At a contempt sanction hearing arising from bankruptcy and fraudulent conveyance proceedings, the Trustee sought leave to withdraw the motion for further incarceration after obtaining new information that undermined the bona fides of the creditor applicants' underlying claims and disclosure.
The court held that only the Trustee had standing to enforce the contempt order within the fraudulent conveyance action, and that leave was required because contempt at the sanction stage is a matter between the court and the contemnor.
Applying the full and frank disclosure obligation governing ex parte relief, the court found material non-disclosure in obtaining the Mareva and Anton Piller orders and rescinded those orders.
Although the respondent debtor had not fully purged contempt, further incarceration was not warranted; the motion was withdrawn, Christina Chiang was found to have purged her contempt, and costs were awarded to the Trustee and Christina Chiang against the creditor applicants.
