Doc1060 william maxwell motion for settlement_walk away

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MOTION FOR ORDER APPROVING COMPROMISE AND SETTLEMENT AGREEMENT
BETWEEN THE TRUSTEE AND WILLIAM MAXWELL, WILLIAM MAXWELL, PLLC, AND
WILLIAM MAXWELL, PC Page 1 of 5
#4819-2741-0481
Eric W. Pinker, P.C. (epinker@lynnllp.com)
Texas Bar No. 16016550
John Volney (jvolney@lynnllp.com)
LYNN PINKER COX & HURST, LLP
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile
ATTORNEYS FOR PLAINTIFF
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
In re: §
§
FIRSTPLUS FINANCIAL GROUP, INC., § Case No. 09-33918-hdh-11
Debtor, § Chapter 11
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MOTION FOR ORDER APPROVING COMPROMISE AND
SETTLEMENT AGREEMENT BETWEEN THE TRUSTEE AND WILLIAM
MAXWELL, WILLIAM MAXWELL, PLLC, AND WILLIAM MAXWELL, PC
______________________________________________________________________________
NO HEARING WILL BE CONDUCTED ON THIS MOTION UNLESS A WRITTEN
RESPONSE IS FILED WITH THE CLERK OF THE UNITED STATES
BANKRUPTCY COURT AT 1100 COMMERCE, ROOM 12A24, DALLAS, TEXAS
75242-1496, BEFORE THE CLOSE OF BUSINESS ON AUGUST 19, 2016, WHICH
IS MORE THAN TWENTY-FOUR (24) DAYS FROM THE DATE OF THIS
MOTION’S SERVICE.
ANY RESPONSE MUST BE IN WRITING AND FILED WITH THE CLERK, AND A
COPY MUST BE SERVED UPON COUNSEL FOR THE TRUSTEE PRIOR TO THE
CLOSE OF BUSINESS ON AUGUST 19, 2016.
IF A RESPONSE IS FILED, A HEARING WILL BE HELD WITH NOTICE ONLY TO
THE OBJECTING PARTY. IF NO HEARING ON THIS MOTION IS TIMELY
REQUESTED, THE RELIEF REQUESTED SHALL BE DEEMED TO BE
UNOPPOSED, AND THE COURT MAY ENTER AN ORDER GRANTING THE
RELIEF SOUGHT OR PERMITTING THE NOTICED ACTION TO BE TAKEN.
Case 09-33918-hdh11 Doc 1060 Filed 07/25/16 Entered 07/25/16 14:51:11 Page 1 of 8

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#4819-2741-0481
TO THE HONORABLE HARLIN D. HALE,
UNITED STATES BANKRUPTCY JUDGE:
COMES NOW Matthew D. Orwig, the duly-appointed Chapter 11 Trustee and
Liquidating Trustee of the FirstPlus Financial Group, Inc. bankruptcy estate (the “Trustee”)
seeking this Court’s approval for the settlement and compromise of controversies between the
Trustee and William Maxwell, William Maxwell, PLLC, and William Maxwell, PC
(collectively, “William Maxwell”) (collectively, the “Parties”). In support of this motion, which
is made pursuant to Bankruptcy Rule 9019, the Trustee would show the Court the following:
JURISDICTION AND VENUE
1. This Court has jurisdiction over the subject matter of this Motion pursuant to 28
U.S.C. § 1334(b) and the standing order of reference of the District Court. This matter is a core
proceeding. 28 U.S.C. § 157(b)(1), (b)(2)(O).
2. Venue in this Court is proper under 28 U.S.C. §§ 1408 and 1409.
BACKGROUND FACTS
3. The Debtor filed for relief under Chapter 11 of the United States Bankruptcy
Code on June 23, 2009. The Trustee was appointed on July 24, 2009.
4. No creditors’ committee was appointed in this case by the United States Trustee.
5. William Maxwell filed proofs of claim numbered 193-1, 195-5, and 196-1 against
the Estate in the total amount of $5,500,000.00 (the “Claims”) in which William Maxwell
asserted that he was owed that amount for unpaid compensation pursuant to a Legal Services
Agreement and bonus compensation
6. As alleged in the Trustee’s First Amended Complaint in the adversary proceeding
styled Orwig v. Freeman, et al., Adversary No. 11-03397-hdh, pending in this Court (the

