86 S. Ct. 500, 509 (1966) ............................... 12

xii

Constitution, statutes,

11 U.S.C. § 363 ............................................................. passim

28 U.S.C. § 157(b)(2) ........................................................ 3, 29

28 U.S.C. § 158(a)(1) ............................................................... 3

28 U.S.C. § 158(d) .................................................................... 3

28 U.S.C. § 1254(1) .................................................................. 2

28 U.S.C. § 1257 ................................................................ 3, 21

28 U.S.C. § 1334 ................................................................ 3, 30

28 U.S.C. § 1738 ........................................................... passim

U.C.C. § 1-303 ........................................................................ 15

U.C.C. § 9-327 ........................................................................ 14

U.C.C. § 9-617 ............................................................... passim

Rules

Sup. Ct. R.10(a) ............................................................... 23, 27

Sup. Ct. R. 10(c) ............................................................... 23, 27

Miscellaneous:

PEB Commentary 22 with U.C.C. § 9-617 Official

Comments (4) ............................................................... passim

__________________

PETITION FOR A WRIT OF CERTIORARI

__________________

Petitioners, Clean Air Car Service & Parking Branch

Three, LLC, Clean Air Car Service & Parking Corp.,

Operr Service Bureau, Inc., Operr Technologies, Inc.,

and Kevin S. Wang, through the undersigned counsel,

respectfully petition for a writ of certiorari to review the

judgment and opinion of the Court of Appeals for the

Second Circuit.

OPINIONS BELOW

The opinion of the Second Circuit (App., 1a) denying

petition for panel rehearing and rehearing en banc is

unreported. The Summary Order from the Second

Circuit for Clean Air Car Serv. & Parking Branch

Three, LLC v. Clean Air Car Serv. & Parking Branch

Two, LLC (Clean Air Car Serv. & Parking Branch Two,

LLC), Nos. 24-1742-bk(L), 24-1738-bk(Con), 24-1743bk(Con) is not officially reported but available at 2025

U.S. App. LEXIS 11776 * | 2025 LX 32585 | 2025 WL

1409862, (2d Cir. May 15, 2025). Appeal dismissed as

moot, Motion to dismiss for lack of subject matter

jurisdiction was denied. (App., 3a-12a).

The opinions of the Eastern District Court are not

officially reported but are available at Clean Air Car

Serv. & Parking Branch Three, LLC v. Clean Air Car

Serv. & Parking Branch Two, LLC, 2024 U.S. Dist.

LEXIS 110824, 2024 WL 3106171 (June 24, 2024),

Case No. 1:24-cv-1088 (FB) (App., 15a-18a); Clean Air

Car Serv. v. Clean Air Car Serv., 2024 U.S. Dist. LEXIS

110756, 2024 WL 3106107 (E.D.N.Y., June 24, 2024),

with Case No. 1:23-cv-09495 (FB) (App., 19a-24a);

Clean Air Car Serv. v. Clean Air Car Serv., 2024 U.S.

Dist. LEXIS 113146, 2024 WL 3106221 (E.D.N.Y.,

June 24, 2024), Case No. 1:24-cv-2377 (FB). (App., 13a14a). Appeals are dismissed as moot.

The opinions of the bankruptcy Court are not officially

reported but available In re Clean Air Car Serv. &

Parking Branch Two, LLC, No. 23-41937, 2024 Bankr.

LEXIS 1496, at *1 (Bankr. E.D.N.Y. Feb. 8, 2024).

Approved the sale of the Respondents' properties and

issued the Order of Eviction against the tenant

Petitioner Clean Air Car Service & Parking Branch

Three, LLC.

JURISDICTION

The Opinion of the Second Circuit was entered on

May 15, 2025 (App., 3a-12a). Petitioners timely filed a

petition for panel rehearing and rehearing en banc, but

it was denied on June 25, 2025 (App., 1a-2a).

The jurisdiction of this Court is invoked under 28

U.S.C. § 1254(1). However, "[w]hen the lower federal

courts lack jurisdiction, this Court has jurisdiction on

appeal, not of the merits but merely for the purpose of

correcting the error of the lower court in entertaining

the suit." United States v. Corrick, 298 U.S. 435, 440

(1936). Arizonans for Official English v. Arizona, 520

US 43, 73 [1997].

STATUTORY PROVISIONS INVOLVED

The relevant provisions 28 U.S.C. § 157(b)(2), 28

U.S.C § 1334, 28 U.S.C. § 158, 28 U.S.C. § 1257, 28

U.S.C. § 1738, and 11 U.S.C. § 363(m), are reproduced

in full in an appendix hereto. (App., 102a-117a)

FACTUAL AND PROCEDURAL HISTORY

A. Background information for the disputes

1. On or about October 18, 2019, Respondents Clean

Air Service & Parking & Parking Branch Two,

LLC (“Clean Air 2”) and Operr Plaza, LLC (“Operr

Plaza”), entered into an agreement to borrow $12.3

million from a lender 1 (“Lender”), for the "Operr

Plaza Building”. Petitioner Kevin Wang’s

respective membership interests of Respondents, as

collaterals, were pledged subject to the Respondents’

limitation of the Operating Agreements which

include but not limited to a forum-selection causes

that any disputes related to memberships must be

resolved and adjudicated in the New York State

Supreme Court Queens County, (“Queens County

Court”), and its Appellate Division and Section 6.4

for involuntary transfer of the memberships.

2. The relevant Section 6.4 in the Respondents’

Operating Agreements:

6.4 Involuntary Transfer of a Membership

Interest

1 CV Capital Funding, LLC, CVCF Fund Funding I-NEB, LLC,

and/or IV-CVCF NEB I Trust.

…The creditor, transferee or other

claimant, shall only have the rights of an

Assignee, and shall have no right to

become a Member, or to participate in the

management of the business and affairs of

the Company as a Member or Manager

under any circumstances, and shall be

entitled only to receive the share of profits

and losses, and the return of capital, to

which the Member would otherwise have

been entitled…

3. Under the amendment of the Respondents’

Operating Agreement, so long as the Respondents

are indebted to the Lender, the Respondents cannot

file a petition for insolvency, bankruptcy, liquidation

or reorganization and Operating Agreements shall

not be further amended in any respect or

terminated.

4. On June 16, 2021, IV-CVCF NEB REO, LLC, as a

buyer (“Buyer 1”), attended the U.C.C. public

auction and was the sole bidder who was also an

affiliate of the U.C.C. Lender. Both the Lender and

Buyer 1 shared the same signatory representative,

Mr. Bill Wang.

5. The Lender colluded with Buyer 1 by giving the

winning bid instructions to place a single bid of

$100,000 to win the U.C.C. public auction, which

only Buyer 1 as sole bidder participated to acquire

the respective LLC membership interest of

Respondents, subject to all of the mortgages and

other existing debts while the value of the

Respondents’ assets was at least 15 million.

6. All of the acknowledgments by Buyer 1 in the Bill of

Sale are not honest in fact by lying about the

material facts that it has sufficient business

experience and financial means to afford the

business risk of investment but filed bankruptcy for

Respondents in less than two years on May 31,

2023 and did not make any payments to the Lender

from the time of its purchasing the collaterals,

which clearly acted not in good faith.

7. On July 8, 2021, the Appellants attempted to buy

back the U.C.C.-Debtor-Petitioner’ s respective LLC

membership interests of the Respondents based on

the Operating Agreements, but Buyer 1 denied it

by breaking the Operating Agreements.

B. Disputes in New York State Court proceedings

8. On June 9, 2021, Petitioners filed a complaint in

New York Supreme Court, New York County

(Index No. 653710/2021) seeking an injunction to

enjoin the Lender from conducting U.C.C. Article 9

auction but was unsuccessful, which resulted in

involuntarily transferring the Respondents’

respective membership interests from U.C.C.Debtor-Petitioner to Buyer 1 in the U.C.C. sale

under the Section 6.4 of Operating Agreements.

9. On July 22, 2021, The New York State Supreme

Court New York County (“New York County

Court”) with case number 654192/2021, ruled in an

Order, (“July 22 Order”) (App., 98a-101a), that

Defendant no longer has any interests in the LLCs

or rights upon U.C.C. foreclosure; however, on

August 20, 2021, the same court and the same

judge ruled in another Order in rejecting the

U.C.C.-Debtor-Petitioner Kevin S. Wang’ (“U.C.C.Debtor-Petitioner”) argument that Buyer 1 cannot

obtained the managerial rights under involuntary

transfer and any membership dispute must be

resolved in Queens County Court, held that:

“The claims asserted in this action do not

arise out of and are not related to the

operating agreements anyway. They

therefore are not related to the Queens

County forum-selection clause. Plaintiffs’

claims have nothing to do with the

operating agreements and do not implicate

the LLCs’ internal affairs. Rather, the

defendant’s obligation to turn over the

property is based on the outcome of the

foreclosure and on the pledge

agreements…” (“August 20 Order”) (App.,

94a-97a)

Both the July 22 Order and the August 20 Order,

as interlocutory orders, were affirmed on May 2,

2024, by the First Department of New York State

Supreme Court.

10. On or about June 30, 2021, Petitioners sued U.C.C.

Lender and Buyer 1 et al to seek a declaratory

judgment that U.C.C.-Debtor-Petitioner keeps the

managerial rights/buyback rights after the U.C.C.

sale under the Operating Agreements Section 6.4

and liabilities for the U.C.C. sale commercially

unreasonable under U.C.C. Article 9 disposition

before the Queens County Court, with case number

714973/2021, which is still pending for adjudication.

11. On December 10, 2021, the Lender filed for Judicial

Foreclosure against Respondents and Petitioners et

al. with Index No. 727299/2021 in the Queens

County Court. On or about July 26, 2022, Judge

Hom from the Supreme Court, Queens County

issued his Order to stay the foreclosure action due

to related cases and decisions in the other cases

could affect the foreclosure case, which this case is

still currently pending before the Queens County

Court.

C. Proceedings in the Bankruptcy Court and

sales of Respondents’ assets under 11 U.S.C.

363(m)

12. On or about May 13, 2023, the Respondents hired a

broker, CBRE, to sell the Respondents’ properties.

And on May 31, 2023, Buyer 1, as the alleged

managing member on behalf of the Respondents,

filed the Chapter 11 bankruptcy petitions before the

Bankruptcy Court attempting to avoid the

liabilities of U.C.C. Article 9 disposition in the

ongoing lawsuits of New York State Courts.

13. Petitioners filed Motion to Dismiss the bankruptcy

petitions for filing frivolously and filed in bad faith in

the bankruptcy court on or about September 11,

2023 because of the following reasons: (1) the

bankruptcy petitions were filed in bad faith for

being “unlikely to emerge from bankruptcy and

having no chance of reorganizing” by the

Respondents’ own admission “not to seek

reorganization”; (2) the bankruptcy petition should

be dismissed under CTC analysis factors for lack of

good faith or unclean hands to constitute sufficient

“cause” to dismiss a bankruptcy case under the

Second Circuit holding in C-TC 9th Ave. Pshp. v.

Norton Co. (In re C-TC 9th Ave. Pshp.), 113 F.3d

1304 (2d Cir. 1997) ; (3) The bankruptcy petitions

were filed in bad faith to avoid New York State

Court litigations. The Bankruptcy Court denied the

Motion to Dismiss and issued an interlocutory order

on November 4, 2023, (“November 4 Order”). The

appeals were denied by the Eastern District Court

and the Second Circuit as its non-final Order for

lack of jurisdiction2.

14. On December 7, 2023, C2JM HOLDINGS LLC,

(“Buyer 2”), as one of two bidders to bid and win the

auction to purchase the Respondent Clean Air 2’

property; Xiao Jun Chen, (“Buyer 3”), purchased

the Operr Plaza’ property as sole bidder in an

auction for bankruptcy sale while Buyer 2 and

Buyer 3 knows or should know that Buyer 1 is not

acting in good faith in the Article 9 sale but selected

2 The November 4 Order from the Bankruptcy Court denying Motion

to dismiss as non-final became final upon the bankruptcy court

issuing the July 19 Order to confirm the plan of Reorganization now

pending appeals before the Second Circuit with the case numbers 24908, 24-912, and 24-1507.

to purchase the Respondents’ properties any way in

the bankruptcy sales.

15. On February 8, 2024, the Bankruptcy Court issued

an Order authorizing the Sale of the Respondent

Clean Air 2 's assets to Buyer 2 (App., 68a-90a) and

authorizing the Sale of the Respondent Operr

Plaza's assets to Buyer 3 (App., 45a-67a), overruled

the objection that Buyer 2, and Buyer 3 are not good

faith purchasers raised by the Petitioners.

D. Appeals before the District Court

16. Following the briefing on the merits, the Eastern

District Court dismissed the appeals as moot by

holding that Buyer 2 and Buyer 3 are good-faith

purchasers. The Eastern District Court erroneously

held that “[a]lthough [Petitioners] justifiably has

strong opinions on the issue” of the managerial

rights/buyback rights of the Respondents, these

issues should not be before this Court.” Rather, “it is

the subject of the many state-court proceedings”

(App., 28a) and further erroneously held that

“[r]egardless of whether those claims are now

precluded or barred here by an abstention doctrine,

they do not impinge upon the Buyer’s status as a

good-faith purchaser because they do not create an

ownership interest in the property that was sold.”

(App., 23a-24a), “and Appellants’ already-litigated

claim to maintain ownership and management

rights” “is not the type of “adverse claim” that could

impinge upon the Buyer’s status as a good-faith

purchaser”. (App., 17a). Therefore, the Eastern

District Court dismissed the appeals from the

Orders confirming the sales of the Respondents’

Properties as moot.

E. Appeal before the Second Circuit

17. Regarding the jurisdiction, the Second Circuit

acknowledged that Appellants’ argument “appears

to be that when Operr Plaza and Clean Air 2 were

sold to a third-party buyer as the result of a U.C.C.

foreclosure sale in 2021, that third-party buyer was

not a good faith purchaser” (App., 6a-7a), but held

that: “Appellant's reasoning is opaque”, “[w]e are

not persuaded.” “Appellant has failed to establish

that Operr Plaza and Clean Air 2 lacked authority

to file for bankruptcy. We therefore conclude that

the record before us, including the findings made in

the related state court proceedings, (by citing

through footnote See Operr Plaza, LLC v. Wang,

208 N.Y.S.3d 1 96 (1st Dep't 2024) (observing that

Operr Plaza and Clean Air Two were sold in "an

authorized U.C.C. sale" to a third party) amply

supports the exercise of jurisdiction over this matter

by the Bankruptcy Court and accordingly denies

Appellant's motion to dismiss without any citation

from New York State law. (App., 6a-7a)

18. Regarding the properties sold in the bankruptcy

sale, the Court of Appeals held that “for the reasons

discussed in the District Court’s well-reasoned

orders, we agree…, neither of these purported

adverse claims would bear on the buyers’ status as

good-faith purchasers.” We therefore conclude that

the two appeals from the Bankruptcy Court’s Sale

Orders are statutorily moot and must be dismissed.

(App., 9a-10a)

19. There is no dispute from Respondents that Buyer 1

is not a good faith purchaser but a bad faith

transferee in the U.C.C. Article 9 sale, and

Respondents never alleged that Buyer 1 is a good

faith purchaser in the lower courts’ proceedings.

There are no lower courts, including state courts or

federal courts, to adjudicate or determine that

Buyer 1 is a good-faith purchaser in the U.C.C.

Article 9 sale.

REASONS FOR GRANTING THE PETITION

A. The Second Circuit’s rulings in determining the

Bankruptcy Court has subject matter

jurisdiction over the bankruptcy petitions

failed to follow this Court’ precedents, created

conflict among the Courts of Appeals over the

scope of the Rooker-Feldman doctrine and 28

U.S.C.S. § 1738, which has "so far departed from

the accepted and usual course of judicial

proceedings".

This Court held that [i]f the District Court finds that

those who purport to act on behalf of the corporation

have not been granted authority by local law to institute

the [bankruptcy] proceedings, it has no alternative but

to dismiss the petition. Price v. Gurney, 324 U.S. 100,

106, 65 S. Ct. 513, 516 (1945). Price routinely has been

interpreted and applied to that effect by bankruptcy

courts. See also Keenihan v. Heritage Press, Inc., 19

F.3d 1255, 1258 (8th Cir. 1994). Hager v. Gibson, 108

F.3d 35, 39 (4th Cir. 1997). Generally, in cases applying

state law to limit or condition the enforcement of a

federal right, the Court has insisted that the state law is

being "adopted" as the federal rule. United States v.

Yazell, 382 U.S. 341, 356, 86 S. Ct. 500, 509 (1966).

The 4th Circuit held that a bankruptcy case filed on

behalf of an entity by one without requisite authority

under state law is improper and must be dismissed for,

among other reasons, lack of jurisdiction, Hager v.

Gibson (In re Hager), 108 F.3d 35, 38–39 (4th Cir. 1997).

The 10th Circuit held that “bankruptcy courts must

look to state law to determine who has the authority to

commence a bankruptcy case on behalf of a limited

liability company ("LLC") organized pursuant to state

law”. DB Capital Holdings, LLC v. Aspen HH Ventures,

LLC (In re DB Capital Holdings, LLC), BAP No. CO10-046, 5 (B.A.P. 10th Cir. Dec. 6, 2010)

The 5th Circuit held that members may agree in the

articles of organization or operating agreement to

restrict the rights of Members to commence a

bankruptcy case on behalf of the limited liability

company. See Franchise Servs. of N. Am., Inc. v. United

States Trustee (In re Franchise Servs. of N. Am., Inc.),

891 F.3d 198, 208 (5th Cir. 2018), as revised (June 14,

2018) (operating agreement enabling preferred

shareholder to veto a bankruptcy filing not prohibited

by federal bankruptcy law); DB Capital Holdings, LLC

v. Aspen HH Ventures, LLC (In re DB Capital

Holdings, LLC), 463 B.R. 142 (10th Cir. B.A.P. 2010)

(members of limited liability company may agree to

prohibit a bankruptcy filing).

