10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

or

☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to _____

Commission File Number: 000-56115

Woodbridge Liquidation Trust

(Exact name of registrant as specified in its charter)

Delaware	36-7730868
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employment Identification No.)

201 N. Brand Blvd., Suite M Glendale, California	91203
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (310) 765-1550

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of ‘‘large accelerated filer,’’ ‘‘accelerated filer,’’ ‘‘smaller reporting company’’ and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☒
	Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No  ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS

DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

Yes ☒  No ☐

Woodbridge Liquidation Trust

Form 10-Q

September 30, 2022

Table of Contents

PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Net Assets in Liquidation (Unaudited) as of September 30, 2022 and June 30, 2022	1
	Consolidated Statements of Changes in Net Assets in Liquidation (Unaudited) for the Three Months Ended September 30, 2022 and 2021	2
	Notes to Consolidated Financial Statements (Unaudited) for the Three Months Ended September 30, 2022 and 2021	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	27
Item 4.	Controls and Procedures	27
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Woodbridge Liquidation Trust and Subsidiaries

Consolidated Statements of Net Assets in Liquidation

As of September 30, 2022 and June 30, 2022

(Unaudited, $ In Thousands)

	9/30/2022		6/30/2022
Assets
Real estate assets held for sale, net (Note 3)	$	29,050	$	29,062
Cash and cash equivalents		31,867		96,810
Restricted cash (Note 4)		4,192		6,121
Other assets (Note 5)		1,803		5,825
Total assets	$	66,912	$	137,818
Liabilities
Accounts payable and accrued liabilities	$	103	$	119
Distributions payable		1,226		68,767
Accrued liquidation costs (Note 6)		27,667		34,537
Total liabilities	$	28,996	$	103,423
Commitments and Contingencies (Note 14)
Net Assets in Liquidation
Restricted for Qualifying Victims (Note 7)	$	3,483	$	3,485
All Interestholders		34,433		30,910
Total net assets in liquidation	$	37,916	$	34,395

See accompanying notes to unaudited consolidated financial statements.

1

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Consolidated Statements of Changes in Net Assets in Liquidation

For the Three Months Ended September 30, 2022 and 2021

(Unaudited, $ in Thousands)

	Three Months Ended September 30, 2022								Three Months Ended September 30, 2021
	Restricted For Qualifying Victims			All Interestholders		Total			Restricted For Qualifying Victims		All Interestholders		Total
Net Assets in Liquidation as of beginning of period	$	3,485		$	30,910	$	34,395		$	3,167	$	126,373	$	129,540
Change in assets and liabilities (Note 8):
Restricted for Qualifying Victims -
Change in carrying value of assets and liabilities, net		(2	)		-		(2	)		-		-		-
All Interestholders-
Change in carrying value of assets and liabilities, net		-			885		885			-		4,904		4,904
Distributions (declared) reversed, net		-			2,638		2,638			-		99		99
Net change in assets and liabilities		-			3,523		3,523			-		5,003		5,003
Net Assets in Liquidation as of end of period	$	3,483		$	34,433	$	37,916		$	3,167	$	131,376	$	134,543

See accompanying notes to unaudited consolidated financial statements.

2

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

1) Formation and Description of Business

Formation

Woodbridge Liquidation Trust (the “Trust”) was established (i) for the purpose of collecting, administering, distributing and liquidating the Trust assets for the benefit of the Trust beneficiaries in accordance with the Liquidation Trust Agreement of the Trust and the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors dated August 22, 2018 (as amended, modified, supplemented or restated from time to time, the (“Plan”)); (ii) to resolve disputed claims asserted against the Debtors; (iii) to litigate and/or settle causes of action (“Causes of Action”); and (iv) to pay certain allowed claims and statutory fees, as required by the Plan. Woodbridge Group of Companies, LLC and its affiliated debtors are individually referred to herein as a Debtor and collectively as the Debtors. The Trust was formed on February 15, 2019 (the “Plan Effective Date”) as a statutory trust under Delaware law.

On the Plan Effective Date, in accordance with the Plan, (a) the following assets automatically vested in the Trust: (i) an aggregate $5,000,000 in cash from the Debtors for the purpose of funding the Trust’s initial expenses of operation; (ii) certain claims and Causes of Action; (iii) all of the outstanding equity interests of the Wind-Down Entity (as defined below); and (iv) certain other non-real estate related assets, (b) the equity interests of Woodbridge Group of Companies, LLC and Woodbridge Mortgage Investment Fund 1, LLC (together, the “Remaining Debtors”) were cancelled and new equity interests representing all of the newly issued and outstanding equity interests in the Remaining Debtors were issued to the Trust, (c) all of the other Debtors other than the Remaining Debtors were dissolved and (d) the real estate-related assets of the Debtors were automatically vested in the Trust’s wholly-owned subsidiary, Woodbridge Wind-Down Entity LLC (the “Wind-Down Entity”) or one of the Wind-Down Entity’s 43 wholly-owned single member LLCs (the “Wind-Down Subsidiaries”) formed to own the respective real estate assets. The Trust, the Remaining Debtors, the Wind-Down Entity and the Wind-Down Subsidiaries are collectively referred to herein as the “Company.”

As further discussed in Note 10, the Trust has two classes of liquidation trust interests, Class A Liquidation Trust Interests (“Class A Interests”) and Class B Liquidation Trust Interests (“Class B Interests”). The holders of Class A Interests and Class B Interests are collectively referred to as “All Interestholders.”

On December 24, 2019, the Trust’s Registration Statement on Form 10 became effective under the Securities Exchange Act of 1934 (the “Exchange Act”). The trading symbol for the Trust’s Class A Interests is WBQNL. Bid and asked prices for the Trust’s Class A Interests are quoted on the OTC Link ATS, the SEC-registered alternative trading system. The Class A Interests are eligible for the Depository Trust Company’s Direct Registration System (DRS) services. The Class B Interests are not registered with the SEC.

Description of Business

The Trust is prosecuting various Causes of Action acquired by the Trust pursuant to the Plan and is resolving claims asserted against the Debtors. As of September 30, 2022, the Company is the plaintiff in several pending lawsuits. The Company has accrued an estimate of the amount of legal costs to be incurred to pursue this litigation, excluding contingent fees. As more fully discussed in Note 2, the Company’s consolidated financial statements do not include any estimate of future net recoveries from litigation and settlement, since the Company cannot reasonably estimate them.

The Wind-Down Entities’ operations are almost complete. As of September 30, 2022, the Wind-Down Subsidiaries owned one single-family home, located in Los Angeles, California. Construction of this single-family home is substantially complete, and it is listed for sale. For this single-family home and several previously sold homes, the Wind-Down Subsidiaries are completing punch list and repair items. As of September 30, 2022, the Wind-Down Subsidiaries also owned two secured loans and two other properties located in other states. (See Note 3.)

3

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

The Company is required to liquidate its assets and distribute available cash to the Trust beneficiaries. The liquidation activities are carried out by the Trust, the Wind-Down Entity and the Wind-Down Subsidiaries. As of September 30, 2022, the Company estimates that the liquidation activities will be completed by February 15, 2024. As more fully discussed in Note 2, the Company uses the Liquidation Basis of Accounting. The Trust currently operates as one reportable segment comprised primarily of real estate assets held for sale.

Net assets in liquidation represent the remaining estimated aggregate value available to Trust beneficiaries upon liquidation, with no discount for the timing of proceeds (undiscounted).  Net liquidation proceeds, other recoveries and actual liquidation costs may differ materially from the estimated amounts due to the unpredictability of real estate selling prices, the impact of the COVID-19 virus and other global health crises (see below), as well as the uncertainty in the timing of liquidation of the real estate and other assets.

The Trust’s expectations about the amount of any additional distributions and when they will be paid are subject to risks and uncertainties and are based on certain estimates and assumptions, one or more of which may prove to be incorrect.  As a result, the actual amount of any additional distributions may differ materially, perhaps in adverse ways, from the Trust estimates. Furthermore, it is not possible to predict the timing of any additional distributions and any such distributions may not be made within the timing referenced in the consolidated financial statements.

No assurance can be given that total distributions will equal or exceed the estimate of net assets in liquidation presented in the consolidated statements of net assets in liquidation.

The Company observes health and safety guidelines, including allowing its employees to work remotely. The Company will continue to evaluate the impact of the COVID-19 virus and other global health crises on its activities, including the cost and timing of construction related services, the time needed to market and sell its remaining real estate assets and the price at which these real estate assets will be sold.

The ultimate impact of the COVID-19 virus and other global health crises will depend on many factors, some of which cannot be foreseen, including the duration, severity, and geographic concentrations of the pandemic and any resurgence of the disease.

2) Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the consolidated financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. These consolidated financial statements have been presented in accordance with Accounting Standards Codification (“ASC”) Subtopic 205-30, “Liquidation Basis of Accounting,” as amended by Accounting Standards Update (“ASU”) No. 2013-07, “Presentation of Financial Statements (Topic 205), Liquidation Basis of Accounting.” The June 30, 2022 consolidated statement of net assets in liquidation included herein was derived from the audited consolidated financial statements but does not include all disclosures or notes required by U.S. GAAP for complete financial statements.

All material intercompany accounts and transactions have been eliminated.

4

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

Use of Estimates

U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and for the period then ended. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the carrying amounts of assets and liabilities are revised in the period that available information supports a change in the carrying amount.

Liquidation Basis of Accounting

Under the liquidation basis of accounting, all assets are recorded at their estimated net realizable value or liquidation value, which represents the estimated amount of net cash that will be received upon the disposition of the assets (on an undiscounted basis). The measurement of real estate assets held for sale is based on current contracts (if any), estimates and other indications of sales value, net of estimated selling costs. To determine the value of real estate assets held for sale, the Company considered the three traditional approaches to value (cost, income and sales comparison) commonly used by the real estate appraisal community. The applicability and relevancy of each valuation approach as applied may differ by asset. In most cases, the sales comparison approach was accorded the greatest weight. This approach compares a property to other properties with similar characteristics that have recently sold. To validate management’s estimate, the Company also considered opinions from qualified real estate professionals and local real estate brokers and, in some cases, obtained third party appraisals. The estimated selling costs range from 5.0% to 6.5% of the property sales price.

Liabilities, including estimated costs associated with implementing and completing the Plan, are measured in accordance with U.S. GAAP that otherwise applies to those liabilities. The Company has also recorded the estimated development costs to be incurred to prepare the assets for sale as well as the estimated holding costs to be incurred until the projected sale date and the estimated general and administrative costs to be incurred until the completion of the liquidation of the Company and estimated reserves for contingencies. When estimating development costs, the Company considered third party construction contracts and estimates of costs to complete based on construction status, progress and projected completion timing. Estimated development costs also include the costs of design and furnishings necessary to prepare and stage the homes for marketing as well as an accrual for warranty claims. Holding cost estimates consider property taxes, insurance, utilities, maintenance and other costs to be incurred until the sale of the property is closed. Projected general and administrative cost estimates take into account operating costs through the completion of the liquidation of the Company.

