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EXHIBIT 1
FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018
NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021
UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
NORTHERN DIVISION
In the Matter of: }
ROLTA INTERNATIONAL, INC.1 } CASE NO. 20-82282-CRJ-11
}
} CHAPTER 11
}
Debtor(s). }
ORDER DENYING MOTION OF ROLTA INTERNATIONAL, INC., ROLTA UK
LIMITED, AND ROLTA MIDDLE EAST-FZ, LLC FOR RECONSIDERATION OF
ORDER DISMISSING CHAPTER 11 PROCEEDINGS
This case came before the Court on April 22, 2021 for final hearing on Motion of Rolta
International, Inc., Rolta UK Limited, and Rolta Middle East-FZ, LLC for Reconsideration of
Order Dismissing Chapter 11 Proceedings, ECF No. 228, as supplemented by the Surreply of
Rolta International, Inc., Rolta UK Limited and Rolta Middle East-FZ, LLC in Support of Motion
for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 288, and by the Sur-
Surreply of Rolta International, Inc., Rolta UK Limited, and Rolta Middle East FZ, LLC in Support
of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings (ECF No. 228), ECF
No. 301 (collectively, the “Motion for Reconsideration”); Creditors’ Joinder in Support of Motion
for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 233; Judgment
Creditors’ Response in Opposition to Rolta’s Motion for Reconsideration, ECF No. 298; and the
Statement of Rolta AdvizeX Technologies, LLC in Connection with the Motion of Rolta
International, Inc., Rolta UK Limited and Rolta Middle East-FZ, LLC for Reconsideration of
Order Dismissing their Chapter 11 Cases, ECF No. 297.
1 In addition to Rolta International, Inc., the Debtors include the following: Rolta Middle East FZ-LLC, Case
No. 20-82285-CRJ-11; and Rolta UK Limited, Case No. 20-82287-CRJ-11.
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INTRODUCTION
In December of 2020, Pinpoint Multi-Strategy Master Fund, Value Partners Fixed Income
SPC – Value Partners Credit Opportunities Fund SP, and Value Partners Greater China High Yield
Income Fund (collectively, the “Judgment Creditors”) filed a Motion to Dismiss the Debtors’
Chapter 11 Cases (hereinafter the “Motion to Dismiss”) pursuant to 11 U.S.C. § 1112(b). On
January 26, 2021, the Court held the third hearing on the Motion to Dismiss to give the Debtors
one last opportunity to show that they have a realistic chance of successfully reorganizing. At the
conclusion of that hearing, the Court determined that the Debtors had failed to establish any
realistic ability to successfully reorganize based on a proposed Restructuring Services Agreement
(hereinafter the “RSA”) with the Streamcast Group (hereinafter “Streamcast”) and on the sale of
their equity interest in AdvizeX Technologies, LLC (hereinafter “AdvizeX”).
The Debtors now seek reconsideration of the dismissal of their respective cases without
any reference to the RSA and with the AdvizeX shares having been sold during a UCC foreclosure
auction. The relief sought in the Motion for Reconsideration continues to be based upon a proposed
stand-alone reorganization plan without Rolta India, Ltd., the engine that drives the multi-national
business enterprise, of which the Debtors are mere components. To add to the extreme challenges
that the Debtors face in any attempted reorganization, the President and Chief Operating Officer
of Rolta International, Preetha Pulusani (hereinafter “Pulusani”), has now resigned from her
positions and will no longer be available to assist in any reorganization effort.
The proposed DIP financing, oral stalking horse bids, and alleged misrepresentations made
by the Judgment Creditors in this and other court proceedings are insufficient to overcome the
insurmountable obstacles which continue to exist in any reorganization effort by the Debtors. In
the case of In re Albany Partners, 749 F.2d 670, 674 (11th Cir. 1994), the Eleventh Circuit stated
that dismissal of a Chapter 11 case is appropriate where the “economic reality confronting [the
2
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debtor] supports the conclusion that the debtor had no realistic chance of successfully
reorganizing.” See also Pegasus Wireless Corp., 391 Fed. Appx. 802, 803 (11th Cir.
2010)(“Dismissal is particularly appropriate ‘when there is no realistic possibility of an effective
reorganization and it is evident that the debtor seeks merely to delay or frustrate legitimate efforts
of secured creditors to enforce their rights.”). Based upon the facts and circumstances relevant to
these cases, the Court finds that denial of the Motion for Reconsideration currently before the
Court is likewise appropriate where the economic realities which still confront the Debtors
continue to support the conclusion that the Debtors have no realistic chance of successfully
reorganizing.
BACKGROUND AND FINDINGS OF FACT
1. On October 29, 2020, six related entities, Rolta International, Inc. (“Rolta International”);
Rolta, LLC; Rolta Global B.V.; Rolta Middle East-FZ, LLC (“Rolta Middle East”); Rolta
Americas, LLC (“Rolta Americas”); and Rolta UK Limited (“Rolta UK”)(collectively the
“Debtors”), filed voluntary petitions for relief under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Alabama.2
The Debtors are all subsidiaries or affiliates of Rolta India, Ltd. (“Rolta India”) which is
headquartered in India with international offices in the United Kingdom, Netherlands, United
Arab Emirates, and the United States.3
2. Concurrently with their petitions, the debtors filed a Motion for Joint Administration of Cases
Involving Six Related Debtors (hereinafter “Motion for Joint Administration”), ECF No. 3. On
November 24, 2020, the Court entered an order approving the Motion for Joint Administration,
2 See Rolta International, Inc., Case No. 20-82282-CRJ-11; Rolta, LLC, Case No. 20-82283-CRJ-11; Rolta
Global B.V., Case No. 20-82284-CRJ-11; Rolta Middle East-FZ, LLC, Case No. 20-82285-CRJ-11; Rolta
Americas, LLC, Case No. 20-82286-CRJ-11; and Rolta UK Limited, Case No. 20-82287-CRJ-11.
3 See Declaration of Preetha Pulusani, ECF No. 4.
3
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but only as to the three operational debtors, Rolta International, Rolta Middle East, and Rolta
UK.4 The Court denied the request for joint administration as to Rolta, LLC, Rolta Global
B.V., and Rolta Americas, because the debtors were inactive, dormant entities with no
employees, no real property, and no active service contracts.
3. Rolta International is a corporation organized and existing under the laws of Delaware. Rolta
Middle East is a free-zone limited liability company organized and existing under the laws of
the United Arab Emirates with its principal place of business in Dubai Internet City, Dubai,
United Arab Emirates. Rolta UK is a limited company organized and existing under the laws
of the United Kingdom with its principal place of business in Reading, Berkshire County,
United Kingdom. The President of International Operations for Rolta and President of Rolta
International, Inc., Pulusani, filed a Declaration in support of the Debtors’ petitions stating that
she supervises all international operations, other than in India, while working remotely from
her primary residence located in Madison County, Alabama.5 Pulusani, however, recently
resigned as President and Chief Operating Officer of Rolta International and it does not appear
that the Debtors have appointed a successor.6
4. On December 7, 2020, Judgment Creditors filed a Motion to Dismiss the Debtors’ Chapter 11
cases, ECF No. 126, for cause, arguing, in part, that the Debtors filed their Chapter 11 cases
in bad faith to circumvent a turnover order entered just days before the Debtors filed for relief
in this Court. On the same day, the Debtors filed a Complaint against the Judgment Creditors,
AP No. 20-80162-CRJ, seeking to avoid, as preferential transfers, any liens that the Judgment
Creditors have as a result of the New York State order.
