Petition for Writ of Certiorari — In re Lentino

Court,

FILED

9g 98 «621 OCT 14

Orticc UF THE CLERK

y,

N

In The

Supreme Court of the United States

October Term, 1998

IN RE: MARTA A. LENTINO,

Petitioner.

On Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Fifth Circuit

PETITION FOR WRIT OF CERTIORARI

Marta A. LENTINO

Petitioner Pro-Se

99 N. Post Oak Lane # 1207

Houston, Texas 77024

(713) 956-6155

(713) 956-6434 (Fax)

QUESTIONS STATED

Question 1.

Whether the Fifth Circuit’s Court erred by cutting

Petitioners’ only avenue to undo manifest injustice of a

District Court exercising control over a remanded state

court case, enjoining a non-debtor state court defendant

from exercising her legitimate legal rights to defend her-

self, refute the allegations of opposing party, counter-

claim and otherwise participate in the state court

litigation, penalizing such exercise with a jail sentence,

which orders were issued after it had remanded the

removed state court case back to the state court, conflict-

ing with decisions rendered by other circuits, in that

when case is remanded such order is not subject to chal-

lenge in the court of appeals by appeal, mandamus or

otherwise, Thermtron Products, Inc. v. Hermansdorfer, 423

U.S. 336, 343, 96 S.Ct. 584, 589 (1976) and is a well settled

principle of law that remand statute divests District

Court of jurisdiction over a case once it mails a certified

copy of the remand order to the clerk of the state court,

conflicting with the decision rendered in Trans Penn Wax

Corp. v. McCandless, 50 F.3d 217 (3rd Cir.1995), in Brown-

ing v. Navarro, 743 F.2d 1069 (5th Cir.1984), rehearing

denied, 747 F.2d 1465, appeal after remand 826 F.2d 335

(Sth Cir.1987), rehearing denied 830 F.2d 1126, rehearing

denied Navarro v. Holloway, 830 F.2d 1126, appeal after

remand 887 F.2d 553, (5th Cir.1989) rehearing denied 894

F.2d 99 (5th Cir.1990) and the decision rendered by this

Honorable Court in Quackenbush v. Allstate Ins. Co., 517

U.S. 706, 116 S.Ct. 1712 (1996).

ii

QUESTIONS STATED —- Continued

Question 2.

Whether the Fifth Circuit’s court erred by leaving in

place orders which inflict harm, are usurpative in nature

and violate legitimate legal rights, which were issued by

the District Court lacking jurisdiction for it had previ-

ously remanded the removed state court case back to the

state court. Conflicting with 28 U.S.C. § 1447(c), 28 U.S.C.

§ 1447(d).

sitll iaaaaiaaiaaiiaidiatia ii

iii

LIST OF PARTIES

Parties to the Case

1. Petitioner Marta A. Lentino, non Debtor.

2. Eduardo P. Lentino, Debtor

3. Jorge A. Lentino, Debtor

4. Lowell T. Cage, Chapter 7 Trustee of the Bank-

ruptcy Estates of Eduardo P. Lentino, M.D., and Jorge A.

Lentino, M.D.

Counsel in the Case

5. Mrs. Marta A. Lentino, Pro-Se, 99 N. Post Oak

Lane # 1207, Houston, Texas 77024, representing herself.

6. Mrs. Theresa Mobley, Cage, Hill & Niehaus L.L.P.

5851 San Felipe, Suite # 950, Houston, Texas 77057, Attor-

ney for Chapter 7 Trustee Lowell T. Cage.

7. Mr. Scott Rothenberg, Law Offices of Scott

Rothenberg, 4710 Bellaire Blvd., Suite # 160, Bellaire,

Texas 77401, special counsel for Chapter 7 Trustee Lowell

T. Cage.

Other Interested Parties

7. Mr. Richard T. Howell, Jr., Buckley, Mathews,

White, Howell & Janik L.L.P., 2401 Fountainview, Suite

1000, Houston, Texas 77057, Attorney for Cullen Center

Bank and Trust, n/k/a Frost National Bank.

LIST OF PARTIES —- Continued

8. The Honorable Morley H. White, 26600 George

Zeiger Suite # 909, Beechwood, Ohio 44122, Special

Counsel for Chapter 7 Trustee, Lowell T. Cage.

9. Gary S. Tradd, 4731 Ingersoll, Houston, Texas

77027, Special Counsel for Chapter 7 Trustee, Lowell T.

Cage.

10. Neal D. Cannon, Martin and Cannon P.C., 6363

Woodway Suite 902, Houston, Texas 77056, Special Coun-

sel for Chapter 7 Trustee, Lowell T. Cage.

TABLE OF CONTENTS

Page(s)

bo a Ee so Ser rrr peers i

fo LN PERO OPETS CEPT CTER EPEC OeS for ree iii

pp Bs 5, a Re ee Vv

I ooo aan bad hecanse an wks arb dada as 1

TRON act cok ed sbanwe hanes sgucwetabeeas 1

STATUTORY AND REGULATORY PROVISIONS

REG Acie Wicd aty tees ship's cose nescedse 1

STAT res: SIR BEES CAs do coo vin ce cnseccssons 1

REASONS FOR GRANTING THE WRIT ........... 5

A. This is an appropriate case in which to grant the

writ in order to maintain uniformity in well-

established principle of law that remand statute

divests District Court of jurisdiction over case, as

soon as remand order is entered, once it mails a

certified copy of the remand order to the clerk of

thee: GUMS. COMING iG hn 5 a ers a i 5

B. This is an appropriate case in which to grant the

writ because it involves an important question of

Federal Law — the extent to which a U.S. District

Court can continue to exercise control and juris-

diction over a non Debtor state court defendant

in a remanded state court case over two and a

half years after it had remanded the removed

state court case to the state court and after it had

lifted the automatic stay allowing the litigation to

OG TONE orn coin ag oc pated Kane ee at M8 0g 6 odae aoe 8

ee ET. 8 | ie Sa tae ri oe eee ee eee 9

APPENDIX 1: FIFTH CIRCUIT ORDER ..... App. 1

APPENDIX 2: FIFTH CIRCUIT ORDER ..... App. 3

vi

TABLE OF CONTENTS - Continued

APPENDIX 3:

APPENDIX 4:

APPENDIX 5:

APPENDIX 6:

APPENDIX 7:

APPENDIX 8:

APPENDIX 9:

APPENDIX 10:

APPENDIX 11:

Page

DISTRICT COURT ORDER

REMANDING CASE ......... App.

DISTRICT COURT ORDER

RECEIVED BY THE STATE

DISTRICT COURT ORDER .. .App.

JUDGMENT AND OPINION

OF THE COURT OF APPEALS

FOR THE 14TH DISTRICT,

HOUSTON, TEXAS........... App.

THE SUPREME COURT OF

TEXAS DENIAL OF APPLICA-

TION FOR REHEARING ON

APPLICATION FOR WRIT OF

BRI 6 0 os vinta donsnoap case App.

EXCERPTS FROM THE TRAN-

SCRIPT OF PROCEEDINGS OF

IOV. Bly BIOs cccsaubcateses App.

EXCERPTS FROM THE TRAN-

SCRIPT OF PROCEEDINGS OF

JAIN. 2ide BFPO a0 020 vevencceces App.

ORDER SETTING SCHEDUL-

ING CONFERENCE.......... App.

28 U.S.C. § 1334(c)(1), 28 U.S.C.

§ 1334(c)(2), 28 U.S.C. § 1447(c),

20

21

28

31

Vii

TABLE OF AUTHORITIES

Cases

Browning v. Navarro, 743 F.2d 1069 (5th Cir.1984),

rehearing denied, 747 F.2d 1465, appeal after

remand 826 F.2d 335 (5th Cir.1987), rehearing

denied Navarro v. Holloway, 830 F.2d 1126,

appeal after remand 887 F.2d 553 (5th Cir.1989),

rehearing denied 894 F.2d 99 (5th Cir.1990) ...