These estimated amounts are presented in the accompanying consolidated statements of net assets in liquidation.  All changes in the estimated liquidation value of the Company’s real estate held for sale, or other assets and liabilities are reflected as a change to the Company’s net assets in liquidation.

The Company does not record any amount from the future settlement of unresolved Causes of Action or recoveries from Fair Fund or Forfeited Assets in the accompanying consolidated financial statements since they cannot be reasonably estimated. The amount recovered may be material to the Company’s net assets in liquidation.

On a quarterly basis, the Company reviews the estimated net realizable values, liquidation costs and the estimated date of the completion of the liquidation of the Company and records any significant changes. The Company will also revalue an asset when it is under contract for sale and the buyer’s contingencies have been removed. During the period when this occurs, the carrying value of the asset and the estimated closing and other costs will be adjusted, if necessary. If the Company has a change in its plan for the disposition of an asset, the carrying value will be adjusted to reflect this change in the period that the change is approved. The change in value may include the accrued liquidation costs related to the asset.

5

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

Other Assets

The Company recognizes recoveries from the settlement of unresolved Causes of Action when an agreement is executed and collectability is reasonably assured. An allowance for uncollectible settlement installment receivables is recorded when there is doubt about the collectability of the receivable.  Insurance claims are recognized when the insurance company accepts the claim or if a claim is pending and the recoverable amount can be estimated. The Company records escrow receivables at the amount that is expected to be received when the escrow receivable is released. The Forfeited Assets (Note 7) received from the United States Department of Justice (the “DOJ”), other than cash, have been recorded at their estimated net realizable value. In addition, the Company recognizes other amounts to be received based on contractual terms or when the amounts to be received are certain.

Accrued Liquidation Costs

The Company accrues for estimated liquidation costs to the extent they are reasonably determinable. These costs consist of (a) estimated development costs of the single-family homes, including construction and other project related costs, architectural and engineering, project management, city fees, bond payments (net of refunds), furnishings, marketing and other costs; (b) estimated holding costs, including property taxes, insurance, maintenance, utilities and other; and (c) estimated general and administrative costs including payroll, legal and other professional fees, trustee and board fees, rent and other office related expenses, and other general and administrative costs to operate the Company and estimated reserves for contingent liabilities.

Cash Equivalents

The Company considers short-term investments that have a maturity date of ninety days or less at the time of investment to be a cash equivalent. The Company’s cash equivalents include deposits with financial institutions that are insured by the Federal Deposit Insurance Corporation (the “FDIC”).

Restricted Cash

Restricted cash includes cash that can only be used for certain specified purposes.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and restricted cash. At times, balances in any one financial institution may exceed the FDIC insurance limits. The Company mitigates this risk by depositing its cash, cash equivalents and restricted cash in high-credit quality financial institutions. In addition, the Company uses strategies to reduce deposit balances at any one financial institution consistent with FDIC insurance limits.

Income Taxes

The Trust is intended to be treated as a grantor trust for income tax purposes and, accordingly, is not subject to federal or state income tax on any income earned or gain recognized by the Trust. The Trust’s beneficiaries will be treated as the owner of a pro rata portion of each asset, including cash and each liability received by and held by the Trust. Each beneficiary will be required to report on his or her federal and state income tax return his or her pro rata share of taxable income, including gains and losses recognized by the Trust. Accordingly, there is no provision for federal or state income taxes recorded in the accompanying consolidated financial statements.

6

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

The Company regularly analyzes its various federal and state filing positions and only recognizes the income tax effect in the consolidated financial statements when certain criteria regarding uncertain income tax positions have been met. The Company believes that its income tax positions would more likely than not be sustained upon examination by all relevant taxing authorities. Therefore, no provision for uncertain income tax positions has been recorded in the consolidated financial statements.

Net Assets in Liquidation - Restricted for Qualifying Victims

The Company separately presents the portion of net assets in liquidation that are restricted for Qualifying Victims (Note 7) from the net assets in liquidation that are available to All Interestholders.

3) Real Estate Assets Held for Sale

The Company’s real estate assets held for sale as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022									June 30, 2022
	Number of Assets		Gross Value		Closing and Other Costs			Net Value		Number of Assets		Gross Value		Closing and Other Costs			Net Value
Single-family homes		1	$	28,000	$	(1,680	)	$	26,320		1	$	28,000	$	(1,680	)	$	26,320
Other real estate assets:
Secured loans		2		960		(40	)		920		2		972		(40	)		932
Other properties		2		2,000		(190	)		1,810		2		2,000		(190	)		1,810
Subtotal		4		2,960		(230	)		2,730		4		2,972		(230	)		2,742
Total		5	$	30,960	$	(1,910	)	$	29,050		5	$	30,972	$	(1,910	)	$	29,062

As of September 30, 2022, the single-family home was listed for sale and is located in the Los Angeles, California area. The loans are secured by properties located primarily in the eastern United States. The other properties are located in the state of Hawaii and the state of New York. The property located in the state of New York is listed for sale.

During the three months ended September 30, 2022, the Company did not sell any real estate assets. During the three months ended September 30, 2021, the Company sold two single-family homes for net proceeds of approximately $42,445,000. One of the single-family homes sold during the three months ended September 30, 2021 was under construction.

7

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

4) Restricted Cash

The Company’s restricted cash as of September 30, 2022, with comparative information as of June 30, 2022, is as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Distributions restricted by the Company related to unresolved claims, distributions for recently allowed claims, uncashed distribution checks, distributions withheld due to pending avoidance actions and distributions that the Trust is waiting for further beneficiary information	$	1,228	$	3,726
Forfeited Assets (Note 7)		2,964		2,395
Total restricted cash	$	4,192	$	6,121

5) Other Assets

The Company’s other assets as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Escrow receivables (a)	$	370	$	3,420
Forfeited Assets, net (Note 7)		678		1,258
Settlement installment receivables, net (b)		511		756
Other		244		391
Total other assets	$	1,803	$	5,825

(a) Escrow receivables as of September 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022. Escrow receivables as of June 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022 and one single-family home sold prior to June 30, 2021. Amounts are to be released upon the completion of punch list items and/or obtaining a certificate of occupancy.

(b) The allowance for uncollectible settlement installment receivables was approximately $35,000 and $7,000 as of September 30, 2022 and June 30, 2022, respectively.

8

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

6) Accrued Liquidation Costs

The following is a summary of the items included in accrued liquidation costs as of September 30, 2022, with comparative information as of June 30, 2022 ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Development costs:
Construction costs	$	2,685		$	4,331
Construction warranty		4,184			4,184
Indirect costs		82			170
Bond refunds		(388	)		(506	)
Total development costs		6,563			8,179
Holding costs:
Property tax		771			771
Maintenance, utilities and other		302			428
Insurance		200			388
Total holding costs		1,273			1,587
General and administrative costs:
Legal and other professional fees		10,578			12,377
Payroll and payroll-related		5,185			7,989
Directors and officers insurance		2,508			2,508
Board fees and expenses		473			630
State, local and other taxes		330			331
Other		757			936
Total general and administrative costs		19,831			24,771
Total accrued liquidation costs	$	27,667		$	34,537

7) Forfeited Assets - Restricted for Qualifying Victims

The Trust entered into a resolution agreement with the DOJ which provided that the Trust would receive the assets forfeited (“Forfeited Assets”) by Robert and Jeri Shapiro. The agreement provided for the release of specified Forfeited Assets by the DOJ to the Trust and for the Trust to liquidate those assets and distribute the net sale proceeds to Qualifying Victims.  Qualifying Victims include the vast majority of Trust beneficiaries (specifically, all former holders of allowed Class 3 and 5 claims and their permitted assigns), but do not include former holders of Class 4 claims. Distributions to Qualifying Victims are to be allocated pro-rata based on their net allowed claims without considering the (i) 5% enhancement for contributing their causes of action and (ii) 72.5% Class 5 coefficient.

9

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

In March 2021, the Trust received certain Forfeited Assets from the DOJ, including cash, wine, jewelry, handbags, clothing, shoes, art, gold and other assets. The Company recorded the total estimated net realizable value of the Forfeited Assets of approximately $3,459,000. During the three months ended September 30, 2022, the Company sold some of the jewelry, handbags, clothing, shoes and art. During the year ended June 30, 2022, the Company sold the wine and gold and some of the handbags, clothing and shoes. The Forfeited Assets included in the Company’s September 30, 2022 and June 30, 2022 consolidated financial statements are as follows ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Restricted cash (Note 4)	$	2,964		$	2,395
Other assets, net of selling costs (Note 5)		678			1,258
Accrued liquidation costs -primarily legal and professional fees		(159	)		(168	)
Net assets in liquidation - restricted for Qualifying Victims	$	3,483		$	3,485

8) Net Change In Assets and Liabilities

Restricted for Qualifying Victims:

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		569			-		569
Other assets		(579	)		-		(579	)
Total assets	$	(10	)	$	-	$	(10	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(8	)		-		(8	)
Total liabilities	$	(8	)	$	-	$	(8	)
Change in carrying value of assets and liabilities, net	$	(2	)	$	-	$	(2	)

10

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		(19	)		-		(19	)
Other assets		-			-		-
Total assets	$	(19	)	$	-	$	(19	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(19	)		-		(19	)
Total liabilities	$	(19	)	$	-	$	(19	)
Change in carrying value of assets and liabilities, net	$	-		$	-	$	-

11

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

All Interestholders

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(12	)	$	-		$	(12	)
Cash and cash equivalents		(2,540	)		-			(2,540	)
Restricted cash		2			-			2
Other assets		(3,332	)		(110	)		(3,442	)
Total assets	$	(5,882	)	$	(110	)	$	(5,992	)
Accounts payable and accrued liabilities	$	(25	)	$	9		$	(16	)
Accrued liquidation costs		(6,480	)		(381	)		(6,861	)
Total liabilities	$	(6,505	)	$	(372	)	$	(6,877	)
Change in carrying value of assets and liabilities, net	$	623		$	262		$	885

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		2,638
Distributions declared, net	$	2,638

Distributions payable decreased by approximately $67,541,000 during the three months ended September 30, 2022.

12

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(42,454	)	$	2,965		$	(39,489	)
Cash and cash equivalents		34,803			-			34,803
Restricted cash		-			-			-
Other assets		(700	)		823			123
Total assets	$	(8,351	)	$	3,788		$	(4,563	)
Accounts payable and accrued liabilities	$	-		$	49		$	49
Accrued liquidation costs		(8,723	)		(793	)		(9,516	)
Total liabilities	$	(8,723	)	$	(744	)	$	(9,467	)
Change in carrying value of assets and liabilities, net	$	372		$	4,532		$	4,904

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		99
Distributions declared, net	$	99

Distributions payable decreased by approximately $137,000 during the three months ended September 30, 2021.

