SUPPLEMENTAL OBJECTION

Filed 11 October 19 P5:19
Chris Daniel - District Clerk
Harris County
ED101J016552698
JEFFREY GOLDSTEIN and THEODORE ) IN THE DISTRICT COURT OF
By: melanie flores
STEINBERG, Derivatively on Behalf of )
Nominal Defendant ISRAMCO, INC., ) HARRIS COUNTY, TEXAS
)
Plaintiffs, ) 55th JUDICIAL DISTRICT
)
v. )
) SUPPLEMENTAL OBJECTION
HAIM TSUFF, JACKOB MAIMON, ) OF YUVAL LAPINER TO THE
MICHELLE R. CINNAMON FLORES, MAX ) PROPOSED SETTLEMENT
PRIDGEON, FRANS SLUITER, MARC E. )
KALTON and GOODRICH GLOBAL L.T.D. )
B.V.I., NAPTHA ISRAEL PETROLEUM ) Lead Cause No. 2009-34535
CORP. LTD., I.O.C. ISRAEL OIL COMPANY ) (Consolidated Action)
LTD., ISRAMCO OIL & GAS LTD., J.O.E.L. )
JERUSALEM OIL EXPLORATION LTD., )
CHESNY ESTATES LTD., )
)
Defendants, )
)
and )
)
ISRAMCO, INC., )
)
Nominal Defendant. )
_______________________________________ )
I. INTRODUCTION

Yuval Lapiner (“Lapiner” or “Intervenor”), a current shareholder of Isramco, Inc.
(“Isramco” or the “Company”), who previously timely objected to the proposed settlement (the
“Proposed Settlement”), timely filed the Declaration of Yuval Lapiner in Support of the
Objection, the Affidavit of Alexander T. Lamar in support of the Objection, and filed a Petition
in Intervention in the above-styled matter, hereby files this Supplemental Objection to the
Proposed Settlement, and in support thereof would show the Court as follows:
SUPPLEMENTAL OBJECTION OF YUVAL LAPINER TO THE PROPOSED SETTLEMENT Page 1 of 7

II. FACTUAL BACKGROUND
On October 10, 2011, Lapiner filed his Objection to the Proposed Settlement
(“Objection”) in this matter as well as his Petition in Intervention, both documents being
incorporated herein as if fully set forth verbatim. The Objection set forth numerous reasons
why the Proposed Settlement is not in the best interest of the shareholders of the Nominal
Defendant, Isramco, Inc., (“Isramco” or the “Company”). Lapiner had previously filed a
related shareholder derivative action in the Delaware Chancery Court alleging claims against
the defendants similar to those raised in this action. Yuval Lapiner v. Haim Tsuff, et. al, No.
5612-VCL (Del. Ch.). A copy of the Delaware Complaint is attached as Exhibit 2 to the
Declaration of Yuval Lapiner on file in this matter. On October 20, 2010 the Delaware
Chancery Court (Chancellor J. Travis Laster) reluctantly dismissed Lapiner’s action without
prejudice in deference to this first-filed action alleging similar claims.
At the hearing on Defendants’ Motion to Dismiss or Stay held on October 18, 2010,
Chancellor Laster remarked that the Delaware Complaint, “as pled…raises serious loyalty
issues:”
I am going to dismiss this case in favor of the Texas action. I do so
reluctantly. This is a case I would have liked to see litigated here, at least as
pled. And all I’m going on is the face of the complaint. But at least as pled,
it raises serious loyalty issues. Transcript at 27 (lines 21-24) and at 28 (lines
1-2).
Ever since Guth v. Loft, Delaware has had an eye out and given close scrutiny
to cases involving loyalty issues. And when plaintiffs bring those and police
loyalty conflicts and other problems, you can expect to be rewarded for
generating real benefits in litigation by the Delaware courts. Transcript at 29
(lines 5-10).
So this is a case I would have liked to have seen filed here initially, that I,
frankly, would have liked to go forward here. It may well be that the
defendants have great defenses and will win. I don’t know. But this is the
type of situation where I think the state of incorporation has a substantial