4 See Final Order Directing Joint Administration of Rolta International, Inc., Rolta Middle East FZ-LLC, and
Rolta UK Limited, ECF No. 93.
5 See Declaration of Preetha Pulusani, ECF No. 4.
6 See Judgment Creditors’ Response in Opposition to Motion for Reconsideration, ECF No. 298, ¶ 20.
4
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5. During the two years leading up to the petition date, the Judgment Creditors pursued
enforcement proceedings against the Debtors and others based on a default in bond debt issued
by Rolta, LLC and Rolta Americas. The bond indentures were guaranteed by Rolta India, as
the parent guarantor, and the Debtors, as subsidiary guarantors.7
6. In 2018, the Judgment Creditors filed an action in the Supreme Court of the State of New York,
New York County (hereinafter the “New York Court”), styled Pala Assets Holdings Ltd. et al.
v. Rolta International, Inc., et al., No. 652978/2018 (Sup. Ct., N.Y. County), against the
Debtors and other related entities, including their parent corporation, Rolta India, seeking to
recover more than $200 million in defaulted bond debt. On September 2, 2020, the New York
Court entered judgment in favor of the Judgment Creditors in the amount of $187,098,105.00,
jointly and severally, against the Debtors and other defendants, finding that they had breached
the indenture agreements. The following month, the New York Court entered a second
judgment in favor of the Judgment Creditors for $25,763,000.00.8
7. On October 20, 2020, the New York Court entered a turnover order (hereinafter the “Turnover
Order”), requiring the Debtors and other defendants to deliver all cash on hand within seven
days, and to deliver sufficient shares and/or ownership interest in the Debtors, their
subsidiaries, and related companies to satisfy the judgments within thirty days.9 When the
Debtors filed their Chapter 11 petitions in this Court, the Turnover Order was stayed by
operation of law as to the Debtors pursuant to 11 U.S.C. § 362(a) of the Bankruptcy Code.
Since that time, the Judgment Creditors have continued to pursue their rights against the
Debtors’ parent company, Rolta India, which has defended itself by filing an action in the
7 See Motion to Dismiss, ECF No. 126, Exhibit B, Decision and Order in Pala Assets Holdings, Ltd., et al. v.
Rolta, LLC, et al. (Sup. Ct. N.Y. Cnty, Apr. 23, 2019).
8 See Motion to Dismiss, ECF No. 126, Exhibit F, Order and Judgment in Pala Assets Holdings, Ltd., et al. v.
Rolta, LLC, et al. (Sup. Ct. N.Y. Cnty, Sept. 2, 2020).
9 See Motion to Dismiss, ECF No. 126, Exhibit K, Order in Pala Assets Holdings, Ltd., et al. v. Rolta, LLC, et
al. (Sup. Ct. N.Y. Cnty, Apr. 23, 2019).
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High Court of Bombay India arguing that Turnover Order cannot be executed against
defendants located in India.10 On January 8, 2021, the Judgment Creditors proceeded against
Rolta India in the New York Court by moving for the appointment of a receiver over all of its
shares or membership interests in the various Rolta entities.11
8. On December 22, 2020, this Court held the first hearing on the Motion to Dismiss pursuant to
11 U.S.C. § 105(d) and 11 U.S.C. § 1112(b)(3), at the conclusion of which the Court directed
the parties to file supplemental pleadings.
9. On January 4, 2021, the Judgment Creditors filed a Supplement to their Motion to Dismiss,
ECF No. 175, further arguing that: (i) the Debtors would soon be administratively insolvent
based on their eroding cash reserves, accruing administrative expenses, and lack of funding;
and (ii) the Debtors did not have a realistic chance of emerging from Chapter 11 given the lack
of valuable assets available for distribution to creditors, lack of meaningful business
operations, and inability to formulate a feasible exit strategy.
10. On January 7, 2021, the Debtors filed a Response in Opposition to Judgment Creditors’ Motion
to Dismiss the Debtors’ Chapter 11 Cases (hereinafter “Response in Opposition”), ECF No.
181, arguing, in part, that the symbiotic relationship between the Debtors and other non-fling
entities constituted a valuable asset and that dismissal would only benefit the Judgment
Creditors whose liens are subject to avoidance pursuant to 11 U.S.C. § 547.
11. On January 11, 2021, the Court held the second hearing on the Motion to Dismiss, as
supplemented, and the Debtors’ Response in Opposition. During the hearing, counsel for the
Debtors stated that the Debtors did not oppose dismissal of the Rolta, LLC and Rolta Americas
cases, two of the non-operating Debtors, but requested a continuance as to the remaining
10 See Motion to Dismiss, ECF No. 126, at 684.
11 See Motion to Stay Effectiveness of, or Otherwise Hold in Abeyance, Order Dismissing Chapter 11
Proceedings Pending Resolution of Motion for Reconsideration, ECF No. 234.
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Debtors, including the case filed by Rolta Global B.V., the third non-operating Debtor.
Accordingly, the Court entered orders dismissing the cases filed by Rolta, LLC and Rolta
Americas on January 11, 2021, without opposition from any of the Debtors. The Court also
entered an order directing counsel for the remaining Debtors to file a Supplemental Response
to the Motion to Dismiss, explaining how they proposed to effectively reorganize and to
specifically explain how they proposed to file a viable plan providing for the following under
11 U.S.C. § 1123: (i) the designation of classes of claims; (ii) the treatment of all classes under
the plan; and (iii) the means for implementation of the plan of reorganization, including, but
not limited to, exit financing.12
12. On January 20, 2021, the Debtors filed a Supplemental Response in Opposition to Judgment
Creditors’ Motion to Dismiss the Debtors’ Chapter 11 Cases, ECF No. 208, in which the
Debtors stated that the Chairman of Rolta India, KK Singh, had committed to a $1,000,000
line of credit to fund any operating shortfalls and to pay professional fees. The Debtors
explained that they intended to file a Plan which would include a contingent Secured Class for
the Judgment Creditors if the Debtors’ avoidance action was unsuccessful.
13. The Debtors also proposed two parallel paths for confirmation. The first path which the
Debtors described as their “initial and optimum solution and target,” was entirely dependent
upon a restructuring services agreement executed in August of 2019 by Rolta India and
Streamcast.13 The Debtors stated that Streamcast had agreed pursuant to the RSA to act as a
restructuring consultant and investor, and had agreed to restructure all liabilities of the Rolta
global enterprise. While the Debtors proclaimed that the RSA was their best option for
12 See Order: (1) Continuing Hearing on Motion to Dismiss; (2) Fixing Deadline for Debtors to File
Supplemental Response to Motion to Dismiss; and (3) Fixing Deadline for Judgment Creditors to Respond, ECF No.
187.
