BRIEF OF AMICUS CURIAE - DENNIS JAMES HOLIFIELD, FORMER GENERAL COUNSEL FOR THE NOMINAL DEFENDANT, ISRAMCO INC.

BRIEF OF AMICUS CURIAE DENNIS JAMES HOLIFIELD, FORMER GENERAL

COUNSEL FOR THE NOMINAL DEFENDANT, ISRAMCO, INC.,

IN SUPPORT OF NOMINAL DEFENDANT, ISRAMCO, INC.,

IN SUPPORT OF LAPINER INTERVENTION AND

IN OPPOSITION TO DEFENDANT'S MOTION FOR PROTECTIVE ORDER,

DEFENDANT'S MOTION TO SEAL COURT RECORDS, AND DEFENDANT'S

MOTION FOR FINAL APPROVAL OF DERIVATIVE SETTLEMENT

Dennis Holifield was General Counsel to Isramco from March 3, 2011, until his

resignation on September 21, 2011. He was also the Attorney of Record in this proceeding for

Isramco until Order of the Court Granting Leave to Withdraw as Counsel was signed on

October 24, 2011. Mr. Holifield has actively practiced law for over 32 years in multiple

jurisdictions, including Texas.

While most derivative actions are a normal incident of an organization's affairs, to be

defended by the organization's lawyer like any other suit, however, if the claim involves

serious charges of wrongdoing by those in control of the organization, a conflict may arise between the lawyer's duty to the organization and the lawyer's relationship with those

managing or controlling its affairs. 1

The Complaints and Petitions filed before this Court contain very serious allegations of

wrongdoing against those who control the corporation. In his capacity as General Counsel and

Attorney of Record, Mr. Holifield participated heavily in the negotiations with the various

parties for the Stipulation of Settlement (the "Settlement") in this matter.2 However, during the

course of his representation and after submission of the Settlement for the approval of this

Court, of which Mr. Holifield was a signatory on behalf of lsramco, Mr. Holifield became

aware of certain other important facts and matters, that, when taken as a whole, indicated to

him that certain terms of the Settlement had been agreed to in Bad Faith, and that a fraud was

knowingly about to be perpetrated upon the Court and upon the nominal Defendant, Isramco,

by certain parties to this Proceeding, through the tender of the Settlement for approval by this

Court.

Both as an Attorney under the Laws of the State of Texas, and as an Officer of the

Court, Mr. Holifield is ethically bound to bring to the attention of all parties and to this Court,

those matters and facts, whether protected by privilege or not, that are relevant to this Court's

inquiry as to allegations of fraud concerning the Settlement, and fraud negatively impacting the

legitimate interests of Isramco as a separate entity.

Certain of the Defendants before this Court are attempting through Motion to prevent

the Court and Isramco from investigating all of facts of the case and the allegations of fraud in

the purported "Settlement", and to prevent the other parties, including Isramco, from learning

of these facts and allegations, through the normal Rules ofDiscovery.3 Through the use ofthis

Court and through the use of deception, they are attempting to hide the light of truth, and

prevent the truly guilty parties from being brought to Justice.

Mr. Holifield also contends herein that Isramco is not adequately, independently and

impartially represented before this Court at this time, and that Isramco's lawful and legitimate

legal interests in this matter have been subverted and will continue to be subverted and

undermined by.actions of certain Defendants and the current Counsel of Record for Isramco,

unless this Court or some higher authority intervenes.

The Lapiner Intervention appears to be the only true advocate for the rights and interests

of the nominal Defendant, Isramco. "Informal" discovery has been wholly inadequate, and at

least Lapiner seeks the truth though the normal processes of discovery. Lapiner's Motion for

Leave to Conduct Limited Discovery  should be granted.

The purported Settlement is the result of collusion, deception, and fraud against Isramco

and its stockholders. It will also waive and forever release all claims of wrongdoing

perpetrated against it. The proposed Settlement is neither fair, nor reasonable, nor just, and

should not be approved by this Court.

