UNITED STATES BANKRUPTCY COURT

DISTRICT OF MAINE

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IN RE CATHERINE DUFFY PETIT, ) Chapter 7

) Case No. 93-20821

Debtor. )

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MAINE'S VERIFIED REQUEST

FOR CONTEPMT PROCEEDINGS

The State of Maine and the Securities Administrator (collectively, "Maine") request that this court immediately initiate contempt proceedings against the debtor, Catherine Duffy Petit ("Petit"), and her agents, for violating this court's order dated May 10, 1996, which provides in pertinent part:

Maine sets forth the following basis for this request:

1. On October 18, 1996, Maine filed its objection to the Amended Application to Compromise Adversary Proceeding and to Sell Assets, dated September 23, 1996 ("proposed settlement"), between Paul Richard ("Richard") and the bankruptcy trustee. In conjunction with that objection, Maine submitted affidavits from Laurence and Sylvia Paine, who had invested in Petit's lawsuit against Key Bank as recently as August 11, 1996.

2. On October 18, 1996, Assistant Attorney General Linda Conti ("Conti") received a phone message from the Paines. She tried without success to return that call until today, October 23, 1996.

3. Today, October 23, 1996, Conti spoke with both of the Paines and learned that Petit and her agents have contacted the Paines on several occasions and are engaging in a pattern of misrepresentation and intimidation. The balance of the statements in this request are based on Conti's conversations with the Paines.

4. Petit called the Paines up on the day that Maine's objection was filed, October 18, 1996, and was "feather white" angry at them for signing the affidavits. Petit told them that she wanted to come up and meet with them. Subsequently, however, Greg O'Halloran - who had participated in the sale to Paines from Richard and Petit on August 11, 1996-called them and said that Petit would not be coming up to meet with them because Petit's lawyer had told her not to come.

5. On Monday, October 21, 1996, Petit's private investigator, John Rzasa ("Rzasa"), came to the Paines' house. He told them that Key Bank did not want Richard to obtain Petit's interest in the Key Bank litigation, and Richard failing to obtain that interest was the only obstacle to Petit having her case heard in court. Rzasa told the Paines that what they had signed was not what Maine had filed in the bankruptcy court. He also told them that Maine had told the bankruptcy court that the Paines did not want Richard to purchase Petit's interest in the Key Bank litigation.

6. Since Monday, both O'Halloran and Rzasa have called and left messages for the Paines. The Paines believe that Rzasa wants to return to their home to get them to sign something to be submitted to the bankruptcy court.

7. Although the Paines did not explain exactly it in these terms, we are concerned that Petit and her agents are attempting to intimidate these elderly investors with veiled (and perhaps not so veiled) threats that the Paines will not get their money back if they assist Maine. At a minimum, they have been left with the impression that the only thing standing in the way of them collecting the $310,000 that they invested in the Petit litigation is Maine's objection to the proposed settlement. Furthermore, other investors have been told by Richard that he only intended to pay back those investors who did not talk to the State.

8. In our view, these actions are entirely inappropriate and are in violation of this court's prior orders. Maine requests that the court take whatever action is permitted under the Bankruptcy Code, including 11 U.S.C. § 105, to stop this intimidation and interference.

Based upon the foregoing, Maine contempt proceedings be granted. asks that its request for immediate contempt proceedings be granted.

Dated: October 23, 1996 Respectfully submitted,

Augusta, Maine

I have read the foregoing pleading, and I verify that it is true and correct to best of my information and belief.

UNITED STATES BANKRUPTCY COURT

DISTRICT OF MAINE

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IN RE CATHERINE DUFFY PETIT, ) Chapter 7

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I hereby certify that on October 24, 1996, I mailed a copy of the Maine's Verified Request for Contempt Proceedings, to the parties or their counsel listed below, by United States Mail, first-class, postage prepaid, and also by telefax to those persons indicated with an asterisk, addressed as follows:

*Stephen G. Morrell, Esq. Gerard F. Kelly, Esq.

Eaton, Peabody, Bradford & Veague U.S. Trustee

167 Park Row, P.O. Box 9 527 Congress St., Room 302

Brunswick, ME 04011 Portland, Maine 04101

Patrick G. Waters, Esq. *Stephen F. Gordon, Esq.

92 State St. Gordon & Wise

Boston, MA 02109 101 Federal St.

Boston, MA 02110-1844

*Joseph S.U. Bodoff, Esq.

Hinckley, Allen & Snyder

One Financial Center

Boston, MA 02111-2625

Robert C. Barber, Esq.

Looney & Grossman

101 Arch St.

Boston, MA 02110

Joseph V. O'Connell

The Pilot Group

P.O. Box 4901

400 Commercial St.

Portland, ME 04112

Zbigniew J. Kurlanski, Esq.

P.O. Box 46

Exchange St.

Portland, ME 04112

*U. Charles Remmel, Esq.

Kelly, Remmel & Zimmerman

53 Exchange St.

P.O. Box 597

Portland, ME 04112-0597

*John G. Connor, Esq. 415 Congress St., Suite 304

Portland, ME 04101

Jeffrey A. Thaler, Esq.

Berman & Simmons

129 Lisbon St.

P.O. Box 961

Lewiston, ME 04245-0961

*Richard Poulos, Esq.

Poulos & Campbell

183 Middle St.

Portland, ME 04112

James F. Moeller, Esq.

Woodman & Edmands

231 Main St.

P.O. Box 468

Biddeford, ME 04005-0468

*Judge Arthur N. Votolato, Jr.

U.S. Bankruptcy Court

Federal Center

380 Westminster Mall

Providence, RI 02903