Evidence Record

Legal Objection - Post-Judgment Receivership Fee Dispute

1. Defendants object to the Receiver's requested fee of $1,017,601.11 as unreasonable, unnecessary, and not authorized by the Receivership Order. Paragraph 53 of the Receivership Order provides that the Receiver is entitled "to a...

Type
court filing
Date
May 22, 2025 - May 27, 2026
Pages
29
Lines
933
SHA-256
5ee4265f48d0

DISTIL analysis

DISTIL Run
Profile
Standard
Version
1
Doc Type
Legal Objection - Post-Judgment Receivership Fee Dispute
Total Nodes
34
Node Legend
Entity (ENT)
Event (EVT)
Claim (CLM)
Anchor (ANC)
Omission (OMI)
Tension (TEN)
Tell (TEL)
Inference (INF)
Hypothesis (HYP)
Stage 1
Index
Orientation · No nodes
Document Classification
Legal Objection - Post-Judgment Receivership Fee Dispute Defendants/Former Judgment Debtors (Cyberlux Corporation and Mark D. Schmidt) Post-judgment collection receivership, fee and expense dispute May 22, 2025 - May 27, 2026
fee_disputeultra_vires_allegationsinterpleader_involvementreceivership_terminationsettlement_agreement_referenced
Analytical Frame
Defendants challenging receiver's fee request as excessive and unauthorized
Analytical Summary
This objection filed by Defendants Cyberlux Corporation and Mark D. Schmidt challenges Receiver Robert W. Berleth's final fee request of $1,017,601.11 and expense reimbursement of $722,728.68 in a post-judgment receivership case. The Defendants argue that the underlying Virginia judgment was satisfied on June 11, 2025, when lender Legalist SPV III, LP voluntarily wired $3,083,639.75 to the Receiver, not through any collection efforts by the Receiver. They contend the Receiver exceeded his authority under Texas law by engaging in activities beyond collecting the judgment, particularly his involvement in a separate Virginia federal interpleader action that a federal court later terminated. The Defendants assert the Receiver is entitled to at most $218,462.30 (25% of amounts disbursed to Plaintiffs), the amount agreed in settlement, rather than the 33% claimed. They object to expenses incurred after the judgment satisfaction, lack of supporting documentation, and activities they characterize as ultra vires including employee payments, warehouse operations, and Virginia litigation participation.
Key Points
  • Receiver appointed May 22, 2025 to collect Virginia state court judgment domesticated in Texas
  • Legalist SPV III, LP voluntarily paid $3,083,639.75 on June 11, 2025 to satisfy underlying judgment
  • Receiver filed original final report June 11, 2025 stating receivership was complete
  • Receiver now seeks fee of $1,017,601.11 (33% of collected funds) and expenses of $722,728.68
  • Defendants argue receiver entitled to maximum $218,462.30 (25% of $873,849.02 disbursed to plaintiffs)
  • Federal court in Virginia terminated receiver's involvement in separate interpleader action
  • Defendants object to expenses incurred after June 11, 2025 judgment satisfaction
  • Multiple objections based on lack of documentary support for claimed expenses
Stage 2
Core — Entities, Events, Claims
23 nodes
ENT-001
Entity
Cyberlux Corporation
Cyberlux Corporation, defendant and former judgment debtor in this post-judgment receivership action
Page 1 — Defendants and Former Judgment Debtors Cyberlux Corporation ("Cyberlux") and Mark D. Schmidt ("Schmidt") (collectively, "Defendants") file this Objection
ENT-002
Entity
Mark D. Schmidt
Mark D. Schmidt, individual defendant and former judgment debtor in this post-judgment receivership action
Page 1 — Defendants and Former Judgment Debtors Cyberlux Corporation ("Cyberlux") and Mark D. Schmidt ("Schmidt") (collectively, "Defendants") file this Objection
ENT-003
Entity
Robert W. Berleth
Robert W. Berleth, appointed as post-judgment receiver under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3)
Page 1 — On May 22, 2025, the Court entered its Order Appointing Receiver ("Receivership Order," attached as Exhibit } appointing Robert W. Berleth ("Receiver") as a post-judgment receiver under TEX. CIV& PRAC. & REM. CODE § 31.002(b)(3)
ENT-004
Entity
Atlantic Wave Holdings, LLC
Atlantic Wave Holdings, LLC, plaintiff and judgment creditor in this action
Page 1 — ATLANTIC WAVE HOLDINGS, LLC and § § SECURE COMMUNITY, LLC, § Plaintiffs/Judgment-Creditors,
ENT-005
Entity
Secure Community, LLC
Secure Community, LLC, plaintiff and judgment creditor in this action
Page 1 — ATLANTIC WAVE HOLDINGS, LLC and § § SECURE COMMUNITY, LLC, § Plaintiffs/Judgment-Creditors,
ENT-006
Entity
Legalist SPV III, LP
Legalist SPV III, LP, lender to defendants who voluntarily wired funds to satisfy the underlying judgment
Page 2 — on June 11, 2025, Defendants' lender, Legalist SPV III, LP ("Legalist"), voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgment.
ENT-007
Entity
HII Mission Technologies Corp.
HII Mission Technologies Corp., plaintiff in Virginia interpleader action involving competing claims to funds owed to Cyberlux
Page 4 — Defendants object to all fees and expenses claimed by the Receiver in connection with the interpleader action styled HII Mission Technologies Corp. v. Cyberlux Corp., et al., Civil Action No. 3:25-cv-483, in the United States District Court for the Eastern District of Virginia
EVT-001
Event
Appointment of Receiver
Court entered Order Appointing Receiver on May 22, 2025, appointing Robert W. Berleth as post-judgment receiver to collect underlying Virginia state-court judgment domesticated in this court
Page 1 — On May 22, 2025, the Court entered its Order Appointing Receiver ("Receivership Order," attached as Exhibit } appointing Robert W. Berleth ("Receiver") as a post-judgment receiver under TEX. CIV& PRAC. & REM. CODE § 31.002(b)(3) to collect an underlying Virginia state-court judgment ("Underlying Judgment") domesticated in this Court against Defendants.
EVT-002
Event
Legalist Payment to Satisfy Judgment
Legalist SPV III, LP voluntarily wired $3,083,639.75 to the Receiver on June 11, 2025 to satisfy the underlying judgment
Page 2 — on June 11, 2025, Defendants' lender, Legalist SPV III, LP ("Legalist"), voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgment.
EVT-003
Event
Original Final Report Filing
Receiver filed original Final Report on June 11, 2025, stating the receivership had completed with no further remaining issues
Page 3 — In his original Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Original Final Report," Ex. 2), filed June 11, 2025, the Receiver conceded that those funds had been received and that "[t]he Receivership ha[d] completed with no further remaining issues pending the final distribution of funds"
EVT-004
Event
Current Final Report Filing