Under the New York State Limited Liability

Company Law § 417, a written Operating Agreement

for a limited liability company is binding to any and all

members related to the LLC business and its

management. Doyle v. Icon, LLC, 135 A.D.3d 642, 24

N.Y.S.3d 602 [1st Dept. 2016]. In this case, Respondents

are New York-based Limited Liability Companies,

therefore, at least New York State law will apply for the

determination of whether the bankruptcy petitions

were filed with authorization.

Since Buyer 1 is a U.C.C. transferee as an allegedly

managing member who filed the bankruptcy petitions

for Respondents, therefore, whether Buyer 1 is a good

faith purchaser, or a bad faith transferee in the U.C.C.

Article 9 sale under U.C.C. § 9-617 and its Official

Comments is the key issue to be determined in deciding

the jurisdiction of the bankruptcy petition as a matter of

law.

Under N.Y. U.C.C. § 9-617 RIGHTS OF

TRANSFEREE OF COLLATERAL:

(a) Effects of disposition. A secured party's

disposition of collateral after default: (1)

transfers to a transferee for value all of the

debtor's rights in the collateral; … .

(b) Rights of good-faith transferee. A

transferee that acts in good faith takes free

of the rights and interests… .

does not take free of the rights and

interests described in subsection (a), the

transferee takes the collateral subject to: (1)

the debtor's rights in the collateral … .

(U.C.C. § 9-617).

The inquiry under Section 9-617(b) evaluates

whether the transferee acted "in good faith in its

capacity as transferee . . . ." Rapillo v. CitiMortgage, Inc.,

No. 15-CV-5976 (KAM), 2018 U.S. Dist. LEXIS 35491,

2018 WL 1175127, at *8 (E.D.N.Y. Mar. 5, 2018). A

good-faith transferee takes free of subordinate interests

in the collateral even if the secured party "fails to

comply" with the requirements of Article 9, including

the requirement that "[e]very aspect of a disposition of

collateral . . . must be commercially reasonable." N.Y.

U.C.C. § 9-617(b). However, "a transferee that acts with

knowledge of the defects of the disposition or acts in

collusion with the secured party is not acting in good

faith." Hawkland U.C.C. Series § 9-617:3 (citing U.C.C.

§ 9-617, Official Comment 3). N. Star IP Holdings, LLC

v. Icon Trade Servs., LLC, 710 F. Supp. 3d 183, 202

(S.D.N.Y. 2024).

It is well-established that while the Official

Comments themselves are not part of the statutory law

adopted by states and are not binding, courts and legal

professionals almost universally treat the Official

Comments as the most authoritative source for

interpreting the U.C.C. provisions. For example, this

Court cited the 1990 commentaries by the Permanent

Editorial Board (PEB) to the Uniform Commercial

Code, PEB Commentary No. 4 (discussing U.C.C. § 8207) in Delaware v. Texas, No. 111 Original, 1992 U.S.

LEXIS 8013, at *34 Jan. 28, 1992. See also U.C.C. § 9327 cmt. 2 was cited in Platte Valley Bank v. Tetra Fin.

Grp., Ltd. Liab. Co., 682 F.3d 1078, 1086 (8th Cir. 2012),

U. C. C. § 1-303 Comment 3 (2017) was cited in CITGO

Asphalt Ref. Co. v. Frescati Shipping Co., 589 U.S. 348,

374, 140 S. Ct. 1081, 1098 (2020).

While there are different understandings regarding

the interpretation of U.C.C. § 9-617, especially how to

interpret the rights for the bad faith transferee, the PEB

specifically issued PEB COMMENTARY NO. 22 on

August 24, 2020, clarifies that:

“[a]lthough the [U.C.C.] debtor may indeed

be entitled to seek monetary damages for a

disposition that did not comply with Section

9-610, the debtor is also entitled to the

debtor’s right of redemption and other rights

in the collateral when the transferee has not

acted in good faith. A bad faith transferee

may not rely on the ‘take free’ rule”. “In such

a case the [U.C.C. Article 9 sale] disposition

is ineffective to the extent that it would

otherwise have cut off the debtor’s rights in

the collateral, and the debtor retains those

rights, including the debtor’s right of

redemption”. (App., 124a-125a)

Meanwhile, the PEB amended its Official

Comments (4) of U.C.C. § 9-617 to reflect the above

position. The Commentary is available at

https://www.ali.org/peb-ucc (App., 118a-125a).

Under New York law, bona fide purchaser status

cannot be obtained if the purchaser has actual or

constructive notice of an unrecorded prior interest in the

property in question. See Chen v. Geranium

Development Corp., 663 N.Y.S.2d 288, 290, 243 A.D.2d

708, 709 (N.Y. App. Div. 1997); Reynolds v. Springer

Service Station, Inc., 542 N.Y.S.2d 256, 257, 151 A.D.2d

466, 467 (N.Y. A.D. 1989). The Second Circuit’ Order

acknowledged that a “good-faith purchaser” is defined

as “one who purchases the assets for value, in good faith

and without notice of adverse claims.” In re Gucci, 126

F.3d 380, 390 (2d Cir. 1997). In this case, Buyer 1 is a

bad faith transferee in the U.C.C. Article 9 sale and

there is no judgment of foreclosure from the state courts

to terminate the U.C.C.-Debtor-Petitioner’ rights of

redemption as a former equity owner because the

dispute for foreclosure is still ongoing in the New York

State Court; further, under the 2019 Operating

Agreements, as long as the Respondents remain

indebted to the U.C.C.-Lender, the Operating

Agreements cannot be amended, the Respondents’

properties cannot be sold, and bankruptcy petitions

cannot be filed; Petitioners opposed the bankruptcy

petitions from the time that they knew about such filing.

Therefore, Buyer 1 is a bad-faith transferee cannot file

bankruptcy petitions on behalf of Respondents under

the Operating Agreements and U.C.C. § 9-617(c) with

its Official Comments (4).

However, the Second Circuit held the finding in the

State Court judgments sufficient to support the

bankruptcy Court’ jurisdiction without any citation or

analysis of New York law. Therefore, the critical issue is

whether the New York State Court judgments are

dispositive to the issue of whether Buyer 1, as a bad

faith transferee, has authority to file bankruptcy

petitions on behalf of Respondents under the RookerFeldman Doctrine and under 28 U.S.C. § 1738.

Rooker-Feldman doctrine, see Rooker v. Fidelity

Trust Co., 263 U. S. 413, 44 S. Ct. 149, 68 L. Ed. 362

(1923); District of Columbia Court of Appeals v.

Feldman, 460 U. S. 462, 103 S. Ct. 1303, 75 L. Ed. 2d

206 (1983), prohibits federal courts from adjudicating

cases brought by state-court losing parties challenging

state-court judgments. But as this Court explained in

Skinner v. Switzer, even though a “state-court decision

is not reviewable by lower federal courts,” a “statute or

rule governing the decision may be challenged in a

federal action.” 562 U. S. 521, 532, 131 S. Ct. 1289, 179

L. Ed. 2d 233 (2011). Reed v. Goertz, 598 U.S. 230, 23435, 143 S. Ct. 955, 960-61 (2023). Here, as in Skinner,

Petitioners do not challenge the adverse state-court

decisions themselves, but rather challenge the “statute

or rule” governing the decision from the state Court

because Petitioners argued lack of jurisdiction of the

bankruptcy petition under U.C.C. § 9-617 (c) and

challenged the state court for its adjudication applied at

most under U.C.C. § 9-617 (a), which are totally

different rules applicable.

Furthermore, [w]hen there is parallel state and

federal litigation, Rooker-Feldman is not triggered

simply by the entry of judgment in state court. This

Court has repeatedly held that "the pendency of an

action in the state court is no bar to proceedings

concerning the same matter in the Federal court having

jurisdiction." Comity or abstention doctrines may, in

various circumstances, permit or require the federal

court to stay or dismiss the federal action in favor of the

state-court litigation. But neither Rooker nor Feldman

supports the notion that properly invoked concurrent

jurisdiction vanishes if a state court reaches judgment

on the same or related question while the case remains

sub judice in a federal court. Exxon Mobil Corp. v. Saudi

Basic Indus. Corp., 544 U.S. 280, 292, 125 S. Ct. 1517,

1526-27 (2005) (internal citation omitted).

This Court has repeatedly stated that simultaneous

state and federal litigation of overlapping, and even

identical, issues is an important feature of our federal

system, see, e.g., Parsons Steel, Inc. v. First Ala. Bank,

474 U.S. 524-525 S. Ct. 768 (1986), Doran v. Salem Inn,

Inc., 422 U.S. 928 S. Ct. 2561 (1975), and we will not

interpret the Rooker-Feldman doctrine to destroy that

feature. Noel v. Hall, 341 F.3d 1148, 1165 (9th Cir. 2003).

Under 28 U.S.C. § 1738, federal courts must give

"full faith and credit" to judgments of state courts.

Section 1738 does not allow federal courts to employ

their own preclusion rules in determining the

preclusive effect of state judgments. "Rather, it . . .

commands a federal court to accept the rules chosen by

the State from which the judgment is taken." Kremer v.

Chem. Constr. Corp., 456 U.S. 461, 482, 72 L. Ed. 2d

262, 102 S. Ct. 1883 (1982); accord Matsushita Elec.

Indus. Co. v. Epstein, 516 U.S. 367, 373, 134 L. Ed. 2d 6,

116 S. Ct. 873 (1996).

In this case, New York state law should be applied in

deciding the authority for filing bankruptcy petitions.

The law of preclusion can be divided into two branches:

res judicata (claim preclusion) and collateral estoppel

(issue preclusion). Moccio v. N.Y. State Office of Court

Admin., 95 F.3d 195, 200 (2d Cir. 1996). Under the

Constitution's Full Faith and Credit Clause, see U.S.

Const. Art. IV, § 1, federal courts must accord state court

judgments the same preclusive effect as other courts

within that state. See Migra v. Warren City School

District, 465 U.S. 75, 81, 79 L. Ed. 2d 56, 104 S. Ct. 892

(1984).

Our analysis is governed by New York State law,

which has adopted a transactional approach to res

judicata, barring a later claim arising out of the same

factual grouping as an earlier litigated claim even if the

later claim is based on different legal theories or seeks

dissimilar or additional relief. This bar will not apply,

however, where "the initial forum did not have the

power to award the full measure of relief sought in the

later litigation." McLearn v. Cowen & Co., 48 N.Y.2d

696, 422 N.Y.S.2d 60, 61, 397 N.E.2d 750 (N.Y. 1979).

Colon v. Coughlin, 58 F.3d 865, 870 n.3 (2d Cir. 1995).

(Internal citation omitted).

Under New York law, the doctrine of issue

preclusion only applies if (1) the issue in question was

actually and necessarily decided in a prior proceeding,

and (2) the party against whom the doctrine is asserted

had a full and fair opportunity to litigate the issue in the

first proceeding. See Hill v. Coca-Cola Bottling Co., 786

F.2d 550, 552-53 (2d Cir. 1986); Kaufman v. Eli Lilly &

Co., 65 N.Y.2d 449, 455, 492 N.Y.S.2d 584, 588, 482

N.E.2d 63 (1985). Colon v. Coughlin, at 865, 869.

(Internal citation omitted).

In this case, the New York County Court’s ruling that

the U.C.C.-Debtor-Petitioner holds no membership

interest solely by reason of the U.C.C.-Lender’s

foreclosure which cannot establish that Buyer 1 is a

good-faith purchaser under U.C.C. § 9-617(b) when the

New York County Court acknowledged in its August 20

Order that it has no power to award the relief that

Petitioners sought to dispute the managerial rights

under the forum-selection cause in the Operating

Agreement which designated Queens County Court as

forum to adjudicate the membership dispute. The

determination of whether Buyer 1 qualifies as a goodfaith purchaser or bad-faith transferee must be made

separately, under U.C.C. § 9-617(b) or § 9-617(c). More

specifically, while the July 22 Order held that the

U.C.C.-Debtor-Petitioner has no longer had any

interests in the Respondents upon the U.C.C.-Lender’

U.C.C. foreclosure, the same judge on August 20 Order

clearly acknowledged that the July 22 Order is solely

based on U.C.C. foreclosure and further clarified in that

case that “[t]he claims asserted in this action do not arise

out of and are not related to the operating agreements

anyway. They are therefore not subject to the Queens

County forum-selection clause. Plaintiffs' claims have

nothing to do with the operating agreements and do not

implicate the LLCs' internal affairs.” (App., 96a). The

foregoing Orders make clear that the State Court

judgments have not adjudicated or do not determine

whether Buyer 1, as U.C.C. transferee, qualifies as a

good-faith purchaser. This is because a U.C.C.

foreclosure under U.C.C. § 9-617 (a) does not necessarily

implicate the internal affairs of an LLC under its

Operating Agreement, which must instead be

evaluated independently under U.C.C. § 9-617 (b) or §

9-617 (c). Buyer 1 attempted to rely on the “take free”

rule, which only good faith purchaser is entitled to

amend the 2019 Operating Agreements in 2021 and

2023 to “gain authorization” to file bankruptcy, it is

clearly against the above U.C.C. § 9-617 (c) and its

Comments (4). Buyer 1 cannot enjoy the managerial

rights for Respondents to file bankruptcy petitions

which Buyer 1, as a bad-faith transferee, was not

entitled to. Therefore, the doctrines of claim preclusion

and issue preclusion are not applicable in this case

because the issue of managerial rights under U.C.C. §

9-617 (c) and its Official Comments has not been

“actually and necessarily decided” in State Courts and

there is no “a full and fair opportunity to litigate in the

state court while the state court did not have the power

to award the full measure of relief sought in this case

upon its own acknowledgement in August 20 Order

from New York County Court.

This Court held [p]reclusion, of course, is not a

jurisdictional matter. In parallel litigation, a federal

court may be bound to recognize the claim- and issuepreclusive effects of a state-court judgment, but federal

jurisdiction over an action does not terminate

automatically on the entry of judgment in the state

court. Nor does § 1257 stop a district court from

exercising subject-matter jurisdiction simply because a

party attempts to litigate in federal court a matter

previously litigated in state court. If a federal plaintiff

"present[s] some independent claim, albeit one that

denies a legal conclusion that a state court has reached

in a case to which he was a party . . ., then there is

jurisdiction and state law determines whether the

defendant prevails under principles of preclusion."

GASH Assocs. v. Rosemont, 995 F.2d 726, 728 (CA7

1993); accord Noel v. Hall, 341 F.3d 1148, 1163-1164

(CA9 2003). Exxon Mobil Corp. v. Saudi Basic Indus.

Corp., at 1517, 1526-27.

However, the Second Circuit held that the

Bankruptcy Court had jurisdiction but failed to cite any

legal authority under New York State law explaining

why the Petitioners’ argument that “third-party buyer

was not a good faith purchaser” should be rejected.

Without identifying how and why the Rocker-Feldman

doctrine and 28 U.S.C. § 1738 are applicable to this case,

the Second Circuit’s Order is erroneous in concluding

that the Bankruptcy Court has jurisdiction over the

bankruptcy petition without adjudicating the

independent claim that Buyer 1 was a bad-faith

transferee in the U.C.C. Article 9 sale, which cannot

take free rights from the U.C.C.-debtor-petitioner who

denied a legal conclusion that a state court has reached

in a case to which he was a party, because the State

Court held that he has no membership interest of

Respondents solely under U.C.C. foreclosure without

adjudicating anything else such as membership dispute

which should be adjudicated by Queens County Court

under forum-selection Clause. Therefore, there is

jurisdiction to adjudicate the independent claim and

state law determines whether the Petitioners prevail

under principles of preclusion, which are applicable in

this case as addressed above. It is obvious that the

Second Circuit improperly treated the state court

judgment as jurisdictional, as its Order did nothing

more than only referring the state judgment without

analysis, then concluded that the Bankruptcy Court

had jurisdiction over the bankruptcy petition, which

clearly conflicts with this Court’s precedents at least as

holding in Exxon Mobil Corp. v. Saudi Basic Indus.

The Second Circuit’ rulings have decided bankruptcy

jurisdiction without analysis of any New York State law

as an important federal question in a way that conflicts

with the relevant decisions of this Court but also created

a circuit conflict concerning how bankruptcy jurisdiction

should be determined between the Second Circuit and

at least the 4th, 5th, and 10th Circuits. Therefore, such

rulings from the Second Circuit have “so far departed

from the accepted and usual course of judicial

proceedings, or sanctioned such a departure by a lower

court, as to call for an exercise of this Court’s supervisory

power” as addressed above, which warrants this Court

to grant the petition for review. Sup. Ct. R. 10(a) and (c).

B. The Second Circuit’s rulings on the status of a

good faith purchaser created Circuit conflicts

in determining whether the dispute over the

bankruptcy debtor’ ownership constituted an

adverse claim sufficient to defeat the status of a

good faith purchaser in the bankruptcy sale

under 11 U.S.C. 363 (m) which "has not but

should be settled by this Court".

Property interests are created and defined by state

law, and unless some federal interest requires a

different result, there is no reason why such interests

should be analyzed differently simply because an

interested party is involved in a bankruptcy proceeding.