9) Credit Agreement

The Company does not currently have any outstanding credit agreements.  On May 16, 2022, the Company terminated its prior credit agreement.  Also, the Company never had outstanding borrowings on its credit agreement.

13

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

10) Beneficial Interests

The following table summarizes the Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Outstanding at beginning of period		11,513,535			675,617		11,512,855			654,784
Allowed claims		1,348			-		302			-
5% enhancement for certain allowed claims		67			-		-			-
Settlement of claims by cancelling Liquidation
Trust Interests		(760	)		-		(1,392	)		(167	)
Outstanding at end of period		11,514,190			675,617		11,511,765			654,617

Of the 11,514,190 Class A Interests outstanding at September 30, 2022, 11,436,259 are held by Qualifying Victims (Note 7).

At the Plan Effective Date, certain claims were disputed. As those disputed claims are resolved, additional Class A Interests and (if applicable) Class B Interests are issued on account of allowed claims or Class A Interests and (if applicable) Class B Interests are cancelled. No Class A Interests or Class B Interests are issued on account of disallowed claims. The following table summarizes the unresolved claims against the Debtors as they relate to Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Reserved for unresolved claims at beginning of period		90,793			333		124,609			5,011
Allowed claims		(1,348	)		-		(302	)		-
5% enhancement for certain allowed claims		-			-		-			-
Disallowed claims		(75,570	)		-		(3,146	)		-
Reserved for unresolved claims at end of period		13,875			333		121,161			5,011

Of the 13,875 Class A Interests relating to unresolved claims at September 30, 2022, 1,880 would be held by Qualifying Victims (Note 7).

14

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

11) Distributions

The Plan provides for a distribution waterfall that specifies the priority and manner of distribution of available cash to all Interestholders, excluding distributions of the net sales proceeds from Forfeited Assets (Note 7). Distributions are to be made (a) to the Class A Interests until they have received distributions of $75.00 per Class A Interest; thereafter (b) to the Class B Interests until they have received distributions of $75.00 per Class B Interest; thereafter (c) to each Liquidation Trust Interest (whether a Class A Interests or Class B Interest) until the aggregate of all distributions made pursuant to this clause equals an amount equivalent to interest, at a per annum fixed rate of 10%, compounded annually Interests, accrued on the aggregate principal amount of all Net Note Claims, Allowed General Unsecured Claims and Net Unit Claims, all as defined in the Plan, treating each distribution pursuant to (a) and (b) above as reductions of such principal amount; and thereafter (d) to the holders of Allowed Subordinated Claims, as defined in the Plan, until such claims are paid in full, including interest, at a per annum fixed rate of 10% or such higher rate as may be agreed to, as provided for in the Plan, compounded annually, accrued on the principal amount of each Allowed Subordinated Claim, as defined.

The following distribution was paid during the three months ended September 30, 2022 relating to the tenth distribution ($ in millions, except for $ per Class A Interest):

									Deposits Into
			$ per						Restricted
	Date		Class A		Total				Cash
	Declared		Interest		Declared		Paid		Account
Tenth Distribution	6/15/2022	(a)	$	5.63	$	-	$	64.19	$	0.83

(a) The $65.02 million distribution was declared on June 15, 2022 and the distribution was paid on July 15, 2022.  The deposit into the restricted cash account was made on July 26, 2022.

There were no distributions declared during the three months ended September 30, 2021.

For every distribution, a deposit is made into a restricted cash account for amounts (a) payable for Class A Interests that may be issued in the future upon the allowance of unresolved claims, (b) in respect of Class A Interests issued on account of recently allowed claims (c) for holders of Class A Interests who failed to cash distribution checks mailed in respect of prior distributions (d) for distributions that were withheld due to pending avoidance actions and (e) for holders of Class A Interests for which the Trust is waiting for further beneficiary information.

During the three months ended September 30, 2022 and 2021, as (a) claims were resolved, (b) claims were recently allowed, (c) addresses for holders of uncashed distribution checks were obtained, (d) pending avoidance actions were resolved and (e) further beneficiary information was received, distributions of approximately $651,000 and $38,000, respectively, were paid to holders of Class A Interests from the restricted cash account and distributions payable were reduced by the same amount.

During the three months ended September 30, 2022 and 2021, as a result of claims being disallowed or Class A Interests being cancelled, approximately $2,483,000 and $99,000, respectively, were released from the restricted cash account and distributions payable were reduced by the same amount.

15

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

As a result of distribution checks that had not been cashed within 180 days of their issuance, Interestholders were deemed to have forfeited their rights to reserved and future Class A Interest distributions. During the three months ended September 30, 2022, some Interestholders that had previously been deemed to have been forfeited their rights to receive Class A Interest distributions had responded and therefore approximately $12,000 was added to the restricted cash account and distributions payable were increased by the same amount. During the three months ended September 30, 2021, no Interestholders were deemed to have forfeited their rights to reserved and future Class A distributions.

12) Related Party Transactions

Terry Goebel, a member of the Trust Supervisory Board, is president and a principal owner of G3 Group LA (G3), a construction firm specializing in the development of high-end luxury residences. G3 is owned by Terry Goebel and his son Kelly Goebel. As of September 30, 2022, the Company was under contract with G3 for the development of one single-family home in Los Angeles, California. As of September 30, 2022 and June 30, 2022 the remaining amounts payable under this contract were approximately $438,000 and $438,000, respectively. During the three months ended September 30, 2022 and 2021, approximately $0 and $1,286,000, respectively, were paid by the Company to G3 related to this contract.

The Liquidation Trustee of the Trust is entitled to receive 5% of the total gross amount recovered by the Trust from the pursuit of the Causes of Action. During the three months ended September 30, 2022 and 2021, approximately $8,000 and $49,000, were accrued as amounts due to the Liquidation Trustee, respectively. As of September 30, 2022 and June 30, 2022, approximately $89,000 and $81,000, respectively, were payable to the Liquidation Trustee. These amounts are included in accounts payable and accrued liabilities in the accompanying consolidated statements of net assets in liquidation. During the three months ended September 30, 2022 and 2021, no amounts were paid to the Liquidation Trustee.

In November 2019, the Trust entered into an arrangement with Akerman LLP, a law firm based in Miami, Florida of which the Liquidation Trustee is a partner, for the provision, at the option of the Trust on an as-needed basis, of e-discovery and related litigation support services in connection with the Trust’s prosecution of the Causes of Action. Under the arrangement, the Trust is charged for the services at scheduled rates per task which, depending on specific task, include flat rates, rates based on volume of data processed, rates based on the number of data users, the hourly rates of Akerman LLP personnel, or other rates. During the three months ended September 30, 2022 and 2021, respectively, approximately $115,000 and $107,000, respectively, were paid related to these services and there are no outstanding payables as of September 30, 2022 and June 30, 2022.

The executive officers of the Wind-Down Entity are entitled to a bonus based on the Wind-Down Entity achieving certain specified cumulative amounts of distributions to the Trust. Based on the carrying amounts of the net assets in liquidation included in the accompanying consolidated statements of net assets in liquidation, approximately $827,000 and $3,000,000 were accrued as of September 30, 2022 and June 30, 2022, respectively, as the estimated amount of the bonus (including associated payroll taxes). This amount is included in the payroll and payroll-related costs portion of accrued liquidation costs in the accompanying consolidated statement of net assets in liquidation. During the three months ended September 30, 2022 and 2021, $2,173,000 and $0, respectively, were paid related to bonuses.

13) Causes of Action

During the three months ended September 30, 2022 and 2021, the Company recorded approximately $190,000 and $971,000, respectively, from the settlement of Causes of Action. The Company also recorded liabilities of 5% of the settlement as amounts payable to the Liquidation Trustee and an allowance for uncollectible settlement installment receivables.

16

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

14) Commitments and Contingencies

As of September 30, 2022, the Company had construction contracts under which approximately $600,000 was unpaid.

The Company had a lease for its office space that expired on August 31, 2021. The Company had one three-month option to extend the lease. The amount of rent paid, including common area maintenance and parking charges, during the three months ended September 30, 2022 and 2021, was approximately $13,000 and $50,000, respectively. On June 4, 2021, the Company opted not to extend its existing lease and entered into a new office lease at a different location. The new lease was for the period from August 1, 2021 through July 31, 2022. The annual base rent was approximately $43,000 plus common area maintenance charges. On May 16, 2022, the Company extended its lease for six months. The Company has one additional six-month option to extend the lease. The Company paid approximately $55,000 relating to prepaid rent, common area maintenance charges and a security deposit for the new lease during the year ended June 30, 2021. The monthly rent during the six-month extension is approximately $4,000 per month.

The Company is not presently the defendant in any material litigation nor, to the Company’s knowledge, is any material litigation threatened against the Company.

15) Subsequent Events

The Company evaluates subsequent events up until the date the unaudited consolidated financial statements are issued.

Distributions

During the period from October 1, 2022 through November 10, 2022, as (a) claims were resolved, (b) claims were recently allowed, (c) addresses for holders of uncashed distribution checks were obtained, (d) pending avoidance actions were resolved and (e) further beneficiary information was received, distributions of approximately $6,000 were paid to holders of Class A Interests from the restricted cash account and distributions payable were reduced by the same amount.

17

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 1.  Financial Statements (Continued)

Woodbridge Liquidation Trust and Subsidiaries

Notes to Consolidated Financial Statements

For the Three Months Ended September 30, 2022 and 2021

(Unaudited)

Escrow Receivable

During the period from October 1, 2022 through November 10, 2022, $350,000 of escrow receivable was released relating to one single-family home that was sold during the year ended June 30, 2022.

Causes of Action

During the period from October 1, 2022 through November 10, 2022, the Trust recorded approximately $41,000 from the settlement of Causes of Action. The Company recorded approximately $2,000 as the amount due to the Liquidation Trustee on account of such settlements.

Forfeited Assets

During the period from October 1, 2022 through November 10, 2022, the Company realized net proceeds of approximately $62,000 from the sale of Forfeited Assets.

Other Refunds and Receipts

During the period from October 1, 2022 through November 10, 2022, the Company received approximately $53,000 of property tax refunds.

On October 7, 2022, a construction performance escrow deposit of approximately $24,000 was returned to the Company following the satisfactory completion of work related to one single-family home.

On November 1, 2022, the Company received approximately $45,000 of net proceeds from the sale of furniture used in the staging of a previously sold single-family home.

18

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of changes in net assets and net assets in liquidation and analysis should be read in conjunction with the accompanying unaudited consolidated financial statements of Woodbridge Liquidation Trust and the related notes thereto. The Trust, the Remaining Debtors, the Wind-Down Entity and the Wind-Down Subsidiaries, as used herein, are defined in Note 1 to the consolidated financial statements and are collectively referred to herein as the Company.