13 See Supplemental Response in Opposition to Judgment Creditors’ Motion to Dismiss The Debtors’ Chapter
11 Cases. ECF No. 208, p. 5.
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implementing a plan of reorganization, they admitted that the RSA required statutory approval
from various European authorities, including the European Central Bank, to make investments
totaling $800 million to settle the liabilities of the Rolta global enterprise. Despite extended
delays, the Debtors stated that they anticipated a resolution regarding the RSA no later than
March 31, 2021.14 To date, the Debtors have not argued that the RSA has been approved.
14. Alternatively, the Debtors proposed to sell the Rolta International’s shares of AdvizeX, a
wholly-owned subsidiary of Rolta International, while concurrently completing a formal
valuation of the filing entities to establish the viability of the Debtors in their own right or to
establish the basis for a court-approved sales process of the entities.
15. On January 22, 2021, the Judgment Creditors filed a (I) Reply in Further Support of Motion to
Dismiss the Debtors’ Chapter 11 Cases and (II) Opposition to Debtors’ Motion for Authority
to Enter into a Line of Credit, ECF No. 215. The Judgment Creditors argued that neither of the
parallel paths proposed by the Debtors for reorganizing were viable alternatives for an effective
reorganization. Specifically, the Judgment Creditors explained that the RSA is simply a
consulting arrangement between Rolta India and Streamcast, to which the Debtors are not
parties. As to the proposed § 363 sale of AdvizeX, the Judgment Creditors argued that the sale
would not meaningfully benefit creditors because Rolta International’s shares of AdvizeX are
pledged to Huntington Bank as collateral for a $20 million line of credit. Finally, the Judgment
Creditors argued that the proposed insider line of credit from KK Singh, the Chairman of Rolta
India, was at best speculative and insufficient.
16. On January 25, 2021, AdvizeX filed a Statement in Connection with Judgments Creditors’
Motion to Dismiss the Debtors’ Chapter 11 Cases, ECF No. 220. Counsel for AdvizeX stated
that the proposed § 363 sale of the non-debtor entity would destroy or greatly diminish its value
14 Id. at p. 6.
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by leading to a departure of key employees. Counsel further advised that the promised
Streamcast deal, proposed as the best path forward by the Debtors, actually created more
uncertainty for AdvizeX given the continuing delays and uncertainty surrounding the RSA.
17. The Motion to Dismiss and related proceedings came before this Court for final hearing on
January 26, 2021, during which the Court found that the Chapter 11 cases should be dismissed
pursuant to 11 U.S.C. § 1112(b), for cause, including, lack of good faith. During the final
hearing, counsel for the Bankruptcy Administrator also recommended dismissal. After
carefully considering all of the pleadings, the arguments of counsel, and the Bankruptcy
Administrator’s oral recommendation, the Court concluded that the Debtors did not have a
realistic possibility of effectively reorganizing and merely sought, instead, to delay or frustrate
the efforts of the Judgment Creditors to enforce their rights under the Turnover Order issued
by the New York Court. Following the hearing, the Court entered an Order Dismissing Chapter
11 Case pursuant to 11 U.S.C. § 1112(b), ECF No. 224, in the Jointly Administered Case.
The Court also entered separate orders dismissing the Rolta Global B.V., Rolta Middle East,
and Rolta UK cases.15
18. On February 9, 2021, Rolta International, Rolta Middle East, and Rolta UK filed the Motion
for Reconsideration and sought reinstatement of their respective cases. The Debtors argued,
in part, that following dismissal of their cases they had retained new, additional counsel to
propose a revised plan of reorganization which would include a sales process for the equity
in AdvizeX, an oral commitment of $1 million of DIP financing to fund their Chapter 11
proceedings and pay administrative claims, and oral stalking horse bids for Rolta Middle East
and Rolta UK. The Debtors further argued that approximately $535 million of unsecured
15 See Order Dismissing Chapter 11 Case, ECF No. 224. See also Rolta Global B.V., Case No. 20-82284-
CRJ-11; Order Dismissing Case, ECF No. 111; Rolta Middle East-FZ, LLC, Case No. 20-82285-CRJ-11, Order
Dismissing, ECF No. 95; and Rolta UK Limited, Case No. 20-82287-CRJ-11, Order Dismissing Case, ECF No. 91.
9
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claimants and bondholders supported reinstatement. See ECF No. 228, Exhibit 1, Letter by
Counsel to Citicorp International Limited, in its capacity as Trustee and Security Agent for
the 8.875% Senior Notes due 20019 issued by Rolta Americas, LLC under that certain
Indenture dated as of July 24, 2012, which purports to express the Indenture Trustee’s support
of the Debtors efforts to seek reconsideration and the strategy outlined in the Motion for
Reconsideration. However, the Indenture Trustee did not participate in these cases prior to
dismissal and has not filed any pleading in support of the Motion for Reconsideration, nor
appeared during any of the hearings before this Court.
19. The Court scheduled the Motion for Reconsideration for Status Conference on February 23,
2021 in the normal course of scheduling pending matters.
20. On February 12, 2021, seven trade creditors, M&D Enterprise Ventures, Inc.; Active Soft,
Inc.; The Travel Universe, Inc.; Epikentron, LLC; Reliable Software Resources, Inc.; Data
Glove, Inc.; and SAP Technology Solutions, Inc. (hereinafter collectively, the “Trade
Creditors”) filed Creditors’ Joinder in Support of Motion for Reconsideration of Order
Dismissing Chapter 11 Proceedings, ECF No. 233, (hereinafter the “Joinder”). Prior to filing
the Joinder, the Trade Creditors had not participated in the Chapter 11 cases and had not filed
proofs of claims. Together the Trade Creditors are owed approximately $155,000 by Rolta
International.
21. On February 12, 2021, the Debtors filed a Motion to Stay Effectiveness of, or Otherwise Hold
in Abeyance, Order Dismissing Chapter 11 Proceedings (ECF No. 224) Pending Resolution
of Motion for Reconsideration (ECF No. 228), ECF No. 234, (“Motion to Stay”) arguing that
they would be irreparably injured absent a stay of the Orders dismissing their cases. On the
same day, the Debtors filed a Complaint for Emergency Injunction, AP No. 21-80016-CRJ,
seeking either (i) an extension of the automatic stay under § 362(a) of the Bankruptcy Code;
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or (ii) an injunction under 11 U.S.C. § 105(a) of the Bankruptcy Code prohibiting the
Judgment Creditors from (a) taking any action with respect to the shares, equity, and/or
membership interest of the Debtors; (b) taking any action with respect to the Debtors’
property; and (c) taking any action with respect to an officer, director, or employee of the
Debtors, unless a Judgment Creditor has a claim arising solely from a separate relationship
against such employee.
22. On February 17, 2021, in response to a request by the Debtors, the Court held an expedited
hearing on the Motion to Stay. Following the hearing, the Court entered an Order Denying
Motion to Stay Effectiveness of, or Otherwise Hold in Abeyance, Order Dismissing Chapter
11 Proceedings Pending Resolution of Motion for Reconsideration, ECF No. 255. The Court
explained it did not find that cause existed to grant the relief requested. In addition, the Court
found that it was unclear that a stay pending resolution of the Motion to Reconsider would
stay the Judgment Creditors’ pending action in the New York Court in which they were
seeking the appointment of a receiver.