Travelers Casualty & Surety Co. of America v. Pacific

Gas & Elec. Co., 549 U.S. 443, 451, 127 S. Ct. 1199, 167

L. Ed. 2d 178 (2007) (quoting Butner v. United States,

440 U.S. 48, 55, 99 S. Ct. 914, 59 L. Ed. 2d 136 (1979)).

Stern v. Marshall, 564 U.S. 462, 495, 131 S. Ct. 2594,

2616 (2011).

Uniform treatment of property interests by both

state and federal courts within a State serves to reduce

uncertainty, to discourage forum shopping, and to

prevent a party from receiving "a windfall merely by

reason of the happenstance of bankruptcy." Lewis v.

Manufacturers National Bank, 364 U. S. 603, 609. The

justifications for the application of state law are not

limited to ownership interests; they apply with equal

force to security interests. Butner v. United States, 440

U.S. 48, 55 (1979). (internal citation omitted)

Buyer 1, as the LLC member assignee to the

Respondents, has no managerial rights under the

Operating Agreements Section 6.4 “under any

circumstance”, U.C.C.-Debtor-Petitioner holds the

managerial rights if his membership was involuntarily

transferred to an assignee or transferee, which Buyer 1

cannot increase any non-existing managerial rights

simply because of filing the bankruptcy.

Furthermore, the Eastern District Court

acknowledged that the petitioners “justifiably has

strong opinions on the issue” of the managerial

rights/buyback rights of the Respondents (App., 28a)

but erroneously held that the Petitioners’ arguments

“do not create an ownership interest in the property

that was sold” (App., 24a). That is not how New York

law provides for this issue.

Under the New York law, an owner of equity has a

right to redeem at any time before an actual sale under

a judgment of foreclosure. In re Rodgers, 333 F.3d 64, 68

(2d Cir. 2003) (internal citation omitted)

The U.C.C.-Debtor-Petitioner, as the former owner

of equity, has rights of redemption to equity of interest

of the Respondents, which have not expired because

Buyer 1 is a bad faith transferee under U.C.C. § 9-617

(c), subject to U.C.C.-Debtor-Petitioner’s rights, and

there is no judgment of foreclosure from a New York

State court either, which the foreclosure is still pending

before the Queens County Court. The 5th Circuit held:

[t]he Supreme Court explains that "adverse

claims" with regard to good faith purchasers

implies ownership must be disputed, stating

that the knowledge required to vitiate such

a label is of "defect in [title], or adverse claim

to it." [In Boone v. Chiles, 35 U.S. 177, 210,

10 Pet. 177, 9 L.Ed. 388 (1836)]. These cases

make clear that, under the notice-definition

of a good faith purchaser, the threshold for

an "adverse claim" is a dispute in ownership

interest.” SR Constr., Inc. v. Hall Palm

Springs, L.L.C. (In re RE Palm Springs II,

L.L.C.), 65 F.4th 752, 760-61 (5th Cir. 2023).

Nothing in the above 5th Circuit case law quoting the

Supreme Court’s holding confines the definition of an

“adverse claim” solely to disputes over direct ownership

of the property. Rather, a dispute over the ownership or

control of the entity that owns the property may also

qualify as “adverse claim.” The 5th Circuit held that

[t]hese cases make clear that, under the noticedefinition of a good faith purchaser, the threshold for an

"adverse claim" is a dispute in ownership interest. Id.

As acknowledged by the Eastern District Court, the

ownership of the Respondents is under dispute. Buyer

2 and Buyer 3 know and should know that Buyer 1 is a

bad faith transferee with no authorization for the sale of

Respondents’ properties and rights of redemption for

U.C.C.-Debtor-Petitioner have not expired. Clearly, the

Order from the Second Circuit is in error by baselessly

limiting the dispute solely related to the ownership of

the property to qualify as “adverse claim” and

dismissing the appeal as moot.

11 U.S. Code § 363 (m), provides:

“[t]he 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.”

As the 5th Circuit held that "[t]he Bankruptcy Code

does not explicitly define 'good faith,' " but the Court has

"defined the term in two ways": (1) a notice-based

definition, wherein a "good faith purchaser" is "'one who

purchases the assets for value, in good faith, and

without notice of adverse claims'"; and (2) a conductbased definition, meaning one who does not engage in

"'misconduct'" including, inter alia, "'fraud, collusion

between the purchaser and other bidders, or an

attempt to take grossly unfair advantage of other

bidders.'" SR Constr., Inc. v. Hall Palm Springs, L.L.C.

at 752, 759.

Therefore, when the Second Circuit’s Order creates

a direct conflict with at least the 5th Circuit regarding

the scope of what constitutes a “good-faith purchaser”,

which this Court has not but should be settled by this

Court to interpret the meaning of good faith purchaser

under 11 U.S.C. § 363(m) regarding how to determine

good faith purchaser status when it is tied to the U.C.C.

Article 9 sale dispute, which warrants this Court to

grant certiorari to hear this case. Sup. Ct. R. 10 (a) and

(c).

C. The subject matter jurisdictional nature and

determination of good faith purchaser status

under 11 U.S.C. § 363(m) are all important

federal questions, which warrant granting

certiorari because only this Court has the

highest authority to interpret the meaning of

statutory language de novo when it has

different interpretations or understanding

from the lower courts.

Chapter 11 of the Bankruptcy Code, together with

the Uniform Commercial Code (U.C.C.) as adopted

under state law, is crucial in commercial transactions

and debt resolution in the United States, particularly in

the context of insolvency and bankruptcy. The

intersection of the U.C.C. and federal bankruptcy law is

especially significant with respect to questions of

bankruptcy court jurisdiction and the validity of a

bankruptcy sale of a debtor’s property when the

underlying disputes arise from a U.C.C. Article 9 sale

governed by state law. All 50 states have adopted

U.C.C., including but not limited to Article 9, which

governs secured transactions, including the rules for

disposing of collateral after a default.

In U.S. law, a "federal question" refers to a legal issue

concerning the U.S. Constitution, federal laws, or

treaties, which gives federal courts the authority to hear

a case. Since the Bankruptcy Reform Act of 1978,

bankruptcy is an area in which the Supreme Court has

had frequent opportunity to address the meaning of

statutory language de novo. Clear and predictable rules

are particularly important in the bankruptcy context,

given the central role bankruptcy law plays in

commercial markets. Lower courts are bound to follow

this Court precedents, so one way in which the

Supreme Court can promote clarity and certainty is to

interpret the law or statutes through its decisions.

This Court held that "[j]urisdiction is power to

declare the law," and "`[w]ithout jurisdiction the court

cannot proceed at all in any cause,'" Ex parte McCardle,

7 Wall. 506, 514 (1869). Courts "have an independent

obligation to determine whether subject-matter

jurisdiction exists, even in the absence of a challenge

from any party." Arbaugh v. Y H Corp, 546 U.S. 500,

514, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006) (citing

Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583

(1999). Courts must also raise and enforce subject

matter jurisdiction sua sponte. MOAC Mall Holdings

LLC v Transform Holdco LLC, 143 S Ct 927, 936 [2023].

An unmet jurisdictional precondition deprives courts of

the power to hear the case, thus requiring immediate

dismissal. Hamer v. Neighborhood Housing Servs. of

Chicago, 583 U. S. 17, —-—, 138 S.Ct. 13, 17-18, 199

L.Ed.2d 249 (2017).

Bankruptcy jurisdiction is treated as a federal

question because it arises under federal law (the

Bankruptcy Code). While bankruptcy courts have

broad statutory jurisdiction over matters arising under

the Bankruptcy Code, the Supreme Court has

significantly limited their power, especially when it

comes to state law claims. When Bankruptcy Court

jurisdiction is a critical issue to be resolved before the

Court decides any other cause, Section 363 sales are

also a common feature of Chapter 11 bankruptcies.

Therefore, a decision by this Court would provide

much-needed clarity and uniformity in resolving the

bad faith transferee issue tied to U.C.C. Article 9 dispute,

which has substantial implications for both bankruptcy

jurisdiction and the validity of bankruptcy sales which

warrant this Court to grant Ceritirari to hear this case

for addressing the scope of statutory language for

Bankruptcy Court jurisdiction under 28 U.S.C. 157(b)(2)

and 28 U.S.C. § 1334 and the interpretation of a good

faith purchaser under 11 U.S.C. § 363(m).

D. This case presents an ideal vehicle to hear a

case with “national significance” recurring

in its nature and “could have precedential

value” for further defining Bankruptcy

Court jurisdiction and determining good

faith purchaser status in the bankruptcy sale

while the disputes tied to U.C.C Article 9 sale

but also it will promote “the policy of not

rewarding those that do not act in good

faith”.

The U.C.C. is a comprehensive set of laws governing

all commercial transactions in the United States. It is

not a federal law, but a uniformly adopted state law.

The U.C.C. has been called “the backbone of American

commerce” because it provides a consistent set of laws

for commercial transactions across the United States,

enabling businesses to contract with confidence and

promoting economic growth in our nation.

The Bankruptcy Code is to afford the honest but

unfortunate debtor "a new opportunity in life with a

clear field for future effort, unhampered by the pressure

and discouragement of preexisting debt.'" Grogan v.

Garner, 498 U.S. 279, 286, 111 S. Ct. 654, 659, 112

L.Ed.2d 755 (1991). But that objective is tempered by

an awareness that debtors who lack good faith cannot

be rewarded with the benefits of the bankruptcy process.

See Natural Land Corp. v. Baker Farms, Inc. (In re

Natural Land Corp.), 825 F.2d 296, 297-98 (11th Cir.

1987). Further, if a bankruptcy petition is filed by a bad-

faith transferee in the U.C.C. Article 9 sale, like this case,

which it clearly abuses the Bankruptcy Code by

circumventing or undermining state law. This can be

particularly problematic when the bankruptcy petition

has no genuine need for bankruptcy relief by filing in

bad faith. There is no meaningful dispute from the

Respondents that the petitions were filed in bad faith3

as a matter of law in this case.

The issues in this case that are tied to the U.C.C.

dispute are clearly presented, were fully briefed, and

decided by the Second Circuit, there are no factual or

procedural obstacles that would detract from the

Court’s ability to focus on this critical issue of law.

Petitioners would have prevailed on two grounds, either

of which would be sufficient: (1) bankruptcy petitions

were filed by a bad faith transferee in the U.C.C. Article

9 sale which does not have authorization to file the

bankruptcy under U.C.C adopted by the state law and

its Official Comments; and (2) buyers in the bankruptcy

sale are not good faith purchasers because the bad faith

transferee in the Article 9 sale cannot take free right

from U.C.C.-Debtor-Petitioner which constitutes the

3 In the Order entered by the Eastern District Court, which is

currently pending appeal before the Second Court with case number

25-1507, the District Court clearly and specifically finds that [w]ith

respect to the bankruptcy court’s jurisdiction and order denying

Petitioners’ motion to dismiss for filing bankruptcy petitions

frivolously and in bad faith], Respondent(s) either dismisses

Petitioners’ arguments as “irrelevant,”, or does not address them at all.”

see ECF Case 1:24-cv-05445-FB Document 28 Filed 04/23/25 Page 6

of 17 Page ID #: 13524.

adverse claim to defeat the good faith purchaser status

for a bankruptcy buyer.

Granting review in this case would afford the Court

the opportunity to address both grounds, or

alternatively, to reverse solely on the jurisdictional issue

if it so chooses. This case is particularly well-suited for

review because it presents, for the first time, the

question of whether a bad-faith transferee in a U.C.C.

Article 9 sale may file a bankruptcy petition related to

both the Bankruptcy Court’s jurisdiction and the

validity of the resulting bankruptcy sale. In future cases,

particularly if this petition is denied, bad-faith

transferees will increasingly exploit the bankruptcy

process to circumvent and undermine state law,

effectively rendering U.C.C. Article 9 sale and its relief

meaningless as a practical matter in our entire nation

by abusing or misusing the Bankruptcy Code and

Bankruptcy Courts as a vehicle to file bankruptcy

petitions in bad faith, as in this case.

This case involves a new form of business scam to

abuse both the U.C.C. and the Bankruptcy Code, as

follows, by way of this case as an example:

In the underlying U.C.C. loan transaction, the

U.C.C.-Lender deliberately withheld the necessary

funds to create a “default” against U.C.C. borrowers and

the U.C.C.-Debtor. Thereafter, the Lender and Buyer 1,

an affiliated business entity of the U.C.C.-Lender,

initiated a U.C.C. sale by collusion under the name of

U.C.C. “public sale” by Buyer 1 bidding a nominal price

instructed by the U.C.C.-Lender in bad faith with only

one bidder presented in a public auction, such as Buyer

1 bidding only $100,000 to acquire the collaterals, which

are the memberships of the Respondents to control the

Respondents, with assets valued at no less than $15

million in the U.C.C. sale in this case; When the U.C.C.Debtor–Petitioner sought relief under Article 9 in state

courts against the U.C.C.-Lender, Buyer 1 et al, the

U.C.C-Lender moved for judicial foreclosure. After the

state court stayed the foreclosure action in order to

adjudicate other disputes, such as U.C.C. Article 9 sale

liability for being commercially unreasonable that could

affect the outcome of the foreclosure, the U.C.C.-Lender,

through its affiliated entity, Buyer 1, filed bankruptcy

petitions on behalf of the Respondents to abuse the

bankruptcy system. The petitions were filed despite the

absence of any realistic prospect for reorganization for

the sole purpose of employing the Bankruptcy Code and

Bankruptcy Court as tools or vehicles to avoid the

U.C.C. Article 9 liabilities as a litigation tactic in

addition to other grounds demonstrating that the filings

were made in bad faith. If the lower courts’ decisions are

affirmed without being heard by this Court, New York

U.C.C. § 9-617 (c), along with Official Comments (4) and

related provisions of U.C.C Article 9 relief, will be

rendered meaningless because, upon bankruptcy

proceedings to be completed, Respondents would leave

no assets or monetary value for dispute in the state

courts, regardless of the underlying merits of the cases

in the state courts.

The issues raised in this case are not isolated

incidents limited only to the Petitioners; rather, the

nature of U.C.C. Article 9 sale disputes would be

recurring to other similarly situated borrowers and

lenders with the same issues in other cases. For

example, as indicated in the above PEB

COMMENTARY NO. 22, it makes it very clear:

“[t]his Commentary disagrees with the

decision in Atlas MF Mezzanine Borrower,

LLC v. Macquarie Texas Loan Holder

LLC, 174 A.D.3d 150 (2019). In that case

the debtor alleged that the disposition

transferee had not acted in good faith and

that therefore the disposition should be set

aside. The court, citing a policy against

disturbing foreclosure sales in the interest

of commercial certainty, rejected the

debtor’s argument that the sale should be

set aside and instead explained its view

that the debtor’s remedy was to seek

monetary damages. Although the debtor

may indeed be entitled to seek monetary

damages for a disposition that did not

comply with Section 9-610, the debtor is

also entitled to the debtor’s right of

redemption and other rights in the

collateral when the transferee has not

acted in good faith. A bad faith transferee

may not rely on the “take free” rule. Any

policy based on commercial certainty is

subordinate to the policy of not rewarding

those that do not act in good faith.” (App.,

124a-125a)

Such policy consideration from PEB is consistent

with this Court’ position, for example, [t]he maxim that

“‘he who comes into equity must come with clean hands’”

has long guided this Court’s exercise of equitable

discretion. Precision Instrument Mfg. Co. v. Automotive

Maintenance Machinery Co., 324 U. S. 806, 814, 65 S.

Ct. 993, 89 L. Ed. 1381, 1945 Dec. Comm'r Pat. 582

(1945). While “‘equity does not demand that its suitors

shall have led blameless lives’” as to other matters, “it

does require that they shall have acted fairly and

without fraud or deceit as to the controversy in issue.”

Trump v. J.G.G., 145 S. Ct. 1003,1015-16 (2025).

(Internal citation omitted).

It is a self-imposed ordinance that closes the doors of

a court of equity to one tainted with inequitableness or

bad faith relative to the matter in which he seeks relief,

however improper may have been the behavior of the

defendant. That doctrine is rooted in the historical

concept of the court of equity as a vehicle for

affirmatively enforcing the requirements of conscience

and good faith. This maxim necessarily gives a wide

range to the equity court's use of discretion in refusing

to aid the unclean litigant. Precision Instrument Mfg.

Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 814-15, 65

S. Ct. 993, 997-98 (1945). (Internal citation omitted).

Although PEB issued the Official Comments for how

to correctly interpret U.C.C. § 9-617 while the U.C.C.

transferee is acting in bad faith in the U.C.C Article 9

sale, the Second Circuit ignored the interpretation from

PEB COMMENTARY NO. 22 in determining

bankruptcy jurisdiction and good-faith purchaser

status under Section 363(m), which expose Petitioners

and other potential litigants similarly situated to unfair

and prejudicial outcomes at least in the Second Circuit

jurisdiction. Such an erroneous position for ignoring the

interpretation of U.C.C. § 9-617 from PEB would be

easily extended to other circuit jurisdictions as well

while bankruptcy is tied to U.C.C. Article 9 sale dispute.

Therefore, it is time for this Court to take action to

resolve these issues raised in this case to enforce a public

policy of “not rewarding those that do not act in good

faith” by the exercise of equitable discretion. A decision

by this Court establishing clear precedent on the issues

presented in this case would have a far-reaching

positive impact on U.S. businesses, particularly at the

critical intersection of the U.C.C. and bankruptcy law

tied to U.C.C. Article 9 sale disputes, which warrants

this Court to grant certiorari to hear this case for justice

and fairness.