Forward-Looking Statements

Certain statements included in this Quarterly Report on Form 10-Q are forward-looking statements. Those statements include, without limitation, financial guidance, and projections and statements with respect to expectation of future financial condition, changes in net assets in liquidation, cash flows, plans, targets, goals, objectives, performance , and termination and dissolution of the Trust. Such forward-looking statements also include statements that are preceded by, followed by, or that include the words “believes”, “estimates”, “plans”, “expects”, “intends”, “is anticipated”, “will continue”, “project”, “may”, “could”, “would”, “should” and similar expressions, and all other statements that are not historical facts. All such forward-looking statements are based on the Trust’s current expectations and involve risks and uncertainties which may cause actual results to differ materially from those set forth in such statements. Such risks and uncertainties include the amount of sales proceeds, timing of sales of real estate assets, amount of funds needed for warranty claims, punch list items and holding costs of single-family homes, amount of general and administrative costs, the number and amount of successful litigations and/or settlements and the ability to recover thereon, the amount of funding required to continue litigations, the continuing impact of the COVID-19 pandemic and other global health issues, interest rates, adverse weather conditions in the regions in which properties to be sold are located, inflation, domestic and global economic and political conditions, changes in tax and other governmental rules and regulations applicable to the Trust and its subsidiaries and other risks and uncertainties identified in Part I. Financial Information, Item 1A. Risk Factors of the Company’s Annual Report on Form 10-K, or contained in any of the Trust’s subsequent filings with the SEC including in Part II. Other Information, Item 1A. Risk Factors of this Form 10-Q. These risks and uncertainties are beyond the ability of the Trust to control, and in many cases, the Trust cannot predict the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements.

In connection with the “safe harbor” provisions of the Securities Act of 1933 and the Exchange Act, the Trust has identified and is disclosing important factors, risks and uncertainties that could cause its actual results to differ materially from those projected in forward-looking statements made by the Trust, or on the Trust’s behalf. (See “Part II. Other Information, Item 1A. Risk Factors” of this Form 10-Q.) These cautionary statements are to be used as a reference in connection with any forward-looking statements. The factors, risks and uncertainties identified in these cautionary statements are in addition to those contained in any other cautionary statements, written or oral, which may be made or otherwise addressed in connection with a forward-looking statement or contained in any of the Trust’s subsequent filings with the SEC. Because of these factors, risks and uncertainties, the Trust cautions against placing undue reliance on forward-looking statements. Although the Trust believes that the assumptions underlying forward-looking statements are currently reasonable, any of the assumptions could be incorrect or incomplete, and there can be no assurance that forward-looking statements will prove to be accurate. Forward-looking statements speak only as of the date on which they are made. Except as may be required by law, the Trust does not undertake any obligations to modify, update or revise any forward-looking statement to take into account or otherwise reflect subsequent events, corrections in or revisions of underlying assumptions, or changes in circumstances arising after the date that the forward-looking statement was made.

Overview

Pursuant to the Plan, the Trust was formed on February 15, 2019 to hold, either directly or indirectly through the Wind-Down Entity and the Wind-Down Subsidiaries, the assets and equity interests formerly owned by the Debtors. Each of the real properties formerly owned by the Debtors was transferred, on the effective date of the Plan to one of the Wind-Down Subsidiaries. The purpose of the Wind-Down Group is to develop (as applicable), market, and sell those properties to generate cash. Assets formerly owned by the Debtors other than real estate assets and certain cash were transferred on the Plan Effective Date of the Trust. The purpose of the Trust is to receive remittances of cash from the Wind-Down Entity, to resolve disputed claims, to prosecute the Causes of Action, to pay allowed administrative and priority claims, as defined in the Plan, and, subject to the payment of Trust expenses and the retention of various reserves, to make distributions of cash to Interestholders in accordance with the Plan.

19

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The Trust operates pursuant to the Plan and the Trust Agreement. The Trust was formed as a Delaware statutory trust and is administered by the Liquidation Trustee under the supervision of its Supervisory Board. The Wind-Down Entity, a wholly-owned subsidiary of the Trust, operates pursuant to the Plan and the Wind-Down Entity LLC Agreement. The Wind-Down Entity was formed as a Delaware limited liability company and is administered by its Board of Managers, one of which is the chief executive officer. One member of the Board of Managers is also a member of the Supervisory Board of the Trust.

The Bankruptcy Court has retained certain jurisdictions regarding the Trust, the Liquidation Trustee, the Supervisory Board, the Wind-Down Entity, the Board of Managers, and assets of the Trust and the Wind-Down Entity, including the determination of all disputes arising out of or related to administration of the Trust and the Wind-Down Entity and its subsidiaries.

As of September 30, 2022, the number of Liquidation Trust Interests outstanding in each class is as follows:

Class of Interest	Number Outstanding
Class A Liquidation Trust Interests		11,514,190
Class B Liquidation Trust Interests		675,617

For each of the classes of Liquidation Trust Interests, the number of Liquidation Trust Interests outstanding will increase to the extent that the disputed claims become allowed claims. In addition, the number of Liquidation Trust Interests outstanding will decrease to the extent that disputed claims are settled by cancelling previously issued Liquidation Trust Interests.

Since the Plan Effective Date through September 30, 2022, the Wind-Down Subsidiaries have disposed of approximately 145 properties for aggregate net sales proceeds of approximately $551.95 million. As of September 30, 2022, the Company owned five real estate assets (including one single-family home and one other real estate asset listed for sale) with a gross carrying value of approximately $30.97 million. Given the significantly smaller inventory of remaining real estate assets when compared to the inventory as of the Plan Effective Date, the amount of net proceeds from the sale of real estate assets in the future is likely to be less than the amount realized from the Plan Effective Date through September 30, 2022. The Company expects to complete the liquidation of its assets during the fiscal year ending June 30, 2024.

Discussion of the Company’s Operations

Three months ended September 30, 2022

20

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following is a summary of the Consolidated Statement of Changes in Net Assets in Liquidation for the three months ended September 30, 2022 ($ in thousands):

	Restricted for			All
	Qualifying Victims			Interestholders		Total
Net assets in liquidation as of June 30, 2022	$	3,485		$	30,910	$	34,395
Change in assets and liabilities:
Restricted for Qualifying Victims - change in carrying value of assets and liabilities, net		(2	)		-		(2	)
All Interestholders-
Change in carrying value of assets and liabilities, net		-			885		885
Distributions (declared) reversed, net		-			2,638		2,638
Net change in assets and liabilities		-			3,523		3,523
Net assets in liquidation, as of September 30, 2022	$	3,483		$	34,433		37,916

Net assets in liquidation – Restricted for Qualifying Victims decreased by approximately $0.002 million during the three months ended September 30, 2022.

Net assets in liquidation – All Interestholders increased by approximately $3.52 million during the three-month period ended September 30, 2022. This increase was due to an increase in the carrying value of assets and liabilities of approximately $0.88 million, net and distributions reversed of approximately $2.64 million for disallowed claims and cancelled interests. The components of the changes in the carrying value of assets and liabilities, net are as follows ($ in thousands):

	Restricted for			All
	Qualifying Victims			Interestholders		Total
Remeasurement of assets and liabilities, net	$	(2	)	$	288	$	284
Settlement recoveries recognized, net (1)		-			154		154
Other		-			443		445
Change in carrying value of assets and liabilities, net	$	(2	)	$	885	$	883

(1) Net of 5% payable to the Liquidation Trustee of approximately $8 and an allowance for uncollectible settlement installment receivables of approximately $28.

During the three months ended September 30, 2022, the Company:

• Reversed distributions of approximately $2.64 million primarily from claims being disallowed or Class A Interests being cancelled.

• Received net proceeds from the sale of Forfeited Assets of approximately $0.58 million.

• Completed construction of two single-family homes (10733 Stradella and 1520 Carla Ridge).

• Recorded approximately $0.18 million from the settlement of Causes of Action, net of 5% payable to the Liquidation Trustee and an allowance for uncollectible installment receivables.

• Paid construction costs of approximately $1.28 million relating to single-family homes under development.

21

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

• Paid holding costs of approximately $0.27 million.

• Paid general and administrative costs of approximately $4.96 million, including approximately $0.16 million of board member fees and expenses, approximately $3.02 million of payroll and other general and administrative costs and approximately $1.78 million of professional fees.

For the three months ended September 30, 2021

The following is a summary of the Consolidated Statement of Changes in Net Assets in Liquidation for the three months ended September 30, 2021 ($ in thousands):

	Restricted for		All
	Qualifying Victims		Interestholders		Total
Net assets in liquidation as of June 30, 2021	$	3,167	$	126,373	$	129,540
Change in assets and liabilities:
Restricted for Qualifying Victims - change in carrying value of assets and liabilities, net		-		-		-
All Interestholders-
Change in carrying value of assets and liabilities, net		-		4,904		4,904
Distributions (declared) reversed, net		-		99		99
Net change in assets and liabilities		-		5,003		5,003
Net assets in liquidation, as of September 30, 2021	$	3,167	$	131,376		134,543

Net assets in liquidation – Restricted for Qualifying Victims did not change during the three months ended September 30, 2021.

Net assets in liquidation – All Interestholders increased approximately $5.00 million during the three months ended September 30, 2021. This increase was due to changes in the carrying value of assets and liabilities, net of approximately $4.90 million and distributions reversed of approximately $0.10 million for disallowed claims and cancelled interests. The components of the change in the carrying value of assets and liabilities, net are as follows ($ in thousands):

	Restricted for		All
	Qualifying Victims		Interestholders		Total
Sales proceeds in excess of carrying value	$	-	$	3,071	$	3,071
Settlement recoveries recognized, net (1)		-		926		926
Remeasurement of assets and liabilities, net		-		812		812
Other		-		95		95
Change in carrying value of assets and liabilities, net	$	-	$	4,904	$	4,904

(1) Net of 5% payable to the Liquidation Trustee of approximately $49 during the three months ended September 30, 2021.

22

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

During the three months ended September 30, 2021, the Company:

• Reversed distributions of approximately $0.10 primarily from claims being disallowed or Class A Interests being cancelled.

• Completed construction of two single-family homes (2600 Hutton and 1484 Carla Ridge).

• Sold two single-family homes for net proceeds of approximately $42.45 million. One of the single-family homes was under construction.

• Recorded approximately $0.93 million for the settlement of Causes of Action, net of 5% payable to the Liquidation Trustee..

• Paid construction costs of approximately $4.23 million relating to single-family homes under development.

• Paid holding costs of approximately $0.40 million.

• Paid general and administrative costs of approximately $4.12 million, including approximately $0.20 million of board member fees and expenses, approximately $1.14 million of payroll and other general and administrative costs and approximately $2.78 million of professional fees.

Liquidity and Capital Resources

Liquidity

The Company’s only sources for meeting its capital requirements are its cash and cash equivalents, proceeds from the sale of its real estate assets, collection of escrow receivables, recoveries on Causes of Action and proceeds from the sale of Forfeited Assets¹. The Company’s primary uses of funds are and will continue to be for distributions, development costs including warranty claims, holding costs and general and administrative costs, all of which the Company expects to be able to adequately fund over the next twelve months from its primary sources of capital.

