Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_08-cv-01387/USCOURTS-casd-3_08-cv-01387-1/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

LASALLE BANK NATIONAL

ASSOCIATION,

Plaintiff,

CASE NO. 08CV1387 DMS (POR)

ORDER RE: RECEIVER’S TENTH

REPORT

[Doc. 147]

vs.

COMAIR ROTRON, INC., THERMAFLO,

INC.; and COMAIR PARENT CORP.,

Defendant.

On May 13, 2011, and pursuant to Court order, Joel B. Weinberg, the receiver herein

(“Receiver”), filed the Receiver’s Tenth Report and Petition for Instructions (“Tenth Report”). (Doc.

147.) No objections to the Tenth Report have been filed. The matter is suitable for submission

without oral argument, pursuant to Local Rule 7.1(d). 

Pursuant to Local Rule 66.1, a receiver’s report must include (1) a summary of Receiver’s

operations; (2) an inventory of receivership assets and their appraised value; (3) a schedule of all

receipts and disbursements; (4) a list of all creditors, their addresses, and claimed amounts; and (5) a

petition for instructions including a recommendation as to whether the receivership should be

continued. The Tenth Report provides the following:

1. Defendants’ Business Operations

As discussed in this Court’s October 9, 2008 Order concerning Receiver’s First Report,

Case 3:08-cv-01387-DMS-POR Document 152 Filed 05/31/11 Page 1 of 3
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Defendant Comair Parent Corp. is a Delaware corporation. (Doc. 37 at 2.) It owns 100 percent of the

issued and outstanding shares of Defendant Comair Rotron, Inc., which is also a Delaware corporation.

(Id.) Comair Rotron, Inc., and Comair Parent Corp own 99.96 percent and .04 percent, respectively,

of the shares in Comair Rotron de Mexico, S. de R.L. de C.V. (“Mexican Subsidiary”). (Id.)

Defendant Comair Rotron, Inc. owns 100 percent of the issued and outstanding stock of Comair

Rotron Europe, Ltd. (“UK Subsidiary”), Electronic Systems Cooling, Inc., and Defendant ThermaFlo,

Inc. (Id. at 2-3.) The UK Subsidiary is currently under the control of an administrator appointed by

a court in the United Kingdom. (Id. at 3.) Pursuant to this Court’s Order, the Receiver sold Defendant

Comair Rotron’s 100 percent stake in Shanghai Comair Cooling Fan, Co., to an affiliate of WET

enterprises (“WET”). (See Order re: Receiver’s Second Report, December 3, 2008, Doc. 61, at 2.)

The receivership proceedings have progressed to the point where the receivership estate is no

longer conducting business operations. (Pet. Ex. A, ¶ 1.) With one exception, all of the receivership

assets have been liquidated. (Id.) The Receiver indicates that the only remaining tasks are the pursuit

of a claim against an individual named Gary Kuzmin and the resolution of certain New York State tax

issues. (Id.) These are discussed below.

The Receiver further reports that he continues to maintain adequate cash reserves for payment

of the expenses of the receivership estate. (Pet. Ex. A, ¶ 2.) In addition, and pursuant to Court Order,

the Receiver has paid all professional fees incurred in connection with the receivership. (Id.) Other

than a claim submitted by the lawyers for the Defendant companies, the Receiver is unaware of any

actual or alleged administrative expenses with respect to the receivership estate. (Id.) Finally, the

Receiver has remitted excess proceeds held by the receivership estate during the period of the Tenth

Report to the Plaintiff on account of Plaintiff’s secured claim. (Id. at ¶ 3.) 

2. Defendants’ Financial Condition

 As of April 30, 2011, Defendants had a cash balance of $200,834.56. (Pet. at 2.) All

collectible accounts have been collected and Defendants’ net accounts receivable is $0. (Id.)

Defendants no longer have any inventories of finished goods, raw materials, or components, as they

have either been delivered to customers or sold at public auction. (Id. at 2-3.) The Tenth Report also

details Defendants’ receipts and disbursements(Pet. Ex. B), as well as a list of Defendants’ creditors,

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including addresses and the amounts of their claims. (Pet. Ex. D). 

3. Receiver’s Petition for Instructions

First, the Receiver, with Court approval respecting the employment of special counsel, is

pursuing a claim against Mr. Kuzmin for nearly $200,000. (Pet. ¶ 1.) The claim concerns Mr.

Kuzmin’s contractual obligation to pay Defendants’ reasonable attorney fees arising out of prereceivership litigation against Defendants in a federal district court in Texas, which was subsequently

ordered to arbitration. (Id.) The claim is currently being handled by Defendants’ pre-receivership

counsel at no expense to the receivership estate. (Id.) While counsel reports that an arbitrator has been

appointed, theReceiver is uncertain how long it will take to resolve this matter, but estimates 180 days

are required to conclude the matter. (Id.) 

Second, the Receiver has caused all missing tax returns to be prepared and filed. (Id. at ¶ 2.)

The Receiver has received correspondence from New York State respecting what it perceives to be

tax deficiencies, which the Receiver’s accountants and administrator are attempting to resolve. (Id.)

The Receiver estimates the magnitude of this matter to be between $10,000 and $15,000. (Id.)

As a result of the foregoing, the receivership estate is not in a position to be concluded. The

Receiver requests that the Receivership be continued through September 30, 2011. (Id.) 

For these reasons, IT IS HEREBY ORDERED:

1. The receivership shall continue through the date upon which this Court makes a further

Order with respect to the Receiver’s Eleventh Report and Petition for Instructions; and

2. Pursuant to Civ. L. R. 66.1, the Receiver shall file and serve his Eleventh Report and

Petition no later than September 30, 2011. Comments or objections shall be filed no later than

October 7, 2011. The matter shall be calendared for Friday, October 14, 2011 at 1:30 p.m.

The Receiver shall notify interested parties of the Court’s decision.

IT IS SO ORDERED.

DATED: May 25, 2011

HON. DANA M. SABRAW

United States District Judge

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