CONCLUSION

For the foregoing reasons, the petition for a writ of

certiorari should be granted.

Respectfully submitted,

Dated: September 19, 2025

Queens, New York

/s/Joe Zhenghong Zhou

Joe Zhenghong Zhou, Esq.

Counsel of Record

Law Offices of Joe Zhenghong

Zhou & Associates, PLLC

136-20 38th Avenue, Suite 10H

Flushing, NY 11354 USA

Tel: (718) 539-7098

joezhoulaw@gmail.com

Case No. 25IN THE SUPREME COURT OF

THE UNITED STATES

______________________

Clean Air Car Service & Parking Branch Three, LLC,

Clean Air Car Service & Parking Corp., Operr Service

Bureau, Inc.., Operr Technologies, Inc., and Kevin S.

Wang,

Petitioners,

Clean Air Car Service & Parking Branch Two, LLC.,

Operr Plaza, LLC.,

Respondents.

On Petition for a Writ of Certiorari to the United States

Court of Appeals for the Second Circuit

______________________

APPENDIX FOR THE PETITION FOR A

WRIT OF CERTIORARI

_____________________

JOE ZHENGHONG ZHOU, ESQ,

Counsel of Record

Law Offices of Joe Zhenghong

Zhou & Associates, PLLC

136-20 38th Avenue, Suite 10H

Flushing, NY 11354 USA

Tel: (718) 539-7098

joezhoulaw@gmail.com

TABLE OF APPENDICES

Appendix A:

Court Order,

24-1742 (Lead), 24-1738 (Con), 24-1743 (Con)

United States Court of Appeals for the Second Circuit

June 25, 2025........................................................................1a

Appendix B:

Summary Order,

24-1742 (Lead), 24-1738 (Con), 24-1743 (Con)

United States Court of Appeals for the Second Circuit

May 15, 2025 ........................................................................3a

Appendix C:

Memorandum and Order

24-cv-02377 (FB)

United States District Court Eastern District of New

York

June 24, 2024.....................................................................13a

Appendix D:

Memorandum and Order

24-cv-01088 (FB)

United States District Court Eastern District of New

York

June 24, 2024.....................................................................15a

Appendix E:

Memorandum and Order

23-cv-09495 (FB)

United States District Court Eastern District of New

York

June 24, 2024......................................................................19a

Appendix F:

Memorandum and Order

23-cv-09495 (FB)

United States District Court Eastern District of New

York

March 13, 2024..................................................................25a

Appendix G:

Court Order

23-cv-41937 (NHL)

United States Bankruptcy Court Eastern District of

New York

March 28, 2024..................................................................35a

Appendix H:

Court Order

23-cv-41937 (NHL)

United States Bankruptcy Court Eastern District of

New York

February 8, 2024...............................................................45a

Appendix I:

Court Order 23-cv-41937 (NHL)

United States Bankruptcy Court Eastern District of

New York

February 8, 2024...............................................................68a

Appendix J:

Court Order and Judgment

Index No. 654192/21, Case No. 2022-00695

Supreme Court of the State of New York Appellate

Division, First Judicial Department

May 2, 2024.........................................................................91a

Appendix K:

Decision and Order

Index No. 654192/21

Supreme Court of the State of New York

August 20, 2021.................................................................94a

Appendix L:

Decision and Order

Index No. 654192/21

Supreme Court of the State of New York

July 22, 2021.......................................................................98a

Appendix M:

28 U.S. Code § 157 Judiciary and Judicial

Procedure Provisions.....................................................102a

Appendix N:

28 U.S. Code § 1334 Judiciary and Judicial

Procedure Provisions.....................................................106a

Appendix O:

11 U.S. Code § 363(m) Federal Bankruptcy

Provision............................................................................109a

Appendix P:

28 U.S. Code § 158 Judiciary and Judicial

Procedure Provisions.....................................................110a

Appendix Q:

28 U.S.C. § 1257 Judiciary and Judicial

Procedure Provisions ....................................................116a

Appendix R:

28 U.S.C. § 1738 Judiciary and Judicial

Procedure Provisions.....................................................117a

Appendix S:

Amendments to Official Comments

PEB COMMENTARY NO. 22 STATUS OF A

DISPOSITION UNDER SECTION 9-610 OF THE

UNIFORM COMMERCIAL CODE IF THE

TRANSFEREE DOES NOT ACT IN GOOD FAITH

August 24, 2020...............................................................118a

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE

SECOND CIRCUIT

_____________________________________________

At a stated term of the United States Court of Appeals

for the Second Circuit, held at the Thurgood Marshall

United States Courthouse, 40 Foley Square, in the City

of New York, on the 25th day of June, two thousand

twenty-five.

________________________________________

In Re: Clean Air Car Service & Parking Branch Two,

LLC,

Debtor.

**********************************************

Clean Air Car Service & Parking Branch Three, LLC,

Appellant,

IV - CVCF NEB I Trust, IV - CVCF NEB REO, LLC,

Clean Air Car Service & Parking Corp.,

Operr Technologies Inc., Operr Service Bureau Inc.,

Kevin S. Wang, Creditor,

Plaintiffs,

ORDER

Docket Nos: 24-1742 (Lead)

24-1738 (Con), 24-1743 (Con)

Clean Air Car Service & Parking Branch Two, LLC,

Debtor - Appellee,

Operr Plaza, LLC,

Joint-Administered-Debtor-Appellee.

_______________________________________

Appellant, Clean Air Car Service & Parking Branch

Three, LLC, filed a petition for panel rehearing, or, in

the alternative, for rehearing en banc. The panel that

determined the appeal has considered the request for

panel rehearing, and the active members of the Court

have considered the request for rehearing en banc.

IT IS HEREBY ORDERED that the petition is

denied.

FOR THE COURT:

Catherine O'Hagan Wolfe, Clerk

/s/ Catherine O'Hagan Wolfe

APPENDIX B

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT

HAVE PRECEDENTIAL EFFECT. CITATION

TO A SUMMARY ORDER FILED ON OR

AFTER JANUARY 1, 2007, IS PERMITTED

AND IS GOVERNED BY FEDERAL RULE OF

APPELLATE PROCEDURE 32.1 AND THIS

COURT’S LOCAL RULE 32.1.1. WHEN CITING

A SUMMARY ORDER IN A DOCUMENT

FILED WITH THIS COURT, A PARTY MUST

CITE EITHER THE FEDERAL APPENDIX OR

AN ELECTRONIC DATABASE (WITH THE

NOTATION “SUMMARY ORDER”). A PARTY

CITING TO A SUMMARY ORDER MUST

SERVE A COPY OF IT ON ANY PARTY NOT

REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals

for the Second Circuit, held at the Thurgood Marshall

United States Courthouse, 40 Foley Square, in the City

of New York, on the 15th day of May, two thousand

twenty-five

PRESENT: GERARD E. LYNCH,

SARAH A. L. MERRIAM,

MARIAARAÚJO KAHN

Circuit Judges.

__________________________________________

IN RE: CLEAN AIR CAR SERVICE &

PARKING BRANCH TWO, LLC,

Debtor.

_________________________________________________

CLEAN AIR CAR SERVICE & PARKING BRANCH

THREE, LLC,

Appellant,

IV - CVCF NEB I TRUST; IV - CVCF NEB REO, LLC;

CLEAN AIR CAR SERVICE & PARKING CORP.;

OPERR TECHNOLOGIES INC.; OPERR SERVICE

BUREAU INC.; KEVIN S. WANG, Creditor,

Plaintiffs,

24-1742-bk(L);

24-1738-bk(Con);

24-1743-bk(Con)

CLEAN AIR CAR SERVICE & PARKING

BRANCH TWO, LLC,

Debtor-Appellee,

OPERR PLAZA, LLC,

Joint-Administered-Debtor-Appellee.

__________________________________________

For Appellant:

KEVIN S. WANG, Wood Wang &

Associates PLLC, Flushing, NY.

For Debtors-Appellees: JAY S. HELLMAN (Thomas

A. Draghi, on the brief), Westerman Ball Ederer

Miller Zucker & Sharfstein LLP, Uniondale, NY.

Consolidated appeal from multiple judgments of the

United States District Court for the Eastern District of

New York (Block, J.).

UPON

DUE

CONSIDERATION,

these

consolidated appeals from the judgments of the District

Court entered on June 24, 2024, are DISMISSED.

Plaintiff-Appellant Clean Air Car Service & Parking

Branch Three, LLC (“Appellant”) appeals from three

District Court orders dismissing the appeals of three

separate Bankruptcy Court orders concerning the sale

of assets and property. Specifically, Appellant

challenges Bankruptcy Court orders: (1) approving the

sale of a parking garage owned by Appellee Clean Air

Car Service & Parking Branch Two, LLC (“Clean Air

2”) to an unaffiliated purchaser for value at a public

auction; (2) approving the sale of an office building

owned by Appellee Operr Plaza, LLC (“Operr Plaza”) to

a different unaffiliated purchaser for value at a public

auction (collectively, the “Sale Orders”); and (3) evicting

Appellant from the parking garage formerly owned by

Clean Air 2 (the “Eviction Order”).

The District Court dismissed the appeals of the Sale

Orders as statutorily moot, finding that the assets were

sold to good-faith purchasers for value pursuant to 11

U.S.C. §363(m). The District Court also dismissed the

appeal of the Eviction Order as moot, determining that

Appellant had already been evicted from the parking

garage. Appellant now appeals from the District

Court’s orders of dismissal. We assume the parties’

familiarity with the underlying facts, procedural history,

and arguments on appeal, to which we refer only as

necessary to explain our decision.

STANDARD OF REVIEW

“A district court’s order in a bankruptcy case is subject

to plenary review, meaning that this Court undertakes

an independent examination of the factual findings

and legal conclusions of the bankruptcy court.” In re

Kalikow, 602 F.3d 82, 91 (2d Cir. 2010) (citation and

quotation marks omitted). “Whether an action is moot

is [also] a legal question that we address de novo.” Bellin

v. Zucker, 6 F.4th 463, 473 (2d Cir. 2021) (citation

omitted).

DISCUSSION

I. Appellant’s Motion to Dismiss for Lack of

Subject Matter Jurisdiction

We first address Appellant’s motion to dismiss the

underlying action and, therefore, these appeals, on the

basis that the Bankruptcy Court lacked subject matter

jurisdiction. Appellant summarily asserts in its brief

that “the Appellees are prohibited from filing for

bankruptcy,” Appellant’s Br. at 28, relying upon a

reading of the operating agreements that were in place

for Operr Plaza and Clean Air 2 prior to 2021, when

they were sold to new owners. Appellant’s reasoning is

opaque, but the thrust of its argument appears to be

that when Operr Plaza and Clean Air 2 were sold to a

third-party buyer as the result of a UCC foreclosure

sale in 2021,1 that third-party buyer was not a good

faith purchaser. Appellant contends that the LLC

members put in place by the third-party buyer

therefore lacked authority to take actions on behalf of

Operr Plaza and Clean Air 2. It was these new

members who modified the operating agreements to

expressly permit the companies, with “unanimous

written consent of the Member and the Board,” to

“institute proceedings to have the Company be

adjudicated bankrupt.” Supp. App’x at 879, 892 (Clean

Air 2); id. at 903, 916 (Operr Plaza). Appellant says that

these modifications were unauthorized and of no effect.

Accordingly, Appellant argues, the filing of the

bankruptcy petitions was not authorized and the

Bankruptcy Court lacked jurisdiction over this matter.

We are not persuaded. Appellant has failed to establish

that Operr Plaza and Clean Air 2 lacked authority to

file for bankruptcy. We therefore conclude that the

record before us, including the findings made in the

related state court proceedings, amply supports the

exercise of jurisdiction over this matter by the

Bankruptcy Court and accordingly deny Appellant’s

motion to dismiss. 2

See Operr Plaza, LLC v. Wang, 208 N.Y.S.3d 196 (1st Dep’t 2024)

(observing that Operr Plaza and Clean Air Two were sold in “an

authorized UCC sale” to a third party).

2 We also deny Appellant’s motion to the extent it seeks sanctions and

an award of fees and costs.

II. Appellees’ Motions to Dismiss the Appeals as

Moot

Appellees have filed several motions to dismiss the

appeals. See ACMS Nos. 33- 35, 169, 171. In their

motions, and in their brief, Appellees contend that the

orders appealed from are moot. We agree.

A. The Appeals of the Sale Orders Are Moot.

The District Court concluded that “any appeal of the

sale of the Operr Plaza’s assets is statutorily moot

because the property was sold to a good-faith purchaser

within the meaning of 11 U.S.C. §363(m).” App’x at 212.

Likewise, the District Court concluded that the appeal

of the sale order as to “the Clean Air Two Debtor’s

property” was moot because that property, too, “was

sold to a good-faith purchaser” under the same

definition. Id. at 113. We agree as to both.

Section 363(m) provides:

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.

A “good-faith purchaser” is defined as “one who

purchases the assets for value, in good faith and

without notice of adverse claims.” In re Gucci, 126 F.3d

380, 390 (2d Cir. fraudulent, collusive actions

specifically intended to affect the sale price or control

the outcome of the sale.” Id.

Appellant contends that the District Court’s conclusion

that the debtors’ assets were purchased by good-faith

purchasers is wrong because the purchasers did not

pay value for the assets and were on notice of adverse

claims. We disagree. First, The Clean Air 2 and Operr

Plaza properties were each sold at a fair and

competitive auction on December 7, 2023, and there is

no evidence of fraud or collusion. That is sufficient to

establish that the purchasers paid value for the assets.

See In re Colony Hill Assocs., 111 F.3d 269, 276 (2d Cir.

1997). Second, as the District Court observed, the only

“adverse claims” identified by Appellant are (1) the

plainly meritless claim that Mr. Wang has ongoing

authority over the LLCs, and (2) a disputed lease

agreement concerning the Clean Air 2 property. See

App’x at 115-16. We have not addressed what

constitutes an “adverse claim” for purposes of the goodfaith purchaser analysis, but both parties endorse the

Fifth Circuit’s definition of an adverse claim as “a

dispute in ownership interest” on appeal. Matter of RE

Palm Springs II, L.L.C., 65 F.4th 752, 761 (5th Cir.

2023). We accordingly assume, for purposes of this case,

without deciding, that that is the correct definition of an

“adverse claim.” For the reasons discussed in the

District Court’s well-reasoned orders, we agree that

under that definition, neither of these purported

10 a

adverse claims would bear on the buyers’ status as

good-faith purchasers.

1997) (citations and quotation marks omitted). “The

good-faith requirement prohibits. 3

We therefore conclude that the two appeals from the

Bankruptcy Court’s Sale Orders are statutorily moot

pursuant to §363(m) and must be dismissed. See In re

Gucci, 126 F.3d at 389 (“We cannot take any action that

affects the judicially-authorized sale if the purchaser

acted in good faith and no stay was granted.”).

B. The Appeal of the Eviction Order Is Moot.

Finally, Appellant argues that the District Court erred

in dismissing the Eviction Order as moot. The property

at issue was sold on February 20, 2024, Appellant was

formally evicted from the property by the United States

Marshal on April 18, 2024, and thereafter the new

owner began operating on the premises. “Acase is moot

when the issues presented are no longer ‘live’ or the

parties lack a legally cognizable interest in the outcome.

If there is no reasonable expectation that the wrong will

be repeated, then it becomes impossible for the court to

grant any effectual relief whatever to the prevailing

party.” White River Amusement Pub, Inc. v. Town of

Hartford, 481 F.3d 163, 167-68 (2d Cir. 2007) (citations

and quotation marks omitted). The property has been

sold. Appellant has been evicted and has no right to

3 The exception in 11 U.S.C. §363(m) for cases in which a sale is

stayed pending appeal does not apply, because we previously denied

such a stay. SeeApp’x at 120.

11 a

possession or tenancy. No effective relief can now be

granted, more than a year after the eviction was

completed. See In re M.A.S. 284 Parking Corp., 107

F.3d 3, 1997 WL 62958, at *1 (2d Cir. 1997) (summary

order) (“We find that, after the eviction, the debtor’s

appeals to the district court and to this court were moot.

Events occurring during the pendency of an appeal

that would prevent an appellate court from fashioning

effective relief render an appeal moot.”); Adams v.

Standard Fed. Bank, 371 F. App’x 187, 188 (2d Cir.

2010) (summary order) (finding that appeal from

denial of an order enjoining bank from evicting plaintiff

was moot because plaintiff had already “been evicted

from the[] premises”). We therefore conclude that the

appeal from the Eviction Order is moot and was

properly dismissed, and that the appeal of the Eviction

Order to this Court is also moot. 4

4 Appellees also contend that the appeal from the Sale Orders and

Eviction Order should be dismissed under the equitable mootness

doctrine. We have previously held that “a bankruptcy appeal is

presumed equitably moot when the debtor’s reorganization plan has

been substantially consummated.” In re BGI, Inc., 772 F.3d 102, 108

(2d Cir. 2014) (citation omitted). The debtors’ plans in this case have

been approved, and the debtors’ assets have been distributed except

for a small pot of money reserved for the ongoing administration of

the debtors’estates and the resolutionof still-pending claimobjections.

See Supp. App’x at 1535-56 (Clean Air 2 Confirmation Order); id. at

1610-31 (Operr Plaza Confirmation Order). The resulting

presumption of equitable mootness may be overcome only “where: (i)

effective relief can be ordered; (ii) relief will not affect the debtor’s reemergence; (iii) relief will not unravel intricate transactions; (iv)

affected third-parties are notified and able to participate in the appeal;

12 a

We have considered Appellant’s remaining arguments

and find them to be without merit. Accordingly, for the

reasons set forth above, Appellant’s motion to dismiss

for lack of subject matter jurisdiction is DENIED.