Capital Resources

In addition to consolidated cash and cash equivalents as of September 30, 2022 of approximately $36.06 million (of which approximately $4.19 million is restricted), the capital resources available to the Company are as follows:

• Sales of Real Estate:  The Wind-Down Group is in the process of marketing and selling its real estate assets, all of which are held for sale.  One single-family home and one other real estate asset was listed for sale as of September 30, 2022. As of September 30, 2022, the Company owned a total of five real estate assets with a gross carrying value of approximately $30.96 million. The majority of the gross carrying value is concentrated in one single-family home. Based on the remaining assets of the Company, future net proceeds will be significantly less than the Company has realized in prior periods.

• Escrow Receivables:  As of September 30, 2022, the Wind-Down Group had escrow receivables relating to two single-family homes that had been sold and for which it was completing punch list items and/or awaiting the issuance of a certificate of occupancy.

• Causes of Action Recoveries:  During the three months ended September 30, 2022, the Company recognized approximately $0.19 million from the settlement of Causes of Action. There can be no assurance that the amounts the Company recovers from settling Causes of Action in the future will be consistent with the amount recovered in prior periods.

¹ The Trust is required to distribute the net sale proceeds from liquidating the Forfeited Assets to the Qualifying Victims. Qualifying Victims are the former holders of Class 3 and Class 5 Claims and their permitted assigns. Former holders of Class 4 Claims are not Qualifying Victims. Because of the requirement to distribute the net sale proceeds of the Forfeited Assets to the Qualifying Victims only, the Forfeited Assets as of September 30, 2022 are presented in the consolidated statement of net assets as restricted net assets in liquidation. As of September 30, 2022, 11,436,259 of the 11,514,190 Class A Interests were held by Qualifying Victims. Of the 13,875 Class A Interests relating to unresolved claims as of September 30, 2022, 1,880 would be held by Qualifying Victims.

23

PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

• Forfeited Assets:  Forfeited Assets consist of cash and other assets (jewelry, art, clothing, handbags and shoes). During the three months ended September 30, 2022, the Trust sold some of its Forfeited Assets and received net proceeds of approximately $0.58 million.  As noted earlier, net sale proceeds from liquidating the Forfeited Assets are to be distributed only to Qualifying Victims.

 Uses of Liquidity

The primary uses of the Company’s liquidity are to pay (a) distributions payable, (b) development costs including warranty claims, (c) holding costs including maintenance and repair costs, and (d) general and administrative costs. As of September 30, 2022, the Company’s total liabilities were approximately $29.00 million. The total liabilities recorded as of September 30, 2022 may not be indicative of the costs paid in future periods, which may be significantly higher.

Given current cash and cash equivalent balances, projected sales of real estate assets, Causes of Action recoveries, distributions declared, and expected cash needs, the Company does not expect a deficiency in liquidity in the next twelve months. Due to the uncertain nature of future net sales proceeds, recoveries and costs to be incurred, it is not possible to be certain that the current liquidity will be adequate to cover all future financial needs of the Company.  Creating contingent obligation agreements and/or seeking methods to reduce professional costs, including legal fees, and administrative costs are strategies that could be undertaken to address liquidity issues should they arise. These strategies could impact the Company’s ability to maximize recoveries from the settlement of unresolved Causes of Action.

Distributions

Distributions will be made at the sole discretion of the Liquidation Trustee in accordance with the provisions of the Plan and the Trust Agreement. As of November 10, 2022, the Liquidation Trustee has declared ten distributions to the Class A Interestholders. The distributions include a cash distribution on account of the then-allowed claims and a deposit is made into a restricted cash account for amounts that are or may become payable (a) in respect of Class A Interests that may be issued in the future upon the allowance of unresolved bankruptcy claims, (b) in respect of Class A Interests on account of recently allowed claims, (c) for holders of Class A Interests who failed to cash distribution checks mailed in respect of prior distributions, (d)  for distributions that were withheld due to pending avoidance actions and (e) for holders of Class A Interests for which the Trust is waiting for further beneficiary information.

As claims are resolved, additional Class A Interests may be issued or cancelled (see the Company’s Annual Report on Form 10-K filed on September 26, 2022, “Part 1, Item 1. Business, D. Plan Provisions Regarding the Company, 2. Treatment under the Plan of holders of claims against and equity interests in the Debtors and 3. Assets and liabilities of the Company”). Therefore, the total amount of a distribution declared may change between the date declared and the date paid. The Liquidation Trustee will continue to assess the adequacy of funds held and expects to make additional cash distributions on account of Class A Interests, but does not currently know the timing or amount of any such distribution(s).

Sections 7.6 and 7.18 of the Plan provide that distributions that have not been cashed within 180 calendar days of their issuance shall be null and void and the holder of the associated Liquidation Trust Interests “shall be deemed to have forfeited its rights to any reserved and future Distributions under the Plan,” with such amounts to become “Available Cash” of the Trust for all purposes.  On February 1, 2022, the Trust sent letters to the holders of the Class A Interests who had failed to cash distribution checks in respect of prior distributions, which checks were issued more than 180 days prior to the date of the letter. The letter informed each recipient that, unless the Trust was contacted on or before February 28, 2022, such recipient’s reserved and future distributions would be deemed forfeited in accordance with the Plan  The Trust provided this final notice simply as a one-time courtesy and reserves its rights to strictly enforce the Plan’s forfeiture provisions, and any other provision of the Plan, against any person (including any recipient of the final notice) at any time in the future, without further notice.

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PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following tables summarize the distributions declared, distributions paid and the activity in the restricted cash account for the periods from February 15, 2019 (inception) through September 30, 2022 and from February 15, 2019 (inception) through November 10, 2022:

				During the Period from February 15, 2019 (inception) through September 30, 2022 ($ in Millions)							During the Period from February 15, 2019 (inception) through November 10, 2022 ($ in Millions)
	Date Declared	$ per Class A Interest		Total Declared		Paid		Restricted Cash Account			Total Declared		Paid		Restricted Cash Account
Distributions Declared
First	3/15/2019	$	3.75	$	44.70	$	42.32	$	2.38		$	44.70	$	42.32	$	2.38
Second	1/2/2020		4.50		53.43		51.19		2.24			53.43		51.19		2.24
Third	3/31/2020		2.12		25.00		24.19		0.81			25.00		24.19		0.81
Fourth	7/13/2020		2.56		29.97		29.24		0.73			29.97		29.24		0.73
Fifth	10/19/2020		2.56		29.95		29.20		0.75			29.95		29.20		0.75
Sixth	1/7/2021		4.28		50.01		48.67		1.34			50.01		48.67		1.34
Seventh (a)	5/13/2021		2.58		30.02		29.33		0.69			30.02		29.33		0.69
Eighth	10/8/2021		3.44		40.02		39.14		0.88			40.02		39.14		0.88
Ninth	2/4/2021		3.44		39.98		39.15		0.83			39.98		39.15		0.83
Tenth	6/15/2022		5.63		65.02		64.19		0.83			65.02		64.19		0.83
Subtotal		$	34.86	$	408.10	$	396.62	$	11.48		$	408.10	$	396.62	$	11.48
Distributions Returned / (Reversed)
Disallowed/cancelled (b)									(6.27	)						(6.27	)
Returned (c)									0.74							0.74
Forfeited (d)									(1.15	)						(1.15	)
Subtotal									(6.68	)						(6.68	)
Distributions Paid from Reserve Account (e)									(3.57	)						(3.58	)
Distributions Payable, Net						as of 9/30/2022:		$	1.23				as of 11/10/2022:		$	1.22

(a) The seventh distribution included the cash the Trust received from Fair Funds.

(b) As a result of claims being disallowed or Class A Interests cancelled.

(c) Distribution checks returned or not cashed.

(d) Distributions forfeited as Interestholders did not cash checks that were over 180 days old.

(e) Paid as claims are allowed or resolved.

 Management believes that, since its inception, the Wind-Down Entity has made substantial progress toward completion of its liquidation activities and is nearing the end of the liquidation of its real estate portfolio. Holders of Liquidation Trust Interests are advised that future distributions from the Trust will be limited. Once the Company’s remaining real property assets have been liquidated and the net proceeds resulting therefrom, net of reserves, have been distributed, further distribution(s) will be materially reliant on future recoveries from litigation, which are uncertain and the amount and timing of which are difficult to determine.

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PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Contractual Obligations

As of September 30, 2022, the Company has contractual commitments related to construction contracts totaling approximately $0.60 million. The Company has an office lease that expires in January 2023. The Company has one six-month option to extend the lease. The Company expects that it will continue to lease office space until the liquidation process is completed.

Critical Accounting Policies and Practices

The Company’s consolidated financial statements are prepared in accordance with U.S. GAAP. The accounting policies and practices that the Company believes are the most critical are discussed below. These accounting policies and practices require management to make decisions on subjective and/or complex matters that may inherently be uncertain. Estimates are required to prepare the consolidated financial statements in conformity with U.S. GAAP. Significant estimates, judgments and assumptions are required in a number of areas, including, but not limited to, the sales price of real estate assets, selling costs, development costs, holding costs, potential warranty claims, and general and administrative costs to be incurred until the completion of the liquidation of the Company and estimated reserves for contingent liabilities. In many instances, changes in the accounting estimates are likely to occur from period to period. Actual results may differ from the estimates. The Company believes the current assumptions and other considerations used in preparing the consolidated financial statements are appropriate. However, if actual experience differs from the assumptions and other considerations used in estimating amounts reflected in the Company’s consolidated financial statements, the resulting changes could have a material adverse effect on the Company’s net assets in liquidation.

Liquidation Basis of Accounting

Under the Liquidation Basis of Accounting, all assets are recorded at their estimated net realizable value or liquidation value, which represents the estimated amount of net cash that may be received upon the disposition of the assets (on an undiscounted basis). Liabilities are measured in accordance with U.S. GAAP that otherwise applies to those liabilities. The Company has not recorded any amount from the future settlement of unresolved Causes of Action or Fair Fund recoveries in the accompanying consolidated financial statements because they cannot be reasonably estimated.

Valuation of Real Estate

The measurement of real estate assets held for sale is based on current contracts (if any), estimates and other indications of sales value, net of estimated selling costs. To determine the value of real estate assets held for sale, the Company considered the three traditional approaches to value (cost, income and sales comparison) commonly used by the real estate appraisal community. The applicability and relevancy of each valuation approach as applied may differ by asset. In most cases, the sales comparison approach was accorded the greatest weight. This approach compares a property to other properties with similar characteristics that have recently sold. To validate management’s estimate, the Company also considers opinions from qualified real estate professionals and local real estate brokers and, in some cases, has obtained third party appraisals.