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#4819-2741-0481
“Adversary Proceeding”), William Maxwell served as Debtor’s Counsel and participated in the
wrongdoing made the basis of the lawsuit.
7. The Trustee and William Maxwell have agreed upon terms for settlement of the
Claim and the Adversary Proceeding. A copy of the Compromise and Settlement Agreement
(the “Agreement”) is attached to this motion as Exhibit A, and is incorporated herein by
reference. The Agreement is a walk-away providing that William Maxwell will withdraw his
$5.5 million in proofs of claim and his counterclaim and that the Trustee will drop his claims
pleaded against William Maxwell. The Agreement provides for a full release of any and all pre-
and post-petition claims and causes of action between the Parties.
8. Because the controversies between the Parties involve issues that would likely
take substantial time and money to resolve, the Trustee has concluded that the interests of the
estate are better served by entering into the attached Agreement. The Trustee requests approval
to enter into the Agreement as follows.
BASIS FOR RELIEF REQUESTED
9. In deciding whether to approve a proposed settlement agreement or compromise
of controversy, a bankruptcy court should consider the following factors:
a. the probability of success on the merits and the resolution of the dispute;
b. the complexity of the litigation being settled;
c. the expense, inconvenience and delay associated with litigating the dispute; and
d. the paramount interests of creditors.
Texas Extrusion Corp. v. Lockheed Corp. (In re Texas Extrusion Corp.), 844 F.2d 1142,
1158-59 (5th Cir. 1988), cert denied, 105 S. Ct. 31 (1989); United States v. Aweco, Inc. (In re
Aweco, Inc.), 752 F.2d 293, 298 (5th Cir. 1984), cert. denied, 469 U.S. 880 (1984).

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#4819-2741-0481
10. While it is necessary for the proponent of a compromise to set forth the factual
and legal basis for the compromise so the court can make an intelligent and informed evaluation
of the proposed settlement, it is not incumbent upon the proponent to present a mini-trial or a full
evidentiary hearing. Texas Extrusion, 844 F.2d at 1158-59; Aweco, 725 F.2d at 298.
11. The Agreement is in the best interests of the Debtor’s bankruptcy estate and
should be approved. The Settlement provides for William Maxwell to withdraw his proofs of
claim for $5.5 million while the Trustee dismisses his claims against William Maxwell. While
the Trustee believes that he has a strong claims against William Maxwell, the Trustee is
concerned that, even if he is ultimately successful in prosecuting his claims, there are insufficient
collectable assets to justify the prosecution, particularly in light of the forfeiture order entered
against William Maxwell after William Maxwell’s conviction in the related criminal
proceedings. Given the cost of prosecuting the Trustee’s claim, the Trustee believes that
William Maxwell’s agreement to withdraw his claim in exchange for the Trustee doing the same
is in the best interests of the estate. Accordingly, the Trustee requests that the Court grant this
motion and authorize the Trustee and William Maxwell to enter into the Agreement.
WHEREFORE, the Trustee respectfully requests that this Court find that the
Agreement incorporated as Exhibit A is in the best interest of the Debtor’s estate and approve
of the Agreement between the Trustee and William Maxwell, William Maxwell, PLLC, and
William Maxwell, PC.

_____________________________________________________________________________________________
#4819-2741-0481
Date: July 25, 2016 Respectfully submitted,
/s/ John Volney
Eric W. Pinker, P.C. (epinker@lynnllp.com)
John Volney (jvolney@lynnllp.com)
LYNN PINKER COX & HURST, LLP
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile
ATTORNEYS FOR PLAINTIFF
CERTIFICATE OF SERVICE
The undersigned hereby certifies that a true and correct copy of the above and foregoing
document has been served on July 25, 2016 via ECF or United States Mail to the parties of
record.
/s/ John Volney
John Volney

EXHIBIT A

Doc1060 william maxwell motion for settlement_walk away

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