Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca5-13-10122/USCOURTS-ca5-13-10122-0/pdf.json

Parties Involved:
Novo Point, L.L.C.
Appellant
Ondova Limited Company

Gary N. Schepps
Appellant
Daniel J. Sherman
Appellee

Document Text:

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 13-10122

In the Matter of: ONDOVA LIMITED COMPANY,

Debtor

----------------------------

GARY N. SCHEPPS,

Appellant

v.

DANIEL J. SHERMAN, Chapter 11 Trustee,

Appellee

Appeal from the United States District Court

for the Northern District of Texas

USDC No. 3:12-CV-416

Before JOLLY, HIGGINBOTHAM, and DAVIS, Circuit Judges.

PER CURIAM:*

Attorney Gary Schepps appeals from a bankruptcy court order entered

in the case styled Matter of Ondova Limited Company.1 The order at issue,

 

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not 

be published and is not precedent except under the limited circumstances set forth in 5TH 

CIR. R. 47.5.4.

1 Case No. 09-34784-sgj-11 (Bankr. N.D. Tex.).

United States Court of Appeals

Fifth Circuit

FILED

August 14, 2015

Lyle W. Cayce

Clerk

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entered on December 15, 2011, barred Schepps from appearing or participating 

further in the Ondova Limited bankruptcy (the “Bar Order”).2 Concluding that 

the Bar Order against Schepps was effectively vacated by subsequent orders 

of the district court and bankruptcy court—and emphasizing that it has so 

been vacated—we dismiss this appeal as moot.3

I.

By way of background, the Ondovo Limited bankruptcy spawned out of 

a convoluted litigation, the history of which we set out in Netsphere, Inc. v. 

Baron.4 Schepps had served as counsel for Jeffrey Baron in Netsphere and he

purported to represent Baron and various Baron-controlled entities, along with 

various other entities, in the Ondovo Limited bankruptcy. Some of the entities 

Schepps purported to represent in the Ondovo Limited bankruptcy became 

subject to a receivership order entered by the district court in the Netsphere 

 

2 R.19-21. The Bar Order provided, specifically, that: (1) “Gary Schepps . . . shall file 

no further pleadings and/or appeals of any kind in the Ondova Limited Company bankruptcy, 

Case No. 09-34784-sgj-11;” (2) “[t]he Clerk for the United States Bankruptcy Court for the 

Northern District of Texas is directed to remove any pleadings and/or appeals filed by Gary 

Schepps electronically as soon as they are filed;” (3) “[n]o responses are required to be filed 

by counsel relating to any pleadings or appeals filed by Gary Schepps in this Bankruptcy 

Case;” and (4) “[i]n the event Gary Schepps files any pleadings in violation of this Order, this 

court will conduct a show cause hearing and issue appropriate sanctions against Gary 

Schepps.” Id. at 21.

3 Schepps’ notice of appeal references a district court order administratively closing 

the case with regard to his appeal from the Bar Order, but his substantive challenge pertains

to the Bar Order itself. Because we dismiss Schepps’ substantive arguments as moot, and 

because mootness is an independent jurisdictional barrier, see North Carolina v. Rice, 404 

U.S. 244, 245-46 (1971), we need not and do not reach the question of whether the district 

court order administratively closing the case was a “final decision” over which we have 

jurisdiction under 28 U.S.C. §§ 158(d) and 1291. See generally Mire v. Full Spectrum Lending 

Inc., 389 F.3d 163 (5th Cir. 2004) (explaining that in some situations an administratively 

closed case is the functional equivalent of a stay and cannot constitute a final appealable 

order, but in others it is the functional equivalent of a dismissal over which an appellate court 

can exercise review).

4 703 F.3d 296, 302-05 (5th Cir. 2012).

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case on November 24, 2010 (the “Receivership Order”).5 The Receivership 

Order identified entities subject to the receivership as Baron and any Baroncontrolled entity, and it “enjoin[ed] any person from taking any action based 

upon any [then] existing directive from any person other than the [r]eceiver 

with regard to the affairs and business” of any such entity.6 It also gave the 

receiver exclusive authority to act on behalf of any such entity in legal 

proceedings and to control such entity’s actions in such proceedings.7 After 

entry of the Receivership Order, Schepps made several filings in the 

bankruptcy court on behalf of Novo Point, LLC, an entity expressly subject to 

the receivership, apparently in violation of the Receivership Order. In response 

to these filings, and on motion of the receiver, the bankruptcy court issued a 

show-cause order and initiated contempt proceedings against Schepps. 