Receiver filed Fourth and Final Report on May 7, 2026, seeking fees of $1,017,601.11 and reimbursement of expenses of $722,728.68
Page 1 — On May 7, 2026, the Receiver filed his Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Final Report," attached as Exhibit 2).
EVT-005
Event
Disbursement to Plaintiffs
Receiver disbursed $873,849.02 to Plaintiffs from the funds received from Legalist
Page 2 — Of that amount, $873,849.02 was disbursed to Plaintiffs by the Receiver.
EVT-006
Event
Virginia Interpleader Filing
HII Mission Technologies Corp. filed interpleader complaint on June 24, 2025 after receiving competing claims to funds owed to Cyberlux
Page 4 — The Virginia Interpleader was filed on June 24, 2025, after the Receiver acknowledged that the receivership here was complete and moved to terminate it. See Original Final Report 1 9, Ex. 3; Complaint for Interpleader, Ex. 8. HII Mission Technologies Corp. ("HIT') filed the interpleader complaint on its own initiative after it received competing claims to funds owed to Cyberlux.
EVT-007
Event
Virginia Court Termination of Receiver
On May 11, 2026, the Eastern District of Virginia court terminated the Receiver as an interpleader-defendant, finding the Receiver had no claim to interpleaded funds since the underlying judgment was satisfied in June 2025
Page 4, 5 — On May 11, 2026, the court terminated the Receiver as an interpleader-defendant, finding that the Receiver's involvement in the Virginia Interpleader was predicated on his purported authority as a receiver, but given the Underlying Judgment was satisfied on June 11, 2025, the Receiver had no claim to the interpleaded funds.
EVT-008
Event
Settlement Between Parties
Plaintiffs and Defendants reached settlement agreement regarding receiver's fee at $218,462.30 (25% of amounts disbursed to Plaintiffs)
Page 6 — The Receiver is instead entitled to, at most, $218,462.30, which is 25% of the amounts disbursed by the Receiver in this action and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5.
CLM-001
Claim
Receiver Did Not Collect Judgment
Defendants claim the Receiver did not 'collect' the underlying judgment through his own actions; rather, Legalist voluntarily wired the funds to satisfy the judgment
Page 2 — Here, the Receiver did not "collect" the Underlying Judgment by his actions. Rather, on June 11, 2025, Defendants' lender, Legalist SPV III, LP ("Legalist"), voluntarily wired1 $3,083,639.75 to the Receiver to satisfy the Underlying Judgment.
CLM-002
Claim
Receivership Concluded June 11, 2025
Defendants claim the receivership concluded on June 11, 2025, as acknowledged by the Receiver in his original final report stating the receivership had completed with no further remaining issues
Page 3 — In his original Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Original Final Report," Ex. 2), filed June 11, 2025, the Receiver conceded that those funds had been received and that "[t]he Receivership ha[d] completed with no further remaining issues pending the final distribution of funds"
CLM-003
Claim
Receiver Fee Should Be Limited to $218,462.30
Defendants claim the Receiver is entitled to at maximum 25% of amounts disbursed to Plaintiffs ($218,462.30), not 33% of collected funds, as this amount represents the settlement agreement between parties
Page 2 — The Receiver is thus not entitled to 33% of the Underlying Judgment. Instead, the Receiver is entitled to, at a maximum, 25% of what the Receiver disbursed to Plaintiffs, which is $218,462.30 and the amount agreed upon via settlement between Plaintiffs and Defendants.
CLM-004
Claim
Post-June 11 Expenses Unreasonable
Defendants claim expenses incurred after June 11, 2025 were unreasonable and unnecessary since the underlying judgment was satisfied and the receivership had concluded
Page 6 — In the Receiver's Original Final Report, filed on June 11, 2025, the Receiver advised that the receivership had concluded with no further remaining issues pending the final distribution of the funds received from Legalist. See Original Final Report 19, Ex. 3; E.D. Va. Memorandum Order p. 3, Ex. 6. In the Original Final Report, the Receiver claimed only $83,341.22 in expenses. Id. at 1 7(e). The increase of more than $639,000 in alleged expenses results entirely from activities undertaken after the Underlying Judgment was satisfied and receivership had concluded on June 11, 2025, by the Receiver's own admission.
CLM-005
Claim
Virginia Interpleader Actions Unauthorized
Defendants claim all fees and expenses related to the Virginia Interpleader were unauthorized because the Receiver was not authorized by Texas law or the Receivership Order to take action in other litigation in other jurisdictions
Page 4 — Defendants object to all fees and expenses claimed by the Receiver in connection with the interpleader action styled HII Mission Technologies Corp. v. Cyberlux Corp., et al., Civil Action No. 3:25-cv-483, in the United States District Court for the Eastern District of Virginia (the "Virginia Interpleader"), because the Receiver was not authorized by Texas law or the Receivership Order to take any action in the Virginia Interpleader or to otherwise insert himself into other litigation in other jurisdictions that were none of his business, let alone at the expense of Defendants
CLM-006
Claim
Receiver Exceeded Scope of Authority
Defendants claim the Receiver exceeded his authority under the Receivership Order and Texas statute by taking actions beyond collecting the underlying judgment, including paying employees, maintaining warehouses, and engaging in other business operations
Page 11 — Defendants object to paragraph 13 of the Berleth Declaration because actions taken to maintain the warehouse, provide oversight and payroll, and handle deliveries had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Those actions are ultra vires.
CLM-007
Claim
Federal Court Finding on Judgment Satisfaction
The Eastern District of Virginia court found that Legalist satisfied the underlying judgment in June 2025, and the Receiver had no claim to the interpleaded funds
Page 3 — In the Virginia Interpleader, explained in more detail below, the United States District Court for the Eastern District of Virginia likewise held that "Legalist satisfied [the Underlying Judgment] in June 2025." See E.D. Va. Memorandum Order p. 3, Ex. 6.
CLM-008
Claim
Lack of Documentary Support
Defendants claim the Receiver failed to provide adequate documentary evidence supporting claimed expenses, including itemized invoices for attorney fees and proof of actual payment
Page 11 — The Receiver has failed to provide itemized invoices for attorney's fees and expenses paid to the Receiver's counsel, without which there is no way to determine whether the fees and expenses paid were reasonable and necessary, even if they were authorized (they were not).