Burnham v. Superior Court of California, 110 S.Ct.

eee SRO AONE ih ae Ve TEKS Stinks Fhe tives

In re Cathedral of Incarnation in Diocese of Long

Island, 90 F.3d 28 (2nd Cir.1996) rehearing denied,

eo & hr Fe 4. Re Serer err

In re Conejo Enterprises, Inc., 96 F.3d 346 (9th

LED cicctneatsnrticandudetatandehscae sas

In re Lowe, 102 F.3d 731 (4th Cir.1996)...........

Lentino v. Cullen Center Bank and Trust, 919 S.W.2d

743 (Tex.App. — Houston [14th Dist.] 1996, writ

Cae hin bh iexere sc ete bi awudiceheuses 0

Liberty Mut. Ins. Co. v. Ward Trucking Corp., 48 F.3d

PR MOUER 60 cS GV eUseesdcadccenecsecees

Litkey v. U.S., 510 U.S. 540 (1994)...............

Matter of U.S. Brass Corp., 110 F.3d 1261 (7th

oe Pe ee ryt et ee ey oe eee eee

Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 116

SE ein a dt tee Ler ncantectan «

Seedman v. U.S. Dist. Court For Cent. D. of Cal., 837

i § Fs | Sr errr

Page(s)

viii

TABLE OF AUTHORITIES - Continued

Page

State Bank of Lombard v. Charthouse, Inc., 46 B.R.

ee NS in. ban Woes vnpedGhn boncg soceae¥sos 2

Thermtron Products, Inc. v. Hermansdorfer, 423 U.S.

Sa Ns Ew cS esi cccensPecatesceaewsnse 7

Thompson v. Radosta, 906 F.Supp. 367 (E.D.La.1995) ..... 6

Trans Penn Wax Corp. v. McCandless, 50 F.3d 217

Ce ER eae ciakke ote eaten bea dk eee kd bas ned eens 6

U.S. v. Jordan, 49 F.3d 152 (5th Cir.1995) ............. 4

STATUTES

Be CE Be henge Sens lvg ues eek state seceteeeebs 2

Pi te a ey rere rey 23

BE Rc Ee EE ras ns bbe se SE ae a euircdgiehdces sa 6, 8

Bp MPa Se fais, 0 Cad dca sve Scch vices tckeues 8

CF. CE I FUND six tin biek'd Seis os aac de te 5

PETITION FOR WRIT OF CERTIORARI

Petitioner Marta A. Lentino, respectfully requests

that the Court grant the Petition for Writ of Certiorari to

the United States Court of Appeals for the Fifth Circuit.

¢

ORDERS BELOW

Petitioners’ Appendices provide the pertinent

Orders.

JURISDICTION

Jurisdiction exists under 28 U.S.C. § 1254.

¢

STATUTORY AND REGULATORY

PROVISIONS INVOLVED

Petitioners’ Appendices provide the pertinent Section

of the United States Code.

STATEMENT OF THE CASE

The United States Court of Appeals for the Fifth

Circuit entered its order denying Petitioners’ Petition for

Writ of Mandamus on June 29, 1998. Petitioner filed a

Petition for Rehearing and a Suggestion for Rehearing En

Banc, which the Fifth Circuit denied on August 10, 1998.

Petitioner is the non debtor wife of Eduardo P. Len-

tino, M.D. a general surgeon, and is a co-defendant in

state court case No. 91-18878 styled Cullen Center Bank

and Trust v. Eduardo P. Lentino et al., which was filed on

May 3, 1991, and is currently pending, after its reversal,

in the 281st Judicial District Court of Harris County,

Texas. Petitioner attended Law School overseas, although

not yet licensed to practice in the State of Texas.

On October 26, 1993 Cullen bank obtained a judg-

ment, said usurious and fraudulent judgment was later

reversed by the Court of Appeals for the 14th District,

Houston, Texas, and Writ of Error was denied by the

Supreme Court of Texas. Lentino v. Cullen Center Bank and

Trust, 919 S.W.2d 743 (Tex. App. - Houston [14th Dist.]

1996, writ denied).

On August 24, 1994 Eduardo P. Lentino, M.D. and his

brother Jorge A. Lentino, M.D. filed for Chapter 7 bank-

ruptcy following the entrance of said erroneous judgment

and the seizure of all of their business and termination of

their employment contracts. 7

On August 30, 1994 Debtor Eduardo P. Lentino, M.D.,

a state court defendant, removed the state court Case No.

91-18878 to the U.S. District Court, the Honorable Judge

Lynn N. Hughes presiding. On September 27, 1994 Cullen

Bank, n/k/a Frost National Bank filed a motion for

remand and abstention stating that the case should be

remanded mandatorily to state court or in the alternate

that the Federal Court should abstain and remand, rely-

ing therein on 28 U.S.C. § 1334, also stating in its motion

that courts must abstain under 28 U.S.C. § 1334(c)(2)

relying therein on State Bank of Lombard v. Charthouse, Inc.,

46 B.R. 468, 470-71 (N.D. Ill. 1985), or alternatively that

the District Court exercise its discretionary power to abs-

tain in the interest of justice, or in the interest of comity

with state courts or respect for State law, relying on

1334(c)(1). Further Cullen Bank informed the District

Court that there were non-debtors parties involved in the

state court proceeding.

On January 25, 1995 the District Court granted Cullen

bank’s motion and abstention was entered, said order

was mailed to the state court by certified mail on January

25, 1995. The Chapter 7 Trustee of the bankruptcy estates

of Debtors Lentino did not intervene and/or appeal said

order to remand the removed state court case to the state

court.

Well over two and a half years after the state court

case had been remanded the District Court entered a

series of orders at the instance and request of the joint

bankruptcy case Trustee Lowell T. Cage, which orders

totally precluded this Petitioner from defending herself in

said siate court litigation. Petitioner was ordered to with-

draw her pleadings in the state court case where she is

still a defendant, was orally instructed “not to file any-

thing” under threat of being sent either to the Harris

County jail or the Montgomery County jail if she tries to

represent and defend herself in said litigation. Petitioner

already was incarcerated for several hours in the Federal

Court building jail for filing pleadings in the state court

litigation to defend and protect her interest. Petitioners’

interests are not represented by anyone and has other-

wise not retained counsel, and has dismissed her pre-

vious trial attorney.

‘iia

On May 13, 1998 the District Court lifted the auto-

matic Stay allowing the litigation to go forward, but

keeping in place the injunctive orders issued against this

Petitioner, which orders precluded Petitioner from filing

any pleadings in her own defense in said remanded case

where she is still a defendant.

The District Court made improper biased and derog-

atory remarks regarding this Petitioner and her family

and improperly imported into the trial court its personal

view about the Hispanic people by stating that “One of

the real tragedies of American Life is the exploitation of

physicians. They are just put upon by everybody. You

know, illiterate Hispanic housewives and physicians, who

own hospitals and live in houses of more than a million

dollars of value, those are the tragic people in our soci-

ety” and further stating “I just don’t know how these

people can stand to live with themselves”. To the extent

that a judge has become biased due to opinions formed

during the judicial proceeding, disqualification is

required if the Judge displays a high degree of favoritism

or antagonism that would make a fair judgment impossi-

ble. Litkey v. U.S., 510 U.S. at 554, U.S. v. Jordan, 49 F.3d at

155.

The Fifth Circuit did not enter its opinion stating its

rationale for denying Petitioners’ Writ of Mandamus.

Petitioner ask the Court to exercise its certiorari jurisdic-

tion and resolve these issues and settle an important

question of Federal law - the extent to which a US.

District Court can continue to exercise control and juris-

diction over a non Debtor state court defendant in a

remanded state court case over two and a half years after

it had remanded the removed state court case to the state

court and after it had lifted the automatic stay allowing

the litigation to go forward.