Following several rounds of hearings, the bankruptcy court issued the Bar 

Order, the purpose of which was to prohibit Schepps from taking further action 

on behalf of entities subject to the receivership in violation of the Receivership 

Order.

Schepps appealed the Bar Order to the district court. By the time 

briefing was completed, “the [r]eceivership [was] in the process of winding 

down,” and the district court reasoned that the underlying purpose of the Bar 

Order would not be further served by its enforcement at that time.8 On June 

18, 2012, the district court entered an “Order on Appeal” that effectively

reversed the Bar Order.9 The district court’s Order on Appeal was entered on 

 

5 Doc. 130, Case No. 3:09-cv-00988-L (N.D. Tex.) (Order Appointing Receiver, Nov. 24, 

2010). 

6 Id. at 2.

7 Id. at 7-8.

8 See R.996-1001.

9 Id. at 1001 (“[I]t is ORDERED that Gary Schepps has a right to appear in the District 

Court as counsel of record for Baron and those entities he claims he owns. Schepps is 

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the bankruptcy court docket the same day.10 In response to the Order on 

Appeal, the bankruptcy court issued the following order dated August 27, 2012:

This court must honor the guidance and reasoning of the Article 

III court from which this bankruptcy court’s authority to exercise 

bankruptcy jurisdiction flows. [The district court] has essentially 

indicated in the Order on Appeal of Schepps Bar Order that, 

regardless of whatever restrictions he may have at one time 

intended with respect to Novo Point, LLC and who may speak for 

it, he believes Schepps should be permitted to speak for Jeff Baron, 

Novo Point, LLC, and any other entities Jeff Baron claim he owns 

in these court proceedings. Given this ruling, this court does not 

believe it is appropriate to further consider the Show Cause 

Matters that it has had under advisement.

WHEREFORE, IT IS HEREBY ORDERED, ADJUDGED, AND 

DECREED, that the Show Cause Matters are considered resolved 

and discharged and this court will not further consider the 

appropriateness of civil contempt sanctions against . . . Schepps.11

No party challenged the district court’s Order on Appeal or the bankruptcy 

court’s subsequent order discharging the show-cause matters against Schepps.

Months later, in Netsphere, we vacated the Receivership Order as 

improper.12 We found it unnecessary to address an outstanding petition for a 

writ of mandamus filed by Novo Point, LLC, “which challenged the bankruptcy 

court’s decision to strike various notices of appeal filed by Novo Point [because] 

[t]he bankruptcy court struck these notices based on its finding that they 

violated the terms of the [R]eceivership [O]rder—which we have now set 

aside.”13 To be clear, the Bar Order at issue today also stemmed from the 

 

GRANTED LEAVE TO APPEAL all orders of the Bankruptcy Court allegedly affecting 

property now in possession and control of the Receiver on Jeffrey Baron’s behalf.”).

10 Doc. 790, Case No. 09-34784-sgj-11 (Bankr. N.D. Tex.).

11 Doc. 807, Case No. 09-34784-sgj-11 (Bankr. N.D. Tex.).

12 703 F.3d 296, 311 (5th Cir. 2012).

13 Id. at 315.

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bankruptcy court’s efforts to enforce the terms of the Receivership Order, 

which we vacated in Netsphere.

On January 7, 2013, the district court entered an order instructing the 

clerk to administratively close the case with regard to Schepps’ appeal of the 

Bar Order because, “[i]n light of the Fifth Circuit’s recent opinion [in 

Netsphere] . . . there are no further issues . . . to address concerning the appeal 

of the [B]ar [O]rder.”14 Schepps appeals the district court order 

administratively closing the case to our court.15

II.

Our decision in Netsphere vacated the Receivership Order from which 

the Bar Order derived. Yet even before Netsphere issued both the district court 

and the bankruptcy court issued orders effectively vacating the Bar Order and 

discharging all show-cause matters against Schepps. Emphasizing that the 

Bar Order is no longer of any effect and that Schepps remains an officer of the 

court in good stead, we DISMISS this appeal as MOOT. The Trustee’s motion 

to dismiss this appeal as untimely is DENIED as MOOT.

 

14 R.1002.

15 Id. at 1003-05.

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