Stage 3
In Situ — Quotations, Tells, Tensions, Questions
7 nodes
QUO-001
Quotation
Receivership Order Fee Provision
The Receivership Order provides that the Receiver is entitled to a fee equal to 25% of all sales of assets and recoveries, and up to 33% if the full underlying judgment is collected
Page 2 — Paragraph 53 of the Receivership Order provides that the Receiver is entitled "to a fee equal to 25% of all sales of assets that come into his actual, constructive, or legal possession, and all recoveries and credits against the judgment," so long as the Rohrmoos Ventures elements have been satisfied and after notice and a hearing. See Receivership Order 153, Ex> 1. To the extent the Receiver collects the full amount of the Underlying Judgment, the Court may award the Receiver 33% of the collected funds.
QUO-002
Quotation
Original Final Report Completion Statement
In the original final report filed June 11, 2025, the Receiver stated the receivership had completed with no further remaining issues
Page 3 — In his original Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Original Final Report," Ex. 2), filed June 11, 2025, the Receiver conceded that those funds had been received and that "[t]he Receivership ha[d] completed with no further remaining issues pending the final distribution of funds"
TEN-001
Tension
Fee Calculation Dispute
Tension between Receiver's claim for 33% fee ($1,017,601.11) based on collecting full judgment versus Defendants' position that 25% of disbursed amount ($218,462.30) is appropriate given voluntary payment by lender
Page 2 — Here, the Receiver did not "collect" the Underlying Judgment by his actions. Rather, on June 11, 2025, Defendants' lender, Legalist SPV III, LP ("Legalist"), voluntarily wired1 $3,083,639.75 to the Receiver to satisfy the Underlying Judgment... The Receiver is thus not entitled to 33% of the Underlying Judgment. Instead, the Receiver is entitled to, at a maximum, 25% of what the Receiver disbursed to Plaintiffs, which is $218,462.30
TEN-002
Tension
Receivership Status Contradiction
Tension between Receiver's June 11, 2025 statement that receivership was complete versus continued incurrence of $639,000+ in additional expenses thereafter
Page 6 — In the Receiver's Original Final Report, filed on June 11, 2025, the Receiver advised that the receivership had concluded with no further remaining issues pending the final distribution of the funds received from Legalist... In the Original Final Report, the Receiver claimed only $83,341.22 in expenses. Id. at 1 7(e). The increase of more than $639,000 in alleged expenses results entirely from activities undertaken after the Underlying Judgment was satisfied and receivership had concluded on June 11, 2025
TEN-003
Tension
Scope of Authority Dispute
Fundamental disagreement over whether Receiver's authority extended beyond collecting the specific judgment to include business operations, employee payments, and involvement in unrelated litigation
Page 11 — Defendants object to paragraph 13 of the Berleth Declaration because actions taken to maintain the warehouse, provide oversight and payroll, and handle deliveries had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Those actions are ultra vires.
QST-001
Question
Authority for Virginia Interpleader Participation
What legal authority did the Receiver have to participate in the Virginia federal court interpleader action filed after the underlying judgment was satisfied?
Page 4 — Defendants object to all fees and expenses claimed by the Receiver in connection with the interpleader action styled HII Mission Technologies Corp. v. Cyberlux Corp., et al., Civil Action No. 3:25-cv-483, in the United States District Court for the Eastern District of Virginia (the "Virginia Interpleader"), because the Receiver was not authorized by Texas law or the Receivership Order to take any action in the Virginia Interpleader
QST-002
Question
Reasonableness of Continued Operations
Were the Receiver's actions in maintaining business operations, paying employees, and managing warehouses reasonable and necessary for collecting a judgment already satisfied by third-party payment?
Page 13 — Defendants object to subparagraph 15(C) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority.
Stage 4
Interpretive — Inferences, Omissions, Patterns
4 nodes
INF-001
Inference
Strategic Motivation for Continued Activities
The Receiver's continued activities after judgment satisfaction, particularly involvement in the Virginia interpleader involving approximately $25 million, may have been motivated by potential additional recovery rather than completing the original receivership mandate
Page 4 — HII Mission Technologies Corp. ("HIT') filed the interpleader complaint on its own initiative after it received competing claims to funds owed to Cyberlux. The Receiver played no role in causing HII to file the interpleader or in generating the approximately $25 million that was interpleaded into the federal court.
INF-002
Inference
Settlement Indicates Agreed Fee Amount
The existence of a settlement agreement between Plaintiffs and Defendants establishing the receiver fee at $218,462.30 suggests all parties except the Receiver agreed this amount was appropriate, potentially undermining the Receiver's larger claim
Page 6 — The Receiver is instead entitled to, at most, $218,462.30, which is 25% of the amounts disbursed by the Receiver in this action and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5.
OMI-001
Omission
Missing Itemized Fee Documentation
Defendants note the Receiver failed to provide itemized invoices for attorney fees and detailed documentation supporting claimed expenses, creating inability to evaluate reasonableness
Page 11 — The Receiver has failed to provide itemized invoices for attorney's fees and expenses paid to the Receiver's counsel, without which there is no way to determine whether the fees and expenses paid were reasonable and necessary, even if they were authorized (they were not).
OMI-002
Omission
No Explanation for Expense Increase
The Receiver's final report does not adequately explain why expenses increased from $83,341.22 claimed in June 2025 to $722,728.68 (over $639,000 increase) despite earlier representation that receivership was complete
Page 6 — In the Original Final Report, the Receiver claimed only $83,341.22 in expenses. Id. at 1 7(e). The increase of more than $639,000 in alleged expenses results entirely from activities undertaken after the Underlying Judgment was satisfied and receivership had concluded on June 11, 2025, by the Receiver's own admission.