One of the key elements in the proposed Settlement, that supposedly forms the primary

consideration for the joinder and approval of Isramco' s portion of the Settlement, is that certain

corporate governance reforms would be instituted, providing a sufficient "check and balance"

against future abuses of power and loyalty as are alleged in the Consolidated Actions. 5

However, during the course of Mr. Holifield's inquiries and conversations with Defendant

Haim Tsuff, CEO, Director, and majority stockholder of Isramco, and Independent Directors of

the Corporation, as well as conversations with Isramco's senior management, it became

painfully clear to Mr. Holifield that many actions taken by Mr. Tsuff and the management

controlled by him, both in the past as directly related to the allegations contained in this Action,

as well as statements and actions taken by Mr. Tsuff subsequent to this Action and subsequent

to his joinder and approval of the Settlement now before this Court, indicated that Defendant

Tsuff had and has no real intention of allowing any checks or balances whatsoever, nor any

respect for laws not in his favor.

Mr. Holifield asserts that Mr. Tsuff's singular and exclusive uses and abuses of power

as the CEO and majority stockholder of the Company, and his ongoing unlawful misconduct

would nonetheless continue unabated by any act of the corporation, its Directors, its legal

counsel, nor Order of this Court. It also became clear to Mr. Holifield in the course of these

conversations and observance of Mr. Tsuff's actions, that Mr. Tsuff considers himself to be

above the Law, and above any control (direct or indirect) of Directors, legal counsel, and other

stockholders of lsramco, and of this Court.7 Mr. Tsuff is the alter ego of lsramco. The

The Court's attention is directed to all of the factual allegations expressed in all of the original

Complaints and Amended Complaints against Defendant Haim Tsuff and certain of the Directors of the

Corporation, all of which have been consolidated in this Action.

corporation is a mere conduit for the transaction of private business of Mr. Tsuff and that no

separate identity of the individual and the corporation really exists.

It is clear to Mr. Holifield that Defendant Tsuffs covenants and agreements in the

proposed Settlement are a sham and a fraud against this Court and against the other parties to

this Action. As such, it has became clear that Defendant Tsuffused the services of Mr.

Holifield, through his representation of Isramco, to enter into the Stiplulation of Settlement.

The Settlement as entered into by Mr. Tsuff is only a ruse, a disguise, and an escape from all

liability, that completely releases Mr. Tsuff from any and all wrongdoing. Mr. Holifield verily

believes- knows- that Mr. Tsuffhas entered to the terms of the Settlement in Bad Faith and

with no intention whatsoever to follow through on his commitments contained therein, as well

as his duties of loyalty to the corporation and its shareholders.

Under the Texas Rules of Professional Conduct, a lawyer shall not assist or counsel a

client to engage in conduct that the lawyer knows is criminal or fraudulent. 8 Further, when a

lawyer has confidential information clearly establishing that a client is likely to commit a

criminal or fraudulent act that is likely to result in substantial injury to the financial interests or

property of another, the lawyer shall promptly make reasonable efforts under the circumstances

to dissuade the client from committing the crime or fraud. 9 When a lawyer has confidential

information clearly establishing that the lawyer's client has committed a criminal or fraudulent

act in the commission of which the lawyer's services have been used, the lawyer shall make

reasonable efforts under the circumstances to persuade the client to take corrective action. 10

When a lawyer knows that a client expects representation not permitted by the rules of

professional conduct or other law, the lawyer shall consult with the client regarding the relevant

limitations on the lawyer's conduct.  

Mr. Holifield appeared in this Court in his capacity as General Counsel for Isramco and

not as an attorney for any of the other Defendants nor as an attorney for any particular member

of management, including individual Directors, under his duties to both his client, Isramco, and

to this Court.

A lawyer may reveal confidential information when the lawyer has reason to believe it

is necessary to do so in order to prevent the client [and others] from committing a criminal or

fraudulent act, 12 and to the extent revelation reasonably appears necessary to rectify the

consequences of a client's criminal or fraudulent act in the commission of which the lawyer's

services had been used. 13 It is asserted here before this Court, that Mr. Holifield's services as

an attorney were used to induce Isramco into a false and sham Settlement that benefits only the

wrongdoers in this Case, is not in the best interests of Isramco, and is based upon false and

illusory promises.

The only "attorney-client" communications and "privileged information" sought by the

Motions before this Court to be protected and sealed serve only to hide and protect the fraud

and deceit by the Defendant Tsuff and other wrongdoers, to the detriment of all other parties

(including Isramco) to this Action, as well as to this Court and the proper administration of

Justice.