+

REASONS FOR GRANTING THE WRIT

A. This is an important case in which to grant the writ

in order to maintain uniformity of well-established

principle of law that remand statute divests District

Court of jurisdiction over case, as soon as remand

order is entered, once it mails a certified copy of the

remand order to the clerk of the state court.

Because the Fifth Circuit Court allowed the District

Court to keep in place injunctive orders towards this

Petitioner, issued over two and a half years after it had

remanded the removed state court case to the state court,

which orders penalize the lawful exercise of legitimate

legal rights to defend oneself against the opposing party

allegations and otherwise participate in the litigation like

any other defendant that has been afforded equal protec-

tion of the laws guaranteed by the Fourteenth Amend-

ment of the U.S. Constitution, to a jail sentence, and

subjects this Petitioner to an imposed default leaving the

floor open for Cullen Center Bank and Trust, n/k/a Frost

National Bank, to proceed unhampered towards a devas-

tating judgment against this Petitioner, in essence, inflict-

ing a sanction without any hearing or adjudication

thereon. It is appropriate for this-honorable Court to

maintain in place the decisions rendered by other circuits

including the Fifth Circuit.

As a matter of federal statute, remand is effected

when the Federal Court clerk sends a certified copy of the

order of remand to the clerk of the state court, and it may

proceed with the case, 28 U.S.C. § 1447(c).

Remand statute divests District Court of jurisdiction

over case as soon as remand order is entered and from

that point on it cannot reconsider its ruling even if dis-

trict court clerk fails to mail certified copy of remand

order to state court. In re Lowe, 102 F.3d 731 (4th Cir.1996).

Further in Trans Penn Wax Corp. v. McCandless, 50 F.3d 217

(3rd Cir.1995) the Third Circuit stated that physical mail-

ing of certified copy of remand order to state court is key

event to divest District Court of jurisdiction, which con-

curs with this Circuits’ opinion in Browning v. Navarro,

743 F.2d 1069 (Sth Cir.1984), rehearing denied, 747 F.2d

1465, appeal after remand 826 F. 2d 335 (5th Cir. 1987),

rehearing denied, Navarro v. Holloway, 830 F.2d 1126,

appeal after remand 887 F.2d 553 (5th Cir.1989) rehearing

denied 894 F.2d 99 (5th Cir.1990).

Furthermore, reconsideration will be impermissible

for order remanding case to state court based on lack of

diversity jurisdiction, remand order coinpletely divested

court of subject matter jurisdiction, Thompson v. Radosta,

906 F.Supp. 367 (E.D.La.1995).

Further when District Court remands case which has

been removed to state court, district-court disassociates

itself from case entirely, retaining nothing of the matter

on federal court’s docket Quackenbush v. Allstate Ins. Co.,

517 U.S. 706, 116 S.Ct. 1712 (1996).

Court of Appeals lacks jurisdiction to review district

court’s remand order which was based on lack of jurisdic-

tion over state breach of contract claim, where state

action was removed from state court pursuant to statute

governing removal of claims relating to bankruptcy cases,

and district court ordered the case remanded to state

court on mandatory abstention grounds. In re Conejo

Enterprises, Inc. 96 F.3d 346 (9th Cir.1996). Further, the

Court of Appeals lacked jurisdiction over appeal from

district court order remanding eminent domain proceed-

ings, regardless whether decision to remand was based

on legal or equitable determination. In re Cathedral of

Incarnation in Diocese of Long Island, 90 F.3d 28, (2nd

Cir.1996), rehearing denied, 99 F.3d 66 (2nd Cir.1996).

The mere fact that bankruptcy court may have erred

in concluding that there was equitable ground to remand

removed proceeding did not permit review of remand

order, pursuant to statute providing for remand on any

equitable ground and providing that decision to remand

would not be reviewable, where court’s stated ground for

remand was equitable one. Matter of U.S. Brass Corp., 110

F.3d 1261 (7th Cir.1997).

Federal judges can remand with impunity if they

don’t state their reasons: “if a trial judge purports to

remand a case on the ground that it was removed

improvidently and without jurisdiction, his order is not

subject to challenge in the courts of appeal by appeal, by

mandamus, or otherwise Thermtron Products, Inc. v. Her-

mansdorfer, 423 U.S. 336, 343, 96 S.Ct. 584, 589 (1976),

(emphasis added). There is usually no right of appeal

from an order remanding a removed action, because the

remand order is not a final judgment on the merits,

Thermtron, supra, at 352-353, 96 S.Ct. 594. Further, after

certification to state court, federal court can not vacate

remand order and once it has certified the remand order

to state court it is divested of jurisdiction and can take no

further action on case. Seedman v. U.S. Dist. Court For

Cent. D. of Cal., 837 F.2d 413 (9th Cir.1988).

When a District Court exercises its power to remand

under 28 U.S.C. § 1447(c), § 1447(d) its order is non-

reviewable. Liberty Mut. Ins. Co. v. Ward Trucking Corp., 48

F.3d 742, 750 (3rd Cir.1995). The panel decision is erro-

neous for it allows to remain in place orders which inflict

irreparable harm, which were issued by the District Court

after it had relinquished jurisdiction to the state district

court, it also allows the crushing of fundamental legiti-

mate legal rights and legitimizes an erroneous abusive

preclusion and sanction imposing a sure destiny of

default and damages and subjects Petitioner to incur in

multiple litigation to defend and protect Petitioners’

rights, defenses and counterclaims. Petitioner respectfully

requests that this Court grant the Writ and reverses the

Fifth Circuit’s denial of granting mandamus and dissolve

the injunctive orders issued against this Petitioner, non

Debtor state court defendant, which were issued lacking

jurisdiction and/or exceeding its prescribed jurisdiction.

B. This is an appropriate case in which to grant the

writ because it involves an important question of

Federal Law - the extent to which a U.S. District

Court can continue to exercise control and jurisdic-

tion over a non Debtor state court defendant in a

remanded state court case over two and a half years

after it had remanded the removed state court case

to the state court and after it had lifted the auto-

matic stay allowing the litigation to go forward.

The Panel did not state in its orders its rationale

when it denied Petitioners’ petition for rehearing and

suggestion for rehearing en banc. This honorable Court

has stated that judgment entered by a court lacking juris-

diction is void (per Justice Scalia with three Justices con-

curring and five Justices concurring in the judgment)

Burnham v. Superior Court of California, 110 S.Ct. 2105

(1990), supra, [n.1] at 2106. Therefore, orders entered lack-

ing jurisdiction are also void.

¢

CONCLUSION

The Fifth Circuits’ denial of Petitioner’s Petition for

Writ of Mandamus given the extraordinary circumstances

in this case injects uncertainty into an area of the law in

which certainty and stability are critical regarding juris-

dictional issues and because it leaves in place injunctive

orders which inflict irreparable harm, allows the crushing

of fundamental legitimate legal rights and condones the

manifest injustice by precluding this non-Debtor state

court defendant from defending herself and participate in

the litigation in which she is a named defendant. This can

not be condoned in our judicial system. The exercise of

legitimate legal rights can not be negated, conditioned or

penalized with a jail sentence. For these reasons Peti-

tioner asks the Court to grant writ of certiorari and

reverse the denial of the Fifth Circuit Court of Appeals.

Respectfully submitted,

Marta A. LENTINO

Petitioner Pro-Se

99 N. Post Oak Lane # 1207

Houston, Texas 77024

(713) 956-6155

(713) 956-6434 (FAX)

App. 1

APPENDIX 1

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 98-20491

In Re: MARTA A LENTINO

Petitioner

Appeal from the United States District Court for the

Southern District of Texas, Houston

(Filed Aug. 10, 1998)

ON MOTION FOR RECONSIDERATION AND SUGGES-

TION FOR REHEARING EN BANC

Before JOLLY, HIGGINBOTHAM, and DeMOSS, Circuit

Judges.