23. On March 3, 2021, the Debtors filed a Notice of Appeal, ECF No. 268, of the Order Denying
Stay and Motion for Leave to Take Interlocutory Appeal, ECF No. 269. Thereafter, the
Debtors filed a Notice of Record on Appeal and Statement of Issues, ECF No. 275, which
included issues before this Court in the Motion for Reconsideration. Accordingly, this Court
entered an Order Continuing Hearing on Motion for Reconsideration, ECF No. 285, pending
resolution of the Motion for Leave to Take Interlocutory Appeal.
24. On March 16, 2021, Pulusani resigned as the Chief Operating Office and President of
International Operations, without the Debtors identifying a successor.16
25. On March 24, 2021, the United States District Court for the Northern District of Alabama
16 See Judgment Creditors’ Response In Opposition to Motion for Reconsideration, ECF No. 298, ¶ 20.
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(the “District Court”) entered an Order denying the Debtors’ request for leave to file an
interlocutory appeal. Thereafter, on March 31, 2021, the District Court entered a
Memorandum Opinion explaining its ruling. The District Court stated that the Debtors failed
to show irreparable harm, inter alia, because: (i) the Debtors themselves caused the delay in
the resolution of the Motion for Reconsideration by filing the Notice of Appeal; and (ii) even
if a receiver is appointed by the New York Court, any harm arising from the appointment is
reparable because the New York proceeding provides legal remedies by which the Debtors
can stay the action while challenging the appointment. This Court then scheduled the Motion
for Reconsideration for hearing on April 21, 2021.
26. On April, 14, 2021, the Judgment Creditors filed a Response in Opposition to Rolta’s Motion
for Reconsideration, ECF No. 298, arguing in part, that the Debtors still have no realistic
chance of successfully reorganizing given the continuing absence of Rolta India from the
proceedings before this Court, the continuing lack of creditor participation in these cases, and
the post-dismissal resignation of Pulusani. The Judgment Creditors further argued that the
Debtors’ proposed sale of equity in Rolta International, the value of which is principally
derived from AdvizeX, is now a nullity following the post-dismissal foreclosure auction on
April 1, 2021 of AdvizeX conducted by Judgment Creditor Value Partners Fixed Income SPC
– Value Partners Credit Opportunities Fund SP (“VP Credit”).
27. On April 21, 2021, the Debtors filed a Sur-Surreply in Support of Motion for Reconsideration
of Order Dismissing Chapter 11 Proceedings (ECF No. 228), ECF No. 301, arguing in part,
that the Judgment Creditors have engaged in gamesmanship by: (i) making inconsistent
statements in this Court, the District Court, and the New York Court regarding the value of
Rolta International; and (ii) misconstruing the effect of a public auction of the AdvizeX shares
owned by Rolta International. The Debtors further argued that as a result of their affirmative
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misstatements to this Court, the Judgment Creditors received a windfall from the foreclosure
auction of AdvizeX which the Debtors allege that this Court will have authority to undo upon
reinstatement of their respective cases because the sale failed to comply with applicable law.
Finally, the Debtors argued that dismissal was not in the best interest of the creditors who
filed proofs of claim in their cases. Prior to dismissal, certain claims had been filed in the
Rolta International case. Following dismissal of the cases, multiple claims were filed by
Citicorp International Limited, Indenture Trustee, each in the amount of $535,985,217.79 and
by DB Trustees (Hong Kong) Limited each in the amount of $187,759,921.52 which claims
total $2,361,760,293.29. Nevertheless, despite the large claims asserted in these cases, the
non-Judgment Creditors have yet to actively participate or to appear in these cases either prior
to dismissal, or in support of the Motion for Reconsideration.
CONCLUSIONS OF LAW
I. STANDARD FOR RECONSIDERATION OF THE DISMISSAL ORDERS
The Debtors seek relief from this Court’s Orders dismissing their respective Chapter 11
cases under Rule 59(e) and Rule 60(b) of the Federal Rules of Civil Procedure pursuant to which
a motion to reconsider may be treated either as a motion to alter or amend, or as a motion for relief
from judgment, respectively. The Debtors assert that, under Rule 59(e), dismissal of their Chapter
11 cases constitutes a manifest error of fact, and that, under Rule 60(b)(6), relief from judgment is
appropriate in order to do substantial justice given the circumstances of these cases.
Under Rule 59(e) of the Federal Rules of Civil Procedure, as made applicable to bankruptcy
proceedings by Rule 9023 of the Federal Rules of Bankruptcy Procedure, “[t]he only grounds for
granting [a motion for reconsideration] are newly discovered evidence or manifest errors of law or
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fact.”17 The Eleventh Circuit has cautioned that “[m]otions to amend should not be used to raise
arguments which could, and should, have been made before the judgment was issued.”18 The
Court of Appeals has further cautioned that such motions are not “vehicle[s] to reargue issues
resolved by the court’s decision or to make additional arguments on matters not previously raised
by counsel.”19 As recently reaffirmed by the Eleventh Circuit, it is well established that “[a] Rule
59(e) motion for reconsideration may be granted for newly-discovered evidence or manifest errors
of law or fact but cannot be used to relitigate old matters, raise arguments, or present evidence that
could have been raised before the court entered judgment.” 20 “Reconsidering the merits of a
judgment, absent a manifest error of law or fact, is not the purpose of Rule 59.”21
Rule 60(b), as made applicable to bankruptcy proceedings by Rule 9024 of the Federal
Rules of Bankruptcy Procedure, allows relief to a party from a final judgment for the following
reasons:
(1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered
evidence that, with reasonable diligence, could not have been discovered in time to
move for a new trial . ..; (3) fraud . . .misrepresentation, or misconduct by an
imposing party; (4) the judgment is void; (5) the judgment has been satisfied,
released or discharged . . . reversed or vacated . . . . ; or (6) any other reason that
justifies relief.22
“By its very nature,” Rule 60(b) “seeks to strike a delicate balance between two countervailing
impulses: the desire to preserve the finality of judgments and the incessant command of the court’s
17 Dimaria Properties, LLC v. 3400 Atlantic, LLC (In re Dimaria Properties, LLC), 654 Fed. Appx. 1018,
1020 (11th Cir. 2016)(quoting In re Kellogg, 197 F.3d 116, 1119 (11th Cir. 1999)).
18 Id. (quoting Lussier v. Dugger, 904 F.2d 661, 667 (11th Cir. 1990)).
19 Daughtrey, Jr. v. Rivera, II (In re Daughtrey, Jr.), 896 F.3d 1255, 1280 (11th Cir. 2018).
20 Arbelaez, Sr. v. Enclave Shores Condominium Assoc., Inc. (In re Enclave Shores Condominium, Inc.) 835
Fed. Appx. 1007, 1008 (11th Cir. Feb. 9, 2021); See also Jacobs v. Tempur-Pedic Int’l, Inc., 626 F.3d 1327, 1344
(11th Cir. 2010)(“[A] Rule 59(e) motion [cannot be used] to relitigate old matters, raise argument or present
evidence that could have been raised prior to the entry of judgment.”)(quoting Michael Linet, Inc. v. Village of
Wellington, Fla., 408 F.3d 757, 763 (11th Cir. 2005)).
