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Prosser Wins Procedural Victory in Federal Court

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In the ongoing bankruptcy trial of Jeffrey Prosser, former owner and CEO of Innovative Telephone, Prosser won a rare procedural victory Monday in U.S. District Court.

Prosser has often been on the losing end of such cases in the District Court recently, which hears appeals from the U.S. Bankruptcy Court, but this time District Court Judge Curtis Gómez ruled in his favor.

A year ago, Bankruptcy Court Judge Judith K. Fitzgerald issued a ruling that Prosser did not have a "global" right to argue matters in her court but had to establish his standing to do so on a case-by-case basis.

Fitzgerald had so ruled on petition of one of the court-appointed trustees in the case, Chapter 11 Trustee Stan Springel. Springel hadsought the ruling to limit the number of motions that Prosser‘s lawyers were filing in the case, or as the judge put it: "Springel‘s motion suggests that Prosser‘s frequent efforts to participate in the bankruptcy proceedings constitute a nuisance precluding smooth sailing in the bankruptcy proceedings."

Gómez decided that Prosser was, in fact, a "person aggrieved" and that he had a right to make motions on various matters.

Ironically, the two lawyers listed on the order as being on the winning side, Robert Craig of Omaha, Neb., and A. Jeffrey Weiss of St. Thomas, no longer work for Prosser.

Meanwhile, Jeffrey B.C. Moorhead, the St. Croix attorney who once tried to participate in these proceedings as a representative of the Virgin Islands Public Service Commission, has reappeared in the ongoing legal saga on behalf of Prosser’s wife, Dawn Prosser.

Moorhead argued that she is the owner of the family‘s unfinished mansion in Estate Shoys, St. Croix. In a document filed with the court in July, Moorhead said that since Dawn Prosser is not party to the bankruptcy proceedings, the mansion should not be sold to pay off creditors.

In addition, David Sharp, once Prosser‘s hand-picked president of Innovative Telephone, filed a claim of $2.7 million earlier this year for severance pay after Springel fired him from that job. On July 30, Springel’s lawyers filed a court paper stating – without commenting on the merits of the case – that Sharp‘s claim should be disregarded because it was filed several days after the due date for such claims.

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