Free Motion for Disbursement of Funds - District Court of Colorado - Colorado

Case 1:01-cv-00645-JLK

Document 194-2

Filed 10/12/2007

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 01-cv-645-JLK SECURITIES AND EXCHANGE COMMISSION Plaintiff, v. KENNETH ROY WEARE a/k/a ROY WEAVER, J&K GLOBAL MARKETING CORPORATION, and AAA-AUCTION.COM, INC., Defendants.

RECEIVER'S EIGHTH APPLICATION FOR FEES AND EXPENSES

Patten, MacPhee & Associates, Inc., the Court-appointed Receiver in this case, hereby applies to the Court for the payment of professional fees and expenses for the period from July 1, 2007 through September 30, 2007, in the total amount of $46,000.52. In support thereof, the Receiver states as follows: 1. On October 26, 2005, the Court entered its Order Appointing Receiver, appointing

Patten, MacPhee & Associates, Inc. as Receiver in the above-captioned matter to, among other things, establish and administer a claims process for investors and propose a distribution plan to the Court for funds collected by the SEC from various bank accounts in the United States and abroad. 2. Detailed descriptions of the activities undertaken by the Receiver since its appoint-

ment by the Court through September 30, 2007 have been provided in the Receiver's quarterly

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reports for the calendar quarters ended December 31, 2005, March 31, 2006, June 30, 2006, September 30, 2006, December 31, 2006, March 31, 2007, June 30, 2007, and September 30, 2007. In addition, a listing of the activities undertaken by the Receiver during the period covered by this fee application is set forth on pages 2-4 of Exhibit B, attached hereto. 3. To date, the Court has approved payment to the Receiver of $181,537.50 for

professional fees and $68,227.30 for reimbursement of the Receiver's out-of-pocket expenses. 4. the following: Exhibit A - List of Patten MacPhee & Associates, Inc.'s employees and their respective billing rates. Exhibit B - Summary of Billings, which includes Attachments 1 and 2. Attachment 1 to Exhibit B sets forth in detail, in chronological order, the time entries by employee, including a narrative description of the services rendered, during the period covered by this fee application. Attachment 1 also includes summaries, by employee and by category, of the hours and services for which the Receiver has billed. Each employee for whom the Receiver seeks payment of professional fees in connection with this matter has kept daily time records, and all work has been billed on an hourly basis. The Receiver has taken special care to ensure that duplication of time and services rendered has not occurred. In addition, it should be noted that while the undersigned has performed his professional responsibility to oversee and supervise this matter, to date he has not charged for any of his time. Attachment 2 to Exhibit B sets forth detail regarding the out-of-pocket expenses incurred by the Receiver during the period covered by this fee application. -2In support of this Eighth Application for Fees and Expenses, the Receiver attaches

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5.

During the period of time covered by this fee application, the Receiver's employees

expended a total of 246.7 hours, for which the Receiver seeks payment in the amount of $34,259.00. As a result, the effective hourly rate requested by the Receiver in this fee application is $138.87. 6. During the period of time covered by this fee application, the Receiver also incurred

out-of-pocket expenses in the amount of $11,741.52. As set forth in Attachment 2 to Exhibit B, those expenses primarily related to database, broadcast e-mail, website and other services provided by MARKITOUTTM ($9,120.50), in particular database services related to the validation of claims. The Receiver also incurred out-of-pocket expenses of $1,320.00 for legal services during the period covered by this fee application. 7. The Receiver believes that the services rendered and expenses incurred to date have

been necessary and reasonable, especially in light of the scope of activities undertaken and the number of potential claimants here. For reasons discussed at length in the Receiver's Fifth Application for Fees and Expenses, the total amount requested by the Receiver for both professional fees and expenses in this matter has been substantially more than the Receiver's initial estimate of such fees and expenses set forth in its September 23, 2005 proposal in response to the SEC's request for proposals ("RFP"). In an effort to stay within that and subsequent estimates of fees and expenses, while continuing to provide high quality professional services, 152.1 hours expended by the Receiver's employees since January 1, 2007 have been recorded as no charge (NC) ­ thus, saving the receivership estate $25,235.00. In addition, since January 1, 2007, the hours expended by Stephanie L. Katz have been charged at a discounted rate of $75.00 per hour, saving an additional $8,330.00. Nevertheless, the amounts requested in the Receiver's Eighth Application For Fees and -3-

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Expenses continue to be more than anticipated due, in large part, to the additional time needed by the Receiver's employees to process the more complex claims and the substantial fees ­ $13,242.00 this quarter alone ­ related to numerous e-mail, postal and telephone communications from investors. WHEREFORE, the Receiver respectfully requests that the Court enter an order granting it payment for professional fees and the reimbursement of out-of-pocket expenses for the period July 1, 2007 through September 30, 2007, in the total amount of $46,000.52. DATED this 12th day of October, 2007.

Patten, MacPhee & Associates, Inc.

s/Leslie A. Patten Leslie A. Patten, President 1775 Sherman Street, Suite 2900 Denver, Colorado 80203 Telephone: (303) 296-2900 Fax: (303) 296-4475

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