August 8, 1995

Peter C. Fessenden, Esq.

August 8, 1995

Page 2

P & M Associates may be reluctant to reveal this information to you because I would suspect that they have their own interests in pursuing Ed Simpson for fraud. However, I do not see why it cannot -be subpoenaed. -It certainly -should not be privileged, and even if there is a confidentiality agreement, the Court in these circumstances should order the production of the documents.

We should also be obtaining from Ms. Petit and Mr. Simpson, or any of Mr. Simpson's affiliates, essentially all documents relating to any financial transactions between the two. They could, for example, come up with "checks" or other evidences of money flowing from Mr. Simpson to Ms. Petit, but this does not necessarily mean that there was, in fact, an obligation outstanding as of the time of the Bernstein, Shur settlement. (According to Dick Poulos, although I have not seen it, Mr. Simpson actually waived his interest in any settlement funds from the Bernstein, Shur settlement. Nonetheless, Ron Caron paid Tweed Management $580,000.) Thus, in order to get the entire financial picture, we need documents not only that prove that money flowed from Mr. Simpson to Ms. Petit, but that relate to their entire financial dealings.

Another interesting issue that has been raised by Dick Poulos has been the question of the connection between this bankruptcy

and the lawsuit by the Penobscot Indian Nation against Key Bank. Apparently, Shirley LeBlanc has been working in connection with that lawsuit. That work may have included work done prior to the bankruptcy filing in this case. If those funds were paid, they were probably paid by Mr. Simpson or Mr. Richards. This raises the distinct possibility that monies paid to Shirley LeBlanc (and others) in connection with the suit by the Penobscot Indian Nation are now being claimed by Mr. Simpson and/or Mr. Richards as part of their claims in this case.

The reason that this suspicion arises is that (again according to Mr. Poulos) a Mike Marcello (who had been working with Shirley LeBlanc on the Penobscot Indian Nation matter) has actually testified that he received a retainer from Ms. Petit upon which he had been living for the previous year (the year in question was 1994). I am sure we will find that the money did not actually flow directly from Ms. Petit for she is much too smart for that. However, Mr. Marcello apparently thought it was Ms. Petit's money. The logical inference is that Ms. Petit has some connection with

Peter C. Fessenden, Esq.

August 8, 1995

Page 3

the Penobscot Indian Nation case. This, of course, is further buttressed by the fact that Mr. Caron and Mr. Gordon are handling that matter. At the very least, this raises further questions as to the basis for the proofs of claim of Mr. Richard and Mr. Simpson. Going further, however, it raises the possibility of out and out fraud by Ms. Petit and further defalcation on her part.

jgc/vda/108.2/bankrupt.2/correu/truutee.ltr