00754439.DOCX 6 

UNITED STATES BANKRUPTCY COURT 

SOUTHERN DISTRICT OF FLORIDA 

Fort Lauderdale Division 

In re: 

LIBERTY POWER HOLDINGS, LLC, 

et al., 

 Debtors. 

____________________________________/

Lead Case No. 21-13797-SMG 

Chapter 11 

LIMITED OBJECTION TO PROPOSED SETTLEMENTS BY 

PHILIP J. VON KAHLE AS ASSIGNEE OF LIBERTY POWER CORPORATION1

Philip J. von Kahle, in his capacity as the Assignee (the “Assignee”) for the benefit of 

creditors of Liberty Power Corporation (“LPC”), by and through his counsel, hereby files this 

Limited Objection (the “Limited Objection”) to the Debtor’s Motion Pursuant to Section 105(a) 

of the Bankruptcy Code and Fed. R. Bankr. P. 9019 for Entry of an Order Approving the Terms of 

a Settlement By and Between the Debtors and the D&O Parties (ECF No. 871) (the “D&O 

Motion,” and together David Hernandez (“Hernandez”) and Martin Halpern (“Halpern”) are the 

“D&O Parties”) and Debtor’s Motion Pursuant to Section 105(a) of the Bankruptcy Code and Fed. 

R. Bankr. P. 9019 for Entry of an Order Approving the Terms of a Settlement By and Among the 

Debtors, Boston Energy Trading and Marketing, LLC, and Peter S. Kaufman (ECF No. 872) (the 

“Kaufman Motion,” and together with the D&O Motion, the “Motions”), and states as follows: 

LIMITED OBJECTION 

 By the Motions, the Debtors seek approval of the Global Settlement and Release 

Agreement attached to the D&O Motion at Exhibit B (the “D&O Agreement”), and the Global 

 

1

 The undersigned and counsel for the Movant agreed to extend the Assignee’s deadline to file the instant 

objection until Tuesday, May 23, 2023, at 4:00 p.m. in order to provide additional time to reach an 

agreement with the settling parties on the issues raised herein. Accordingly, the Assignee requests the 

Court deem the objection timely filed notwithstanding L.R. 5005-1(F)1. 

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Settlement and Release Agreement attached to the Kaufman Motion at Exhibit B (the “Kaufman 

Agreement,” and together with the D&O Agreement, the “Agreements”). The Assignee asserts 

this limited objection on the following bases: (1) the releases contained in the Agreements include 

language that is ambiguous as to whether the parties intend to release claims held by LPC; (2) the 

Agreements are each represented to be a “global” settlement of claims without clarifying that the 

Assignee participated in the mediation and was excluded from the settlements; and (3) the D&O 

Agreement purports to carve out claims for the benefit of the D&O Parties against BETM (as 

defined below), but those claims are property of LPC’s estate under the Assignee’s control. 

Although the Assignee has attempted to resolve these issues with the Debtors, BETM, and the 

settling parties; the settling parties have not agreed to include clarifying language in the order 

approving the settlements. 

RELEVANT FACTS 

1. On April 20, 2021 (the “Petition Date”), Liberty Power Holdings, LLC (the 

“Debtor”) filed a voluntary petition for relief pursuant to Chapter 11 of Title 11 of the U.S. Code 

commencing the instant bankruptcy case. 

2. On May 14, 2021, LPC executed an assignment of substantially all of its assets to 

the Assignee for the benefit of creditors, pursuant to Florida Statute, Chapter 727. On May 19, 

2021, the Assignee commenced the case styled In re the Assignment for the Benefit of Creditors 

of Liberty Power Corp., LLC, Case No. CACE-21-010056, pending in the Seventeenth Judicial 

Circuit, in and for Broward County, Florida (the “Assignment Case”). 

3. Prior to the Petition Date and the commencement of the Assignment Case, both the 

Debtor and LPC were jointly operated by Hernandez as CEO and board member of both entities. 

Although the Debtor and LPC were two entities on paper, Hernandez admittedly operated them as 

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a single unified entity,2 and claimed “what was good for LPH, was good for LPC ... .” [Rule 2004 

Examination of David Hernandez (June 7, 2022), at 133:20-21]. 

4. In or around April 2019, LPC retained Gordian Group to provide advice and 

consultation to LPC and its subsidiaries regarding a potential debt restructuring and/or refinancing. 

LPC’s main contact at Gordian Group was Peter Kaufman (“Kaufman”). 

5. That engagement resulted in LPH refinanced its debt with BETM. 

6. Following the effects of Winter Storm Uri, Hernandez sought personal advice from 

Kaufman, who counseled Hernandez to take actions in furtherance of Hernandez’s own interests, 

at the expense of LPC’s interests. 