21 Jacobs v. Tempur-Pedic Int’l, Inc., 626 F.3d at 1344.
22 FED. R. CIV. P. 60(b)(1)-(6).
14
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conscience that justice be done in light of all the facts.”23
“Rule 60(b)(6) is a ‘catch-all’ provision, and a ‘grand reservoir of equitable power to do
Preview
FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 EXHIBIT 1 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF ALABAMA NORTHERN DIVISION In the Matter of: } ROLTA INTERNATIONAL, INC.1 } CASE NO. 20-82282-CRJ-11 } } CHAPTER 11 } Debtor(s). } ORDER DENYING MOTION OF ROLTA INTERNATIONAL, INC., ROLTA UK LIMITED, AND ROLTA MIDDLE EAST-FZ, LLC FOR RECONSIDERATION OF ORDER DISMISSING CHAPTER 11 PROCEEDINGS This case came before the Court on April 22, 2021 for final hearing on Motion of Rolta International, Inc., Rolta UK Limited, and Rolta Middle East-FZ, LLC for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 228, as supplemented by the Surreply of Rolta International, Inc., Rolta UK Limited and Rolta Middle East-FZ, LLC in Support of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 288, and by the Sur- Surreply of Rolta International, Inc., Rolta UK Limited, and Rolta Middle East FZ, LLC in Support of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings (ECF No. 228), ECF No. 301 (collectively, the “Motion for Reconsideration”); Creditors’ Joinder in Support of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 233; Judgment Creditors’ Response in Opposition to Rolta’s Motion for Reconsideration, ECF No. 298; and the Statement of Rolta AdvizeX Technologies, LLC in Connection with the Motion of Rolta International, Inc., Rolta UK Limited and Rolta Middle East-FZ, LLC for Reconsideration of Order Dismissing their Chapter 11 Cases, ECF No. 297. 1 In addition to Rolta International, Inc., the Debtors include the following: Rolta Middle East FZ-LLC, Case No. 20-82285-CRJ-11; and Rolta UK Limited, Case No. 20-82287-CRJ-11. Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 1 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 INTRODUCTION In December of 2020, Pinpoint Multi-Strategy Master Fund, Value Partners Fixed Income SPC – Value Partners Credit Opportunities Fund SP, and Value Partners Greater China High Yield Income Fund (collectively, the “Judgment Creditors”) filed a Motion to Dismiss the Debtors’ Chapter 11 Cases (hereinafter the “Motion to Dismiss”) pursuant to 11 U.S.C. § 1112(b). On January 26, 2021, the Court held the third hearing on the Motion to Dismiss to give the Debtors one last opportunity to show that they have a realistic chance of successfully reorganizing. At the conclusion of that hearing, the Court determined that the Debtors had failed to establish any realistic ability to successfully reorganize based on a proposed Restructuring Services Agreement (hereinafter the “RSA”) with the Streamcast Group (hereinafter “Streamcast”) and on the sale of their equity interest in AdvizeX Technologies, LLC (hereinafter “AdvizeX”). The Debtors now seek reconsideration of the dismissal of their respective cases without any reference to the RSA and with the AdvizeX shares having been sold during a UCC foreclosure auction. The relief sought in the Motion for Reconsideration continues to be based upon a proposed stand-alone reorganization plan without Rolta India, Ltd., the engine that drives the multi-national business enterprise, of which the Debtors are mere components. To add to the extreme challenges that the Debtors face in any attempted reorganization, the President and Chief Operating Officer of Rolta International, Preetha Pulusani (hereinafter “Pulusani”), has now resigned from her positions and will no longer be available to assist in any reorganization effort. The proposed DIP financing, oral stalking horse bids, and alleged misrepresentations made by the Judgment Creditors in this and other court proceedings are insufficient to overcome the insurmountable obstacles which continue to exist in any reorganization effort by the Debtors. In the case of In re Albany Partners, 749 F.2d 670, 674 (11th Cir. 1994), the Eleventh Circuit stated that dismissal of a Chapter 11 case is appropriate where the “economic reality confronting [the 2 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 2 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 debtor] supports the conclusion that the debtor had no realistic chance of successfully reorganizing.” See also Pegasus Wireless Corp., 391 Fed. Appx. 802, 803 (11th Cir. 2010)(“Dismissal is particularly appropriate ‘when there is no realistic possibility of an effective reorganization and it is evident that the debtor seeks merely to delay or frustrate legitimate efforts of secured creditors to enforce their rights.”). Based upon the facts and circumstances relevant to these cases, the Court finds that denial of the Motion for Reconsideration currently before the Court is likewise appropriate where the economic realities which still confront the Debtors continue to support the conclusion that the Debtors have no realistic chance of successfully reorganizing. BACKGROUND AND FINDINGS OF FACT 1. On October 29, 2020, six related entities, Rolta International, Inc. (“Rolta International”); Rolta, LLC; Rolta Global B.V.; Rolta Middle East-FZ, LLC (“Rolta Middle East”); Rolta Americas, LLC (“Rolta Americas”); and Rolta UK Limited (“Rolta UK”)(collectively the “Debtors”), filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Alabama.2 The Debtors are all subsidiaries or affiliates of Rolta India, Ltd. (“Rolta India”) which is headquartered in India with international offices in the United Kingdom, Netherlands, United Arab Emirates, and the United States.3 2. Concurrently with their petitions, the debtors filed a Motion for Joint Administration of Cases Involving Six Related Debtors (hereinafter “Motion for Joint Administration”), ECF No. 3. On November 24, 2020, the Court entered an order approving the Motion for Joint Administration, 2 See Rolta International, Inc., Case No. 20-82282-CRJ-11; Rolta, LLC, Case No. 20-82283-CRJ-11; Rolta Global B.V., Case No. 20-82284-CRJ-11; Rolta Middle East-FZ, LLC, Case No. 20-82285-CRJ-11; Rolta Americas, LLC, Case No. 20-82286-CRJ-11; and Rolta UK Limited, Case No. 20-82287-CRJ-11. 3 See Declaration of Preetha Pulusani, ECF No. 4. 3 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 3 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 but only as to the three operational debtors, Rolta International, Rolta Middle East, and Rolta UK.4 The Court denied the request for joint administration as to Rolta, LLC, Rolta Global B.V., and Rolta Americas, because the debtors were inactive, dormant entities with no employees, no real property, and no active service contracts. 3. Rolta International is a corporation organized and existing under the laws of Delaware. Rolta Middle East is a free-zone limited liability company organized and existing under the laws of the United Arab Emirates with its principal place of business in Dubai Internet City, Dubai, United Arab Emirates. Rolta UK is a limited company organized and existing under the laws of the United Kingdom with its principal place of business in Reading, Berkshire County, United Kingdom. The President of International Operations for Rolta and President of Rolta International, Inc., Pulusani, filed a Declaration in support of the Debtors’ petitions stating that she supervises all international operations, other than in India, while working remotely from her primary residence located in Madison County, Alabama.5 Pulusani, however, recently resigned as President and Chief Operating Officer of Rolta International and it does not appear that the Debtors have appointed a successor.6 4. On December 7, 2020, Judgment Creditors filed a Motion to Dismiss the Debtors’ Chapter 11 cases, ECF No. 126, for cause, arguing, in part, that the Debtors filed their Chapter 11 cases in bad faith to circumvent a turnover order entered just days before the Debtors filed for relief in this Court. On the same day, the Debtors filed a Complaint against the Judgment Creditors, AP No. 20-80162-CRJ, seeking to avoid, as preferential transfers, any liens that the Judgment Creditors have as a result of the New York State order. 