interest, and Delaware has a substantial interest in encouraging plaintiffs to
police transactions that look like this, at least on their face.
Transcript at 29 (lines 11-20), attached hereto as Exhibit 3 (emphasis added) to the
Declaration of Yuval Lapiner.
As observed by the Delaware Chancery Court, the allegations of self-dealing in this
action are strong and the Texas litigation was approached “as if it was going to be a filed-andsettled
case, as opposed to a filed-and-litigated case.” Transcript p. 33 (lines 13-21).
Chancellor Laster, who has extensive experience and is an expert in presiding over
litigation involving Delaware corporations, was able to forecast the outcome of this case by
observing the lack of actual prosecution. Not surprisingly, the Plaintiffs who are proposing this
hollow settlement, who conducted no adversarial depositions of any of the Individual
Defendants, who merely received “several hundred pages” of documents, who have shown no
standing by the Plaintiffs to even support the settlement, and who ignored discussing the merits
of the case did not advise the Court of the range of possible monetary recovery if this action were
successfully prosecuted to judgment. Moreover, the lack of nearly any substantive adversarial
discovery and plaintiff’s counsel merely reviewing “hundreds of pages” of documents, makes the
settlement terms even more suspect -particulary since the only real recovery in the Proposed
Settlement is a payoff to Plaintiff’s counsel of $1 million by the Company, on whose behalf the
action was filed. Based on the non-existent litigation of this action, it is not surprising that
Plaintiffs’ counsel has failed to submit a lodestar or any detailed billings of their time expended
on this litigation and instead simply request the Court blindly approve their $1 million windfall.
Additionally, there is strong evidence to support the allegations that the Company has
suffered hundreds of millions of dollars of damages as a result of the sale of oil and gas interests
held by Isramco in an incredibly successful gas field, Isramco’s former interest is now worth
approximately $2.5 billion, to various companies owned and/or controlled by the Defendants.
The Proposed Settlement fails to recover any of these alleged damages for the Company, and
instead costs Isramco over $1 million in attorneys’ fees and costs. The Proposed Settlement is
therefore not fair, reasonable nor adequate, and Lapiner’s intervention is necessary in order to
protect the interests of the Company and its shareholder.

III. NEW EVIDENCE

On October 18, 2011, Dennis Holifield, former Vice President and General Counsel of
Isramco, contacted counsel for Lapiner and forwarded to them the Summary Report of
Legal/Compliance Deficiencies in Isramco, Inc. (ISRL) and Affiliates (the “Summary Report”)
that he prepared and filed with the United States Securities and Exchange Commission (“SEC”)
on October 6, 2011. See Exhibit A to Declaration of Dennis Holifield, attached hereto as Exhibit
1. The Summary Report discusses in detail numerous instances of wrongdoing by Defendant
Haim Tsuff, and others, to the detriment of the Isramco shareholders, including perpetrating a
fraud on this Court through the Proposed Settlement. Specifically, Mr. Holifield stated as
follows in the Summary Report:
Fraud Upon the Court: Directors Fraud/Derivatives Settlement – Isramco, Inc. is
the nominal defendant in a consolidated shareholder’s derivative action in Harris
County, Texas. During the pendency of this litigation, Isramco, Inc., and more
specifically, Isramco’s CEO, Haim Tsuff (through his separate legal counsel),
engaged in settlement negotiations that culminated in an Agreed Settlement involving
mainly corporate governance reforms, including the creation and management of
several board committees, with extensive guidelines affecting director involvement,
independence, and reporting guidelines.