7. The Assignee has investigated these circumstances and has identified certain 

actionable claims which he may bring against Hernandez, Gordian, and Kaufman. Those claims 

include, without limitation, negligence, breach of contract, malpractice, breach of fiduciary duty, 

and aiding and abetting breach of fiduciary duty collectively with all other claims the Assignee 

may assert against Hernandez, Gordian, and/or Kaufman, the “Assignee Claims”). Many of the 

Assignee Claims are the same or similar to the claims settled by the Debtors in the Agreements, 

and all of them arise out of the same or similar nucleus of operative facts. 

8. Accordingly, LPC participated in a pre-suit mediation with the Debtor, Hernandez, 

Kaufman, and others on January 17-18, 2023 (the “Mediation”), with Harley Riedel, Esq. as 

mediator. 

9. Additionally, LPC has potential claims to bring against the Debtors’ lender, Boston 

Energy Trading and Marketing LLC (“BETM”), which were not the subject of Mediation. 

 

2

 According to Hernandez, LPH was “more of a legal construct” that was managed with LPC in “one unified 

way.” [Statutory Examination of Assignor’s Representative, David Hernandez (June 16, 2021), at 14:2-5]. 

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10. As of the filing of this Limited Objection, the Assignee has not reached a settlement 

of the Assignment estate’s claims against Hernandez or Kaufman. 

ANALYSIS 

A. The Releases are Ambiguous as to the Assignee’s Claims 

Each of the Settlement Agreements contains a release that is ambiguous as to whether it 

purports to release the Assignee’s claims against the settling parties by virtue of being a creditor 

in the instant bankruptcy. For example, the D&O Settlement Agreement states: 

6. General Release by the Debtors: As a material 

inducement to Hernandez and Halpern to enter into this Agreement, 

effective automatically on the Effective Date, each of the Debtors, 

on behalf of themselves and their bankruptcy estates, and 

anyone claiming by, through, or under them (collectively the 

“Debtor Releasing Parties”), hereby fully and forever remises, 

releases, acquits, waives, disclaims, surrenders, satisfies, and 

discharges each of Hernandez and Halpern ... 

[D&O Settlement Motion, at Ex. B, pg. 3, ¶ 6 (emphasis added)].3 While the Assignee has no 

objection to the Debtors settling the estates’ claims against the Settling Parties, the Assignee 

believes the current language, without clarification, creates ambiguity as to whether the Assignee’s 

claims against these same individuals might be released since the Assignee is also a creditor in this 

case. See, Proof of Claim No. 56. 

 The ambiguity of the release language is compounded by the fact that each of the 

Agreements indicates that it is a “global” settlement of claims, with specific reference to the 

mediation, but devoid of any mention of LPC’s claims, the Assignee’s attendance at the mediation, 

the Assignee’s separately asserted claims, or the fact that the Assignee is not included in the 

“global” settlement. Due to the overlapping nature of the Debtor’s claims with the Assignee’s 

Claims, however, the Agreements, or the order approving same, should specify that they do not 

 

3

 The Kaufman Settlement Agreement contains substantially the same language. 

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waive, release, limit, modify, or otherwise affect in any way the Assignee’s Claims. This is 

especially important given the lack of formality between the entities’ operations pre-Petition, the 

Assignee believes calling these settlements “global” without expressly indicating that LPC is not 

a party is ambiguous and potentially prejudicial to LPC’s claims against these same individuals. 

For the avoidance of doubt, and notwithstanding vague references to releases from 

“affiliates” of certain Releasing Parties, such as Hernandez, in the Agreements, the Assignee has 

not agreed to provide, and is not providing, any of the releases set forth in the Agreements, as 

presently drafted. Accordingly, to the extent the Court approves the Agreements, LPC requests 

the Order include clarifying language identifying that the Agreements and the approval of same in 

no way waives, releases, limits, modifies, or otherwise impacts in any way any of the Assignee’s 

Claims, including without limitation claims against Hernandez and/or Kaufman. 

B. The BETM Carveout appears to reference claims held by LPC 

The D&O Agreement provides in the release a carveout of claims purportedly held by 

Hernandez and Halpern against BETM: 