PER CURIAM:

(“) The Motion for Reconsideration is DENIED and no

member of this panel nor judge in regular active service

on the court having requested that the court be polled on

Rehearing Er. Banc, (Fep. R. App. P. and 5TH Cir. R. 35) the

Suggestion for Rehearing En Banc is also DENIED.

( ) The Motion for Reconsideration is DENIED and the

court having been polled at the request of one of the

members of the court and a majority of the judges who

are in regular active service not having voted in favor.

App. 2

(Feo. R. Apr. P. and 51x Cir. R. 35) the Suggestion for

Rehearing En Banc is also DENIED.

( ) A member of the court in active service having

requested a poll on the reconsideration of this cause en

banc, and a majority of the judges in active service not

having voted in favor, Rehearing En Banc is DENIED.

ENTERED FOR THE COURT:

/s/ P. Higginbotham

United States Circuit Judge

REHG-4

App. 3

APPENDIX 2

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 98-20491

In Re: MARTA A LENTINO

Petitioner

Appeal from the United States District Court for the

Southern District of Texas, Houston

(Filed Jun. 29, 1998)

Before JOLLY, HIGGINBOTHAM, and DeMOSS, Circuit

Judges.

BY THE COURT:

IT IS ORDERED that petitioner’s writ of mandamus

is denied.

App. 4

APPENDIX 3

Unrrep States District Court

SouTHERN District oF TExAs

Cutten Center BANK & Trust, §

Plaintiff, ;

— § Civ. ACTION

Epuarvo P. Lentino, et al., § H-94-3007

Defendants. ;

Orper To REMAND

The removal having been an abusive misuse of the

bankruptcy system, this case is remanded to the 269th

Judicial District Court of Texas, Harris County (#4).

Signed January 25, 1995, at Houston, Texas.

/s/ Lynn N. Hughes

Lynn N. Hughes

United States District Judge

TRUE COPY I CERTIFY

ATTEST: 7-2-98

MICHAEL N. MILBY, Clerk

By /s/ L. Babbitt

Deputy Clerk

App. 5

APPENDIX 4

91-18878

Unrtep States District Court

SOUTHERN District oF TEXAS

Cutten Center BANK & Trust, §

Plaintiff, :

versus § Crvit ACTION

Epuarpbo P. LEentiNno, et al., § H-94-3007

Defendants. ;

Orper To REMAND

(Filed Feb. 3, 1995)

The removal having been an abusive misuse of the

bankruptcy system, this case is remanded to the 269th

Judicial District Court of Texas, Harris County (#4).

Signed January 25, 1995, at Houston, Texas.

/s/ Lynn N. Hughes

Lynn N. Hughes

United States District Judge

App. 6

[Envelope]

[Post Office Stamp — Feb. 2, 1995]

CLERK

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF TEXAS

POST OFFICE BOX 61010

HOUSTON, TEXAS 77208

OFFICIAL BUSINESS

PENALTY FOR PRIVATE USE $300

Katherine Tyra

269th JDC of Harris County

301 Fannin Room 400

Houston, Tx 77002

CERTIFIED MAIL

P 714 717 285

STATE OF TEXAS

COUNTY OF HARRIS

I, Charles Bacarisse, District Clerk of

Harris County, Texas, do hereby certify

that the foregoing data is a true and

correct copy of the original record,

now in my lawful orderly and posses-

sion as appears of record in my office.

a) filed on 2/3/95

b) recorded under Vol. ___ Judge __

in the minutes of said court

c) abstracted from the file record in

my lawful possession electron-

ically stored in digital form and

App. 7

pertaining to the in reference

to cause number , or

d) abstracted from the original record

in my lawful possession electron-

ically stored in digital form per-

taining to __ from ___ to the

present date.

Witness my office hand and seal of

office this SEP 03 1998

CHARLES BACARISSE,

DISTRICT CLERK

Harris County, Texas

By /s/ Deputy

O. FLORES

App. 8

APPENDIX 5

Unitrep States District Court

SOUTHERN District OF TEXAS

IN Re Jorce A. LENTINO, §

Epuarpbo P. LENTINO, §

Marta LENTINO, § Civit ACTION

Debtors. S ca -S0

§

Order

1. The automatic stay is lifted for Cullen Center to sue

on the debt.

2. The counter-claim in usury is by the estate; no auto-

matic stay existed.

Signed at Houston, Texas, on May 12, 1998.

/s/ Lynn N. Hughes

Lynn N. Hughes

United States District Judge

App. 9

APPENDIX 6

FEBRUARY 29, 1996

[LOGO]

JUDGMENT

The Fourteenth Court of Appeals

MARTA A. LENTINO, EDUARDO P. LENTINO, AND

JORGE A. LENTINO, APPELLANTS

NO. 14-94-00175-CV

V.

CULLEN CENTER BANK AND TRUST, APPELLEE

This cause, an appeal from the partial summary judg-

ment and jury verdict in favor of appellee, Cullen Center

Bank and Trust signed October 26, 1993, came on to be

heard on the transcript of the record. We have inspected

the record and find error in the judgment. We therefore

order the judgment of the court below REVERSED and

REMAND the cause for proceedings in accordance with

the court’s opinion.

We order appellee, Cullen Center Bank and Trust,

jointly and severally, to pay all costs incurred because of

this appeal.

We order this decision certified below for obser-

vance.

App. 10

Reversed and Remanded; opinion filed February 29, 1996.

[LOGO]

In The

Fourteenth Court of Appeals

NO. 14-94-00175-CV

MARTA A. LENTINO, EDUARDO P. LENTINO,

AND JORGE A. LENTINO,

Appellants

¥,

CULLEN CENTER BANK AND TRUST, Appellee

ee

On Appeal from the 269th District Court

Harris County, Texas

Trial Court Cause No. 91-18878

OPINION

Appellants, Marta A. Lentino, Eduardo P. Lentino,

M.D., and Jorge A. Lentino, M.D., appeal from a partial

summary judgment and jury verdict in favor of appellee,

Cullen Center Bank and Trust. Appellants bring six

points of error, contending: (1) the trial court improperly

granted appellee’s motion for partial summary judgment;

and (2) the trial court erred by overruling appellants’

motion to modify, correct, or reform the judgment when

there was insufficient evidence or no evidence to support

the jury’s verdict. Appellants also request that in ‘he

event this case is reversed and remanded, this Cou’

reverse the awards of prejudgment and postjudgment

App. 11

interest, attorney’s fees, costs of court, and several post-

judgment orders by the trial court relating to the seizure

of appellants’ property. We reverse and remand for a trial

on the merits.

In November 1982, Eduardo and Jorge Lentino indi-

vidually executed separate promissory notes for $150,000

to appellee in order to finance their bank stock purchases.

Both notes were renewed in November 1983. On Decem-

ber 14, 1984, Eduardo and Jorge Lentino and four other

parties, jointly and severally, executed a new promissory

note to appellee in the original amount of $2,252,250.

Also on that day, Eduardo and Jorge Lentino executed

guarantee agreements in favor of Cullen that uncondi-

tionally guaranteed payment of the $2,252,250 note.

Appellee advanced no additional funds to appellants as

consideration for increasing their obligation.

In February 1986, appellee filed individual suits

against Jorge and Eduardo Lentino for default on the

December 1984 note, which matured on November 30,

1985. In March 1987, both Eduardo and Jorge Lentino

entered into separate compromise settlement agreements

with appellee. According to the terms of these agree-

ments, Eduardo and Jorge agreed to execute new prom-

issory notes to pay appellee $148,842 and $171,186.29,

respectively. The compromise settlement agreements fur-

ther provided that: (1) appellee would pay Eduardo and

Jorge each $10 and release them of their joint and several

liability under the 1984 note and guaranty agreements; (2)

if Eduardo or Jorge defaulted on their notes, the default-

ing party could be liable for the outstanding balance on

the original 1984 note; and (3) Eduardo and Jorge waived

App. 12

all affirmative defenses and causes of action relating to

the loan documents in the underlying lawsuit.