4 See Final Order Directing Joint Administration of Rolta International, Inc., Rolta Middle East FZ-LLC, and Rolta UK Limited, ECF No. 93. 5 See Declaration of Preetha Pulusani, ECF No. 4. 6 See Judgment Creditors’ Response in Opposition to Motion for Reconsideration, ECF No. 298, ¶ 20. 4 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 4 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 5. During the two years leading up to the petition date, the Judgment Creditors pursued enforcement proceedings against the Debtors and others based on a default in bond debt issued by Rolta, LLC and Rolta Americas. The bond indentures were guaranteed by Rolta India, as the parent guarantor, and the Debtors, as subsidiary guarantors.7 6. In 2018, the Judgment Creditors filed an action in the Supreme Court of the State of New York, New York County (hereinafter the “New York Court”), styled Pala Assets Holdings Ltd. et al. v. Rolta International, Inc., et al., No. 652978/2018 (Sup. Ct., N.Y. County), against the Debtors and other related entities, including their parent corporation, Rolta India, seeking to recover more than $200 million in defaulted bond debt. On September 2, 2020, the New York Court entered judgment in favor of the Judgment Creditors in the amount of $187,098,105.00, jointly and severally, against the Debtors and other defendants, finding that they had breached the indenture agreements. The following month, the New York Court entered a second judgment in favor of the Judgment Creditors for $25,763,000.00.8 7. On October 20, 2020, the New York Court entered a turnover order (hereinafter the “Turnover Order”), requiring the Debtors and other defendants to deliver all cash on hand within seven days, and to deliver sufficient shares and/or ownership interest in the Debtors, their subsidiaries, and related companies to satisfy the judgments within thirty days.9 When the Debtors filed their Chapter 11 petitions in this Court, the Turnover Order was stayed by operation of law as to the Debtors pursuant to 11 U.S.C. § 362(a) of the Bankruptcy Code. Since that time, the Judgment Creditors have continued to pursue their rights against the Debtors’ parent company, Rolta India, which has defended itself by filing an action in the 7 See Motion to Dismiss, ECF No. 126, Exhibit B, Decision and Order in Pala Assets Holdings, Ltd., et al. v. Rolta, LLC, et al. (Sup. Ct. N.Y. Cnty, Apr. 23, 2019). 8 See Motion to Dismiss, ECF No. 126, Exhibit F, Order and Judgment in Pala Assets Holdings, Ltd., et al. v. Rolta, LLC, et al. (Sup. Ct. N.Y. Cnty, Sept. 2, 2020). 9 See Motion to Dismiss, ECF No. 126, Exhibit K, Order in Pala Assets Holdings, Ltd., et al. v. Rolta, LLC, et al. (Sup. Ct. N.Y. Cnty, Apr. 23, 2019). 5 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 5 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 High Court of Bombay India arguing that Turnover Order cannot be executed against defendants located in India.10 On January 8, 2021, the Judgment Creditors proceeded against Rolta India in the New York Court by moving for the appointment of a receiver over all of its shares or membership interests in the various Rolta entities.11 8. On December 22, 2020, this Court held the first hearing on the Motion to Dismiss pursuant to 11 U.S.C. § 105(d) and 11 U.S.C. § 1112(b)(3), at the conclusion of which the Court directed the parties to file supplemental pleadings. 9. On January 4, 2021, the Judgment Creditors filed a Supplement to their Motion to Dismiss, ECF No. 175, further arguing that: (i) the Debtors would soon be administratively insolvent based on their eroding cash reserves, accruing administrative expenses, and lack of funding; and (ii) the Debtors did not have a realistic chance of emerging from Chapter 11 given the lack of valuable assets available for distribution to creditors, lack of meaningful business operations, and inability to formulate a feasible exit strategy. 10. On January 7, 2021, the Debtors filed a Response in Opposition to Judgment Creditors’ Motion to Dismiss the Debtors’ Chapter 11 Cases (hereinafter “Response in Opposition”), ECF No. 181, arguing, in part, that the symbiotic relationship between the Debtors and other non-fling entities constituted a valuable asset and that dismissal would only benefit the Judgment Creditors whose liens are subject to avoidance pursuant to 11 U.S.C. § 547. 11. On January 11, 2021, the Court held the second hearing on the Motion to Dismiss, as supplemented, and the Debtors’ Response in Opposition. During the hearing, counsel for the Debtors stated that the Debtors did not oppose dismissal of the Rolta, LLC and Rolta Americas cases, two of the non-operating Debtors, but requested a continuance as to the remaining 10 See Motion to Dismiss, ECF No. 126, at 684. 11 See Motion to Stay Effectiveness of, or Otherwise Hold in Abeyance, Order Dismissing Chapter 11 Proceedings Pending Resolution of Motion for Reconsideration, ECF No. 234. 6 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 6 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 Debtors, including the case filed by Rolta Global B.V., the third non-operating Debtor. Accordingly, the Court entered orders dismissing the cases filed by Rolta, LLC and Rolta Americas on January 11, 2021, without opposition from any of the Debtors. The Court also entered an order directing counsel for the remaining Debtors to file a Supplemental Response to the Motion to Dismiss, explaining how they proposed to effectively reorganize and to specifically explain how they proposed to file a viable plan providing for the following under 11 U.S.C. § 1123: (i) the designation of classes of claims; (ii) the treatment of all classes under the plan; and (iii) the means for implementation of the plan of reorganization, including, but not limited to, exit financing.12 12. On January 20, 2021, the Debtors filed a Supplemental Response in Opposition to Judgment Creditors’ Motion to Dismiss the Debtors’ Chapter 11 Cases, ECF No. 208, in which the Debtors stated that the Chairman of Rolta India, KK Singh, had committed to a $1,000,000 line of credit to fund any operating shortfalls and to pay professional fees. The Debtors explained that they intended to file a Plan which would include a contingent Secured Class for the Judgment Creditors if the Debtors’ avoidance action was unsuccessful. 13. The Debtors also proposed two parallel paths for confirmation. The first path which the Debtors described as their “initial and optimum solution and target,” was entirely dependent upon a restructuring services agreement executed in August of 2019 by Rolta India and Streamcast.13 The Debtors stated that Streamcast had agreed pursuant to the RSA to act as a restructuring consultant and investor, and had agreed to restructure all liabilities of the Rolta global enterprise. While the Debtors proclaimed that the RSA was their best option for 12 See Order: (1) Continuing Hearing on Motion to Dismiss; (2) Fixing Deadline for Debtors to File Supplemental Response to Motion to Dismiss; and (3) Fixing Deadline for Judgment Creditors to Respond, ECF No. 187. 13 See Supplemental Response in Opposition to Judgment Creditors’ Motion to Dismiss The Debtors’ Chapter 11 Cases. ECF No. 208, p. 5. 