5. General Release by D&O Parties: As one of the material 

inducements to the Debtors to enter into this Agreement, effective 

automatically on the date the Debtors receive the Settlement Payment (the 

“Effective Date”), each of Hernandez and Halpern, on behalf of 

themselves and each and every of their heirs, agents, attorneys, legal 

representatives, affiliates, predecessors, successors, and assigns and 

anyone claiming by, through, or under them (collectively, the “Releasing 

Parties”), hereby fully and forever remises, releases, acquits, waives , 

disclaims, surrenders, satisfies, and discharges each of the Debtors, their 

respective bankruptcy estates and each of their respective present and 

former managers (including Stephen Gray, Jay Goldman and Louis 

Martinsen), members, officers (including Bob Butler as the chief 

restructuring officer), directors, employees, attorneys, affiliates, direct and 

indirect subsidiaries, accountants, financial advisors, agents and 

representatives, (collectively, the “Debtor Released Parties”) but 

specifically excluding Boston Energy Trading and Marketing, LLC, 

its parents and/or subsidiaries from the Debtor Released Parties, of 

and from any and all manner of claims, debts, equity or ownership 

interests, rights, dues, sums of money, accountings, bonds, warranties, 

representations, covenants, promises, contracts, controversies, 

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agreements, liabilities, obligations, reckonings, expenses, damages, 

judgments, executions, objections, defenses, setoffs, actions, liens, suits, 

proceedings, claims, counterclaims, losses, costs, expenses, attorneys' 

fees, demands, and causes of action of any kind or nature whatsoever, 

whether contingent, whether disputed or undisputed, whether or not wellfounded in fact or law, whether in law, equity or otherwise, whether known 

or unknown, and whether now accrued or hereafter maturing, which any 

of the Releasing Parties ever had, now has or hereafter can, shall or may 

have against any of the Debtor Released Parties, from the beginning of the 

world until the Effective Date, for or by reason of any matter, cause, 

omission, or thing whatsoever, including, but not limited to, any matter, 

cause, omission, or thing related to, arising out of or in connection with 

the Debtors, the Chapter 11 Cases and the D&O Claims, and by this 

Agreement, the Releasing Parties acknowledge and affirm that they have 

not assigned any of claims or causes of action being released hereunder to 

any third-party not bound by this Agreement. Nothing contained in this 

Section or elsewhere in this Agreement shall release any of the Debtor 

Released Parties from their respective obligations set forth in this 

Agreement.

[D&O Agreement, pg. 3 (emphasis added) (the highlighted portion, the “BETM Carveout”)]. 

The Assignee files this limited objection with respect to BETM Carveout because LPC has 

potential claims to bring against BETM. While the BETM Carveout appears to preserve claims, 

the D&O Agreement indicates that Hernandez and/or Halpern hold claims against BETM 

individually, which potential claims the Assignee believes are actually held by LPC. The Assignee 

does not object to the nature of the BETM Carveout preserving claims which Hernandez and/or 

Halpern may hold, but the Assignee does not want his silence to be interpreted as a tacit agreement 

that Hernandez and/or Halpern do in fact hold in their individual capacities claims against BETM. 

Accordingly, to the extent the Court approves the D&O Agreement, the Assignee requests the 

Order include language that the approval of same in no way waives, impacts, resolves, or otherwise 

adjudicates any issue with respect to LPC’s claims against BETM, nor that the approval is any 

adjudication of the ownership of any claims as between Hernandez and/or Kaufman on the one 

hand and LPC and/or the Assignee on the other. 

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C. The Agreements include Vague and Ambiguous “Cooperation” Requirements 

 The D&O Motions and Agreements also contain vague and ambiguous “cooperation” 

requirements for certain settling parties, such as Hernandez and Kaufman. While the Agreements 

do not expressly purport to compel disclosures of privileged and confidential information with 

respect to the Assignee, neither Hernandez nor Kaufman has authority to waive any privilege held 

by LPC. As a result of the Assignment, the Assignee maintains exclusive control over LPC’s 

privilege. CITE. As such, any cooperation must be limited by, subject to, and without waiver 

of, the Assignee’s exclusive control of LPC’s privilege. 

WHEREFORE, the Assignee requests that to the extent the D&O Agreement or the 

Kaufman Agreements are approved by this Court, that the Orders approving same include 

clarifications as provided herein; and for such other and further relief as the Court deems just and 

proper. 

Dated: May 23, 2023 

Respectfully submitted, 

BAST AMRON LLP 

Counsel for Assignee, Philip J. von Kahle for the 

Benefit of Creditors of Liberty Power Corp., LLC 

One Southeast Third Ave., Suite 2410 

Miami, Florida 33131 

Telephone: 305.379.7904 

Facsimile: 786.206.8740 

Email: jbast@bastamron.com 

Email: dquick@bastamron.com

By: /s/ Dana R. Quick 

Jeffrey P. Bast (FBN 996343) 

Dana R. Quick (FBN 074402) 

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CERTIFICATE OF SERVICE 

I hereby certify that on this 23rd day of May, 2023, true and correct copies of the foregoing 

were served electronically via the Court’s electronic filing system on all parties registered to 

receive notifications via CM/ECF in this case. 

 /s/ Dana R. Quick 

 Dana R. Quick, Esq. 

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