Accrued Liquidation Costs

The estimated costs associated with implementing and completing the Company’s plan of liquidation are recorded as accrued liquidation costs. The Company has also recorded the estimated development costs to be incurred to prepare the assets for sale as well as the estimated holding, maintenance and repair costs to be incurred until the projected sale date and the estimated general and administrative costs to be incurred until the completion of the liquidation of the Company and estimated reserves for contingent liabilities.

Changes in Carrying Value

On a quarterly basis, the Company reviews the estimated net realizable values, liquidation costs and the estimated date of the completion of the liquidation of the Company and records any significant changes. The Company will also evaluate an asset when it is under contract for sale and the buyer’s contingencies have been removed. During the period that this occurs, the carrying value of the asset and the estimated closing and other costs will be adjusted, if necessary. If the Company has a change in its plan for the disposition of an asset, the carrying value will be adjusted to reflect this change in the period that the change is approved. The change in value may also include a change to the accrued liquidation costs related to the asset.

All changes in the estimated liquidation value of the Company’s assets, real estate held for sale, or other assets and liabilities are reflected as a change to the Company’s net assets in liquidation.

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PART I.  FINANCIAL INFORMATION (CONTINUED)

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable, as the Company is a “smaller reporting company” within the meaning of Rule 12b-2 of the Exchange Act.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As of the end of the period covered by this report, management and the Liquidation Trustee evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Based upon, and as of the date of, the evaluation, management and the Liquidation Trustee concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including the Liquidation Trustee, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934, as amended.

In connection with the preparation of our Form 10-Q, our management and the Liquidation Trustee assessed the effectiveness of our internal control over financial reporting as of September 30, 2022. In making that assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013).

Based on its assessment, our management and the Liquidation Trustee believes that, as of September 30, 2022, our internal control over financial reporting was effective based on those criteria. There have been no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

Below is a description of pending litigation. As the Company is the plaintiff in these legal proceedings and does not have the ability to estimate the ultimate recovery amount until they are settled, and in accordance with the Company’s accounting policy, no recoveries have been recorded in the Company’s consolidated financial statements for these legal proceedings, other than for settlements for which the Trust has entered into a signed settlement agreement and collectability is reasonably assured.

Goldberg v. Halloran & Sage LLP, et al., Case No. 19STCV42900 (Cal. Super. Ct., L.A. Cnty., filed Dec. 2, 2019), is an action by the Trust against nine law firms (Halloran & Sage LLP; Balcomb & Green, P.C.; Rome McGuigan, P.C.; Haight Brown & Bonesteel LLP; Bailey Cavalieri LLC; Sidley Austin LLP; Davis Graham & Stubbs LLP; Robinson & Cole LLP; and Finn Dixon & Herling LLP) and ten individual attorneys (Richard Roberts, Lawrence R. Green, Jon H. Freis, Brian Courtney, Ted Handel, Thomas Geyer, Neal Sullivan, S. Lee Terry, Jr., Shant Chalian, and Reed Balmer) for conduct in connection with their representation of Robert Shapiro, the Debtors or their affiliates before the commencement of the Bankruptcy Cases, as well as against up to 100 “Doe” defendants. The conduct challenged in the complaint includes knowingly and/or negligently preparing loan documents and investment agreements with material misstatements and omissions, designing deceptive securities products, preparing incorrect legal opinion memoranda on which investors relied, and assisting in the creation of nominally third-party borrower entities that were in fact controlled by Robert Shapiro.

The first set of counts in the complaint are against law firm Halloran & Sage LLP, attorney Richard Roberts, and the “Doe” defendants for aiding and abetting securities fraud (First Count), aiding and abetting fraud (Second Count), aiding and abetting breach of fiduciary duty (Third Count), negligent misrepresentation (Fourth Count), professional negligence (Fifth Count), and aiding and abetting conversion (Sixth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

The second set of counts in the complaint are against law firm Balcomb & Green, P.C., attorney Lawrence R. Green, and the “Doe” defendants for aiding and abetting securities fraud (Seventh Count), aiding and abetting fraud (Eighth Count), aiding and abetting breach of fiduciary duty (Ninth Count), negligent misrepresentation (Tenth Count), professional negligence (Eleventh Count), and aiding and abetting conversion (Twelfth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

The third set of counts in the complaint are against attorney Jon H. Freis and the “Doe” defendants for aiding and abetting securities fraud (Thirteenth Count), aiding and abetting fraud (Fourteenth Count), aiding and abetting breach of fiduciary duty (Fifteenth Count), negligent misrepresentation (Sixteenth Count), professional negligence (Seventeenth Count), and aiding and abetting conversion (Eighteenth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

The fourth set of counts in the complaint are against law firm Rome McGuigan, P.C., attorney Brian Courtney, and the “Doe” defendants for aiding and abetting securities fraud (Nineteenth Count), aiding and abetting fraud (Twentieth Count), aiding and abetting breach of fiduciary duty (Twenty-First Count), negligent misrepresentation (Twenty-Second Count), professional negligence (Twenty-Third Count), and aiding and abetting conversion (Twenty-Fourth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

The fifth set of counts in the complaint are against law firm Haight Brown & Bonesteel LLP, attorney Ted Handel, and the “Doe” defendants for aiding and abetting securities fraud (Twenty-Fifth Count), aiding and abetting fraud (Twenty-Sixth Count), aiding and abetting breach of fiduciary duty (Twenty-Seventh Count), negligent misrepresentation (Twenty-Eighth Count), professional negligence (Twenty-Ninth Count), and aiding and abetting conversion (Thirtieth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $20 million, as well as for punitive damages.

The sixth set of counts in the complaint are against law firm Bailey Cavalieri LLC, Thomas Geyer, and the “Doe” defendants for aiding and abetting securities fraud (Thirty-First Count), aiding and abetting fraud (Thirty-Second Count), aiding and abetting breach of fiduciary duty (Thirty-Third Count), negligent misrepresentation (Thirty-Fourth Count), professional negligence (Thirty-Fifth Count), and aiding and abetting conversion (Thirty-Sixth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

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PART II.  OTHER INFORMATION (CONTINUED)

Item 1.  Legal Proceedings (Continued)

The seventh set of counts in the complaint are against law firm Sidley Austin LLP, attorney Neal Sullivan, and the “Doe” defendants for aiding and abetting securities fraud (Thirty-Seventh Count), aiding and abetting fraud (Thirty-Eighth Count), aiding and abetting breach of fiduciary duty (Thirty-Ninth Count), negligent misrepresentation (Fortieth Count), professional negligence (Forty-First Count), and aiding and abetting conversion (Forty-Second Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $500 million, as well as for punitive damages.

The eighth set of counts in the complaint are against law firm Davis Graham & Stubbs LLP, attorney S. Lee Terry, Jr., and the “Doe” defendants for aiding and abetting securities fraud (Forty-Third Count), aiding and abetting fraud (Forty-Fourth Count), aiding and abetting breach of fiduciary duty (Forty-Fifth Count), negligent misrepresentation (Forty-Sixth Count), professional negligence (Forty-Seventh Count), and aiding and abetting conversion (Forty-Eighth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $200 million, as well as for punitive damages.

The ninth set of counts in the complaint are against law firm Robinson & Cole LLP, attorney Shant Chalian, and the “Doe” defendants for aiding and abetting securities fraud (Forty-Ninth Count), aiding and abetting fraud (Fiftieth Count), aiding and abetting breach of fiduciary duty (Fifty-First Count), negligent misrepresentation (Fifty-Second Count), professional negligence (Fifty-Third Count), and aiding and abetting conversion (Fifty-Fourth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $5 million, as well as for punitive damages.

The tenth set of counts in the complaint are against law firm Finn Dixon & Herling LLP, attorney Reed Balmer, and the “Doe” defendants for aiding and abetting securities fraud (Fifty-Fifth Count), aiding and abetting fraud (Fifty-Sixth Count), aiding and abetting breach of fiduciary duty (Fifty-Seventh Count), negligent misrepresentation (Fifty-Eighth Count), professional negligence (Fifty-Ninth Count), and aiding and abetting conversion (Sixtieth Count). These defendants are alleged to be jointly and severally liable for rescission of investors’ purchases of securities and for damages in an amount believed to be in excess of $5 million, as well as for punitive damages.

The eleventh set of counts in the complaint are against law firms Halloran & Sage LLP; Balcomb & Green, P.C.; Rome McGuigan, P.C.; Haight Brown & Bonesteel LLP; Bailey Cavalieri LLC; Sidley Austin LLP; Davis Graham & Stubbs LLP; Robinson & Cole LLP; and Finn Dixon & Herling LLP; attorney Jon H. Freis, and the “Doe” defendants for actual-intent fraudulent transfer (Sixty-First Count) and constructive fraudulent transfer (Sixty-Second Count). These defendants are alleged to be liable for damages in an amount believed to be in excess of $5 million, as well as for provisional remedies, avoidance of the transfers, and punitive damages.

The case was designated as a complex matter on December 18, 2019 and was assigned to the Honorable Amy Hogue.

On March 20, 2020, two sets of defendants – Sidley Austin LLP and Neal Sullivan; and Davis Graham & Stubbs LLP and S. Lee Terry, Jr. – filed special motions to strike the portions of the complaint directed at them under a California statute (Civil Procedure Code section 425.16) that permits defendants to bring early challenges to causes of action against them that allegedly arise from protected litigation activity if those causes of action lack minimal merit.  The defendants that filed these special motions to strike asserted that the claims against them arise from communicative conduct in the course of quasi-judicial proceedings, such as regulatory inquiries, and that the Trust cannot establish a likelihood of prevailing on its claims against them.  The Trust opposed these motions, and the matters were heard on July 28, 2020, and taken under submission on that date.  On August 14, 2020, the Court entered orders: (i) granting the motion to strike filed by Sidley Austin LLP and Neal Sullivan, and (ii) granting in part and denying in part the motion to strike filed by Davis Graham & Stubbs LLP and S. Lee Terry, Jr.  In September 2020, the Trust filed notices of appeal of the foregoing orders, and Davis Graham & Stubbs LLP and S. Lee Terry, Jr. subsequently filed a cross-appeal.  On January 27, 2021, the Court entered an order granting, in part, a motion for attorneys’ fees filed by Sidley Austin LLP and Neal Sullivan, pursuant to which the movants were awarded $282,500.00 in fees and $5,557.87 in costs. On March 1, 2021, the Trustee filed a notice of appeal of the order granting fees and costs.

On April 13, 2020, four sets of defendants – Rome McGuigan, P.C. and Brian Courtney; Bailey Cavalieri LLC and Thomas Geyer; Robinson & Cole LLP and Shant Chalian; and Finn Dixon & Herling LLP and Reed Balmer – filed motions to quash the service of summonses.  The defendants that filed these motions asserted that they are not subject to suit in California because they do not have sufficient contacts with California to justify a California court’s exercise of jurisdiction over them.  The Trust opposed these motions, and the matters were heard in part on July 15, 2020 and in part on July 20, 2020, and (with exception of the motion filed by Finn Dixon & Herling LLP and Reed Balmer) were taken under submission on July 20, 2020.  The motion filed by Finn Dixon & Herling LLP, and Reed Balmer was taken off calendar prior to July 20, 2020, and the parties thereafter reached a confidential settlement.  On July 21, 2020, the Court entered orders granting the motions to quash filed by Rome McGuigan, P.C. and Brian Courtney; Bailey Cavalieri LLC and Thomas Geyer; and Robinson & Cole LLP and Shant Chalian.  On September 10, 2020, the Trust filed a notice of appeal of the foregoing orders.