7 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 7 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 implementing a plan of reorganization, they admitted that the RSA required statutory approval from various European authorities, including the European Central Bank, to make investments totaling $800 million to settle the liabilities of the Rolta global enterprise. Despite extended delays, the Debtors stated that they anticipated a resolution regarding the RSA no later than March 31, 2021.14 To date, the Debtors have not argued that the RSA has been approved. 14. Alternatively, the Debtors proposed to sell the Rolta International’s shares of AdvizeX, a wholly-owned subsidiary of Rolta International, while concurrently completing a formal valuation of the filing entities to establish the viability of the Debtors in their own right or to establish the basis for a court-approved sales process of the entities. 15. On January 22, 2021, the Judgment Creditors filed a (I) Reply in Further Support of Motion to Dismiss the Debtors’ Chapter 11 Cases and (II) Opposition to Debtors’ Motion for Authority to Enter into a Line of Credit, ECF No. 215. The Judgment Creditors argued that neither of the parallel paths proposed by the Debtors for reorganizing were viable alternatives for an effective reorganization. Specifically, the Judgment Creditors explained that the RSA is simply a consulting arrangement between Rolta India and Streamcast, to which the Debtors are not parties. As to the proposed § 363 sale of AdvizeX, the Judgment Creditors argued that the sale would not meaningfully benefit creditors because Rolta International’s shares of AdvizeX are pledged to Huntington Bank as collateral for a $20 million line of credit. Finally, the Judgment Creditors argued that the proposed insider line of credit from KK Singh, the Chairman of Rolta India, was at best speculative and insufficient. 16. On January 25, 2021, AdvizeX filed a Statement in Connection with Judgments Creditors’ Motion to Dismiss the Debtors’ Chapter 11 Cases, ECF No. 220. Counsel for AdvizeX stated that the proposed § 363 sale of the non-debtor entity would destroy or greatly diminish its value 14 Id. at p. 6. 8 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 8 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 by leading to a departure of key employees. Counsel further advised that the promised Streamcast deal, proposed as the best path forward by the Debtors, actually created more uncertainty for AdvizeX given the continuing delays and uncertainty surrounding the RSA. 17. The Motion to Dismiss and related proceedings came before this Court for final hearing on January 26, 2021, during which the Court found that the Chapter 11 cases should be dismissed pursuant to 11 U.S.C. § 1112(b), for cause, including, lack of good faith. During the final hearing, counsel for the Bankruptcy Administrator also recommended dismissal. After carefully considering all of the pleadings, the arguments of counsel, and the Bankruptcy Administrator’s oral recommendation, the Court concluded that the Debtors did not have a realistic possibility of effectively reorganizing and merely sought, instead, to delay or frustrate the efforts of the Judgment Creditors to enforce their rights under the Turnover Order issued by the New York Court. Following the hearing, the Court entered an Order Dismissing Chapter 11 Case pursuant to 11 U.S.C. § 1112(b), ECF No. 224, in the Jointly Administered Case. The Court also entered separate orders dismissing the Rolta Global B.V., Rolta Middle East, and Rolta UK cases.15 18. On February 9, 2021, Rolta International, Rolta Middle East, and Rolta UK filed the Motion for Reconsideration and sought reinstatement of their respective cases. The Debtors argued, in part, that following dismissal of their cases they had retained new, additional counsel to propose a revised plan of reorganization which would include a sales process for the equity in AdvizeX, an oral commitment of $1 million of DIP financing to fund their Chapter 11 proceedings and pay administrative claims, and oral stalking horse bids for Rolta Middle East and Rolta UK. The Debtors further argued that approximately $535 million of unsecured 15 See Order Dismissing Chapter 11 Case, ECF No. 224. See also Rolta Global B.V., Case No. 20-82284- CRJ-11; Order Dismissing Case, ECF No. 111; Rolta Middle East-FZ, LLC, Case No. 20-82285-CRJ-11, Order Dismissing, ECF No. 95; and Rolta UK Limited, Case No. 20-82287-CRJ-11, Order Dismissing Case, ECF No. 91. 9 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 9 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 claimants and bondholders supported reinstatement. See ECF No. 228, Exhibit 1, Letter by Counsel to Citicorp International Limited, in its capacity as Trustee and Security Agent for the 8.875% Senior Notes due 20019 issued by Rolta Americas, LLC under that certain Indenture dated as of July 24, 2012, which purports to express the Indenture Trustee’s support of the Debtors efforts to seek reconsideration and the strategy outlined in the Motion for Reconsideration. However, the Indenture Trustee did not participate in these cases prior to dismissal and has not filed any pleading in support of the Motion for Reconsideration, nor appeared during any of the hearings before this Court. 19. The Court scheduled the Motion for Reconsideration for Status Conference on February 23, 2021 in the normal course of scheduling pending matters. 20. On February 12, 2021, seven trade creditors, M&D Enterprise Ventures, Inc.; Active Soft, Inc.; The Travel Universe, Inc.; Epikentron, LLC; Reliable Software Resources, Inc.; Data Glove, Inc.; and SAP Technology Solutions, Inc. (hereinafter collectively, the “Trade Creditors”) filed Creditors’ Joinder in Support of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings, ECF No. 233, (hereinafter the “Joinder”). Prior to filing the Joinder, the Trade Creditors had not participated in the Chapter 11 cases and had not filed proofs of claims. Together the Trade Creditors are owed approximately $155,000 by Rolta International. 21. On February 12, 2021, the Debtors filed a Motion to Stay Effectiveness of, or Otherwise Hold in Abeyance, Order Dismissing Chapter 11 Proceedings (ECF No. 224) Pending Resolution of Motion for Reconsideration (ECF No. 228), ECF No. 234, (“Motion to Stay”) arguing that they would be irreparably injured absent a stay of the Orders dismissing their cases. On the same day, the Debtors filed a Complaint for Emergency Injunction, AP No. 21-80016-CRJ, seeking either (i) an extension of the automatic stay under § 362(a) of the Bankruptcy Code; 10 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 10 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 or (ii) an injunction under 11 U.S.C. § 105(a) of the Bankruptcy Code prohibiting the Judgment Creditors from (a) taking any action with respect to the shares, equity, and/or membership interest of the Debtors; (b) taking any action with respect to the Debtors’ property; and (c) taking any action with respect to an officer, director, or employee of the Debtors, unless a Judgment Creditor has a claim arising solely from a separate relationship against such employee. 22. On February 17, 2021, in response to a request by the Debtors, the Court held an expedited hearing on the Motion to Stay. Following the hearing, the Court entered an Order Denying Motion to Stay Effectiveness of, or Otherwise Hold in Abeyance, Order Dismissing Chapter 11 Proceedings Pending Resolution of Motion for Reconsideration, ECF No. 255. The Court explained it did not find that cause existed to grant the relief requested. In addition, the Court found that it was unclear that a stay pending resolution of the Motion to Reconsider would stay the Judgment Creditors’ pending action in the New York Court in which they were seeking the appointment of a receiver. 