Appellees’ motions to dismiss the appeals as moot are

GRANTED. These appeals are hereby DISMISSED.

FOR THE COURT:

Catherine O’Hagan Wolfe, Clerk of Court

/s/ Catherine O’Hagan Wolfe

and (v) appellant diligently sought a stay of the reorganization plan.”

In re MPM Silicones, L.L.C., 874 F.3d 787, 804 (2d Cir. 2017) (citation

and quotation marks omitted). Appellant fails to meet these

exceptions.Accordingly, we find thatAppellant’s appeal from the Sale

Orders and Eviction Order is also subject to dismissal on the basis of

equitable mootness.

APPENDIX C

13 a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

---------------------------------------------------------------x

CLEAN AIR CAR SERVICE & PARKING

BRANCH THREE, LLC, CLEAN AIR CAR

SERVICE & PARKING CORP.,

Appellants,

MEMORANDUM AND ORDER

-againstCase No. 1:24-cv-2377 (FB)

CLEAN AIR CAR SERVICE & PARKING

BRANCH TWO, LLC,

Appellee.

---------------------------------------------------------------x

Appearances:

For the Appellants:

KEVIN S. WANG

Wood Wang & Associates, PLLC

30-50 Whitestone Expy, Ste. 402, Flushing, NY 11354

For the Appellees:

JAY S. HELLMAN

THOMAS A. DRAGHI

ALEXANDRA TROIANO

Westerman Ball Ederer Miller Zucker & Sharfstein,

LLP, 1201 RXR Plaza, Uniondale, NY 11556

BLOCK, Senior District Judge:

Appellants ask the Court to vacate the March 28, 2024

order of the bankruptcy court authorizing the eviction

14 a

and removal of Clean Air Service & Parking Branch 3,

LLC (“Clean Air Three”) from the property located at

37-20 Prince Street, Unit PU, Flushing, Queens

County, NY 11354 (Block 4972, Lot 1104) (the

“Property”). See In re: Clean Air Car Service & Parking

Branch Two, LLC and Operr Plaza, LLC, Case No. 2341937 (NHL), ECF No. 331 (Bankr. E.D.N.Y. 2023).

The Property was sold on February 20, 2024, after the

Bankruptcy Court issued an order approving the sale.1

The Bankruptcy Court subsequently entered an order

granting Appellee’s eviction motion. Clean Air Three

was evicted from the Property on April 18, 2024, by the

United States Marshall.

As Clean Air Three has been evicted, this appeal is

rendered moot. See In re M.A.S. 284 Parking Corp., 107

F.3d 3 (2d Cir. 1997) (“[A]fter the eviction, the debtor’s

appeals . . . were moot.”). Accordingly, the appeal is

dismissed.

SO ORDERED.

/s/ Frederic Block

FREDERIC BLOCK

Senior United States District Judge

Brooklyn, New York

June 24, 2024

1 This Court dismissed the appeal of that order as statutorily moot

under 11 U.S.C. § 363(m).

APPENDIX D

15 a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

---------------------------------------------------------------x

CLEAN AIR CAR SERVICE & PARKING

BRANCH THREE, LLC, CLEAN AIR CAR

SERVICE & PARKING CORP., OPERR

TECHNOLOGIES, INC., OPERR SERVICE

BUREAU, INC., KEVIN S. WANG,

Appellants,

-against-

MEMORANDUM AND ORDER

Case No. 1:24-cv-1088 (FB)

CLEAN AIR CAR SERVICE & PARKING

BRANCH TWO, LLC, and OPERR PLAZA, LLC,

Appellees.

---------------------------------------------------------------x

Appearances:

For the Appellants:

KEVIN S. WANG

Wood Wang & Associates, PLLC

30-50 Whitestone Expy, Ste. 402, Flushing, NY 11354

For the Appellees:

JAY S. HELLMAN

THOMAS A. DRAGHI

ALEXANDRA TROIANO

Westerman Ball Ederer Miller Zucker & Sharfstein,

LLP, 1201 RXR Plaza, Uniondale, NY 11556

16 a

BLOCK, Senior District Judge:

Appellants ask the Court to vacate and reverse the

February 8, 2024 order of the United States

Bankruptcy Court for the Eastern District of New York

approving the sale of the assets of the Debtor-Appellee,

Operr Plaza, LLC (the “Operr Plaza Debtor”). In re:

Clean Air Car Service & Parking Branch Two, LLC

and Operr Plaza, LLC, Case No. 23-41937 (NHL), ECF

No. 247 (Bankr. E.D.N.Y. 2023) (the “Sale Order”).

They also request that the Court dismiss the

bankruptcy proceeding in its entirety, sua sponte.

For the following reasons, this appeal is dismissed as

statutorily moot.

The Court relayed the background of this case in its

March 13, 2024 Memorandum and Order denying

Appellants’ motion for a stay in Clean Air Car Serv. &

Parking Branch Three, LLC v. Clean Air Car Serv. &

Parking Branch Two, LLC, No. 23-CV-9495 (FB), 2024

WL 1144635, at *1 (E.D.N.Y. Mar. 13, 2024) (the “Stay

Decision”).1 The Court assumes the parties’ familiarity

with those facts and incorporates them herein by

reference.

1 The Operr Plaza Debtor’s bankruptcy proceeding is being jointly

administered with that of Clean Air Car Service & Parking Branch

Two, LLC (the “Clean Air Two Debtor”). The bankruptcy court

entered separate orders approving the sale of the assets of each

Debtor andAppellants appealed both

17 a

This appeal concerns the authorized sale of the Operr

Plaza Debtor’s the principal asset — an office

building— to an unaffiliated bidder (the “Buyer”) for

$2.5 million.

II.

As the Court found in the appeal of the order approving

the sale of the Clean Air Two Debtor’s assets, any

appeal of the sale of the Operr Plaza’s assets is

statutorily moot because the property was sold to a

good-faith purchaser within the meaning of 11 U.S.C. §

363(m). The Operr Plaza Debtor’s property was sold for

value, as determined by the amount an unaffiliated

third-party was willing to pay in a fair, competitive

auction. See In re Boston Generating, LLC, 440 B.R.

302, 324 (Bankr. S.D.N.Y. 2010) (“[Fair] sale process

reflects a true test of value.”). There is no evidence in the

record of any “fraudulent, collusive actions specifically

intended to affect the sale price or control the outcome

of the sale.” See In re Gucci, 126 F.3d 380, 390 (2d Cir.

1997). And Appellants’ already-litigated claim to

maintain ownership and management rights in the

Operr Plaza Debtor, see Operr Plaza, LLC v. Wang, No.

654192/2021, 2022 WL 43689, at *1 (N.Y. Sup. Ct. Jan.

03, 2022) (recognizing that Kevin Wang “no longer

owns the [Operr Plaza Debtor].”), aff’d, 208 N.Y.S.3d

196 (1st Dep’t 2024), is not the type of “adverse claim”

that could impinge upon the Buyer’s status as a goodfaith purchaser. See Matter of RE Palm Springs II,

L.L.C., 65 F.4th 752, 760 (5th Cir.) (“Adverse claims

with regard to good faith purchasers implies ownership

18 a

must be disputed . . . the knowledge required to vitiate

such a label is of defect in title or adverse claim to it.”)

(cleaned up) (emphasis in original).

Accordingly, this appeal is statutorily moot pursuant to

§ 363(m).

CONCLUSION

For the foregoing reasons, the appeal of the bankruptcy

court order approving the sale of the Operr Plaza

Debtor’s assets is DISMISSED.

SO ORDERED.

/s/ Frederic Block

FREDERIC BLOCK

Senior United States District Judge

Brooklyn, New York

June 24, 2024

APPENDIX E

19 a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

---------------------------------------------------------------x

CLEAN AIR CAR SERVICE & PARKING

BRANCH THREE, LLC, CLEAN AIR CAR

SERVICE & PARKING CORP., OPERR

TECHNOLOGIES, INC., OPERR SERVICE

BUREAU, INC., KEVIN S. WANG,

Appellants,

-against-

MEMORANDUM AND ORDER

Case No. 1:24-cv-09495 (FB)

CLEAN AIR CAR SERVICE & PARKING

BRANCH TWO, LLC, and OPERR PLAZA, LLC,

Appellees.

---------------------------------------------------------------x

Appearances:

For the Appellants:

KEVIN S. WANG

Wood Wang & Associates, PLLC

30-50 Whitestone Expy, Ste. 402, Flushing, NY 11354

For the Appellees:

JAY S. HELLMAN

THOMAS A. DRAGHI

ALEXANDRA TROIANO

Westerman Ball Ederer Miller Zucker & Sharfstein,

LLP, 1201 RXR Plaza, Uniondale, NY 11556

20 a

BLOCK, Senior District Judge:

Appellants ask the Court to vacate and reverse the

February 8, 2024 order of the United States

Bankruptcy Court for the Eastern District of New York

approving the sale of the assets of the Debtor-Appellee,

Clean Air Car Service & Parking Branch Two, LLC

(the “Clean Air Two Debtor”). In re: Clean Air Car

Service & Parking Branch Two, LLC and Operr Plaza,

LLC, Case No. 23-41937 (NHL), ECF No. 246 (Bankr.

E.D.N.Y. 2023) (the “Sale Order”). They also request

that the Court dismiss the bankruptcy proceeding in its

entirety, sua sponte.

For the following reasons, this appeal is dismissed as

statutorily moot.

The Court relayed the facts of this case in its March 13,

2024 Memorandum and Order denying Appellants’

motion for a stay pending appeal. Clean Air Car Serv.

& Parking Branch Three, LLC v. Clean Air Car Serv.

& Parking Branch Two, LLC, No. 23-CV-9495 (FB),

2024 WL 1144635, at *1 (E.D.N.Y. Mar. 13, 2024) (the

“Stay Decision”). The Court assumes the parties’

familiarity with those facts and incorporates them

herein by reference.

As noted therein, this appeal concerns the authorized

sale of the Clean Air Two Debtor’s principal asset — a

parking garage — to an unaffiliated bidder (the

“Buyer”) for $4.5 million.

21 a

II.

The threshold issue before the Court is whether this

appeal is statutorily moot because the Clean Air Two

Debtor’s property was sold to a good-faith purchaser.

The Court holds that it is.

Section 363(m) of the Bankruptcy Code provides that:

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 means that when, as here, a sale authorized

pursuant to 11 U.S.C. § 363 is not stayed, the appeal is

statutorily moot if the property was purchased in good

faith.1 See In re Motors Liquidation Co., 428 B.R. 43, 53

(S.D.N.Y. 2010). Agood-faith purchaser is someone who

“purchases the assets for value, in good faith and

without notice of adverse claims.” See In re Gucci, 126

F.3d 380, 390 (2d Cir. 1997).

1 As noted in the Stay Decision, the Supreme Court recently

determined that § 363(m) was non-jurisdictional. See MOAC Mall

Holdings LLC v. Transform Holdco LLC, 598 U.S. 288, 297 (2023).

Thus, although compliance with § 363(m) remains important and

mandatory, “a party can lose the benefit of its terms.” See Matter of

Fieldwood Energy LLC, 93 F.4th 817, 823 (5th Cir. 2024).

22 a

The record is plain regarding the first and second

prongs: the Clean Air Two Debtor’s property was sold

for value, as determined by the amount an unaffiliated

third-party was willing to pay in a fair, competitive

auction. See In re Boston Generating, LLC, 440 B.R.

302, 325 (Bankr. S.D.N.Y. 2010) (“[Fair] sale process

reflects a true test of value.”). And there is no evidence

of any “fraudulent, collusive actions specifically

intended to affect the sale price or control the outcome

of the sale.” In re Gucci, 126 F.3d at 390.

The more significant question is the Buyer’s knowledge

of any “adverse claims.” Two groups of claims are at

issue.

First, Appellants have a claim against the estate

asserting that they have the right to operate the

parking garage and collect rent that would have

otherwise been paid to the Clean Air Two Debtor, based

on a disputed lease agreement. But the bankruptcy

court addressed this issue by ruling that the lease

agreement, to the extent it implicated an interest in the

property at all, was subject to “a bona fide dispute”

under 363(f).2 Accordingly, the property could be — and

was — sold “free and clear” of any interest implicated

by Appellants’ claims regarding the disputed lease

This determination was not clearly erroneous as the

representations from the parties, as discussed at the August 29

hearing, provided “an objective basis for either a factual or legal

dispute as to the validity of the [interest].” See In re Downtown

Athletic Club of New York City, Inc., No. M-47 (JSM), 2000 WL

744126, at *4 (S.D.N.Y. June 9, 2000)

23 a

agreement.3 See In re Borders Grp., Inc., 453 B.R. 477,

485 n.4 (Bankr. S.D.N.Y. 2011) (“[S]ection 363(m)

protects a good faith sale from an unstayed appellate

challenge, including where the sale is approved free of

interests under section 363(f).”); In re Scimeca Found.,

Inc., 497 B.R. 753, 772 (Bankr. E.D. Pa. 2013) (“[T]he

effect of such a sale is to divest the property sold of all

interests so that the purchaser holds no legal

responsibility to honor those interests.”). Thus, the

Buyer’s alleged knowledge of this claim did not bear on

its status as a good-faith purchaser, because the claim

was not adverse to the Buyer’s interest in the property.

See Matter of RE Palm Springs II, L.L.C., 65 F.4th 752,

760 (5th Cir.) (“Adverse claims with regard to good faith

purchasers implies ownership must be disputed . . . the

knowledge required to vitiate such a label is of defect in

title or adverse claim to it.”) (cleaned up) (emphasis in

original).

Second, Appellants rely on their already-litigated

claims to have continuing managerial and ownership

rights in the Clean Air Two Debtor because those

interests were not properly sold. See Operr Plaza, LLC

v. Wang, No. 654192/2021, 2022 WL 43689, at *1 (N.Y.

Sup. Ct. Jan. 03, 2022) (recognizing that Kevin Wang

“no longer owns the [Clean Air Two Debtor].”), aff’d, 208

N.Y.S.3d 196 (1st Dep’t 2024). Regardless of whether

those claims are now precluded or barred here by an

3 As the Bankruptcy Court explained in its order, Appellants are

“adequately protected by having their Encumbrances, if any . . .

attach to the cash proceeds of the Sale.” Sale Order 9.

24 a

abstention doctrine, they do not impinge upon the

Buyer’s status as a good-faith purchaser because they

do not create an ownership interest in the property that

was sold. Matter of RE Palm Springs, 65 F.4th at 760.

In sum, § 363(m) prohibits the Court from reversing or

modifying the bankruptcy court’s order, rendering this

appeal statutorily moot.

CONCLUSION

For the foregoing reasons, the appeal of the bankruptcy

court order approving the sale of the Clean Air Two

Debtor’s assets is DISMISSED.

SO ORDERED.

/s/ Frederic Block

FREDERIC BLOCK

Senior United States District Judge

Brooklyn, New York

June 24, 2024

APPENDIX F

25 a

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

---------------------------------------------------------------x

CLEAN AIR CAR SERVICE & PARKING

BRANCH THREE, LLC, CLEAN AIR CAR

SERVICE & PARKING CORP., OPERR

TECHNOLOGIES, INC., OPERR SERVICE

BUREAU, INC., KEVIN S. WANG,

Appellants,

-against-

MEMORANDUM AND ORDER

Case No. 1:24-cv-09495 (FB)

CLEAN AIR CAR SERVICE & PARKING

BRANCH TWO, LLC, and OPERR PLAZA, LLC,

Appellees.

---------------------------------------------------------------x

BLOCK, Senior District Judge:

At issue in this bankruptcy appeal is the bankruptcy

court’s order confirming the sale of the assets of Clean

Air Car Service & Parking Branch Two, LLC (“Clean

Air Two”), over the objection of Clean Air Car Service &

Parking Branch Three (“Clean Air Three”). Clean Air

Three moves for a stay of that order pending appeal.1

For the following reasons, the motion is denied.

1 Appellants filed their initial brief on March 6, 2024. Absent

extensions—which the Court is not inclined to grant—the appeal

should be fully briefed by April 18, 2024, and will be decided in due

course.

26 a

In 2020, Clean Air Two and Operr Plaza, LLC (“Operr

Plaza”)—both owned at the time by Kevin Wang—

defaulted on a $12.3 million loan from CVCF Fund

Funding I-NEB, LLC (“CVCF”), secured by a parking

garage and office building in Flushing, Queens. That

should have led to a straightforward foreclosure action

in state court. Instead, it resulted in a hostile takeover

of the two entities that has generated half a dozen

actions in state and federal court.

The federal-court action is a Chapter 11 bankruptcy

proceeding voluntarily initiated by the new—and

disputed—owner of Clean Air Two and Operr Plaza.

Clean Air Two listed the parking garage as its principal

asset, with a value of $7.63 million based on a

November 2021 appraisal, and its principal liability as

the CVCF loan, to which it assigned a current value of

$22.2 million. In addition, two other entities owned by

Wang—Clean Air Three and Clean Air Car Service

and Parking Corp. (“Clean Air One”)—asserted claims

against the estate based on a lease giving Clean Air

Three the right to operate the garage for twenty years

and Clean Air One the right to collect rent that would

otherwise have been paid to Clean Air Two. Clean Air

Two has moved to disallow the claims on the ground

that the lease is an after-the-fact fabrication intended to

divert income from Clean Air Two after Wang lost

control of the company.