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PART II.  OTHER INFORMATION (CONTINUED)

Item 1.  Legal Proceedings (Continued)

On June 16, 2020, the Trust reached a confidential settlement with Balcomb & Green, P.C. and Lawrence R. Green.  On July 6, 2020, these defendants filed a motion seeking the Court’s determination that the settlement was made in good faith under a California statute (Civil Procedure Code section 877.6) that permits settling defendants to seek a good faith settlement finding in order to bar any other defendant from seeking contribution or indemnity.  The motion was unopposed, and the Court entered an order granting it on August 12, 2020.

On January 21, 2021, the Trust reached a confidential settlement with Robinson & Cole LLP and Shant Chalian.  As part of that settlement, the appeal of the jurisdictional ruling as to those parties has been dismissed.

The other appeals remain pending. On June 14, 2021, the Trustee filed a combined opening brief for all of the appeals other than his appeal of the order granting fees and costs to Sidley Austin LLP. Between September 22-29, 2021, the respondents filed their opening briefs.   On March 17, 2022, the Trustee filed a combined reply brief for all of the appeals other than his appeal of the order granting fees and costs to Sidley Austin LLP.  On June 30, 2022, Davis Graham & Stubbs LLP filed its reply brief in support of its cross-appeal of the order denying a portion of its special motion to strike.  The matter is currently fully briefed and awaiting the Court scheduling oral argument.

The appeal of the award granting fees and costs to Sidley Austin LLP remains pending.  The Trustee is due to file an opening brief in November 2022.

On October 28, 2020, the Trust filed a federal lawsuit against four defendants that prevailed on the motions to quash service of summons in the California state court action (Rome McGuigan, P.C.; Brian Courtney; Bailey Cavalieri LLC; and Thomas Geyer), as well as a fifth defendant (Ivan Acevedo), and certain “Doe” defendants.”  The case is styled Goldberg v. Rome McGuigan, P.C., et al., Case No. 2:20-cv-09958-JFW-SK (C.D. Cal.).  The complaint contains counts for (i) violations of section 10(b) of the Exchange Act and Rule 10b-5; (i) aiding and abetting fraud; (iii) aiding and abetting breach of fiduciary duty; (iv) negligent misrepresentation; (v) professional negligence; (vi) aiding and abetting conversion; (vii) actual fraudulent transfer; and (viii) constructive fraudulent transfer.  The conduct challenged in the complaint includes certain of the same conduct challenged in the California state court action, and a footnote in the complaint explains:  “Plaintiff filed an action in Los Angeles Superior Court against [four of these defendants] raising some of the claims asserted in this action.  Those defendants filed a motion to quash service, alleging that the court did not have personal jurisdiction.  The Court granted those motions, and Plaintiff appealed.  Plaintiff brings this action to preserve his rights and ensure that his claims against [the defendants] are adjudicated on the merits.  Should the state court appeal be successful, resulting in two cases being simultaneously litigated on the merits in two forums, [plaintiff] will consider dismissing this action and litigating the case in state court.”  On January 4, 2021, the four defendants from the California state court action filed motions to dismiss this federal lawsuit, and on March 4, 2021, the court entered an order granting those motions in part by dismissing the first count (arising under the federal securities laws), without ruling on the remaining counts (arising under state law) in light of potential personal jurisdiction issues.  On March 29, 2021, the same four defendants again moved to dismiss the remaining counts for lack of personal jurisdiction. On April 23, 2021 the federal court entered an order granting those motions, but has not yet entered a final judgment.

Avoidance actions. The Trust is currently prosecuting numerous legal actions to recover preferential payments, fraudulent transfers, and other funds subject to recovery by the bankruptcy estate.  These actions were filed in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”), are pending before the Honorable J. Kate Stickles, and generally fall into the following categories:

o Preferential transfers. Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code and seek to avoid or recover payments made by the Debtors during the 90 days prior to the December 4, 2017 bankruptcy filing, including payments to miscellaneous vendors and former Noteholders and Unitholders.

o Fraudulent transfers (Interest to Noteholders and Unitholders). Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code and seek to avoid or recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for interest paid to former Noteholders and Unitholders.

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PART II.  OTHER INFORMATION (CONTINUED)

Item 1.  Legal Proceedings (Continued)

o Fraudulent transfers (Shapiro personal expenses). Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code and seek to avoid and recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for the personal expenses of Robert and Jeri Shapiro, including those identified in a forensic report prepared in connection with an SEC enforcement action in the United States District Court for the Southern District of Florida.

o Fraudulent transfers and fraud (against former agents). These actions, which arise under chapter 5 of the Bankruptcy Code and applicable state law governing fraudulent transfers, seek to avoid and recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for commissions to former agents, as well as for fraud, aiding and abetting fraud, and the unlicensed sale of securities asserted by the Trust based on claims contributed to the Trust by defrauded investors. These actions were filed by the Trust in the United States Bankruptcy Court for the District of Delaware between November 15, 2019 and December 4, 2019. Actions of this type are also being pursued by the SEC, and it is the Trust’s understanding that any recoveries obtained by the SEC will be transmitted to the Trust pursuant to a Fair Fund established by the SEC.

The Trust has filed over 400 legal actions of this nature, many of which have been resolved, resulting in recoveries by or judgments in favor of the Trust. Since inception and as of October 31, 2022, the Trust has obtained judgments of approximately $44.73 million, including default judgments of approximately $36.21 million and stipulated judgments of approximately $8.52 million. It is unknown at this time how much, if any, will ultimately be collected on the judgments.  Additionally, the Trust has entered into settlements in approximately 227 legal actions and approximately 245 potential avoidance claims for which litigation was not filed, resulting in aggregate settlements of approximately $18.17 million of cash payments made or due to the Trust and approximately $11.21 million in reductions of claims against the Trust.

Other legal proceedings.  In addition, other legal proceedings were prosecuted by the Trust and United States governmental authorities, which actions resulted in recoveries in favor of the Trust. Such actions include:

o Actions regarding the Shapiro’s personal assets. On December 4, 2019, the Trust filed an action in the Bankruptcy Court, Adv. Pro. No. 10-51076 (BLS), Woodbridge Liquidation Trust v. Robert Shapiro, Jeri Shapiro, 3X a Charm, LLC, Carbondale Basalt Owners, LLC, Davana Sherman Oaks Owners, LLC, In Trend Staging, LLC, Midland Loop Enterprises, LLC, Schwartz Media Buying Company, LLC and Stover Real Estate Partners LLC. In this action, the Trust asserts claims under chapter 5 of the Bankruptcy Code and applicable state law for avoidance of preferential and fraudulent transfers together with claims for fraud, aiding and abetting fraud, the unlicensed sale of securities, breach of fiduciary duty and unjust enrichment. The Trust seeks to recover damages and assets held in the names of Robert Shapiro, Jeri Shapiro and their family members and entities owned or controlled by them, which assets the Trust contends are beneficially owned by the Debtors or for which the Debtors are entitled to recover based on the Shapiros’ defalcations, including over $20 million in avoidable transfers. On February 4, 2022, the Trust entered into a Settlement Agreement with Ms. Jeri Shapiro resolving the Trust’s adversary proceeding against Ms. Shapiro.  In connection with the Settlement Agreement, Ms. Shapiro responded to interrogatories from the Trust and submitted a declaration under penalty of perjury detailing her lack of assets.  Upon execution of the Settlement Agreement, Ms. Shapiro executed and delivered a Stipulated Judgment for approximately $20.6 million that will be held by the Trust in escrow for three years that can be entered without notice if the Trust learns Ms. Shapiro’s representations in her declaration were false or materially inaccurate.  Additionally, Ms. Shapiro authorized the Trust to expunge the filed claims of certain co-defendants she was listed as an officer and turned over payments to the Trust that were received by certain co-defendants in the adversary proceeding.  A stipulation of dismissal (as to Ms. Shapiro only) was entered on April 1, 2022.

o Criminal proceeding and forfeiture.  In connection with the United States’ criminal case against Robert Shapiro (Case No. No. 19-20178-CR-ALTONAGA (S.D. Fla. 2019)), Shapiro agreed to the forfeiture of certain assets.  The Trust filed a petition in the Florida court to claim the Forfeited Assets as property of the Debtors’ estates, and therefore as property that had vested in the Trust pursuant to the Plan.  The Trust has entered into an agreement with the United States Department of Justice to resolve its claim.  The agreement was approved by the Bankruptcy Court on September 17, 2020 and was approved by the United States District Court on October 1, 2020.  Among other things, the agreement provides for the release of specified Forfeited Assets by the United States to the Trust, and for the Trust to liquidate those assets and distribute the net sale proceeds to Qualifying Victims, which include the vast majority of Trust beneficiaries—specifically, all former holders of Class 3 and 5 claims under the Plan and their permitted assigns—but do not include former holders of Class 4 claims under the Plan. The Trust has taken possession of the Forfeited Assets and has sold the wine and gold assets as well as an automobile.  Some of the jewelry, art, clothing, handbags and shoes have also been sold.

31

PART II.  OTHER INFORMATION (CONTINUED)

Item 1.  Legal Proceedings (Continued)

Wind-Down Group litigation. The Wind-Down Group owns a portfolio of real estate assets, which includes secured loans and other properties.  As part of its recovery efforts, the Wind-Down Group, through its subsidiaries, is involved in ordinary routine litigation incidental to such assets.  Among other litigation, certain Woodbridge entities (including the Trust, the Wind-Down Entity, and WB 8607 Honoapiilani, LLC) filed an action against Certain Underwriters at Lloyd’s of London in Los Angeles Superior Court, alleging that the defendant insurer breached its obligations under an insurance policy purchased to protect a property owned by WB 8607 Honoapiilani (a subsidiary of the Wind-Down Entity) in Hawaii, which property was destroyed by fire in August 2017.  The Superior Court granted the defendant’s motion for summary judgment, and on March 25, 2021 entered judgment in favor of the defendant.  The judgment provided that plaintiffs take nothing by way of the complaint.  Further, the judgment provided that defendant refund plaintiffs for the premium payments under the insurance policy at issue in the lawsuit ($110,829.43), less all amounts paid by the defendant in respect of claims under the policy ($97,770.38) and less defendant’s costs (defendant requested costs of $9,874.71).  Plaintiffs have appealed the judgment. The appeal has been fully briefed and is awaiting oral argument before the Court of Appeal, which argument is presently set to occur in November 2022.