Both Eduardo and Jorge subsequently defaulted on

their 1987 notes, and in 1990, appellee filed separate

lawsuits to collect on these notes. The trial court entered

final judgments in favor of appellee and awarded actual

damages, prejudgment interest, attorneys fees, costs of

court, and postjudgment interest. During postjudgment

discovery, however, appellee allegedly discovered fraud-

ulent transfers by Jorge, Eduardo and Marta Lentino

made during the time the compromise settlement agree-

ments were executed. Appellee subsequently filed this

suit, claiming fraud, fraudulent transfers, breach of con-

tract, conspiracy, negligence, and negligent misrepresen-

tation. The appellants responded with a general denial

and asserted several affirmative defenses, including

usury. The appellants also filed counterclaims alleging

usury, slander of title, unreasonable collection efforts,

and intentional infliction of emotional distress.

In June 1993, Cullen filed a motion for partial sum-

mary judgment, requesting the trial court to hold that the

compromise settlement agreements barred appellants’

“affirmative causes of action” which relate to the under-

lying loan documents. Following the appellants’

response, appellee filed its reply, clarifying that the com-

promise settlement agreement barred all of the Lentinos’

claims and affirmative defenses. See Stiles v. Resolution

Trust Corp., 867 S.W.2d 24, 26 (Tex.1993) (indicating that

specific grounds for summary judgment may be stated in

movant’s reply in order to comply with rule of civil

procedure 166a(c)). The trial court subsequently granted

appellee’s motion and held the compromise settlement

App. 13

agreements barred all of appellants’ causes of action and

affirmative defenses.

The parties proceeded to trial and at the close of

evidence, the trial court directed a verdict in favor of

appellee as to its claims for breach of the compromise

settlement agreements. The trial court also rendered judg-

ment on the jury’s verdict, which addressed other issues,

and awarded $1,817,525.42 in actual damages and

$2,500,000 in exemplary damages against each Jorge and

Eduardo Lentino, along with attorneys’ fees, prejudgment

interest, postjudgment interest and costs of court.

In their first point of error, appellants contend the

trial court improperly granted appellee’s motion for par-

tial summary judgment, in part, because a fact issue

exists as to whether the 1984 note was usurious. Appel-

lants argue that if the 1984 note was usurious, the com-

promise settlement agreements were void because they

failed to purge the usury contained in the 1984 note. See

Commerce Trust Co. v. Ramp, 138 S W.2d 531, 534

(Tex.1940), overruled on other grounds, 561 S.W.2d 777

(Tex.1977); see also Tex. Rev. Crv. Stat. ANN. art. 5069-1.02

(Vernon 1987) (stating that all usurious contracts are con-

trary to public policy); Ferguson v. Tanner Development Co.,

541 S.W.2d 483, 493 (Tex. Civ. App. - Hovston [1st Dist.]

1976), rev'd on other grounds, 561 S.W.2d 777 (Tex.1977)

(stating that contracts which are contrary to public policy

are void). Accordingly, appellants maintain that no sum-

mary judgment could be based on a void instrument.

The movant for summary judgment has the burden to

show that no genuine issues of material fact exist and that

it is entitled to judgment as a matter of law. Nixon v. Mr.

App. 14

Property Management Co., 690 S.W.2d 546, 548-49

(Tex.1985). In deciding whether there is a disputed mate- |

rial fact issue precluding summary judgment, proof

favorable to the non-movant must be taken as true. Id.;

O’Bryant v. Century 21 S. Cent. States, 899 S.W.2d 270, 271

(Tex.App. — Houston [14th Dist.] 1995, no writ). Further, |

we indulge every reasonable inference in favor of the

non-movant and resolve any doubts in his favor.

O’Bryant, 899 S.W.2d at 271; Edwards v. Garcia-Gregory, 866 |

S.W.2d 780, 783 (Tex.App. — Houston [14th Dist.] 1993, |

writ denied). If the movant’s motion and summary judg-

ment proof facially establishes his right to judgment as a

matter of law, then the burden shifts to the non-movant to |

raise fact issues precluding summary judgment. See City |

of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678

(Tex.1979). Moreover, if the non-movant relies on an affir-

mative defense to defeat summary judgment, he must

present summary judgment proof sufficient to raise a fact

issue as to each element of that defense. Brownlee v.

Brownlee, 665 S.W.2d 111, 112 (Tex.1984); see also Wilson v.

General Motors Acceptance Corp., 897 S.W.2d 818, 823

(Tex.App. — Houston [1st Dist.] 1994, no writ).

The essential elements of a usurious transaction are:

(1) a loan of money; (2) an absolute obligation to repay

the principal; and (3) the exaction of a greater compensa-

tion than allowed by law for the use of the money by the

borrower. First Bank v. Tony’s Tortilla Factory, 877 S.W.2d

285, 287 (Tex.1994); Holley v. Watts, 629 S.W.2d 694, 696

(Tex.1982); Blasdell v. Catalina, 858 S.W.2d 653, 655

(Tex.App. — Houston [14th Dist.] 1993), rev’d on other

grounds, 881 S.W.2d 295 (Tex.1994). In the present case,

neither side disputes that appellee loaned Eduardo and

App. 15

Jorge Lentino only $150,000 each, with obligations to

repay the entire amounts. Appellee, however, contends

that appellants failed to present sufficient summary judg-

ment proof demonstrating usurious interest.

In support of its argument, appellee relies heavily on

Sorrells v. Gilberson, 780 S.W.2d 936, 938 (Tex.App. — Aus-

tin 1989, writ denied), which stands for the proposition

that a possessor of a promissory note who moves for

summary judgment against the maker of the note must

present certain proof to establish he is entitled to judg-

ment as a matter of law. Specifically, the possessor of a

note must either: (1) include the note in the summary

judgment proof; or (2) establish the terms of the note by

affidavit or other proper summary judgment proof. Id.

Appellee now contends that appellants’ proof was insuf-

ficient to support their usury defense because: (1) the

1982 and 1983 notes were absent from the summary judg-

ment record; and (2) appellants’ affidavits failed to state

the relevant terms of the 1982 and 1983 notes. See id.

Upon review of the record, however, we find Sorrells

to be inapposite. In the present case, appellants were the

non-movants, and thus, their only burden was to demon-

strate a fact issue as to each element of their usury

defense. See Brownlee, 665 S.W.2d at 112. Unlike the

movant for summary judgment in Sorrells, appellants were

not required to establish conclusively each element of

their defense. Accordingly, appellants were not required

to show the terms of the notes, such as payment schedule,

maturity date, interest rate, default provisions, accelera-

tion terms, and notice, demand and presentment require-

ments to preclude partial summary judgment. As we

App. 16

discuss below, the proof presented by appellants suffi-

ciently established a fact issue as to the existence of

usurious interest. That should have precluded partial

summary judgment.

When a lender requires, as a condition to making a

loan, that a borrower assume a third party’s debt, such

debt must be included in the interest computation to

determine usury. Alamo Lumber Co. v. Gold, 661 S.W.2d

926, 928 (Tex.1983). In this case, the summary judgment

record shows that as a condition to renew appellants’

1983 notes, appellee required them to sign the 1984 note,

making them jointly and severally liable with third par-

ties for $2,252,250. The record also shows that: (1) the

1984 note had a one-year maturity; and (2) appellee did

not advance additional funds to appellants other than the

original $150,000 loan made in 1982. Thus, although the

interest rates on the 1982 and 1983 notes are not in the

record, appellants’ computed interest on the 1984 note

under Alamo Lumber would likely exceed two million

dollars for one year, even though appellants never

received more than $150,000 from appellee.

Further, the maximum lawful rate of interest for a

contract is 24% per annum. Tex. Rev. Civ. Stat. ANn. art.

5069-1.04(a), (b)(1) (Vernon 1987). Interest rates exceeding

the maximum lawful rate are deemed to be usurious. See

Tex. Rev. Crv. Stat. ANN. art. 5069-1.02 (Ver..on 1987).