27 a

On December 19, 2023, the bankruptcy court orally

confirmed the sale of Clear Air Two and Operr Plaza’s

assets, including the parking garage and office building.

Appellants immediately appealed and sought a stay,

which the Court denied on the ground that there was

no possibility of irreparable harm until the bankruptcy

court issued a written order.

The bankruptcy court subsequently entered such an

order on February 8, 2024. The order approved the sale

of the garage for $4.5 million, found that the purchaser

had bought the property in good faith, and provided

that the sale would be free and clear of all other

interests in the property—including the purported

lease. Appellants renewed their request for a stay

pending appeal.

The sale of the parking garage closed on February 20,

2024. Clean Air Two immediately advised Clean Air

Three to vacate the property by 4 p.m. that day because

“[the] Buyer and its management team . . . will be

taking over possession of the parking garage.” Letter

from Thomas A. Draghi to Kevin S. Wang (Feb. 20,

2024). The following day, the Court entered an order

enjoining any eviction attempts pending a ruling on the

motion for a stay, which has now been fully briefed. In

addition to the motion papers, the Court has received

and considered objections from CVCF and the

purchaser of the garage.

28 a

“In deciding whether to issue a stay pending appeal, a

court considers four factors:

(1) whether the stay applicant has made a

strong showing that he is likely to succeed on

the merits; (2) whether the applicant will be

irreparably injured absent a stay; (3) whether

issuance of the stay will substantially injure

the other parties interested in the proceeding;

and (4) where the public interest lies.

Nat. Res. Def. Council, Inc., v. U.S. Food & Drug

Admin., 884 F. Supp. 2d 108, 122 (S.D.N.Y. 2012)

(quoting Nken v. Holder, 556 U.S. 418, 434 (2009)

(internal quotation marks omitted)). “‘The first two

factors . . . are the most critical,’ and these factors have

typically been evaluated on a sliding scale, so that a

strong showing that the applicant is likely to succeed

excuses a weaker showing of irreparable injury.” Id.

(quoting Nken, 556 U.S. at 434).

The already complicated history of this case is

exacerbated by Appellants’prolix and convoluted filings.

In particular, they have devoted a great deal of ink to

explaining why the takeover of Clean Air Two and

Operr Plaza was wrongful and why Wang should be

reinstated as the companies’ sole owner. Although

Wang justifiably has strong opinions on that issue, it is

not before the Court. Rather, it is the subject of the

many state-court proceedings; although Wang has not

prevailed in any of them, they are all still pending,

29 a

either at the trial or the appellate level. In short, the

dispute as to the ownership of Clean Air Two and Operr

Plaza does not form a valid basis for a stay of the

bankruptcy court’s order.

A. Irreparable Harm

What is before the Court is Clean Air Three’s claimed

(but disputed) leasehold interest in the parking garage.

The bankruptcy court’s order effectively deprives Clean

Air Three of that interest, giving it a claim against the

sale proceeds in return. Outside of bankruptcy, a

commercial tenant can obtain an injunction against

eviction pending the outcome of a lease dispute if it can

show that: “(1) it holds a commercial lease, (2) it

received from the landlord either a notice of default, a

notice to cure, or a threat of termination of the lease, (3)

it requested injunctive relief prior to the termination of

the lease, and (4) it is prepared and maintains the

ability to cure the alleged default by any means short of

vacating the premises.” Trump on the Ocean, LLC v.

Ash, 916 N.Y.S.2d 177, 181 (2d Dep’t 2011). While such

an injunction is not applicable here because Clean Air

Three’s eviction does not involve a default, it at least

shows that New York law recognizes that the right to

commercial premises can be protected by injunctive

relief. And even if the loss of the premises could

conceivably support a damages action for wrongful

eviction, see id. at 180 (“Since Trump’s alleged damages

are compensable in money damages and capable of

calculation, Trump failed to establish the element of

irreparable harm.”), the size of the claims against Clean

30 a

Air Two’s bankruptcy estate means that it is virtually

certain that Clean Air Three will have no adequate

damages remedy in this case.

On the other side of the ledger, not being allowed to evict

Clean Air Three means that the purchaser is deprived

of the identical ability to profitably operate the garage.

In other words, the harms are in equipoise.

B. Likelihood of Success

Thus, the likelihood of success on the merits becomes

the dispositive factor. 11 U.S.C. § 363 governs the sale

of the assets of an estate in bankruptcy. Three

provisions are of particular relevance.

Section 363(b) authorizes a sale of assets outside the

ordinary course of the bankrupt entity’s business. Such

a sale “may be conducted if a good business reason

exists to support it.” In re Gucci, 126 F.3d 380, 387 (2d

Cir. 1997) (“Gucci II”).

Under section 363(f), the bankruptcy court may order

that the sale will be “free and clear of any interest . . . of

an entity other than the estate” in certain

circumstances. The relevant circumstance here is that

“such interest is in bona fide dispute.” 11 U.S.C. §

363(f)(4).

Finally, under section 363(m), “[t]he reversal or

modification on appeal of an authorization . . . 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,

31 a

whether or not such entity knew of the pendency of the

appeal, unless such authorization and such sale or

lease were stayed pending appeal.”

Almost all the briefing on Appellants’ motion to stay

concerns the third provision. Perhaps that is because

the Second Circuit has “held in no ambiguous terms

that section 363(m) is a limit on our jurisdiction and

that, absent an entry of a stay of the Sale Order, we only

retain authority to review challenges to the ‘good faith’

aspect of the sale.” In re WestPoint Stevens, Inc., 600

F.3d 231, 248 (2d Cir. 2010) (citing In re Gucci, 105 F.3d

837, 838-840 (2d Cir. 1997) (“Gucci I”)). Perhaps the

parties are unaware that the Supreme Court

abrogated this case law just last year, unanimously

holding that section 363(m) is not jurisdictional and,

rather “plainly contemplates that appellate courts

might ‘revers[e] or modif[y]’ any covered authorization,

with a proviso: Sometimes, the court’s exercise of power

may not accomplish all the appellant wishes, because

the reversal or modification of a covered authorization

may not ‘affect the validity of a sale or lease under such

authorization’ to a good-faith purchaser or lessee under

certain prescribed circumstances.” MOAC Mall

Holdings LLC v. Tranform Holdco LLC, 598 U.S. 288,

299 (2023). In other words, it “merely cloak[s] certain

good-faith purchasers or lessees with a targeted

protection of their newly acquired property interest,

applicable even when an appellate court properly

exercises jurisdiction.” Id. at 300.

32 a

So the fact that the sale of the garage was not stayed

does not doom the present appeal to mootness unless

the appellants show that the buyer was not a good-faith

purchaser. Moreover, appellants have at least a decent

chance of making that showing. “Most courts have

adopted a traditional equitable definition: one who

purchases the assets for value, in good faith and

without notice of adverse claims.” Gucci II, 126 F.3d at

390 (internal quotation marks omitted). With respect to

the last requirement, “[c]ourts generally distinguish

between purchasers who [merely] have knowledge

that objections have been filed, and those that have

more intimate knowledge of the facts giving rise to

adverse claims.” In re Cooper, 592 B.R. 469, 483

(S.D.N.Y. 2018). Despite the Court’s express directive to

address the issue, the parties opposing a stay have been

unable or unwilling to clearly state that the buyer did

not know about Clean Air Three’s claimed lease. On the

contrary, the buyer implies that it did have such

knowledge when it states that it would not have bid on

the garage or consummated the sale “unless the Clean

Air 2 Assets were being sold free and clear of all liens,

claims, encumbrances, and other interests, including

any leases and related interests.” Letter from Robert J.

Spence (Feb. 23, 2024), Ex. C, ¶ 9.

In the end, however, the Court need not decide whether

the buyer is entitled to the protection of section 363(m)

at this stage. Even if it is not, Appellants must still

demonstrate that the sale should not have been

33 a

confirmed. 2 As noted, a sale outside of the normal

course of business requires “a good business reason.”

Gucci II, 126 F.3d at 387. This is obviously a broad

standard, far broader than prior standards that

required an asset whose value was wasting or some

other emergency. See In re Lionel Corp., 722 F.2d 1063,

1069 (2d Cir. 1983) (citing cases). But nor does it “grant[]

the bankruptcy judge carte blanche.” Id. Rather, “there

must be some articulated business justification, other

than appeasement of major creditors, for using, selling

or leasing property out of the ordinary course of

business before the bankruptcy judge may order such

disposition under section 363(b).” Id. at 1070.

One might reasonably dispute whether the sale of the

sole revenuegenerating asset of a business that is—in

theory, at least—attempting to reorganize, rather than

liquidate, is “good business.” On the other hand, the fact

that the asset is burdened with more than $22 million

in debt may make reorganization all but impossible. A

good reason, perhaps, for giving bankruptcy judges

broad discretion to decide what is in the best interest of

the estate.

In any event, Appellants do not make these arguments.

They instead rely, as noted, on the irrelevant dispute as

to Clean Air Two’s ownership. They also argue that the

2 Alternatively, they could theoretically argue that the sale was proper

but should not have been free and clear of Clean Air Three’s lease.

Since there is clearly a bona fide dispute as to the existence and

validity of the lease, that argument would almost certainly lose. See

11 U.S.C. § 363(f)(4).

34 a

sale was for substantially less than the garage’s

appraised value, but the Court entirely agrees with the

bankruptcy court’s reasoning that the result of what

was apparently a fair, competitive auction won by an

unaffiliated bidder is the best evidence of its current

value. These arguments do not convince the Court that

Appellants are likely to prevail on their argument that

the order confirming the sale should be reversed,

regardless of whether the buyer was a good-faith

purchaser.

III

A ruling on a stay pending appeal is necessarily

tentative, and nothing the Court has said is final.

Appellants may ultimately prevail and convince the

Court (1) that the sale lacked “a sound business reason,”

and (2) that the buyer had sufficient knowledge of

Clean Air Three’s claimed lease that it is not entitled to

the protection of section 363(m). But they would be

well-advised to focus their energies on those issues and

to avoid the distraction—however tempting—of the

battles that are unfolding in other courts.

Accordingly, Appellants’ motion for a stay pending

appeal is denied and the temporary injunction

prohibiting Clean Air Three’s eviction is lifted.

SO ORDERED.

/s/ Frederic Block

FREDERIC BLOCK

Senior United States District Judge

Brooklyn, New York

March 13, 2024

APPENDIX G

35 a

UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF NEW YORK

----------------------------------------------------------------------------- X

In re:

Chapter 11

Case No.: 23-41937 (NHL)

(Jointly Administered)

Clean Air Car Service & Parking

Branch Two, LLC and Operr Plaza, LLC,

Debtors.

---------------------------------------------------------X

ORDER: (I) AUTHORIZING AND DIRECTING

THE EVICTION AND REMOVAL OF THE

DISPUTED TENANT FROM THE CLEAN AIR

PROPERTY; (II) AUTHORIZING THE

DEBTOR AND/OR THE CLEAN AIR 2 BUYER

TO CHANGE AND/OR BREAK THE LOCKS

ON THE CLEAN AIR PROPERTY; AND (III)

AUTHORIZING AND DIRECTING THE

UNITED STATES MARSHAL SERVICE

FOR THE EASTERN DISTRICT OF NEW

YORK TO ASSIST WITH THE EVICTION

Upon the motion (the “Motion”) [ECF No. 308] 1 of

Clean Air Car Service & Parking Branch Two, LLC

(the “Clean Air 2 Debtor”), the debtor and debtor-inpossession herein, for the entry of an Order, in

accordance with, inter alia, Bankruptcy Code sections

105(a) and 363: (i) authorizing and directing the

1 Capitalized terms not otherwise defined herein shall have the

definition ascribed to them in the Motion.

36 a

eviction and removal of Clean Air Car Service &

Parking Branch 3, LLC (the “Disputed Tenant”) from

the property located at 37-20 Prince Street, Unit PU,

Flushing, Queens County, NY 11354 (Block 4972, Lot

1104) (the “Clean Air Property”); (ii) authorizing the

Debtor and/or C2JM Holdings LLC (the “Clean Air 2

Buyer”), and/or its management company, to change

and/or break the locks on the Clean Air Property; (iii)

authorizing and directing the United States Marshal

Service for the Eastern District of New York (the “U.S.

Marshal”) to assist the Debtor and/or the Clean Air 2

Buyer with the eviction, as the Debtor and/or the Clean

Air 2 Buyer deems necessary; and (iv) granting the

Debtor such other, further and different relief as the

Court deems just and proper under the circumstances;

and upon the ex parte application (“Application”) [ECF

No. 309] seeking entry of an order pursuant to

Bankruptcy Rule 9006(c) and Local Rule 9077-1

shortening the time for the Debtor’s Motion; and upon

the Affirmation of Thomas A. Draghi pursuant to Local

Bankruptcy Rule 9077-1 in support of the Application;

and upon the Court having entered the order

scheduling a hearing on the Motion [ECF No. 313] (the

“Scheduling Order”); and upon entry and enforcement

of the Order (I) Approving Clean Air 2 APA, (II)

Authorizing the Sale of the Clean Air 2 Debtor’s Assets

Free and Clear of All Encumbrances, and (III)

Granting Related Relief entered by this Court on

February 9, 2024 [ECF No. 246] (the “Sale Order”); and

upon IV-CVCF NEB I Trust and IV-CVCF NEB REO,

LLC having filed a combined joinder to the Motion and

37 a

motion pursuant to Rules 9014 and 9020 of the Federal

Rules of Bankruptcy Procedure seeking to find Kevin S.

Wang and the entities which he controls, the Disputed

Tenant and Clean Air Corporation, in civil contempt of

the Sale Order on March 15, 2024 [ECF No. 315] (the

“Lender Joinder and Contempt Motion”); and upon the

Debtor having served the Motion and Scheduling

Order on all necessary parties in accordance with the

Scheduling Order, with the affidavit of service having

been filed with the Court [ECF No. 316]; and upon

Kevin S. Wang, Clean Air Car Service & Parking Corp.,

Clean Air Car Service & Parking Branch Three, LLC,

Operr Technologies Inc., and Operr Service Bureau Inc

(collectively, the “Objectors”) having filed an objection to

the Motion on March 22, 2024 [ECF No. 319] (the

“Objection”); and the Debtors having filed a reply in

further support of the Motion on March 25, 2024 [ECF

No. 320]; and the Objectors having filed the Letter

request to dismiss or alternatively, grant the request to

file the Motion to dismiss by rescheduling the Motion for

Eviction [ECF No. 321]; and the Clean Air 2 Buyer

having filed a joinder in support of the Motion on March

26, 2024 [ECF No. 322] (the “C2JM Joinder”), and

subsequently a letter withdrawing the C2JM Joinder

on March 27, 2024 [ECF No. 328]; and the Objectors

having filed an affirmation in opposition to the C2JM

Joinder on March 27, 2024 [ECF No. 324] (the

“Stricken Opposition”), which was struck from the

record by the Court; and upon the Court having

conducted a hearing on the Motion on March 27, 2024

(the “Hearing”), at which Thomas A. Draghi, Esq.

38 a

(Counsel to Debtor), Alexandra Troiano, Esq. (Counsel

to Debtor), David J. Wood, Esq. (Wood Wang &

Associates, PLLC), Kevin S. Wang, Esq. (Wood Wang

& Associates, PLLC), Paul S. Samson, Esq. (Counsel to

IVCVCF NEB 1 Trust and IV-CVCF NEB REO, LLC),

Nazar Khodorovsky, Esq. (Office of the U.S. Trustee),

and Robert J. Spence, Esq. (Counsel to the Clean Air 2

Buyer) appeared; and all objections, including the

Objection, having been overruled or withdrawn; and,

upon the record of the Hearing, the Court having

denied any motion to stay this Order pending appeal;

and, upon the record of the Hearing, the Court having

struck from the record the C2JM Joinder and the

Stricken Objection; and for the reasons set forth on the

record at the Hearing, the transcript of which is

incorporated herein by reference; and the Court having

granted the Motion and “so ordered” the record

accordingly; it is hereby

ORDERED, that the Motion is granted to the extent

set forth herein; and, it is further

ORDERED, that, pursuant to Bankruptcy Code

section 105(a) and the inherent power of this Court,

including, inter alia, to enforce this Court’s Sale Order,

effective immediately upon the “so ordering” of the

record at the Hearing, the Disputed Tenant, and any

person or entity operating together with, or on behalf of,

the Disputed Tenant, including, but not limited to,

Kevin S. Wang and each of the Objectors, is directed to

immediately, and by no later than 5:00 p.m. (ET) on

39 a

Friday, March 29, 2024, vacate the Clean Air

Property; and, it is further

ORDERED, that, effective immediately upon the “so

ordering” of the record at the Hearing, the Clean Air 2

Buyer, Icon Parking, and/or another designee of the

Clean Air 2 Buyer, are authorized to enter upon the

Clean Air Property; and, it is further

from the record by the Court; and upon the Court

having conducted a hearing on the Motion on March 27,

2024 (the “Hearing”), at which Thomas A. Draghi, Esq.

