Kato Kaelin, Playboy bunny ordered to appear in Fair Finance hearings
Minor celebrity Kato Kaelin is being told to appear in court in Akron.So is Jami Ferrell, former Playboy Playmate of the Month for January 1997.Same for businesses run by rapper Ludacris.All are being sued by Fair Finance Co. trustee Brian Bash, who says they and others owe lots of money to the bankrupt Akron finance company’s estate.Kaelin, Ferrell and defendants named in dozens of other Fair Finance civil lawsuits, also known as adversary proceedings, are being ordered to appear in person in U.S. Bankruptcy Court in Akron for what are called initial pre-trial conferences. The lawsuits also include Fair Finance co-owners Timothy Durham and James Cochran, at least some of their family members and others who worked for the company. Durham, Cochran and Rick Snow, the former Fair Finance chief financial officer, await a federal criminal trial in Indiana scheduled to start this summer.The lawsuits, filed in six “waves” starting in November, for the most part allege what are called fraudulent transfers that total more than $37 million.If the defendants don’t appear as ordered or don’t get an approved extension, the people named in the suits risk an automatic default in favor of the Fair Finance estate.Conference scheduleBecause of the large number of pretrial conferences — about 90 — Bankruptcy Court Chief Judge Marilyn Shea-Stonum on Tuesday said she expects to hold a pretrial conference every 15 minutes on the days they are scheduled. Dates have been scheduled in March and April.“We’ll have to set up two rooms,” the judge said. “It’s my intention to have two lanes of pretrials.”Besides the main courtroom, Shea-Stonum said she anticipates using the court’s witness room.Shea-Stonum said defendants may seek an extension if they can’t be ready in time for the conference date, but she won’t dismiss the suit.“Let them know they need to be at that first pre-trial,” the judge told Bash in a teleconference call in open court. “If they need an extension of time, they need to file a motion. We need to get them off the starting block. … Defendants need to take a service of summons very seriously.”Cases could be settled prior to their scheduled pre-trial conferences. A lawyer for Bash told the judge that a “handful” of defendants are in settlement talks.Pursuing celebritiesBash alleges in a lawsuit that Kaelin, who became known to the public during the O.J. Simpson murder trial, owes $23,700 to Fair Finance. Ferrell, who was Durham’s girlfriend, owes $174,415, according to Bash. A foundation run by Ludacris owes $30,000 to Fair Finance, the trustee says.Bash this year has filed civil lawsuits seeking more than $1.2 billion from companies and individuals in the Fair Finance bankruptcy. Bash has said that Durham and Cochran ran Fair Finance as a Ponzi scheme shortly after buying the long-time Akron company in 2002. More than 5,000 Ohio residents, many of them elderly, bought more than $200 million in uninsured Fair Finance investment certificates.The Fair Finance estate now has about $2.3 million in escrow, Bash told Shea-Stonum in giving a status update in court. The trustee said he received about $520,000 since January for the estate.Fair Finance never reopened after FBI raids on Nov. 24, 2009. Creditors forced the company into bankruptcy in February 2010. Federal agents arrested and charged Durham, Cochran and Snow last year.The next Fair Finance status hearing is scheduled for 9:30 a.m. April 3. The judge and trustee agreed to schedule upcoming status hearings every other month instead of monthly.Jim Mackinnon can be reached at 330-996-3544 or jmackinnon@thebeaconjournal.com