Therefore, we find that there is, at least, a fact issue as to

whether the 1984 note obligated appellants to pay interest

App. 17

exceeding the maximum lawful rate.’ See also Catalina v.

Blasdel, 881 S.W.2d 295, 296 (Tex.1994) (stating that usury

is a question of fact when not evident from the face of the

instrument); Dryden v. City Nat'l Bank of Laredo, 666

S.W.2d 213, 216 (Tex.App. —- San Antonio 1984, writ ref’d

n.r.e.) (stating that usury, where not apparent from the

face of the instrument, is a question of fact for the jury).

Appellee, nonetheless, argues that even if a fact issue

exists, partial summary judgment was proper because the

1987 compromise settlement agreements released any

claims or defenses that the appellants may have had for

usury under the 1984 note. We disagree.

A claim or defense of usury may be compromised

and released if done in good faith and if the settlement

instrument is purged of the usury contained in the under-

lying note. See Finn v. Alexander, 163 S.W.2d 714, 716 (Tex.

1942); Ramp, 138 S.W.2d at 534. For this to occur, there

must be: (1) cancellation of the obligation tainted by the

usury; and (2) the creation of a new obligation free of

‘ If we apply the maximum lawful interest rate for

contracts, compounded annually for two years, and assume that

Eduardo and Jorge Lentino failed to make any payments on

their 1982 notes, our calculations show that each would owe

appellee $222,000 at the time they signed the 1984 note for

$2,250,000. Because the 1984 note had a one year maturity,

under Alamo Lumber, the Lentinos’ computed interest charge

would have been approximately $2,028,000 each for one year.

This amount, notwithstanding the interest owed by the Lentinos

on the 1984 note itself, clearly exceeds the maximum lawful rate

for contracts, and therefore, would be usurious. Although these

calculations incorporate certain assumptions, they, nonetheless,

illustrate the existence of a fact issue as to appellant’s usury

defense.

App. 18

usury. See Southwestern Inv. Co. v. Hockley County S. & D.,

Inc., 516 S.W.2d 136, 137 (Tex.1974); Ramp, 138 S.W.2d at

534; O’Quinn v. Beanland, 540 S.W.2d 526, 527 (Tex.Civ.

App. - San Antonio 1976, no writ). On the other hand,

when the original usurious obligation transcends into the

subsequent agreement, such agreement is void and unen-

forceable. See Ramp, 138 S.W.2d at 535.

Under the terms of the compromise settlement agree-

ment, both Jorge and Eduardo Lentino agreed to execute

new promissory notes payable to appellee. In return,

appellee paid Jorge and Eduardo $10 each and agreed to

release them from their joint and several liability under

the 1984 note and guaranty agreements. The agreement

also provided, however, that if either Jorge or Eduardo

defaulted on their notes, the defaulting party, at appel-

lee’s sole option, could be liable for the entire outstand-

ing balance on the 1984 note. Because we find that a fact

issue exists as to whether the 1984 note was usurious, we

are unable to determine whether the compromise settle-

ment agreement carried forward the usury contained in

the 1984 note, and thus, was void and unenforceable.

Accordingly, appellants’ first point of error is sustained.

In points two through five, appellants attack the legal

and factual sufficiency of the evidence as it relates to

their alleged breaches of the compromise settlement

agreements. However, given our disposition of appel-

lants’ first point, we need not address the merits of these

issues.

In their sixth point of error, appellants request that,

in the event this case is reversed and remanded, this

App. 19

Court reverse the awards of prejudgment and postjudg-

ment interest, attorney’s fees, costs of court, and several

post judgment orders by the trial court relating to the

seizure of appellants’ property. We decline their request

and reverse and remand this case for a trial on the merits.

/s/ Paul C. Murphy

Chief Justice

Judgment rendered and Opinion filed February 29, 1996.

Panel consists of Chief Justice Murphy, and Justices

Anderson and Fowler.

Publish — Tex. R. App. P. 90.

App. 20

APPENDIX 7

[SEAL] THE SUPREME COURT OF TEXAS

Post Office Box 12248

Austin, Texas 78711 (512) 463-1312

February 21, 1997

Mr. Warren W. Harris Ms. Amy Marlyse Wilson

Bracewell & Patterson Porter & Hedges

711 Louisiana, Suite 2900 700 Louisiana, 35th Floor

Houston, TX 77002-2781 Houston, TX 77002-2764

Mr. Richard T. Howell, Jr. Mr. Scott Rothenberg

Moore & Howell Rothenberg & Gunn

520 Post Oak Blvd., 4710 Bellaire Blvd., Suite 160

Suite 600 Bellaire, TX 77401-4505

Houston, TX 77027

RE: Case Number 96-0487

Style: CULLEN CENTER BANK & TRUST

V.

LOWELL T. CAGE, CHAPTER 7 TRUSTEE OF

THE BANKRUPTCY ESTATES OF EDUARDO P.

LENTINO, M.D., and JORGE A. LENTINO, M.D.,

DEBTORS, and MARTA LENTINO

Dear Counsel: |

Today, the Supreme Court of Texas overruled both

motions for rehearing of the application for writ of error

in the above styled case. (Chief Justice Phillips not sit-

ting.)

ae

Sincerely,

John T. Adams, Clerk

by /s/ Michael C. Murphey

Michael C. Murphey, Deputy

App. 21

APPENDIX 8

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

MARTA LENTINO, ET AL CA NO. H-97-499

VS. HOUSTON, TEXAS

JL YORK PLAZA LIVING y

TRUST, ET AL 11:00 A.M.

)

)

NOVEMBER 21, 1997

)

)

(Filed Jan. 26, 1998)

TRANSCRIPT OF SANCTIONS HEARING

BEFORE THE HONORABLE LYNN N. HUGHES

APPEARANCES:

FOR THE PLAINTIFF:

MS. MARTA LENTINO

PRO SE

709 KUHLMAN

HOUSTON, TEXAS

FOR THE DEFENDANT:

MS. TERESA D. MOBLEY

CAGE, HILL & NIEHAUS

59851 SAN FELIPE, STE. 950

HOUSTON, TEXAS 77057

COURT REPORTER:

HERMAN CHESTER

515 RUSK, #8026

HOUSTON, TEXAS 77002

(713) 250-5580

PROCEEDINGS RECORDED BY MECHANICAL

STENOGRAPHY, TRANSCRIPT PRODUCED BY

COMPUTER-AIDED TRANSCRIPTION

HERMAN CHESTER - (713) 250-5580

App. 22

[p. 42] DEFENDING YOUR HONOR, BECAUSE IF YOUR

HONOR SEES WHAT I’M FILING, THE JUDICIAL

NOTICE IS NOT AN ATTEMPT TO GAIN CONTROL OF

THE CASE OR ANYTHING, IT WASN’T ANYTHING

LIKE THAT AT ALL, YOUR HONOR, IT WAS JUST

TELLING THE JUDGE; PLEASE DEAR DISTRICT

STRICT COURT JUDGE, KNOW THAT THE STAY HAS

NOT BEEN LIFTED REGARDING THE UNITED STATES

COURT REGARDING THE ORDER OF JULY 2ND

ENTERED BY THE YOUR HONOR JUDGE WHELESS -

JUDGE HUGHES. THEN I ATTACHED THE DOCKET TO

SHOW THAT MY APPEAL WAS ALREADY DOCKETED

IN THAT LOUISIANA. AND I AM GETTING READY TO

DO THE BRIEF, YOUR HONOR, IN THE NEXT FEW

WEEKS ON THAT CASE.

THE COURT: GOOD.