Extracted text

29 pages · 49325 characters

Defendants' Objection to Receiver's Fourth and Final Report Final Accounting, Verified Motion for Disbursement of Funds and Motion to Terminate Receivership — Formatted Extract

Type: court filing
Filing Header

ATLANTIC WAVE HOLDINGS, LLC and § §

SECURE COMMUNITY, LLC,

§ Plaintiffs/Judgment-Creditors,

V.

CYBERLUX CORPORATION and MARK D. SCHMIDT, Individually,

§ § § § § § Defendants/Judgment Debtors. §

§

IN THE DISTRICT COURT

129TH JUDICIAL DISTRICT

OF HARRIS COUNTY, TEXAS

DEFENDANTS' OBJECTION TO RECEIVER'S FOURTH AND FINAL REPORT, FINAL ACCOUNTING, VERIFIED MOTION FOR DISBURSEMENT OF FUNDS AND MOTION TO TERMINATE RECEIVERSHIP

Defendants and Former Judgment Debtors Cyberlux Corporation ("Cyberlux") and Mark D. Schmidt ("Schmidt") (collectively, "Defendants") file this Objection to Receiver's Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds and Motion to Terminate Receivership ("Objection") and request a ruling on all objections herein. In support thereof, Defendants rely on the exhibits attached to this Objection and respectfully show unto the Court as follows:

A. Introduction

On May 22, 2025, the Court entered its Order Appointing Receiver ("Receivership Order," attached as Exhibit } appointing Robert W. Berleth ("Receiver") as a post-judgment receiver under TEX. CIV& PRAC. & REM. CODE § 31.002(b)(3) to collect an underlying Virginia state-court judgment ("Underlying Judgment") domesticated in this Court against Defendants. On May 7, 2026, the Receiver filed his Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Final Report," attached as Exhibit 2). Pursuant to paragraph 47 of the Receivership Order, Defendants hereby submit these

general and specific objections to the Final Report and the Declaration of Robert W. Berleth in Support of Receiver's Fees and Expenses ("Berleth Declaration").

B. General Objections

Defendants submit the following general objections to the Final Report, Berleth Declaration, and Receiver's Invoice:

1.
Defendants object to the Receiver's requested fee of $1,017,601.11 as unreasonable, unnecessary, and not authorized by the Receivership Order. Paragraph 53 of the Receivership Order provides that the Receiver is entitled "to a fee equal to 25% of all sales of assets that come into his actual, constructive, or legal possession, and all recoveries and credits against the judgment," so long as the Rohrmoos Ventures elements have been satisfied and after notice and a hearing. See Receivership Order 153, Ex> 1. To the extent the Receiver collects the full amount of the Underlying Judgment, the Court may award the Receiver 33% of the collected funds. Here, the Receiver did not "collect" the Underlying Judgment by his actions. Rather, on June 11, 2025, Defendants' lender, Legalist SPV III, LP ("Legalist"), voluntarily wired1 $3,083,639.75 to the Receiver to satisfy the Underlying Judgment. See Original Final Report 11

2, 6, Exhibit 3; Wire Transfer Confirmation and Judgment Calculation, Ex. 4. Of that amount, $873,849.02 was disbursed to Plaintiffs by the Receiver. The Receiver is thus not entitled to 33% of the Underlying Judgment. Instead, the Receiver is entitled to, at a maximum, 25% of what the Receiver disbursed to Plaintiffs, which is $218,462.30 and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5. Any fee in excess of that amount would be unreasonable under the circumstances.

The wire was authorized on June 10, 2025, and processed on June 11, 2025. See Wire Transfer Confirmation, Ex. 4.

2.
Defendants object to the Receiver's requested reimbursement of $722,728.68 in expenses to the extent incurred after June 11, 2025, save and except these expenses addressed in paragraph 5, sections j., p., and q. below, to which Defendants object for independent reasons.2 On that date, Legalist voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgment. See Wire Transfer Confirmation and Judgment Calculation, Ex. 4. In his original Final Report, Final Accounting, Verified Motion for Disbursement of Funds, and Motion to Terminate Receivership ("Original Final Report," Ex. 2), filed June 11, 2025, the Receiver conceded that those funds had been received and that "[t]he Receivership ha[d] completed with no further remaining issues pending the final distribution of funds " See Original Final Report 19, Ex. 3. In the Virginia Interpleader, explained in more detail below, the United States District Court for the Eastern District of Virginia likewise held that "Legalist satisfied [the Underlying Judgment] in June 2025." See E.D. Va. Memorandum Order p. 3, Ex. 6. Thus, any expenses incurred after June 11, 2025, were unreasonable and unnecessary.
3.
Defendants object to the Receiver's requested fee and reimbursement of $722,728.68 in expenses that were incurred for actions taken or for expenses paid that exceeded the scope of the Receiver's authority under the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). The Receiver was appointed as a post-judgment receiver for the sole purpose of collecting the Underlying Judgment against Defendants. Actions taken and expenses incurred beyond that purpose are ultra vires.3
4.
Defendants object to the Receiver's requested reimbursement of $722,728.68 in expenses to the extent the alleged expenses are otherwise found to be unreasonable, unnecessary,
2
Any objection to all expenses incurred after June 11, 2025 herein is subject to the same exceptions.
3
This is not the first time the Receiver has acted ultra vires. See United States Court of Appeals for the Fifth Circuit - 12.31.24 Per Curiam Opinion, Ex. 7.

or unauthorized by the Receivership Order at the hearing on Defendants' Motion for Adjudication of the Receiver's Fees and Expenses and Return of Receivership Assets ("Hearing").