During the course of my involvement as General Counsel in that litigation, it became
clear to me, that on Thursday, September 15, 2011, after meeting with Haim Tsuff,
both privately and the next morning with the CFO Edy Francis and the Asset
Manager Amir Sanker, neither Mr. Tsuff nor Mr. Francis nor Mr. Sanker had any
intention whatsoever to actually follow any of the corporate governance reforms
agreed-to and that formed the integral part of the settlement. It became clear to me

then that the “governance reforms” and the lawsuit settlement were only “windowdressing”
and that Mr. Tsuff was not going to follow any such guidelines. As noted
above, Mr. Tsuff emphatically stated to me that “I run the company, not the directors,
not the stockholders, no one but me”. At this point, attorney for the corporation, I felt
clear that Mr. Tsuff was engaged in a deliberate fraud against the court, against the
directors, and against the stockholders with respect to the derivatives
settlement. Since I am the attorney of record for Isramco, Inc., in that case, I
have filed with the Court my Motion to Withdraw as attorney of record. I do not
believe the settlement was entered into in good faith. In contrast, I believe it was
entered-into for the sole purpose of giving an appearance of propriety, all the while
not intending to follow the terms of the settlement once the case was dismissed, going
back to “business as usual”.
Such evidence clearly raises tremendous concerns about the propriety of the
Proposed Settlement and gives evidentiary support to Chancellor Laster’s prescient
remarks that this case raises serious loyalty issues. Thus, in addition to the numerous
reasons previously set forth in Lapiner’s Objection to the Proposed Settlement this
Court simply cannot approve the Proposed Settlement in light of allegations, filed
with the SEC by Isramco’s former General Counsel, that the Proposed Settlement is
perpetrating a fraud on this Court

IV. CONCLUSION

For the foregoing reasons, Lapiner respectfully requests that the Court no approve
the Proposed Settlement as it is not fair, reasonable or adequate, or in Isramco’s best
interests.


Respectfully submitted,
HIERSCHE, HAYWARD, DRAKELEY
& URBACH, P.C.
By: _/s/ James T. Drakeley_________
James T. Drakeley
State Bar No. 06111600
Eric G. Walraven
State Bar No. 00794814
Austin C. Evans
State Bar No. 24036536
15303 Dallas Parkway, Suite 700
Addison, Texas 75001
(972) 701-7000 –
Telephone
(972) 701-8765 –
Facsimile
ATTORNEYS FOR YUVAL LAPINER
SUPPLEMENTAL OBJECTION OF YUVAL LAPINER TO THE PROPOSED SETTLEMENT Page 6 of 7

CERTIFICATE OF SERVICE

The undersigned certifies that on October 19, 2011, the foregoing document,
Supplemental Objection of Yuval Lapiner to Proposed Settlement was filed electronically and
served by mail, in accordance with the Texas Rules of Civil Procedure, on the following counsel
of record vial first class mail:
Robin Winchester
Richard Kim
KESSLER TOPAZ MELTZSER
& CHECK, LLP
280 King of Prussia Road
Radnor, PA 19087
Lead Counsel for Plaintiffs
Richard E. Norman
CROWLEY NORMAN, LLP
Three Riverway, Suite 1775
Houston, TX 77056
Counsel for Plaintiffs
Dennis Holifield
ISRAMCO, INC.
2425 West Loop South, Suite 810
Houston, TX 77027
Counsel for Nominal Defendant,
Isramco, Inc.
Michael D. Robbins
DOYLE, RESTREPO, HARVIN
& ROBBINS, LLP
JP Morgan Chase Tower
600 Travis Street, Suite 4700
Houston, TX 77002
Counsel for Defendants Jackob Maimon, Max
Pridgeon and Michelle R. Cinnamon Flores
Constance O’Doherty Barnes
BOYER JACOBS SHORT, PC
Nine Greenway Plaza, Suite 3100
Houston, TX 77046
Counsel for Defendants, Haim Tsuff and
Goodrich Global Ltd.
Isramco, Inc.
c/o General Counsel for Isramco
2425 West Loop South, Suite 810
Houston, TX 77027
Counsel for Nominal Defendant, Isramco, Inc.
__/s/ Eric G. Walraven_____________
Eric G. Walraven
SUPPLEMENTAL OBJECTION OF YUVAL LAPINER TO THE PROPOSED SETTLEMENT Page 7 of 7