7739717.1 55100/140548 04/07/2020

David S. Musgrave, VSB No. 35327

Gordon Feinblatt LLC

233 East Redwood Street

Baltimore, Maryland 21202

(410) 576-4194

dmusgrave@gfrlaw.com

Attorneys for Trustee Kevin R. McCarthy 

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE EASTERN DISTRICT OF VIRGINIA

(Alexandria)

In re: )

)

FEDERAL BUSINESS SYSTEMS ) Case No. 17-12128-BFK

CORPORATION GOVERNMENT )

DIVISION ) Chapter 7

)

Debtor )

)

TRUSTEE’S NOTICE OF INTENTION TO COMPROMISE, NOTICE

OF HEARING, AND NOTICE OF OPPORTUNITY TO OBJECT

(Rose A. Osamba)

PLEASE TAKE NOTICE that Kevin R. McCarthy, Chapter 7 Trustee (the “Trustee”), has 

filed a motion (the “Motion”) seeking court approval of a Settlement Agreement between the 

Trustee and Rose A. Osamba (“Osamba”). Material terms of the Settlement Agreement, a copy of 

which is attached to the motion as Exhibit A, include the following:

(a) Osamba will pay the Trustee $50,000.00 to settle the Trustee’s claims;

(b) After the Trustee receives the $50,000.00 settlement payment, the Trustee, on 

behalf of the bankruptcy estate, shall release all claims against Osamba arising under Chapter 5 of 

the Bankruptcy Code;

(c) Osamba releases her proof of claim (Claim No. 16) and all claims against the 

Trustee, his agents, and the bankruptcy estate under Section 502(h) of the Bankruptcy Code with 

respect to the $50,000.00 settlement payment; and 

(d) After the Trustee receives the $50,000.00 settlement payment, the Trustee and 

Osamba shall cause dismissal with prejudice of the Trustee’s Second Amended Complaint to 

Avoid and Recover Preferential Transfers, Fraudulent Transfers and Post-Petition Transfers in 

McCarthy v. Rose A. Osamba, A.P. No. 19-01068 (the “Adversary Proceeding”).

The Trustee brought the Adversary Proceeding against Osamba to set aside and recover 

transfers totaling $361,123.70 (“the Transfers”) from the Debtor to Osamba. In his Complaint, the 

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Trustee alleged that the Transfers were preferential transfers, fraudulent transfers, and post-petition 

transfers recoverable from Osamba under 11 U.S.C. §§ 547, 548, 549 and 550. The Transfers that 

the Trustee sought to recover consist mainly of purported salary payments received by Osamba 

from Appaloosa International Capital Group LLC (an affiliated entity), purported salary payments 

by the Debtor to Osamba and substantial post-petition payments received by Osamba. Osamba 

has raised defenses to the Complaint, some of which may have merit. The proposed compromise 

will avoid the expense and uncertainty of litigation. Moreover, Osamba has provided financial 

information to the Trustee that shows an inability to satisfy the full amount of the Trustee’s claim. 

Thus, while the Trustee believes that his claims against Osamba have merit, the Trustee believes 

that the $50,000.00 settlement payment is reasonable in light of Osamba’s financial condition and 

the defenses she has raised to the Trustee’s allegations. The Trustee’s business judgment is that 

the proposed compromise is in the best interests of the estate and should be approved by the Court.

HEARING: A hearing shall be held on the Motion at 9:30 a.m. on April 28, 2020 in 

Courtroom I of the U.S. Bankruptcy Court, 200 S. Washington Street, Alexandria, VA 

22314-5405.

YOUR RIGHTS MAY BE AFFECTED. You should read this notice carefully and 

discuss it with your attorney, if you have one in this bankruptcy case. (If you do not have an 

attorney, you may wish to consult one.)

If you do not wish the court to grant the relief sought in the Motion, or if you want the 

court to consider your views on the Motion, then by April 21, 2020 you or your attorney must do 

the following checked items:

[X] File with the court, at the address shown below, a written response with supporting 

memorandum as required by Local Bankruptcy Rule 9013-1(H). Unless a written response and 

supporting memorandum are filed and served by the date specified, the Court may deem 

any opposition waived, treat the Motion as conceded, and issue an order granting the 

requested relief without further notice or hearing. If you mail your response to the court for 

filing, you must mail it early enough so the court will receive it on or before the date stated above. 

The address for the court is as follows:

Clerk of the Court

United States Bankruptcy Court

200 South Washington Street

Alexandria, Virginia 22314

[X] You must also attend the hearing on the Motion on April 28, 2020 at 9:30 a.m. in 

Courtroom I of the U.S. Bankruptcy Court, 200 S. Washington Street, Alexandria, VA 22314-

5405.

If you or your attorney do not take these steps, the Court may decide that you do not oppose 

the relief sought in the Motion and may enter an order granting that relief.

Case 17-12128-BFK Doc 460 Filed 04/07/20 Entered 04/07/20 13:42:05 Desc Main

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Date of Mailing: 4/7/2020 /s/ David S. Musgrave

David S. Musgrave (Bar No. 35327)

Gordon Feinblatt LLC

233 East Redwood Street

Baltimore, Maryland 21202

Phone No. (410) 576-4194

E-mail: dmusgrave@gfrlaw.com

Attorneys for Kevin R. McCarthy, Chapter 7 Trustee

CERTIFICATE OF SERVICE

I certify that on the 7th day of April, 2020, I served a copy of the foregoing through the 

court’s CM/ECF system on all registered CM/ECF participants who have appeared in this case 

and by first-class mail, postage prepaid, on the parties listed on the attached mailing matrix.

/s/ David S. Musgrave

David S. Musgrave (Bar No. 35327)

Case 17-12128-BFK Doc 460 Filed 04/07/20 Entered 04/07/20 13:42:05 Desc Main

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