MS. LENTINO: SO WE SHOULD HAVE AN

ANSWER FROM THE 5TH CIRCUIT WHETHER, LIKE I

TOLD YOUR HONOR, WHETHER YOUR HONOR HAD

EXCEEDED THE SUBJECT MATTER JURISDICTION BY

ADJUDICATING MY RIGHTS IN A STATE COURT CASE

WHEN YOUR HONOR LACKS IN PERSONAM JURIS-

DICTION OVER MYSELF. BECAUSE I AM A DEFEN-

DANT IN THAT CASE. TO BE HONEST WITH YOUR

HONOR, IT’S VERY CONFUSING, IT’S UNCLEAR TO

ME, IS YOUR HONOR STRIKING MY DEFENSES ALSO,

HAS YOUR HONOR STRIKED MY DEFENSES IN THAT

CASE? BECAUSE I DON’T UNDERSTAND, FROM

READING, FROM PLAINLY READING OF THE ORDER,

IT’S VERY AMBIGUOUS TO ME. DID YOUR HONOR

App. 23

INTEND TO STRIKE MY DEFENSES, TO STRIKE ME

PERIOD, EVEN THOUGH I AM A DEFENDANT IN

THAT CASE? AM I PRECLUDED FOR LIFE? I DON’T

UNDERSTAND.

I WAS SANCTIONED BECAUSE I DISMISSED MY

[p. 43] ATTORNEY. ISN’T IT MY RIGHT TO DISMISS MY

ATTORNEY WHEN HE SOLD ME DOWN THE RIVER,

WHEN HE HAD EVIDENCE THAT WOULD PRECLUDE

THE BANK FROM OBTAINING A JUDGMENT AND HE

DECIDED NOT TO PRESENT IT, YOUR HONOR. YOU

KNOW WHAT, YOUR HONOR SANCTIONED ME ON

THE 2ND, YOUR HONOR SANCTIONED ME FOR DIS-

MISSING MY ATTORNEY ACCORDING TO RULE 76 OF

RULE OF CIVIL PROCEDURE, THAT’S WHAT YOUR

HONOR SANCTIONED ME FOR. AND BECAUSE |

MOVED FOR SEVERANCE OF MY OWN CAUSES OF

ACTION, YOUR HONOR NEVER TOLD ME YOU CAN-

NOT GO ON ON YOUR OWN CAUSES OF ACTION,

YOUR HONOR TOLD ME THAT USURY THAT’S PART

OF THE STATE. I DIDN’T MESS AROUND, I ABAN-

DONED THAT. I FILED COMPLETE ABANDONMENT

OVER THERE. I ABIDED BY THIS COURT’S ORDER

THE BEST I COULD. AND I UNDERSTOOD.

THE COURT: NO, YOU HAVEN’T. YOU HAVE

FILED THINGS, EVERY TIME I TURN AROUND YOU

FILE SOMETHING. THEN YOU GO OFF AND GET

YOUR FRIEND KAMINETSKY BACK THERE TO FILE

THINGS. AND YOU ARE SAYING YOU ARE NOT A

PARTY, BUT THEN YOU ARE A PARTY. AND, OF

COURSE, WE LET YOU APPEAR HERE OUT OF COUR-

TESY.

App. 24

MS. LENTINO: I AM AN AGGRIEVED PER-

SON, YOUR HONOR, AN AGGRIEVED PERSON THAT

THE PECUNIARY WAS AFFECTED. THERE IS AN

EFFECT WHEN A PERSON THAT IS NOT A PARTY TO

THE BANKRUPTCY PROCEEDING CAN INTERVENE.

THE COURT: YOU ARE A PARTY TO THIS

PROCEEDING.

MS. LENTINO: I HAVE BEEN A PARTY BY

BEING AN INTERVENOR, YES. BUT WHERE MY

STANDING COMES FROM BEING AN

* * *

[p. 50] PROMISE YOUR HONOR I DIDN’T THINK IT

WAS A PLEADING. HONESTLY, I TELL YOUR HONOR

I DIDN’T THINK IT WAS A PLEADING.

THE COURT: AND WAS THERE SOME REA-

SON THAT YOU COULDN'T FILE A MOTION IN THIS

CASE FOR LEAVE TO FILE A NOTICE IN THE OTHER

CASE?

MS. LENTINO: THAT DIDN’T OCCUR TO ME.

THE COURT: THAT DIDN’T OCCUR TO YOU.

MS. LENTINO: WHAT HAPPENED, YOUR

HONOR, IS THINGS WERE HAPPENING TOO RAPIDLY

IN THE STATE COURT AND I REALLY, I REALLY

DIDN’T —- HOW CAN I TELL YOU - I THOUGHT YOUR

HONOR’S ORDER IS AMBIGUOUS TO ME.

THE COURT: MY ORDER IS AMBIGUOUS?

MS. LENTINO: I DO HAVE A SINCERE QUES-

TION, BECAUSE I DON’T KNOW IF YOUR HONOR IS

App. 25

PRECLUDING ME FROM MY DEFENSES IN THAT

CASE. I AM STILL A DEFENDANT.

THE COURT: I TOLD YOU NOT TO FILE ANY-

THING WITH THAT COURT, DIDN'T IT?

MS. LENTINO: SO THAT WOULD HAVE

INCLUDED JUDICIAL NOTICE?

THE COURT: DID I TELL YOU NOT TO DO

ANYTHING WITH THAT COURT?

MS. LENTINO: WELL, I FILED A COUNTER-

CLAIM, YOUR HONOR.

THE COURT: PARDON?

MS. LENTINO: IT WAS DIFFERENT. WHEN

YOUR HONOR

[p. 54] BY -

MS. MOBLEY: THE TYPICAL MANNER OF

ADOPTING, YOUR HONOR.

THE COURT: I’M GOING TO LOOK AT THESE

DOCUMENTS, BUT IT IS MANIFEST TO THE COURT

THAT THE LENTINOES CANNOT ABIDE THE ORDER

AND THEY HAVE DIRECTLY VIOLATED THE ORDER

AND INTEND TO CONTINUE TO DIRECTLY VIOLAT-

ING MY ORDER, AND MS. LENTINO, JORGE LEN-

TINO, AND EDUARDO LENTINO, I AM NOW TAKING

YOU INTO CUSTODY FOR CONTEMPT OF COURT.

WE WILL RECONVENE AT FOUR O’CLOCK TO

DISCUSS FURTHER SANCTIONS. THE MARSHAL IN

THE BACK OF THE ROOM WILL TAKE YOU INTO

App. 26

CUSTODY AND TAKE YOU TO THE i0TH FLOOR

NOW.

IS THERE ANY QUESTIONS?

MS. LENTINO: I OBJECT TO THE RULING OF

THE COURT, YOUR HONOR.

THE COURT: ALL RIGHT. MR. GOLDBERG,

YOU ARE WELCOME TO COME BACK, I AM NOT

SURE YOU ARE NECESSARY.

MS. LENTINO: IS THERE ANY POSSIBILITY,

YOUR HONOR, THAT I SERVE THE TIME, WHATEVER

TIME YOUR HONOR DECIDES I SHOULD SERVE,

VERSUS MY HUSBAND. BECAUSE WE HAVE A SMALL

DAUGHTER AND NOBODY TO TAKE CARE OF HER.

AND DR. JORGE IS UNDER THE SAME SITUATION.

WE HAVE GOT MINOR DAUGHTERS AT HOME AND -

THE COURT: YOU ARE NOW GOING INTO

THE CUSTODY OF THE MARSHAL UNTIL FOUR

O’CLOCK, AS AN INITIAL SANCTION ON YOUR [p.

55] CONTINUED VIOLATION OF THE LAW.

MARSHAL, I WANT THEM SEPARATbkW.

THE DEPUTY MARSHAL: EXCUSE ME?

THE COURT: I WANTED THEM SEPARATED,

IT IT’S REASONABLY POSSIBLE.

THE DEPUTY MARSHAL: YES, YOUR

HONOR.

App. 27

THE COURT: IF IT’S NOT, LOCK THEM ALL

UP TOGETHER.

FOUR O’CLOCK.