(Counsel to Debtor), Alexandra Troiano, Esq. (Counsel

to Debtor), David J. Wood, Esq. (Wood Wang &

Associates, PLLC), Kevin S. Wang, Esq. (Wood Wang

& Associates, PLLC), Paul S. Samson, Esq. (Counsel to

IVCVCF NEB 1 Trust and IV-CVCF NEB REO, LLC),

Nazar Khodorovsky, Esq. (Office of the U.S. Trustee),

and Robert J. Spence, Esq. (Counsel to the Clean Air 2

Buyer) appeared; and all objections, including the

Objection, having been overruled or withdrawn; and,

upon the record of the Hearing, the Court having

denied any motion to stay this Order pending appeal;

and, upon the record of the Hearing, the Court having

struck from the record the C2JM Joinder and the

Stricken Objection; and for the reasons set forth on the

record at the Hearing, the transcript of which is

incorporated herein by reference; and the Court having

granted the Motion and “so ordered” the record

accordingly; it is hereby

40 a

ORDERED, that the Motion is granted to the extent

set forth herein; and, it is further

ORDERED, that, pursuant to Bankruptcy Code

section 105(a) and the inherent power of this Court,

including, inter alia, to enforce this Court’s Sale Order,

effective immediately upon the “so ordering” of the

record at the Hearing, the Disputed Tenant, and any

person or entity operating together with, or on behalf of,

the Disputed Tenant, including, but not limited to,

Kevin S. Wang and each of the Objectors, is directed to

immediately, and by no later than 5:00 p.m. (ET) on

Friday, March 29, 2024, vacate the Clean Air

Property; and, it is further

ORDERED, that, effective immediately upon the “so

ordering” of the record at the Hearing, the Clean Air 2

Buyer, Icon Parking, and/or another designee of the

Clean Air 2 Buyer, are authorized to enter upon the

Clean Air Property; and, it is further

ORDERED, that pursuant to Bankruptcy Code

section 105(a) and the inherent power of this Court,

including, inter alia, to enforce this Court’s Sale Order,

in the event the Disputed Tenant, or any person or

entity operating together with, or on behalf of, the

Disputed Tenant, including, but not limited to, Kevin S.

Wang and each of the Objectors, has not vacated the

Clean Air Property by 5:00 p.m. (ET) on Friday,

March 29, 2024, the U.S. Marshals are directed to

accompany the Debtor and/or the Clean Air 2 Buyer,

and their retained professionals, to evict the Disputed

41 a

Tenant or any person or entity operating together with,

or on behalf of, the Disputed Tenant, including, but not

limited to, Kevin S. Wang and each of the Objectors,

from the Clean Air Property as of Monday, April 1,

2024; and, it is further

ORDERED, that in carrying out this Order, if the

Disputed Tenant, or any person or entity operating

together with, or on behalf of, the Disputed Tenant,

including, but not limited to, Kevin S. Wang and each

of the Objectors, has not vacated the Clean Air 2

Property by 5:00 p.m. (ET) on Friday, March 29,

2024, the U.S. Marshals are authorized, if necessary,

to enter forcibly into the Clean Air Property and to use

whatever force is reasonably necessary to gain

possession of the Clean Air Property and to protect

their safety and that of the representatives of the

Debtor and/or the Clean Air 2 Buyer, Icon Parking,

and/or another designee of the Clean Air 2 Buyer,

including changing or breaking the locks on the Clean

Air Property and to arrest anyone interfering with the

enforcement of this Order, including, but not limited to,

the Disputed Tenant and Kevin S. Wang; and, it is

further

ORDERED, that, for the avoidance of any doubt, with

respect to any Customers and the transition of the

Clean Air Property to the Clean Air 2 Buyer, at this

time, no vehicles shall be removed from the Clean Air

Property, subject to further order of the Court; and it is

further

42 a

ORDERED, that, if the Disputed Tenant, including,

but not limited to, Kevin S. Wang and each of the

Objectors, receives any payments from Customers in

connection with the parking garage operations at the

Clean Air Property after 5:00 p.m. (ET) on Friday,

March 29, 2024, the Disputed Tenant, including, but

not limited to, Kevin S. Wang and each of the Objectors,

are hereby directed to remit such payments to the

Clean Air 2 Buyer within three (3) business days of

receipt thereof; and it is further

ORDERED, that the Clean Air 2 Buyer reserves all

rights and remedies regarding the operation of the

garage at the Clean Air Property by the Disputed

Tenant, and/or any person or entity operating together

with, or on behalf of, the Disputed Tenant, including,

but not limited to, Kevin S. Wang and each of the

Objectors, and all rights to seek remittance, damages,

or other claims including but not limited to funds

received by the Disputed Tenant, Kevin S. Wang and/or

each of the Objectors, and any other entity or person

affiliated with Kevin S. Wang and/or the Disputed

Tenant (including, but not limited to, each of the

Objectors), from Customers in connection with the

parking garage operations at the Clean Air Property on

or after February 20, 2024; and, it is further

ORDERED, that the Clean Air 2 Debtor’s bankruptcy

estate shall hold harmless any and all of the law

enforcement agencies utilized in the enforcement of

this Order, and their employees from any and all claims,

asserted in any court or tribunal arising from any acts,

43 a

incidents or occurrences in connection with the

enforcement of this Order, including third-party claims;

and, it is further

ORDERED, that the application for a stay pending

appeal of this Order made on the record of the Hearing

by Kevin S. Wang, which was denied upon the record

of the Hearing, is denied; and, it is further

ORDERED, that the Clean Air 2 Debtor is directed to

serve a copy of this Order on May 28, 2024, by (a) email

on Kevin S. Wang; and (b) by overnight mail on the

Disputed Tenant, Kevin S. Wang, and each of the

Objectors; and, it is further

ORDERED, that the Clean Air 2 Debtor, Clean Air 2

Buyer, Icon Parking, and/or another designee of the

Clean Air 2 Buyer, are authorized and empowered to

expend such funds and execute and deliver any and all

documents, and take any reasonable actions to

effectuate this Order, as are reasonably necessary to

implement the terms of this Order; and, it is further

ORDERED, that, for the avoidance of any doubt,

notwithstanding any applicable provisions of the

Bankruptcy Rules or Local Rules, this Order shall not

be stayed after the entry hereof, but shall be effective

and enforceable immediately upon entry of the “so

ordering” of the record at the Hearing; and, it is further

ORDERED, that the portion of the Lender Joinder

and Contempt Motion seeking to find Kevin S. Wang

and the entities which he controls, the Disputed Tenant

and Clean Air Corporation, in civil contempt of the Sale

44 a

Order is hereby denied without prejudice to renew; and,

it is further

ORDERED, this Court shall retain jurisdiction to: (i)

interpret and construe and enforce the provisions of

this Order and any ancillary documents in connection

therewith; (ii) hear and determine any disputes arising

under or related to the foregoing; and (iii) enforce the

provisions of this Order.

Dated: March 28, 2024

Brooklyn, New York

/s/ Nancy Hershey Lord

Nancy Hershey Lord

United States Bankruptcy Judge

APPENDIX H

45 a

UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF NEW YORK

----------------------------------------------------------------------------- X

In re:

Chapter 11

Case No.: 23-41937 (NHL)

(Jointly Administered)

Clean Air Car Service & Parking

Branch Two, LLC and Operr Plaza, LLC,

Debtors.

---------------------------------------------------------X

ORDER (I) APPROVING OPERR PLAZA APA,

(II) AUTHORIZING THE SALE OF THE

OPERR PLAZA DEBTOR’S ASSETS FREE

AND CLEAR OF ALL ENCUMBRANCES,

AND (III) GRANTING RELATED RELIEF

Upon consideration of the motion (the “Motion”)1 of

Clean Air Car Service & Parking Branch Two, LLC

and Operr Plaza, LLC (the “Operr Plaza Debtor”), the

debtors and debtors-inpossession herein (together, the

“Debtors”) 2 for the entry of an order, inter alia,

scheduling a hearing on approval of the proposed sales

(as to each Debtor and its respective sale, the “Sale”) of

all or substantially all of each Debtor’s assets (as to each

Debtor and its respective assets, and as such term is

1 Capitalized terms not otherwise defined herein shall have the

meanings ascribed to them in the APA (as defined below), or to the

extent not defined therein, the Bidding Procedures Order (as defined

below) and the Motion.

2 The last four numbers of each Debtor’s taxpayer identification

numbers are (a) Clean Air Car Service & Parking Branch Two, LLC

(3748) and (b) Operr Plaza, LLC (8223).

46 a

more fully defined in the respective APA, the “Assets”),

free and clear of all liens, claims, encumbrances, and

other interests, including any leases and related

interests, other than those permitted by the APA,

Stalking Horse APA, or Modified APA, as applicable;

and the Court having entered on September 19, 2023

the Order (I) Scheduling a Hearing on the Approval of

the Sale of All or Substantially All of Each of the

Debtor’s Assets Free and Clear of Encumbrances, (II)

Approving Certain Bidding Procedures, and the Form

and Manner of Notice Thereof, (III) Authorizing Each

Debtor to Provide (But Not Approving) Certain Bid

Protections for any Stalking Horse Purchaser, and (IV)

Granting Related Relief [ECF No. 113] (the “Bidding

Procedures Order”); and an auction having been held

on December 7, 2023 at 10:00 a.m.; and upon the Notice

of Successful Bidder in Connection with Operr Plaza

Property [ECF No. 186]; and upon the Declaration of

Daniel Kaplan in Support of the Sale of Each Debtor’s

Assets [ECF No. 191] and the Declaration of Nat

Wasserstein in Support of the Sale of Each Debtor’s

Assets [ECF No. 193] (together, the “Declarations”); and

the Operr Plaza Debtor having determined that the

highest and otherwise best offer for the Assets was

made by 3731 10th Street Realty LLC, an entity

formed by Xiao Jun Chen (i.e., the successful bidder at

the Auction) (the “Operr Plaza Buyer”) pursuant to

that certain Asset Purchase Agreement, dated as of

December 15, 2023, attached hereto as Exhibit 1 (the

“APA”); and Kevin S. Wang, Clean Air Car Service &

Parking Corp, Clean Air Car Service & Parking

47 a

Branch Three, LLC, Operr Technologies Inc., and

Operr Service Bureau Inc. having filed objections to the

sales on December 13, 2023 [ECF No. 190] and

December 15, 2023 [ECF No. 200] (together, the

“Objection”); and the Debtors having filed a reply in

further support of the sales on December 15, 2023

[ECF No. 197]; and the Court having conducted a

hearing on December 19, 2023 (the “Sale Hearing”), the

record of which is incorporated herein by reference, at

which Thomas A. Draghi, Esq. (Counsel to Debtor),

Alexandra Troiano, Esq. (Counsel to Debtor), Jay S.

Hellman, Esq. (Counsel to Debtor), Nat Wasserstein

(Debtor's Independent Director), Kevin S. Wang, Esq.

(Counsel to Kevin S. Wang et al), Paul S. Samson, Esq.

(Counsel to IV-CVCF NEB 1 Trust, IVCVCF NEB

REO, LLC), Nazar Khodorovsky, Esq. (Office of the

United States Trustee), Robert J. Spence, Esq.

(Counsel to C2JM Holdings LLC), David John Wood,

Esq. (Counsel of the firm of Wood Wang & Associates,

PLLC - Representing Self), and Jay Lau (Interested

Party) appeared and were offered an opportunity to be

heard with respect to the Sale, to consider the approval

of the Sale pursuant to the terms and conditions of the

APA, and the Court having considered (i) the Motion

and any objections thereto, (ii) the Sale, (iii) the

arguments of counsel made related thereto, and (iv) the

full record in this chapter 11 case, including the record

related to the hearing to consider the Bidding

Procedures Order and the Sale Hearing held before the

Court and the Declarations; and all parties in interest

having been heard, or having had the opportunity to be

48 a

heard, regarding the approval of the APA, the Sale, and

the transactions contemplated by the APA; and the

Court having overruled the Objection; and upon the

affidavit of the Operr Plaza Buyer dated December 20,

2023 [ECF No. 209] (the “Affidavit”); and it appearing

that the relief requested in the Motion is in the best

interests of the Operr Plaza Debtor, its bankruptcy

estate, its creditors, and other parties in interest in the

Operr Plaza Debtor’s chapter 11 case (this “Chapter 11

Case”); and, in reliance on the Declarations and

Affidavit, as indicated by the Court at the Sale Hearing;

it is hereby FOUND, CONCLUDED, AND

DETERMINED THAT:3

A. The findings and conclusions set forth herein

constitute this Court’s findings of fact and conclusions

of law pursuant to Bankruptcy Rule 7052, made

applicable to this Chapter 11 Case pursuant to

Bankruptcy Rule 9014.

B. To the extent that any of the following findings of fact

constitute

conclusions of law, they are adopted as such. To the

extent any of the following conclusions of law constitute

findings of fact, they are adopted as such.

C. This Court has jurisdiction over the Motion and over

the property of the Debtor, including the Assets to be

sold, transferred, and conveyed pursuant to the APA,

3 All findings of fact and conclusions of law announced by the Court at

the Sale Hearing in relation to the Motion are hereby incorporated

herein to the extent not inconsistent herewith.

49 a

pursuant to 28 U.S.C. §§ 157 and 1334. This is a core

proceeding pursuant to 28 U.S.C. § 157(b)(2). Venue of

this Chapter 11 Case and the Motion in this District

and Court is proper under 28 U.S.C. §§ 1408 and 1409.

D. This Sale Order constitutes a final order within the

meaning of 28 U.S.C. § 158(a). Notwithstanding

Bankruptcy Rule 6004(h), and to any extent necessary

under Bankruptcy Rule 9014 and Rule 54(b) of the

Federal Rules of Civil Procedure, as made applicable by

Bankruptcy Rule 7054, this Court finds that there is no

just reason for delay in the implementation of this Sale

Order.

E. The Operr Plaza Debtor’s Assets constitute property

of its bankruptcy estate and title thereto is vested in

such Debtor’s bankruptcy estate within the meaning of

section 541(a) of the Bankruptcy Code. As set forth

more fully in this Order, the transfer of the Assets by

the Operr Plaza Debtor to the Operr Plaza Buyer will

be a legal, valid, and effective transfer of the Assets, and

will vest the Operr Plaza Buyer with sole ownership,

possession, use, and all rights, title, and interests of the

Operr Plaza Debtor and the Operr Plaza Debtor's

estate in and to the Assets free and clear of any and all

Encumbrances (including, without limitation, any

right to possess or use any part of the Operr Property,

whether pursuant to any lease, license agreement or

otherwise), except as specifically provided in the APA.

F. The statutory bases for the relief requested in the

Motion and provided for herein are sections 105, 363,

50 a

503 and 507 of the Bankruptcy Code, Bankruptcy

Rules 2002, 6004, and Local Rule 6004-1.

G. On May 31, 2023 (the “Petition Date”), the Debtors

filed voluntary petitions for relief under chapter 11 of

title 11 of the United States Code, 11 U.S.C. §§ 101, et

seq. (the “Bankruptcy Code”). Since the Petition Date,

the Debtors have continued to maintain their

businesses and/or manage their properties as debtorsin-possession pursuant to sections 1107 and 1108 of the

Bankruptcy Code.

H. No trustee, examiner, or committee of creditors has

been appointed in the Debtors’ chapter 11 cases.

I. This Court previously entered the Bidding

Procedures Order, among other things: (i) establishing

certain bidding and auction procedures; (ii) scheduling

the Auction (if necessary) and the Sale Hearing to

consider the sale of the Assets; (iii) approving the form

and manner of notice of certain procedures, dates and

deadlines in connection with the Bidding Procedures

and the Sale; and (iv) granting certain related relief.

J. As evidenced by the affidavit of service previously

filed with the Court [ECF No. 124], and based on the

representations of counsel made at the Sale Hearing,

due, proper, timely, adequate, and sufficient notice of

the Motion, the Sale Hearing, the Auction, and the Sale

has been provided in accordance with sections 102(1),

and 363 of the Bankruptcy Code and Bankruptcy

Rules 2002, 6004, 9007, and 9014, and in compliance

with the Bidding Procedures Order, to each party

51 a

entitled to such notice, including, as applicable: (a) the

Office of the United States Trustee for the Eastern

District of New York; (b) counsel to the Lender; (c) all

parties known by the Debtors to assert a lien on any of

the Assets; (d) all known and/or alleged creditors and all

known parties in interest in this Chapter 11 Case,

including any alleged holder of a leasehold interest in

the Assets; (e) the Office of the United States Attorney

for the Eastern District of New York; (f) the Office of the

New York Attorney General; (g) all taxing authorities

having jurisdiction over any of the Assets, including the

Internal Revenue Service; (h) all environmental

authorities having jurisdiction over any of the Assets,

including the Environmental Protection Agency; (i) the

New York State Department of Taxation and Finance;

(j) the New York City Department of Finance; (k) all of

the Debtors’ other known and/or alleged creditors and

equity security holders; and (l) all other parties that

have filed a notice of appearance and demand for

service of papers in the Debtors’ this Chapter 11 Case

as of the service date. The notices described above were

good, sufficient, and appropriate under the

circumstances, and no other or further notice of the

Motion, the Auction, the Sale, and the Sale Hearing is,

or shall be, required.

K. The Debtors have articulated good and sufficient

reasons for this Court to grant the relief requested in

the Motion as it pertains to the Sale and provided for

herein.

52 a

L. The Sale Notice provided all interested parties with

timely and proper notice of the Sale, the Sale Hearing,

and the Auction.

M. The disclosures made by the Operr Plaza Debtor in

the Motion, the Sale Notice, the Declarations, and

related documents filed with the Court concerning the

APA, the Auction, the Sale, and the Sale Hearing were

good, complete, and adequate.

N. The Bidding Procedures set forth in the Bidding

Procedures Order are non-collusive, proposed and

executed in good faith as a result of arms’-length

negotiations, designed to maximize the value of the

Assets, and substantively and procedurally fair to all

parties.