5.
Defendants object to the Receiver's Final Report to the extent the Receiver fails to demonstrate entitlement to the fee and expenses requested at the Hearing, as required by the Receivership Order and applicable law.
6.
Defendants object to all fees and expenses claimed by the Receiver in connection with the interpleader action styled HII Mission Technologies Corp. v. Cyberlux Corp., et al., Civil Action No. 3:25-cv-483, in the United States District Court for the Eastern District of Virginia (the "Virginia Interpleader"), because the Receiver was not authorized by Texas law or the Receivership Order to take any action in the Virginia Interpleader or to otherwise insert himself into other litigation in other jurisdictions that were none of his business, let alone at the expense of Defendants The Virginia Interpleader was filed on June 24, 2025, after the Receiver acknowledged that the receivership here was complete and moved to terminate it. See Original Final Report 1 9, Ex. 3; Complaint for Interpleader, Ex. 8. HII Mission Technologies Corp. ("HIT') filed the interpleader complaint on its own initiative after it received competing claims to funds owed to Cyberlux. The Receiver played no role in causing HII to file the interpleader or in generating the approximately $25 million that was interpleaded into the federal court. On April 7, 2026, the court sua sponte ordered the Receiver to show cause why his continued involvement in the litigation was appropriate, noting that this Court had denied the Receiver's motion to expand his authority See Virginia Show Cause Order, Ex. 9. On May 11, 2026, the court terminated the Receiver as an interpleader-defendant, finding that the Receiver's involvement in the Virginia Interpleader was predicated on his purported authority as a receiver, but given the Underlying

Judgment was satisfied on June 11, 2025, the Receiver had no claim to the interpleaded funds. See E.D. Va. Memorandum Order, Ex. 6.

7.
Defendants object to the Receiver's Final Report to the extent the expenses requested were incurred between June 30, 2025, to August 29, 2025, while the Receivership Order was stayed. See Tex. Ct. App. Memorandum Opinion, Ex. 10.
8.
Defendants object to the Receiver's Final Report to the extent the Receiver has failed to support the Final Report with documentary evidence, including but not limited to that which is necessary to demonstrate that expenses were actually incurred and paid and invoices showing that the services of various attorneys were reasonable and necessary.
C. Objections to Final Report

Defendants submit the following specific objections to the Final Report, paragraph by paragraph, as follows:

1.
Defendants object to paragraph 1 of the Final Report to the extent the work allegedly performed and identified in paragraph 1: (a) exceeded the scope of the Receiver's authority under the Receivership>Order, TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3), and applicable law and was thus ultra vires; (b) was undertaken after June 11, 2025, after the receivership concluded by the Receiver's own admission; and (c) was not otherwise reasonable or necessary.
2.
Defendants object to paragraph 2 of the Final Report because the Receiver did not "recover" $3.083,639.75. Rather, Legalist voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgments. See Original Final Report 11 2, 6, Ex. 3.
3.
Defendants object to paragraph 3 of the Final Report because the Receiver's actions in this receivership to date were largely unauthorized, ultra vires, unreasonable, and unnecessary,

and so the fee and expenses allegedly incurred were not "customary, reasonable, and necessary." Nor did the Receiver collect the full amount of the Underlying Judgment due to his own actions. Rather, Legalist voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgment. See Original Final Report 11 2, 6, Ex. 3. The Receiver is thus not entitled to a fee of 33% of the amount allegedly collected. The Receiver is instead entitled to, at most, $218,462.30, which is 25% of the amounts disbursed by the Receiver in this action and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5.

4.
Defendants object to paragraph 4 of the Final Report because the expenses that the Receiver alleges to have incurred were not "necessary." In the Receiver's Original Final Report, filed on June 11, 2025, the Receiver advised that the receivership had concluded with no further remaining issues pending the final distribution of the funds received from Legalist. See Original Final Report 19, Ex. 3; E.D. Va. Memorandum Order p. 3, Ex. 6. In the Original Final Report, the Receiver claimed only $83,341.22 in expenses. Id. at 1 7(e). The increase of more than $639,000 in alleged expenses results entirely from activities undertaken after the Underlying Judgment was satisfied and receivership had concluded on June 11, 2025, by the Receiver's own admission.
5.
Defendants object to paragraph 5 of the Final Report to the extent it alleges "several potential TRO/serial receiverships ... will take effect upon the termination of this receivership." That allegation is irrelevant to this action and appears designed to justify the continuation of receivership proceedings that the Receiver himself represented had concluded long ago. See Original Final Report 19, Ex. 3. The existence of other potential receiverships does not authorize this Receiver to continue incurring fees and expenses at the expense of Defendants. In one "potential" receivership, the District Court for the 152nd Judicial District of Harris County, Texas

summarily denied an application to appoint Robert W. Berleth as a general receiver over Cyberlux after this Court had declined to confer that authority here. See Order Denying Ex Parte Emergency Application to Appoint Receiver, attached as Exhibit 11.

6.
Defendants object to paragraph 6 of the Final Report to the extent the Receiver is implying that he "recovered" the funds that Legalist voluntarily paid.
7.
Defendants object to the subparagraphs of paragraph 7 of the Final Report, as follows:

a. Defendants object to subparagraph 7(a) of the Final Report in that the funds identified therein were already paid to Plaintiffs pursuant to this Court's March 2, 2026, Order on Judgment Creditors' Second Amended Motion for Distribution of Funds and Defendants' Motion.

b. Defendants object to subparagraph 7(b) of the Final Report because the expenses claimed were unreasonable and unnecessary because they include numerous expenses that were: (a) incurred after June 11, 2025, when the Receivership concluded by the Receiver's own admission; (b) incurred for action taken or expenses paid that exceeded the scope of the receivership under the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 1.002(b)(3); and (c) were otherwise unreasonable and unnecessary.

Defendants object to subparagraph 7(c) of the Final Report because the Receiver's fee should be limited to, at most, $218,462.30, which is 25% of the amounts disbursed by the Receiver in this action and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5.