(RECESS HELD)

THE COURT: IN THE INTEREST OF SAVING

THE TAXPAYERS MONEY, THE MARSHALS ARE

GOING TO BRING YOUR PROPERTY UP SO THEY

DON’T HAVE TO BE PAID OVERTIME.

MS. LENTINO, THE FACILITY WHERE YOU’VE

JUST SPENT THE AFTERNOON IN IS NOT VERY

PLEASANT, IS IT?

MS. LENTINO: NO. YOUR HONOR.

THE COURT: IT IS INFINITELY MORE PLEAS-

ANT THAN THE PLACE WHERF YOU WOULD GO IF I

SERIOUSLY HOLD YOU IN CONTEMPT. YOU WOULD

GO EITHER TO THE HARRIS COUNTY JAIL OR THE

MONTGOMERY COUNTY JAIL. YOU WOULD BE HELD

IN COMMON WITH LARGE GROUPS OR PEOPLE OF A

CLASS YOU’RE NOT USED TO ASSOCIATING WITH. I

CANNOT GIVE YOU UNDERSTANDING, BUT IF YOU

WILL NOT QUIT MESSING IN THE LITIGATION AND

THE PROGRESS OF THIS BANKRUPTCY, I WILL ISO-

LATE YOU FROM IT. I'LL PUT YOU VERY CLOSE Tro

THE STATE COURT LITIGATION, YOU’LL ONLY BE

TWO BLOCKS AWAY, BUT YOU WILL BE WHERE YOU

CANNOT INTERFERE WITH

+ * +

App. 28

APPENDIX 9

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

IN RE:

JORGE A. LENTINO, DB

CIVIL NO. 97-498

Houston, Texas

January 20, 1998

1:30 p.m.

(Filed Jan. 30, 1998)

eo 6¢ €)4 32 SS

HEARING

BEFORE THE HONORABLE LYNN N. HUGHES

UNITED STATES DISTRICT JUDGE

APPEARANCES: -

For Jorge A. Lentino: Jorge A. Lentino, Pro se

For Eduardo P. Lentino: Eduardo P. Lentino, Pro se

For Marta Lentino: Marta Lentino, Pro Se

For Pro Care of

Houston LLC, et al.: Edgar Ahron Goldberg

For National Loan

Investors, LP: James Louis Hordern, Jr.

For Marta Lentino: Marta Lentino, Pro se

For the Trustee: Theresa D. Mobley

Neal D. Cannon, Jr.

Scott Rothenberg

Court Reporter: Ed Reed

__ Proceedings recorded by computer stenography

Produced by computer-aided transcription

App. 29

* * *

[p. 15] my husband will sign that the world is a square.

But what has happened in the past, and Your Honor

needs to understand this, is that attorneys have made by

husband sign affidavits or -

THE COURT: One of the real tragedies of

American life is the exploitation of physicians. They are

just put upon by everybody. You know, illiterate Hispanic

housewives and physicians, who own hospitals and live

in houses of more than a million dollars of value, those

are the tragic people in our society.

MRS. LENTINO: Your Honor, I don’t know

what is so tragic —

THE COURT: I just don’t know how these peo-

ple can stand to live with themselves.

MRS. LENTINO: I don’t know what is so tragic

about earning your living the old fashion way, by earning

your money and living whatever your means lets you to

live.

THE COURT: Or telling the truth.

MRS. LENTINO: We are telling the truth.

THE COURT: Then what is false?

MRS. LENTINO: You have to look at it in the

whole context.

App. 30

THE COURT: No, I’m going to look at individ-

ual facts. Is it not true that Cullen Bank sued him for

$2,252,250 against him?

* * *

App. 31

APPENDIX 10

Cause No. 9118878

CULLEN CENTER BANK

& TRUST

VS.

~LENTINO, EDUARDO P

(MD)

* IN THE DISTRICT

* COURT OF HARRIS

* COUNTY, TEXAS 281ST

* JUDICIAL DISTRICT

ORDER SETTING SCHEDULING CONFERENCE

To All Counsel and Pro Se Parties:

Pursuant to Rule 166, Texas Rules of Civil Procedure,

you are ordered to appear at a Scheduling Conference in

the THE COURTROOM

ON 07-31-1998 at 11:30 o’clock A.M.

Be prepared to discuss and set pretrial and trial dates.

If you do not appear, the court will sign an order of

DISMISSAL FOR WANT OF PROSECUTION or other

appropriate order.

If you have any questions regarding this notice,

please contact the court coordinator Rick Torres, at (713)

755-8268.

Signed JANE BLAND

JUDGE, 281ST DISTRICT

COURT

Generated on: JUNE 17, 1998

MARTA A. LENTINO PRO-SE

709 KUHLMAN RD.

HOUSTON, TX 77024

App. 32

APPENDIX 11

28 U.S.C. § 1334. Bankruptcy cases and proceedings

* * *

(c)(1) Nothing in this section prevents a district

court in the interest of justice, or in the interest of comity

with State courts or respect for state law, from abstaining

from hearing a particular proceeding arising under title

11 or arising in or related to a case under title 11.

(2) Upon timely motion of a party in a proceeding

based upon a State law claim or State law cause of action,

related to a case under title 11 but not arising under title

11 or arising in a case under title 11, with respect to

which an action could not have been commenced in a

court of the United States absent jurisdiction under this

section, the district court shall abstain from hearing such

proceeding if an action is commenced, and can be timely

adjudicated, in a State forum of appropriate jurisdiction.

Any decision to abstain or not to abstain made under this

subsection is not reviewable by appeal or otherwise by

the court of appeals under section 158(d), 1291, or 1292 of

this title or by the Supreme Court of the United States

under section 1254 of this title. This subsection shall not

be construed to limit the applicability of the stay pro-

vided for by section 362 of title 11, United States Code, as

such section applies to an action affecting the property of

the estate in bankruptcy.

* * *

App. 33

(As amended Oct. 22, 1994, Pub.L. 103-394, Title I,

§ 104(b), 108 Stat. 4109.)

(c)(1) Nothing in this section prevents a district

court in the interest of justice, or in the interest of comity

with State courts or respect for State law, from abstaining

from hearing a particular proceeding arising under title

11 or arising in or related to a case under title 11.

(2) Upon timely motion of a party in a proceeding

based upon a State law claim or State law cause of action,

related to a case under title 11 but not arising under title

11 or arising in a case under title 11, with respect to

which an action could not have been commenced in a

court of the United States absent jurisdiction under this

section, the district court shall abstain from hearing such

proceeding if an action is commenced, and can be timely

adjudicated, in a State forum of appropriate jurisdiction.

* * +

28 U.S.C. § 1447. Procedure after removal generally

* * e

(c) A motion to remand the case on the basis of any

defect in removal procedure must be made within 30

days after the filing of the notice of removal under sec-

tion 1446(a). If at any time before final judgment it

appears that the district court lacks subject matter juris-

diction, the case shail be remanded. An order remanding

the case may require payment of just costs and any actual

App. 34

expenses, including ettorney fees, incurred as a result of

the removal. A certified copy of the order of remand shall

be mailed by the clerk to the clerk of the State court. The

State court may thereupon proceed with such case.

(d) An order remanding a case to the State court

from which it was removed is not reviewable on appeal

or otherwise, except that an order remanding a case to

the State court from which it was removed pursuant to

section 1443 of this title shall be reviewable by appeal or

otherwise.

(As amended Oct. 1, 1996, Pub.L. 104-219, § 1, 110

Stat. 3022.)

(c) A motion to remand the case on the basis of any

defect other than lack of subject matter jurisdiction must

be made within 30 days after the filing of the notice of

removal under section 1446(a). If at any time before final

judgment it appears that the district court lacks subject

matter jurisdiction, the case shall be remanded. An order

remanding the case may require payment of just costs

and any actual expenses, including attorney fees,

incurred as a result of the removal. A certified copy of the

order of remand shall be mailed by the clerk to the clerk

of the State court. The State court may thereupon proceed

with such case.