O. The Operr Plaza Debtor conducted the process with

respect to the Sale in accordance with, and has

otherwise complied in all respects with, the Bidding

Procedures Order. The sale process set forth in the

Bidding Procedures Order afforded a full, fair, and

reasonable opportunity for any person or entity to

make a higher or otherwise better offer to purchase the

Assets.

P. The terms contained in the APA constitute the

highest and best offer for the Assets. The Operr Plaza

Debtor’s determination that the APA constitutes the

highest and best offer for the Assets constitutes a valid

and sound exercise of the Operr Plaza Debtor’s

business judgment.

53 a

Q. The APA and the Sale contemplated thereby

represent a fair and reasonable offer to purchase the

Assets under the circumstances of this Chapter 11

Case. No other person, entity or group of persons or

entities has presented a higher or otherwise better offer

to the Operr Plaza Debtor to purchase the Assets for

greater economic value to the Operr Plaza Debtor’s

bankruptcy estates than the Operr Plaza Buyer.

R. Approval of the Motion and the APA and the

consummation of the Sale contemplated thereby is in

the best interests of the Operr Plaza Debtor, its

bankruptcy estate, its creditors, and other parties in

interest in this Chapter 11 Case.

S. The Operr Plaza Debtor has demonstrated

compelling circumstances and a good, sufficient, and

sound business purpose and justification for the Sale of

the Assets because, among other reasons: (i) the APA

constitutes the highest and best offer for the Assets; and

(ii) the APA and the closing thereon (the “Closing”) will

present the best opportunity to realize the value of the

Assets.

T. The Operr Plaza Buyer is purchasing the Assets in

good faith, is a goodfaith buyer within the meaning of

section 363(m) of the Bankruptcy Code, and is not an

“insider” (as defined under section 101(31) of the

Bankruptcy Code) of the Operr Plaza Debtor, and

therefore is entitled to the full benefits and protections

of section 363(m) of the Bankruptcy Code, and

otherwise has proceeded in good faith in all respects in

54 a

connection with the Sale in that: (i) the Operr Plaza

Buyer recognized that the Operr Plaza Debtor was free

to deal with any other party interested in acquiring the

Assets; (ii) the Operr Plaza Buyer complied with the

Bidding Procedures Order; (iii) the Operr Plaza Buyer

agreed to subject its bid to the competitive bidding

procedures set forth in the Bidding Procedures Order;

(iv) all payments to be made by the Operr Plaza Buyer

and other agreements or arrangements entered into by

the Operr Plaza Buyer in connection with the Sale

have been disclosed; (v) the Operr Plaza Buyer has not

violated section 363(n) of the Bankruptcy Code by any

action or inaction; and (vi) the negotiation and

execution of the APA, including the Sale contemplated

thereby, were at arms’- length and in good faith.

U. The APA and the transactions contemplated

thereby cannot be avoided under section 363(n) of the

Bankruptcy Code. The Operr Plaza Debtor, the Operr

Plaza Buyer, and each of their respective agents,

representatives, and affiliates have not engaged in any

conduct that would cause or permit the APA or the

consummation of the transactions contemplated

thereby to be avoided, or costs or damages to be

imposed, under section 363(n) of the Bankruptcy Code.

V. The consideration provided by the Operr Plaza

Buyer pursuant to the APA is fair and adequate and

constitutes reasonably equivalent value and fair

consideration and value under the Bankruptcy Code.

55 a

W. By consummating the Sale, the Operr Plaza Buyer

is not a mere continuation of the Operr Plaza Debtor or

its bankruptcy estate, and there is no continuity, no

common identity, and no continuity of enterprise

between the Operr Plaza Debtor and the Operr Plaza

Buyer. The Operr Plaza Buyer is not holding itself out

to the public as a continuation of the Operr Plaza

Debtor. The Sale does not amount to a consolidation,

merger, or de facto merger of the Operr Plaza Buyer

and the Operr Plaza Debtor. Neither the Operr Plaza

Buyer nor any of its agents, representatives or affiliates

shall assume or in any way be responsible for any

obligation or liability of the Operr Plaza Debtor and its

bankruptcy estate except as expressly provided in this

Sale Order, the APA, or applicable federal and state law.

X. The Operr Plaza Debtor, acting by and through its

agents, representatives, and officers, has full corporate

power and authority to execute and deliver the APA

and all other documents contemplated thereby, and the

Operr Plaza Debtor requires no further consents or

approvals to consummate the Sale contemplated by

the APA, except as otherwise set forth in the APA.

Y. The transfers of the Assets to the Operr Plaza Buyer

will be as of the Closing Date a legal, valid, and effective

transfer of such assets, and vests or will vest the Operr

Plaza Buyer with sole ownership, possession, use, and

all rights, title, and interest to the Assets free and clear

of all Encumbrances (as defined below), unless

otherwise assumed in, or permitted by, the APA.

56 a

Z. The Operr Plaza Debtor may sell the Assets free and

clear of all Encumbrances against the Operr Plaza

Debtor, its bankruptcy estate, or any of the Assets

(unless otherwise assumed in, or permitted by, the APA)

because, in each case, one or more of the standards set

forth in section 363(f)(1)-(5) of the Bankruptcy Code has

been satisfied. Those holders of Encumbrances against

the Operr Plaza Debtor, its bankruptcy estate, or any of

the Assets who did not object, or who withdrew their

objections, to the Sale or the Motion are deemed to have

consented thereto pursuant to section 363(f)(2) of the

Bankruptcy Code. Those holders of such

Encumbrances who did object fall within one or more

of the other subsections of section 363(f) and are

adequately protected by having their Encumbrances, if

any, in each instance against the Operr Plaza Debtor,

its bankruptcy estate, or the Assets, attach to the cash

proceeds of the Sale ultimately attributable to the

Assets in which such creditor alleges an Encumbrance,

in the same order of priority, including any claims for

Adequate Protection, with the same validity, force, and

effect that such creditor had prior to the Sale, subject to

any claims and defenses that the Operr Plaza Debtor

and its bankruptcy estate may possess with respect

thereto. Any purported leasehold interest is subject to a

bona fide dispute within the meaning of section 363(f)(4)

of the Bankruptcy Code, or otherwise falls within

section 363(f) of the Bankruptcy Code. All other holders

of Encumbrances could be compelled in a legal or

equitable proceeding to accept money satisfaction of

57 a

such claim or interest, or otherwise fall within section

363(f) of the Bankruptcy Code.

AA. The Lender (as defined in the Bidding Procedures

Order), in its capacity as such, has consented to the Sale

of the Assets to the Operr Plaza Buyer pursuant to the

APA free and clear of any Encumbrances of the Lender

against the Assets, provided that cash proceeds

generated from the Sale, subject to the Carve-Out (as

defined in the Approved Cash Collateral Stipulation,

ECF No. 60) and any other amounts to be negotiated

and agreed to by the Debtors and the Lender in

connection with a confirmed plan, generated from the

sale of any Assets shall be paid to the Lender in

accordance with the terms of the Debtors’ joint plan of

liquidation.

BB. If the Sale were not free and clear of all

Encumbrances (except as otherwise assumed in, or

permitted by, the APA), or if the Operr Plaza Buyer

would, or in the future could, be liable for any

Encumbrances (except as otherwise assumed in, or

permitted by, the APA), the Operr Plaza Buyer would

not have entered into the APA and would not

consummate the Sale, thus adversely affecting the

Operr Plaza Debtor, its bankruptcy estate and its

creditors.

CC. Given all of the circumstances of these chapter 11

cases, including in this Chapter 11 Case, and the

adequacy and fair value of the consideration provided

by the Operr Plaza Buyer under the APA, the Sale

58 a

constitutes a reasonable and sound exercise of the

Operr Plaza Debtor’s business judgment, is in the best

interests of the Operr Plaza Debtor, its bankruptcy

estate, and its creditors and other parties in interest in

this Chapter 11 Case, and should be approved.

DD. The consummation of the Sale is legal, valid, and

properly authorized under all applicable provisions of

the Bankruptcy Code, including, without limitation,

sections 105(a), 363(b), 363(e), 363(f), and 363(m) of the

Bankruptcy Code, and all of the applicable

requirements of such sections have been complied with

in respect of the Sale.

EE. Cause exists to waive the stay to the extent

necessary, as contemplated by Bankruptcy Rules

4001(a) and 6004(h), to permit the immediate

effectiveness of this Order.

NOW THEREFORE, IT IS HEREBY

ORDERED, ADJUDGED, AND DECREED

THAT:

1. The relief requested in the Motion is granted as set

forth herein.

2. Any and all objections and responses to the Motion

that have not been withdrawn, waived, settled, or

resolved, and all reservations of rights included therein,

including the Objection, are hereby overruled and

denied on the merits.

3. Notice of the Motion, the Auction, the Sale Hearing,

and the Sale was fair and equitable under the

59 a

circumstances, and complied in all respects with

section 102(1) of the Bankruptcy Code, Bankruptcy

Rules 2002 and 6004, and the Local Rules.

Approval of the Sale of the Assets

4. The APA, including all other ancillary documents,

and all of the terms and conditions thereof, and the Sale

contemplated thereby, are hereby approved in all

respects.

5. Pursuant to section 363(b) of the Bankruptcy Code,

the Operr Plaza Debtor, acting by and through its

agents, representatives, and/or officers, is authorized

and empowered to take any and all actions necessary

or appropriate to: (a) consummate and close the Sale

pursuant to and in accordance with the terms and

conditions of this Sale Order and the APA; (b) transfer

and assign all right, title, and interest to all property,

licenses, and rights to be conveyed in accordance with

the terms and conditions of this Sale Order and the

APA; and (c) execute and deliver, perform under,

consummate, and implement this Sale Order and the

APA and all additional instruments and documents

that may be reasonably necessary or desirable to

implement this Sale Order, the APA, and the Sale,

including any other ancillary documents, or as may be

reasonably necessary or appropriate to the

performance of the obligations as contemplated by this

Sale Order, the APA, and any such other ancillary

documents.

60 a

6. This Sale Order shall be binding in all respects upon

the Operr Plaza Debtor, its bankruptcy estate, all

creditors, all holders of equity interests in the Operr

Plaza Debtor, all holders of any Encumbrances against

the Operr Plaza Debtor, including all alleged holders of

leasehold interests, any holders of Encumbrances

against or on all or any portion of the Assets, all

counterparties to any executory contract or unexpired

lease of the Operr Plaza Debtor, the Operr Plaza Buyer

and all agents, representatives, affiliates, and

permitted successors and assigns of the Operr Plaza

Buyer, and any trustees, examiners, or other fiduciary

under any section of the Bankruptcy Code, if any,

subsequently appointed in these chapter 11 cases or

upon a conversion to chapter 7 under the Bankruptcy

Code of these chapter 11 cases, including this Chapter

11 Case. The terms and provisions of the APA and this

Sale Order shall inure to the benefit of the Operr Plaza

Debtor, its bankruptcy estate, its creditors, the Operr

Plaza Buyer, and all agents, representatives, affiliates,

and permitted successors and assigns of the Operr

Plaza Buyer, and any other affected third parties,

including all persons asserting any Encumbrances in

the Assets to be sold to the Operr Plaza Buyer pursuant

to the APA, notwithstanding any subsequent

appointment of any trustee(s), party, entity, or other

fiduciary under any section of any chapter of the

Bankruptcy Code, as to which trustee(s), party, entity,

or other fiduciary such terms and provisions likewise

shall be binding.

61 a

Sale and Transfer of Assets

7. Pursuant to sections 105(a), 363(b), 363(e) and 363(f)

of the Bankruptcy Code, upon the Closing Date and

pursuant to and except as otherwise set forth in the

APA, the Assets shall be transferred to the Operr Plaza

Buyer free and clear of all encumbrances, claims,

interests, and liens, including any leases and related

interests, accruing, arising or relating thereto any time

prior to the Closing Date (collectively, the

“Encumbrances”), with all such Encumbrances to

attach to the cash proceeds of the Sale in the order of

their priority, including any claim for Adequate

Protection, with the same validity, force, and effect that

they now have as against the Assets, subject to any

claims and defenses the Operr Plaza Debtor and its

bankruptcy estate may possess with respect thereto.

8. The conditions of § 363(f) of the Bankruptcy Code

have been satisfied in full. Therefore, the Operr Plaza

Debtor may sell the Assets free and clear of any and all

Encumbrances against, in, or concerning the Assets.

9. On the Closing Date, this Sale Order shall be

construed and shall constitute for any and all purposes

a full and complete general assignment, conveyance,

and transfer of all of the Assets or a bill of sale

transferring good and marketable title in such Assets

to the Operr Plaza Buyer pursuant to the terms set

forth in this Sale Order and the APA.

10. Subject to the terms and conditions of this Sale

Order, the transfer of the Assets to the Operr Plaza

62 a

Buyer pursuant to the APA and the consummation of

the Sale and any related actions contemplated thereby

do not require any consents other than as specifically

provided for in this Sale Order and the APA, constitute

a legal, valid, and effective transfer of the Assets, and

shall vest the Operr Plaza Buyer with sole ownership,

possession, use, and all rights, title, and interest in and

to the Assets as set forth in this Sale Order and the APA

free and clear of all Encumbrances (except as otherwise

assumed in, or permitted by, the APA).

11. Aclosing statement from the closing of the Sale shall

be provided to the U.S. Trustee (attn: Nazar

Khodorovsky, Esq., trial attorney) by email message

within fourteen (14) days after the closing of the Sale

and all funds from the net proceeds of the Sale are to be

kept in the Debtors' debtor-in-possession account

pending further order of the Court.

12. Upon consummation of the Sale, if any person or

entity that has filed financing statements, mortgages,

mechanic’s liens, lis pendens, or other documents or

agreements evidencing Encumbrances against or in

the Assets shall not have delivered to the Operr Plaza

Debtor prior to the Closing, in proper form for filing and

executed by the appropriate parties, termination

statements, instruments of satisfactions, releases of all

Encumbrances that the person or entity has with

respect to such Assets (unless otherwise assumed in, or

permitted by, the APA), or otherwise, then: (a) the

Operr Plaza Debtor is hereby authorized to execute

and file such statements, instruments, releases and

63 a

other documents on behalf of the person or entity with

respect to the Assets; and (b) the Operr Plaza Buyer is

hereby authorized to file, register, or otherwise record a

certified copy of this Sale Order, which, once filed,

registered or otherwise recorded, shall constitute

conclusive evidence of the release of all Encumbrances

against or in the Assets of any kind or nature (except as

otherwise assumed in, or permitted by, the APA),

provided that, notwithstanding anything in this Sale

Order or the APA to the contrary, the provisions of this

Sale Order shall be self-executing, and neither the

Operr Plaza Debtor nor the Operr Plaza Buyer shall be

required to execute or file releases, termination

statements, assignments, consents, or other

instruments in order to effectuate, consummate, and

implement the terms and provisions of this Sale Order.

For the avoidance of doubt, upon consummation of the

Sale, the Operr Plaza Buyer is authorized to file

termination statements, lien terminations, or other

amendments in any required jurisdiction to remove

and record, notice filings, or financing statements

recorded to attach, perfect, or otherwise notice any

Encumbrances that are extinguished or otherwise

released pursuant to this Sale Order under section 363

of the Bankruptcy Code and the related provisions of

the Bankruptcy Code.

13. As of and after the Closing: (a) the Operr Plaza

Debtor’s creditors are hereby authorized and directed

to execute such documents and take all other actions as

may be necessary to release its Encumbrances in the

64 a

Assets (if any) as such Encumbrances may have been

recorded or may otherwise exist; and (b) any Asset that

may be subject to a statutory lien, mechanic’s lien or the

like shall be turned over and such liens shall attach to

the proceeds of the Sale in the same priority they

currently enjoy with respect to such Assets.

14. Pursuant to the Bidding Procedures Order, as of the

date hereof, no purported tenant or lessee of the Operr

Property has any legal, equitable, possessory or other

interest in or to the Operr Property or any portion

thereof.

Additional Provisions

15. The Operr Plaza Debtor and the Operr Plaza Buyer

hereby waive, and shall be deemed to waive, any

requirement of compliance with, and any claims

related to noncompliance with, the provisions of any

bulk sales, bulk transfer, or similar law of any

jurisdiction that may be applicable.

16. Following the Closing, no holder of an

Encumbrance in or against the Operr Plaza Debtor

and its bankruptcy estate or the Assets shall interfere

with the Operr Plaza Buyer’s title to or use and

enjoyment of such Assets based on or related to such

Encumbrance or any actions that the Operr Plaza

Debtor and its bankruptcy estate may take in this

Chapter 11 Case or any successor bankruptcy case.

17. The Operr Plaza Debtor, including its respective

officers, employees, and agents, is hereby authorized to

execute such documents and do such things as are

65 a

necessary or desirable to carry out the transactions

contemplated by the terms and conditions of the APA

and this Sale Order. The Operr Plaza Debtor shall be,

and hereby is, authorized to take all such actions as

may be necessary to effectuate the terms of this Sale

Order and the relief granted pursuant to this Sale

Order.

18. The Sale is undertaken by the Operr Plaza Buyer

without collusion and in good faith, as that term is

defined in section 363(m) of the Bankruptcy Code, and

accordingly, the reversal or modification on appeal of

the authorization provided herein to consummate the

Sale shall not affect the validity of the Sale, unless such

authorization and consummation of the Sale is duly

stayed pending such appeal. The Operr Plaza Buyer is

a good-faith buyer within the meaning of section 363(m)

of the Bankruptcy Code, and as such is entitled to the

full benefits and protections of such section.

19. As a good-faith purchaser of the Assets, the Operr

Plaza Buyer has not colluded with any of the other

bidders, potential b

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