8.
Defendants agree that funds have been distributed to Plaintiffs in satisfaction of the Underlying Judgment and that the Receiver is still holding proceeds to be distributed.
9.
Defendants agree that the Receivership concluded when the Underlying Judgment was satisfied. In his Original Final Report of June 11, 2025, the Receiver himself acknowledged that the receivership had concluded. See Original Final Report 19, Ex. 3 ("The Receivership has completed with no further remaining issues"). Defendants object to paragraph 9 of the Final Report to the extent it requests a final distribution as set out in paragraph 7 of the Final Report.
10.
Defendants object to paragraph 10 of the Final Report and the relief requested therein. Defendants object to the subparagraphs4 of paragraph 20 of the Final Report, as follows:

a. Defendants object to the first subparagraph because neither the fee requested nor actions taken by the Receiver were reasonable;

b. Defendants agree with the second subparagraph that the Receiver disbursed $873,639.75 to Plaintiffs' Counsel;

c. Defendants object to the third subparagraph because they include numerous expenses that were unreasonable and unnecessary because they were: (a) incurred after June 11, 2025, when the Receivership concluded by the Receiver's own admission; (b) incurred for action taken or expenses paid that exceeded the scope of the receivership under the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3); and (c) were otherwise unreasonable and unnecessary.

d. Defendants object to the fourth subparagraph because the Receiver's fee should be limited to, at most, $218,462.30, which is 25% of the amounts

4
In the Final Report, the subparagraphs of paragraph 10 are mislabeled and out of order.

disbursed by the Receiver to Plaintiffs in this action and the amount agreed upon via settlement between Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5.

e. Defendants object to the fifth subparagraph in that the Receivership has already terminated as a matter of law.

f. Defendants object to the sixth subparagraph to the extent the Receiver requests expenses that were unreasonable and unnecessary because they were: (a) incurred after June 11, 2025, when the Receivership concluded by the Receiver's own admission; (b) incurred for action taken or expenses paid that exceeded the scope of the receivership under the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3); and (c) were otherwise unreasonable and unnecessary.

D. Objections to Berleth Declaration

Defendants object to the Berleth Declaration, paragraph by paragraph, as follows:

1.
Paragraph 1 of the Berleth Declaration does not require an objection. Defendants reserve the right to challenge the Receiver's experience and qualifications at the hearing thereon.5
2.
Defendants object to paragraph 2 of the Berleth Declaration to the extent it is offered to establish the Receiver's qualifications to justify the unreasonable, unnecessary, and/or unauthorized fee and expenses demanded. Defendants reserve the right to challenge the Receiver's experience and qualifications at the hearing thereon.
3.
Defendants object to paragraph 3 of the Berleth Declaration to the extent it is offered to establish the Receiver's qualifications to justify the exorbitant fee and expenses
5
See Bankr. S.D. Tex. Memorandum Opinion and Order, Ex. 12; S.D. Tex. Memorandum Opinion and Order, Ex. 13.

demanded. Defendants reserve the right to challenge the Receiver's experience and qualifications at the hearing thereon.

4.
No objection.
5.
No objection.
6.
No objection.
7.
No objection.
8.
Defendants object to paragraph 8 of the Berleth Declaration because the fees and expenses requested are unreasonable and unnecessary, as described in this Objection. Defendants further object to the extent the Receiver has not proved the reasonableness of the requested fee and expenses at a hearing, as required by the Receivership Order, and Defendants reserve their right to challenge the requested fee and expenses at any such hearing.
9.
No objection.
10.
Defendants object to paragraph 10 of the Berleth Declaration because the Receiver did not collect the Underlying Judgment by his own actions. Rather, Legalist voluntarily wired $3,083,639.75 to the Receiver to satisfy the Underlying Judgment. See Original Final Report 11 2, 6, Ex. 3; Joint Notice of Settlement, Ex. 5. Defendants also object in that this case was made complex and difficult due to the Receiver's ultra vires actions that exceeded the scope of the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3).
11.
Defendants object to paragraph 11 of the Berleth Declaration because it misstates the Receiver's entitlement to a fee under the Receivership Order. Defendants incorporate their General Objection No. 1 fully herein by reference.
12.
Defendants object to paragraph 12 of the Berleth Declaration because the collection of the Underlying Judgment did not require immense skill, time, or energy. Indeed, it required

virtually none. The Underlying Judgment was satisfied by Legalist. Defendants also object because, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader has nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized, ultra vires, and took place after the Receiver acknowledged the receivership had concluded. See Original Final Report 19, Ex. 3.

13.
Defendants object to paragraph 13 of the Berleth Declaration because actions taken to maintain the warehouse, provide oversight and payroll, and handle deliveries had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Those actions are ultra vires. Defendants also object because as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader has nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized, ultra vires, and took place after the Receiver acknowledged the receivership had concluded. See Original Final Report 19, Ex. 3.
14.
Defendants object to paragraph 14 of the Berleth Declaration and Exhibit 1 cited therein for the following reasons:

a. The Receiver has failed to provide itemized invoices for attorney's fees and expenses paid to the Receiver's counsel, without which there is no way to determine whether the fees and expenses paid were reasonable and necessary, even if they were authorized (they were not).

b. Expenses identified in Exhibit 1 for purchasing meals for the Receiver's staff are unreasonable and unnecessary and should not be compensated at Defendants'

expense. In addition, the Receiver has failed to provide documentary evidence that these expenses were actually incurred and paid.

c. The Receiver has failed to provide documentary evidence that all expenses identified in Exhibit 1 for locksmiths, storage, and security were actually incurred and paid.

d. All expenses identified in Exhibit 1 for advisory services in Ukraine, travel expenses and per diem related to the Virginia Interpleader, payments to employees, consultant fees, and related matters were not incurred for purposes of collecting the Underlying Judgment and were thus incurred beyond the Receiver's authority. Defendants also object to all expenses incurred prior to the Receiver's appointment and after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 1 9, Ex. 3. Nor has the Receiver provided documentary evidence that any of these expenses were actually incurred and paid.