23. On March 3, 2021, the Debtors filed a Notice of Appeal, ECF No. 268, of the Order Denying Stay and Motion for Leave to Take Interlocutory Appeal, ECF No. 269. Thereafter, the Debtors filed a Notice of Record on Appeal and Statement of Issues, ECF No. 275, which included issues before this Court in the Motion for Reconsideration. Accordingly, this Court entered an Order Continuing Hearing on Motion for Reconsideration, ECF No. 285, pending resolution of the Motion for Leave to Take Interlocutory Appeal. 24. On March 16, 2021, Pulusani resigned as the Chief Operating Office and President of International Operations, without the Debtors identifying a successor.16 25. On March 24, 2021, the United States District Court for the Northern District of Alabama 16 See Judgment Creditors’ Response In Opposition to Motion for Reconsideration, ECF No. 298, ¶ 20. 11 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 11 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 (the “District Court”) entered an Order denying the Debtors’ request for leave to file an interlocutory appeal. Thereafter, on March 31, 2021, the District Court entered a Memorandum Opinion explaining its ruling. The District Court stated that the Debtors failed to show irreparable harm, inter alia, because: (i) the Debtors themselves caused the delay in the resolution of the Motion for Reconsideration by filing the Notice of Appeal; and (ii) even if a receiver is appointed by the New York Court, any harm arising from the appointment is reparable because the New York proceeding provides legal remedies by which the Debtors can stay the action while challenging the appointment. This Court then scheduled the Motion for Reconsideration for hearing on April 21, 2021. 26. On April, 14, 2021, the Judgment Creditors filed a Response in Opposition to Rolta’s Motion for Reconsideration, ECF No. 298, arguing in part, that the Debtors still have no realistic chance of successfully reorganizing given the continuing absence of Rolta India from the proceedings before this Court, the continuing lack of creditor participation in these cases, and the post-dismissal resignation of Pulusani. The Judgment Creditors further argued that the Debtors’ proposed sale of equity in Rolta International, the value of which is principally derived from AdvizeX, is now a nullity following the post-dismissal foreclosure auction on April 1, 2021 of AdvizeX conducted by Judgment Creditor Value Partners Fixed Income SPC – Value Partners Credit Opportunities Fund SP (“VP Credit”). 27. On April 21, 2021, the Debtors filed a Sur-Surreply in Support of Motion for Reconsideration of Order Dismissing Chapter 11 Proceedings (ECF No. 228), ECF No. 301, arguing in part, that the Judgment Creditors have engaged in gamesmanship by: (i) making inconsistent statements in this Court, the District Court, and the New York Court regarding the value of Rolta International; and (ii) misconstruing the effect of a public auction of the AdvizeX shares owned by Rolta International. The Debtors further argued that as a result of their affirmative 12 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 12 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 misstatements to this Court, the Judgment Creditors received a windfall from the foreclosure auction of AdvizeX which the Debtors allege that this Court will have authority to undo upon reinstatement of their respective cases because the sale failed to comply with applicable law. Finally, the Debtors argued that dismissal was not in the best interest of the creditors who filed proofs of claim in their cases. Prior to dismissal, certain claims had been filed in the Rolta International case. Following dismissal of the cases, multiple claims were filed by Citicorp International Limited, Indenture Trustee, each in the amount of $535,985,217.79 and by DB Trustees (Hong Kong) Limited each in the amount of $187,759,921.52 which claims total $2,361,760,293.29. Nevertheless, despite the large claims asserted in these cases, the non-Judgment Creditors have yet to actively participate or to appear in these cases either prior to dismissal, or in support of the Motion for Reconsideration. CONCLUSIONS OF LAW I. STANDARD FOR RECONSIDERATION OF THE DISMISSAL ORDERS The Debtors seek relief from this Court’s Orders dismissing their respective Chapter 11 cases under Rule 59(e) and Rule 60(b) of the Federal Rules of Civil Procedure pursuant to which a motion to reconsider may be treated either as a motion to alter or amend, or as a motion for relief from judgment, respectively. The Debtors assert that, under Rule 59(e), dismissal of their Chapter 11 cases constitutes a manifest error of fact, and that, under Rule 60(b)(6), relief from judgment is appropriate in order to do substantial justice given the circumstances of these cases. Under Rule 59(e) of the Federal Rules of Civil Procedure, as made applicable to bankruptcy proceedings by Rule 9023 of the Federal Rules of Bankruptcy Procedure, “[t]he only grounds for granting [a motion for reconsideration] are newly discovered evidence or manifest errors of law or 13 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 13 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 fact.”17 The Eleventh Circuit has cautioned that “[m]otions to amend should not be used to raise arguments which could, and should, have been made before the judgment was issued.”18 The Court of Appeals has further cautioned that such motions are not “vehicle[s] to reargue issues resolved by the court’s decision or to make additional arguments on matters not previously raised by counsel.”19 As recently reaffirmed by the Eleventh Circuit, it is well established that “[a] Rule 59(e) motion for reconsideration may be granted for newly-discovered evidence or manifest errors of law or fact but cannot be used to relitigate old matters, raise arguments, or present evidence that could have been raised before the court entered judgment.” 20 “Reconsidering the merits of a judgment, absent a manifest error of law or fact, is not the purpose of Rule 59.”21 Rule 60(b), as made applicable to bankruptcy proceedings by Rule 9024 of the Federal Rules of Bankruptcy Procedure, allows relief to a party from a final judgment for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial . ..; (3) fraud . . .misrepresentation, or misconduct by an imposing party; (4) the judgment is void; (5) the judgment has been satisfied, released or discharged . . . reversed or vacated . . . . ; or (6) any other reason that justifies relief.22 “By its very nature,” Rule 60(b) “seeks to strike a delicate balance between two countervailing impulses: the desire to preserve the finality of judgments and the incessant command of the court’s 17 Dimaria Properties, LLC v. 3400 Atlantic, LLC (In re Dimaria Properties, LLC), 654 Fed. Appx. 1018, 1020 (11th Cir. 2016)(quoting In re Kellogg, 197 F.3d 116, 1119 (11th Cir. 1999)). 18 Id. (quoting Lussier v. Dugger, 904 F.2d 661, 667 (11th Cir. 1990)). 19 Daughtrey, Jr. v. Rivera, II (In re Daughtrey, Jr.), 896 F.3d 1255, 1280 (11th Cir. 2018). 20 Arbelaez, Sr. v. Enclave Shores Condominium Assoc., Inc. (In re Enclave Shores Condominium, Inc.) 835 Fed. Appx. 1007, 1008 (11th Cir. Feb. 9, 2021); See also Jacobs v. Tempur-Pedic Int’l, Inc., 626 F.3d 1327, 1344 (11th Cir. 2010)(“[A] Rule 59(e) motion [cannot be used] to relitigate old matters, raise argument or present evidence that could have been raised prior to the entry of judgment.”)(quoting Michael Linet, Inc. v. Village of Wellington, Fla., 408 F.3d 757, 763 (11th Cir. 2005)). 21 Jacobs v. Tempur-Pedic Int’l, Inc., 626 F.3d at 1344. 22 FED. R. CIV. P. 60(b)(1)-(6). 14 Case 20-82282-CRJ11 Doc 304 Filed 05/06/21 Entered 05/06/21 10:10:11 Desc Main Document Page 14 of 24 FILED: NEW YORK COUNTY CLERK 05/07/2021 07:21 PM INDEX NO. 652798/2018 NYSCEF DOC. NO. 626 RECEIVED NYSCEF: 05/07/2021 conscience that justice be done in light of all the facts.”23 “Rule 60(b)(6) is a ‘catch-all’ provision, and a ‘grand reservoir of equitable power to do