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SACKS TIERNEY P.A., ATTORNEYS

4250 NORTH DRINKWATER BOULEVARD

FOURTH FLOOR

SCOTTSDALE, ARIZONA 85251-3693

Jeffrey S. Leonard (No. 003809)

Jeffrey.Leonard@SacksTierney.com

James S. Samuelson (No. 017471 )

James.Samuelson@sackstierney.com

SACKS TIERNEY P.A.

4250 N. Drinkwater Blvd., Fourth Floor

Scottsdale, Arizona 85251-3693

Telephone: (480) 425-2600

Karl A. Berg, Jr. (admitted Pro Hac Vice)

Kberg@mullikenlaw.com

Trevor J. Young (admitted Pro Hac Vice)

Young@mullikenlaw.com

MULLIKEN WEINER BERG & JOLIVET P.C. 

102 S. Tejon Street, Suite 900

Colorado Springs, CO 80903

Telephone: (719) 635-8750

Attorneys for Plaintiff

Robert B. Zelms (No. 18956)

rbz@manningllp.com

Anthony S. Vitagliano (No. 009331)

asv@manningllp.com

MANNING & KASS

ELLROD, RAMIREZ, TRESTER LLP

3636 N. Central Ave., 11th Floor

Phoenix, AZ 85012

Telephone: (602)313-5469

Attorneys for Defendant

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

Axxess Energy LLC, a Delaware 

limited liability company,

Plaintiff,

v.

Clear Energy Systems, Inc., a Nevada 

corporation,

Defendant.

No. 2:15-cv-01831-DJH

JOINT STATUS REPORT

The parties submit this Status Report pursuant to Magistrate Judge David K. 

Duncan’s March 29, 2016 Minute Order (Doc. No. 39) and state as follows:

Case 2:15-cv-01831-DJH Document 40 Filed 04/28/16 Page 1 of 3
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SACKS TIERNEY P.A., ATTORNEYS

4250 NORTH DRINKWATER BOULEVARD

FOURTH FLOOR

SCOTTSDALE, ARIZONA 85251-3693

1. On August 15, 2014, Defendant Clear Energy Systems, Inc. (“CES”) filed its 

voluntary petition for relief under Chapter 11 of the Bankruptcy Code in an action known 

as In re: Clear Energy Systems, Inc., Case No. 2:14-BK-12716-BKM, United States 

Bankruptcy Court, District of Arizona (the “Bankruptcy Action”). The Bankruptcy Action 

is pending.

2. On August 14, 2015, the Bankruptcy Court granted Plaintiff Axxess Energy 

LLC (“Axxess”) relief from the automatic stay to commence this action against CES and to 

seek recovery solely from an insurance policy, Policy No. G24099283 004, issued by 

Westchester Fire Insurance Company (“Westchester”) to CES.

3. On September 14, 2015, Axxess commenced this action by filing its 

Complaint against CES.

4. Axxess, CES and Westchester attended a Settlement Conference with 

Magistrate Judge Duncan on March 29, 2016. The parties reached a settlement agreement 

at the Settlement Conference and the terms of the parties’ agreement were set forth on the 

record. The settlement agreement is contingent on the approval of such agreement by the 

Bankruptcy Court. See Doc. No. 39.

5. Pursuant to the parties’ settlement agreement and the pending Bankruptcy 

Action, Magistrate Judge Duncan ordered that a status report be filed indicating the status 

of the approval of the settlement agreement in the Bankruptcy Action no later than April 

29, 2016. See Doc. No. 39.

6. Axxess, CES, Westchester, and the Chapter 11 Bankruptcy Trustee executed 

a written Settlement Agreement and Release of Any and All Claims dated April 21, 2016 

(the “Settlement Agreement”), which is effective and enforceable upon the entry of an 

order of the Bankruptcy Court approving the Settlement Agreement and such order

becoming final and non-appealable (the “Settlement Effective Date”).

7. On April 27, 2016, the Chapter 11 Trustee filed a Motion for Approval of 

Settlement Agreement in the Bankruptcy Action seeking approval of the Settlement 

Agreement. The Chapter 11 Trustee also filed therewith a Motion to Set Expedited 

Case 2:15-cv-01831-DJH Document 40 Filed 04/28/16 Page 2 of 3
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SACKS TIERNEY P.A., ATTORNEYS

4250 NORTH DRINKWATER BOULEVARD

FOURTH FLOOR

SCOTTSDALE, ARIZONA 85251-3693

Hearing on his Motion for Approval of Settlement Agreement.

8. A hearing on the Chapter 11 Trustee’s Motion for Approval of Settlement 

Agreement has not been set and the Motion for Approval of Settlement Agreement is 

pending before the Bankruptcy Court.

9. In accordance with the Settlement Agreement, Westchester shall pay the 

agreed upon settlement sum to Axxess within ten (10) business days of the Settlement 

Effective Date. Within ten (10) business days of Axxess’ receipt and confirmation of such 

settlement sum being made in good funds, the parties will file a stipulation to dismiss this 

action with prejudice.

Dated this 28th day of April, 2016.

SACKS TIERNEY P.A.

s/ James S. Samuelson

Jeffrey S. Leonard 

James S. Samuelson

4250 N. Drinkwater Blvd.

Fourth Floor

Scottsdale, AZ 85251

and

MULLIKEN WEINER BERG & JOLIVET P.C.

Trevor J. Young

Karl A. Berg, Jr.

102 S. Tejon Street, Suite 900

Colorado Springs, CO 80903

ATTORNEYS FOR PLAINTIFF

MANNING & KASS

ELLROD, RAMIREZ, TRESTER LLP

s/ Anthony S. Vitagliano

Robert B. Zelms

Anthony S. Vitagliano

3636 N. Central Ave., 11th Floor

Phoenix, AZ 85012

Attorneys for Defendant

Case 2:15-cv-01831-DJH Document 40 Filed 04/28/16 Page 3 of 3