15.
Defendants object to subparagraphs "A" through "DD" of paragraph 15 of the Berleth Declaration, as follows:

a. Defendants object to subparagraph 15(A) because the Receiver has failed to provide documentary evidence that storage fees were actually incurred.

b. Defendants object to subparagraph 15(B) because the retainer was paid to a law firm on August 8, 2025, after the Receiver acknowledged the receivership had concluded. See Original Final Report 1 9, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were

unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

c. Defendants object to subparagraph 15(C) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

d. Defendants object to subparagraph 15(D) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

e. Defendants object to subparagraph 15(E) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. &

REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

f. Defendants object to subparagraph 15(F) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

g. Defendants object to subparagraph 15(G) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

h. Defendants object to subparagraph 15(H) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the

collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

i. Defendants object to subparagraph 15(I) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

Defendants object to subparagraph 15(J) to the extent the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Even if the claimed expenses were authorized, the Receiver has provided no

documentary evidence that these expenses were actually incurred and paid or how much of the alleged retainer was applied in the payment thereof.

k. Defendants object to subparagraph 15(K) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

1.
Defendants object to subparagraph 15(L) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

m. Defendants object to subparagraph 15(M) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-

judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

n. Defendants object to subparagraph 15(N) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

o. Defendants object to subparagraph 15(O) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE §_31.002(b)(3). Paying those expenses exceeded the Receiver's authority- Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and

Defendants object to subparagraph 15(P) of the Berleth Declaration because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that if the claimed expenses were

authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid or how much of the alleged retainer was applied in the payment thereof.

q. Defendants object to subparagraph 15(Q) because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

r. Defendants object to subparagraph 15(R) of the Berleth Declaration because paying an attorney to prepare a release of a noncompete agreement for a former employee had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority, as did consulting counsel regarding winding down Cyberlux. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

s. Defendants object to subparagraph 15(S) of the Berleth Declaration because paying employees had nothing to do with the Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3). Paying those expenses exceeded the Receiver's authority. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

t. Defendants object to subparagraph 15(T) of the Berleth Declaration because the Receiver has provided no documentary evidence that the storage fees were actually incurred and paid.

u. Defendants object to subparagraph 15(U) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 195 Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by

collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires.> Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

v. Defendants object to subparagraph 15(V) because the Receiver incurred the expenses listed for travel related to the Virginia Interpleader. As set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Additionally, these expenses were incurred after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Defendants also object because the Receiver has

failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

w. Defendants object to subparagraph 15(W) because the Receiver incurred the expenses listed for travel related to the Virginia Interpleader. As set forth in

Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Additionally, these expenses were incurred after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

x. Defendants object to subparagraph 15(X) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Defendants further object because the Court denied the Receiver's motion to expand the receivership, and so any legal fees paid to prepare that motion are unreasonable,

unnecessary, and not compensable. See Order Denying Expanding Receiver's Authority, attached as Exhibit 14. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

y. Defendants object to subparagraph 15(Y). It appears the Receiver is requesting he be reimbursed for paying to Plaintiffs funds received from Legalist to satisfy the Underlying Judgment. The Receiver is not entitled to reimbursement for amounts paid to Plaintiffs as an expense.

z. Defendants object to subparagraph 15(Z) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

aa. Defendants object to subparagraph 15(AA) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover,

as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver and paid.

bb. Defendants object to subparagraph 15(BB) because the fees and costs identified were incurred by the Receiver in retaining a consultant to analyze Cyberlux's government contracts. These consultant fees were incurred after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 1 9, Ex. 3. Moreover, the consultant work has nothing to do with the Receiver's authority to collect the Underlying Judgment, which had already been satisfied, and so were ultra vires. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

cc. Defendants object to subparagraph 15(CC) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the

collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

dd. Defendants object to subparagraph 15(DD) because the attorney's fees and expenses were paid to a law firm after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3. Moreover, as set forth in Defendants' General Objection No. 6, incorporated fully herein by reference, the Virginia Interpleader had nothing to do with this action and the collection of the Underlying Judgment, and the Receiver's actions taken in that matter were unauthorized and ultra vires. Defendants also object because the Receiver has failed to provide the underlying itemized invoices, without which it is impossible to determine whether the fees and expenses incurred were reasonable and necessary. Defendants further object in that even if authorized, the Receiver has provided no documentary evidence that these expenses were actually incurred and paid.

16.
Defendants object to paragraph 16 of the Berleth Declaration because the claimed level of work and attention required by a receivership of less than three weeks in duration was due largely to the Receiver's unauthorized actions, which exceeded the scope of the Receivership Order. The Underlying Judgment was not recovered by the Receiver but funded by Legalist.
17.
Defendants object to paragraph 17 of the Berleth Declaration because the Receiver's claimed fee exceeds the scope of the Receivership order and should be limited to, at most, $218,462.30, which is 25% of the amounts disbursed by the Receiver to Plaintiffs in this action and the amount agreed upon by Plaintiffs and Defendants. See Joint Notice of Settlement, Ex. 5. The expenses claimed are also unreasonable and were unnecessary because they were: (a) incurred after June 11, 2025, when the Receivership concluded by the Receiver's own admission; (b) incurred for action taken or expenses paid that exceeded the scope of the receivership under the Receivership Order and TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3); and (c) were otherwise unreasonable and unnecessary.

To the extent Exhibit 1 to the Berleth Declaration lists fees and expenses not cited in the declaration and addressed above, Defendants object to those fees and expenses, as follows:

a. Defendants object to all fees and expenses incurred related to the Virginia Interpleader for the reasons set forth in Defendants' General Objection No. 6, incorporated fully herein by reference.

b. Defendants object to all fees and expenses incurred to pay employees because paying employees had nothing to do with the Receiver's appointment as a post- judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC.& REM. CODE § 31.002(b)(3).

c. Defendants object to all fees and expenses incurred for security, a constable, locksmiths, and storage fees because the Receiver has failed to provide documentary evidence that those expenses were actually incurred and actually paid.

d. Defendants object to all fees and expenses incurred for North Axis Advisory, to other consultants, and for staff meals, as those matters had nothing to do with the

Receiver's appointment as a post-judgment receiver to collect the Underlying Judgment, as provided under TEX. CIV. PRAC. & REM. CODE § 31.002(b)(3).

e. Defendants object to all fees and expenses incurred prior to the Receiver's appointment and after the Receiver acknowledged the receivership had concluded on June 11, 2025. See Original Final Report 19, Ex. 3.

f. Defendants object to all fees and expenses not supported by documentary evidence that the fees and expenses were actually incurred and paid.