Mr. Holifield did everything he could possibly do within the bounds of the Law to

impress upon Mr. Tsuff and senior management of Isramco that he believed a number of

actions by Mr. Tsuff and other senior management violated the spirit and terms of the

Settlement, as well as a variety of other Laws and Regulations. Mr. Tsuffflatly dismissed

those concerns and continues to this day to deceive Isramco and this Court. Any further

attempts by Mr. Holifield to rectify those actions would be fruitless under the totality of the

circumstances. The corporation and its legal representatives are under the total and unbridled

control of Mr. Tsuff, to the exclusion of all others, including this Court. As such, the corporate

schema of checks and balances has been totally corrupted by Mr. Tsuff. Mr. Tsuff hides

behind the corporate veil, as well as under its skirt.

Mr. Holifield felt so compelled to come forward in this matter, that he resigned his

representation and his employment, to his personal detriment and at great personal risk.

Isramco is not adequately, independently and impartially represented before this

Court; its lawful and legitimate legal interests have been subverted and

undermined by the actions of certain Defendants.

Under the terms of the Settlement, all defendants, including Mr. Tsuff and Mr. Maimon,

will enjoy a full, complete, and total bar to all past, current and future claims, whether now

known or not, by Isramco and its other shareholders20

. Additionally, the Settlement proposes to

have Isramco, the injured Party, pay all attorneys fees, not only its own, but those of the other

Defendants and the Plaintiffs as well. Everyone under this proposed Settlement gets a free ride

and a complete release of all past wrongdoing, at the sole expense of Isramco and its other

stockholders. None of these actions is in the best interests of lsramco.

Make no mistake: Counsel purporting to act on behalf of Isramco in this matter are

fully compromised by, controlled by, and acting only in the self-interest of the wrongdoers,

Defendants Tsuff and Maimon. This condition works a wrong against the effective

administration of Justice, and should not be allowed to continue. This Court should appoint an

Attorney Ad Litem for the benefit of Isramco, free and independent of the reach and improper

influence of the Defendants.

IV. The Lapiner Intervention appears to be the only true advocate for the rights and

interests of the nominal Defendant, Is ram co, and its stockholders.

Even the Plaintiffs counsel is "circling the wagons" around Defendants Tsuff

and Maimon. Plaintiffs counsel instead should be taking the new information revealed by

Mr. Holifield, withdrawing the proposed Settlement, and pursuing Mr. Tsuff and his cronies to

the fullest extent of the law, rather than coming to his aid. It is also clear that Plaintiffs and

Plaintiffs counsel appear to be fully satisfied with a sham Settlement and a hefty payout (not to

the Plaintiffs, but rather to Plaintiffs counsel. That is not in the interests of the nominal

Defendant, Isramco, Inc. It is clear to all that Lapiner's Intervention has direct merit and

bearing upon the issues raised before this Court, is the only legitimate prosecution of the

wrongs perpetrated against Isramco, and therefore should be allowed to move forward.

V. The proposed settlement is neither fair, reasonable nor just, and should not be

approved by this Court.

As a derivative action, the proposed Settlement remedies nothing for Isramco nor its

other stockholders and the Plaintiffs. Instead, it awards Plaintiffs counsel $1 million in legal

fees, and forever bars Isramco' s causes of action and any ability to recover its damages from

the wrongdoers in this case. The only consideration for Isramco is that it will "end the costs of

litigation" and will "keep the case from becoming more complex", without any compensation

for its losses and expenses and without ever bringing wrongdoers to Justice. Further, one of the

items for Isramco's consideration is purported to be an amendment of the Global Goodrich

consulting agreement. In fact and reality, that consulting agreement has, by its very own terms,

already expired, has not been renewed, and thus any promise to amend the same is purely

illusory. Finally, the "corporate governance reforms" are nothing but window-dressing. Thus,

there is no consideration on the part oflsramco?2 The proposed Settlement allows the

wrongdoers to continue their misdeeds, unpunished. Within the four comers of the proposed

Settlement, there results no effective constraint against those who have done wrong and will

continue to do wrong. And Isramco bears all costs, gets no effective relief, and foregoes all

rights and remedies available to it under the Law.”

“Under all of the circumstances, granting the Motion for a Protective Order, the Motion for Sealing of Court Records, and Motion for Final Approval of the Settlement would result in a gross miscarriage of Justice. If this Court should grant the Motions, it will allow a fraud of the highest order to occur within its halls.”