PRAYER

WHEREFORE, Defendants and Former Judgment Debtors Cyberlux Corporation and court sustain this Objection, deny the relief requested in the Final Report except as to confirming the receivership has terminated as a matter of law, and grant the Defendants and Judgment Debtors such other and further relief to which they may be justly entitled.

Unofficial Copy Office of Måsilyles, Bly g auss DiskriCel Clerka

Respectfully submitted,

ADAMS & REESE, LLP

By: /s/ Evan A. Moeller Evan A. Moeller State Bar No. 24051067 evan.moeller@arlaw.com

Aaron G. McLeod

State Bar No. 24100888 aaron.mcleod@arlaw.com LyondellBasell Tower 1221 McKinney St., Suite 4400 Houston, Texas 77010 Telephone: (713) 652-5151

Facsimile: 6713) 652-5152

Attorneys for Cyberlux Corporation and Mark D. Schmidt

Unofficial Copy Office of militar en Base a & M Con Cle

CERTIFICATE OF SERVICE

I hereby certify that a copy of the above and foregoing was served pursuant to the Texas Rules of Civil Procedure upon all parties on this 27th day of May, 2026.

/s/ Evan A. Moeller Evan A. Moeller

Automated Certificate of eService

This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Monica Rodgriguez on behalf of Evan Moeller Bar No. 24051067 monica.rodriguez@arlaw.com Envelope ID: 115418415

Filing Code Description: Motion (No Fee)

Filing Description: Defendants' Objection to Receiver's Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds and Motion to Terminate Receivership Status as of 5/28/2026 10:22 AM CST

Case Contacts

Name

BarNumber

Email

TimestampSubmitted

Status

Ashish Mahendru

amahendru@thelitigationgroup.com Largess Distra Clerk

5/27/2026 7:59:12 PM

SENT

Darren AndrewBraun

dbraun@thelitigationgroup.com

5/27/2026 7:59:12 PM

SENT

M. H. Cersonsky

mhcersonsky@law.cmpc.com araya

5/27/2026 7:59:12 PM

SENT

Evan A.Moeller

evan.moeller@arlaw.com

5/27/2026 7:59:12 PM

SENT

Evan A.Moeller

evan.moeller@arlaw.com arselentes

5/27/2026 7:59:12 PM

SENT

Danielle Butler

dbutler@thelitigationgroup.com

5/27/2026 7:59:12 PM

SENT

LaDonna Arey

LArey@bellnunnally.com

5/27/2026 7:59:12 PM

SENT

Linda Carranza

carranza@thompsoncoburn.com

5/27/2026 7:59:12 PM

SENT

Elizabeth Myers

Con

emyers@thompsoncoburn.com

5/27/2026 7:59:12 PM

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Tara Rollin

tara.rollin@arlaw.com

5/27/2026 7:59:12 PM

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Robert W.Berleth

rberleth@berlethlaw.com

5/27/2026 7:59:12 PM

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David A.Walton

dwalton@bellnunnally.com

5/27/2026 7:59:12 PM

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Travis Vargo

tvargo@vargolawfirm.com

5/27/2026 7:59:12 PM

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Micah Jackson Undcia

mjackson@berlethlaw.com

5/27/2026 7:59:12 PM

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Brice BBeale

beale@hooverslovacek.com

5/27/2026 7:59:12 PM

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Mary Jahn

mary.jahn@arlaw.com

5/27/2026 7:59:12 PM

SENT

Shawn Grady

shawn@gradycollectionlaw.com

5/27/2026 7:59:12 PM

SENT

Shawn Grady

shawn@gradycollectionlaw.com

5/27/2026 7:59:12 PM

SENT

Aaron McLeod

aaron.mcleod@arlaw.com

5/27/2026 7:59:12 PM

SENT

Jeff Brown

jbrown@thompsoncoburn.com

5/27/2026 7:59:12 PM

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Paula Gentry

pgentry@thompsoncoburn.com

5/27/2026 7:59:12 PM

SENT

Automated Certificate of eService

This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Monica Rodgriguez on behalf of Evan Moeller Bar No. 24051067 monica.rodriguez@arlaw.com Envelope ID: 115418415

Filing Code Description: Motion (No Fee)

Filing Description: Defendants' Objection to Receiver's Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds and Motion to Terminate Receivership Status as of 5/28/2026 10:22 AM CST

Case Contacts

Paula Gentry

pgentry@thompsoncoburn.com

5/27/2026 7:59:12 PM

SENT

Bernadette Martin

bernadette@gradycollectionlaw.com

5/27/2026 7:59:12 PM

SENT

Bernadette Martin

bernadette@gradycollectionlaw.com

5/27/2026 7:59:12 PM

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Records Department

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5/27/2026 7:59:12 PM

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Michael Poynter

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5/27/2026 7:59:12 PM

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Emory Powers

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5/27/2026 7:59:12 PM

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Caroline Pritikin

cpritikin@thompsoncoburn.com

5/27/2026 7:59:12 PM

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Laurie DeBardeleben

Idebardeleben@thompsoncoburn.com

5/27/2026 7:59:12 PM

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Roxanna Lock

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Daniel AArdmore

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Automated Certificate of eService

This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Monica Rodgriguez on behalf of Evan Moeller Bar No. 24051067 monica.rodriguez@arlaw.com

Envelope ID: 115418415

Filing Code Description: Motion (No Fee)

Filing Description: Defendants' Objection to Receiver's Fourth and Final Report, Final Accounting, Verified Motion for Disbursement of Funds and Motion to Terminate Receivership Status as of 5/28/2026 10:22 AM CST

Case Contacts

Daniel AArdmore

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Farah Ardmore

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Tia Archuleta

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Austin DPriddy

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Unofficial Copy

Original source file

Open source
File
Legal Objection - Post-Judgment Receivership Fee Dispute
Source UID
source:5ee4265f48d0c28c4ed6d822ca97f9233fe60afcc9adc36b480117e90961a17d
Full SHA-256
5ee4265f48d0c28c4ed6d822ca97f9233fe60afcc9adc36b480117e90961a17d