32

PART II.  OTHER INFORMATION (CONTINUED)

Item 1A. Risk Factors

Not applicable, as the Company is a “smaller reporting company” within the meaning of Rule 12b-2 of the Exchange Act.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In accordance with the Plan, all Liquidation Trust Interests have been issued without registration under the Securities Act.  The Liquidation Trust Interests have been issued only to holders of allowed claims in Class 3, Class 4, and Class 5 under the Plan entirely in exchange for such claims.  See “Item 1.  Business - D. Plan Provisions Regarding the Company - 2. Treatment under the Plan of holders of claims against and equity interests in the Debtors” of our Annual Report on Form 10-K filed with the SEC on September 26, 2022.  During the period from February 15, 2019 (inception) through September 30, 2022, the Trust has issued an aggregate of 11,542,087 Class A Interests and an aggregate of 677,790 Class B Interests.  As of September 30, 2022, the Trust had 11,514,190 Class A Interests and 675,617 Class B Interests outstanding. All Liquidation Trust Interests were issued on the Plan Effective Date or from time to time thereafter as soon as practicable as and when claims in Class 3, Class 4 or Class 5 have become allowed.

During the three months ended September 30, 2022, the Trust issued the following Liquidation Trust Interests:

	Number of		Number of
	Class A		Class B		Nature of the	Consideration
Date of Sale	Interests Sold		Interests Sold		Transaction	Received
August 1, 2022		847.60		-	Allowance of	Allowance of
					claims	claims
August 29, 2022		557.18		-	Allowance of	Allowance of
					claims	claims
September 1, 2022		10.20		-	Allowance of	Allowance of
					claims	claims
Total		1,414.98		-

The issuance of Liquidation Trust Interests has occurred in reliance upon the exemption from the registration requirements of the Securities Act afforded by Section 1145(a)(1) of the Bankruptcy Code. Section 1145(a)(1) exempts the offer and sale of securities under a plan of reorganization from registration under the Securities Act and state securities laws and regulation if (i) the securities are offered and sold under a plan of reorganization and are securities of the debtor, of an affiliate of the debtor participating in a joint plan with the debtor, or of a successor to the debtor under the plan; (ii) the recipients of the securities hold a pre-petition or administrative claim against the debtor or an interest in the debtor; and (iii) the securities are issued entirely in exchange for the recipient’s claim against or interest in the debtor, or principally in such exchange and partly for cash or property. The Trust believes that the Liquidation Trust Interests are securities of a “successor” to the Debtors within the meaning of Section 1145(a)(1), and such securities were issued under the Plan entirely in exchange for allowed claims in Class 3, Class 4, and Class 5 under the Plan.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

33

PART II.  OTHER INFORMATION (CONTINUED)

Item 6. Exhibits

Exhibit Description

2.1	First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors dated August 22, 2018, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.1	Certificate of Trust of Woodbridge Liquidation Trust dated February 14 and effective February 15, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.2	Liquidation Trust Agreement of Woodbridge Liquidation Trust dated February 15, 2019, as amended by Amendment No. 1 dated August 21, 2019 and Amendment No. 2 dated September 13, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.3	Amendment No. 3 to Liquidation Trust Agreement dated as of November 1, 2019, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
3.4	Amendment No. 4 to Liquidation Trust Agreement dated as of February 5, 2020, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on February 6, 2020.
3.5	Amended and Restated Bylaws of Woodbridge Liquidation Trust effective August 21, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.1	Limited Liability Company Agreement of Woodbridge Wind-Down Entity LLC dated February 15, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.2	Amended and Restated Employment Agreement dated July 31, 2019 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.3	First Amendment to Amended and Restated Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.4	Indemnification Agreement dated February 27, 2019 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.5	Part-Time Employment Agreement dated September 1, 2022 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Form 8-K filed by the Trust on September 1, 2022.
10.6	Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.7	First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.8	Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.9	Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.10	First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.

34

PART II.  OTHER INFORMATION (CONTINUED)

Item 6. Exhibits (Continued)

10.11	Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.12	Stipulation and Settlement Agreement between the United States and Woodbridge Liquidation Trust, as approved by order of the United States Bankruptcy Court for the District of Delaware entered September 17, 2020, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.13	Settlement Agreement dated August 6, 2021 by and among Mark Baker, Jay Beynon as Trustee for the Jay Beynon Family Trust DTD 10/23/1998, Alan and Marlene Gordon, Joseph C. Hull, Lloyd and Nancy Landman, and Lilly A. Shirley on behalf of themselves and the proposed Settlement Class, Michael I. Goldberg, as Trustee for Woodbridge Liquidation Trust, and Comerica Bank, incorporated herein by reference to the Form 10-K filed by the Trust on September 27, 2021.
31.1*	Certification of Liquidation Trustee pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*	Certification of Liquidation Trustee pursuant to 18 U.S.C. 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1	Findings of Fact, Conclusions of Law, and Order Confirming the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors, entered October 26, 2018, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
101	The following financial statements from the Woodbridge Liquidation Trust Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, formatted in eXtensible Business Reporting Language (XBRL): (i) consolidated statements of net assets in liquidation as of September 30, 2022 and June 30, 2022, (ii) consolidated statements of changes in net assets in liquidation for the three months ended September 30, 2022 and 2021, (iii) the notes to the consolidated financial statements. XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
104	Cover Page Interactive Data File (Formatted as Inline XBRL and contained in Exhibit 101)

 *Filed herewith

35

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Woodbridge Liquidation Trust
Date: November 10, 2022	By:	/s/ Michael I. Goldberg
		Michael I. Goldberg,
		Liquidation Trustee

36

EX-31.1

Exhibit 31.1

Certification of Liquidation Trustee pursuant to Section 302

of the Sarbanes-Oxley Act of 2002

I, Michael I. Goldberg, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Woodbridge Liquidation Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the net assets in liquidation and changes in net assets in liquidation of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by other within those entities, particularly during the period in which this report is being prepared;

b) (Omitted pursuant to SEC Release Nos. 33-8238/34-47986 and 33-8392/34-4933);

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 10, 2022	By:	/s/ Michael I. Goldberg
		Michael I. Goldberg,
		Liquidation Trustee

EX-32.2

Exhibit 32.1

Certification of Liquidation Trustee pursuant to 18 U.S.C. 1350,

as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Woodbridge Liquidation Trust (the “Registrant”) for the quarter ended September 30, 2022, as filed with the Securities and exchange Commission on the date hereof (the “Report”), the undersigned, Michael I. Goldberg, Trustee of the Registrant, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge and belief:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the net assets in liquidation and changes in net assets in liquidation of the Registrant.

Date: November 10, 2022	By:	/s/ Michael I. Goldberg
		Michael I. Goldberg,
		Liquidation Trustee

XML

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2022	Nov. 10, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Document Transition Report	false
Entity File Number	000-56115
Entity Registrant Name	Woodbridge Liquidation Trust
Entity Central Index Key	0001785494
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-7730868
Entity Address, Address Line One	201 N. Brand Blvd.,
Entity Address, Address Line Two	Suite M
Entity Address, City or Town	Glendale
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91203
City Area Code	310
Local Phone Number	765-1550
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		0

XML

Consolidated Statements of Net Assets in Liquidation - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Assets
Real estate assets held for sale, net (Note 3)	$ 29,050	$ 29,062
Cash and cash equivalents	31,867	96,810
Restricted cash (Note 4)	4,192	6,121
Other assets (Note 5)	1,803	5,825
Total assets	66,912	137,818
Liabilities
Accounts payable and accrued liabilities	103	119
Distributions payable	1,226	68,767
Accrued liquidation costs (Note 6)	27,667	34,537
Total liabilities	28,996	103,423
Commitments and Contingencies (Note 14)
Net Assets in Liquidation
Restricted for Qualifying Victims (Note 7)	3,483	3,485
All Interestholders	34,433	30,910
Net Assets in Liquidation	$ 37,916	$ 34,395

XML

Consolidated Statements of Changes in Net Assets in Liquidation - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Increase (Decrease) in Net Assets in Liquidation [Roll Forward]
Net Assets in Liquidation as of beginning of period	$ 34,395	$ 129,540
Restricted for Qualifying Victims -
Change in carrying value of assets and liabilities, net	(2)	0
All Interestholders -
Change in carrying value of assets and liabilities, net	885	4,904
Distributions (declared) reversed, net	2,638	99
Net change in assets and liabilities	3,523	5,003
Net Assets in Liquidation as of end of period	37,916	134,543
Restricted for Qualifying Victims [Member]
Increase (Decrease) in Net Assets in Liquidation [Roll Forward]
Net Assets in Liquidation as of beginning of period	3,485	3,167
Restricted for Qualifying Victims -
Change in carrying value of assets and liabilities, net	(2)	0
All Interestholders -
Change in carrying value of assets and liabilities, net	0	0
Distributions (declared) reversed, net	0	0
Net change in assets and liabilities	0	0
Net Assets in Liquidation as of end of period	3,483	3,167
All Interestholders [Member]
Increase (Decrease) in Net Assets in Liquidation [Roll Forward]
Net Assets in Liquidation as of beginning of period	30,910	126,373
Restricted for Qualifying Victims -
Change in carrying value of assets and liabilities, net	0	0
All Interestholders -
Change in carrying value of assets and liabilities, net	885	4,904
Distributions (declared) reversed, net	2,638	99
Net change in assets and liabilities	3,523	5,003
Net Assets in Liquidation as of end of period	$ 34,433	$ 131,376

XML

Formation and Description of Business

3 Months Ended

Sep. 30, 2022

Formation and Description of Business [Abstract]

Formation, Organization and Description of Business

1) Formation and Description of Business

Formation

Woodbridge Liquidation Trust (the “Trust”) was established (i) for the purpose of collecting, administering, distributing and liquidating the Trust assets for the benefit of the Trust beneficiaries in accordance with the Liquidation Trust Agreement of the Trust and the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors dated August 22, 2018 (as amended, modified, supplemented or restated from time to time, the (“Plan”)); (ii) to resolve disputed claims asserted against the Debtors; (iii) to litigate and/or settle causes of action (“Causes of Action”); and (iv) to pay certain allowed claims and statutory fees, as required by the Plan. Woodbridge Group of Companies, LLC and its affiliated debtors are individually referred to herein as a Debtor and collectively as the Debtors. The Trust was formed on February 15, 2019 (the “Plan Effective Date”) as a statutory trust under Delaware law.

On the Plan Effective Date, in accordance with the Plan, (a) the following assets automatically vested in the Trust: (i) an aggregate $5,000,000 in cash from the Debtors for the purpose of funding the Trust’s initial expenses of operation; (ii) certain claims and Causes of Action; (iii) all of the outstanding equity interests of the Wind-Down Entity (as defined below); and (iv) certain other non-real estate related assets, (b) the equity interests of Woodbridge Group of Companies, LLC and Woodbridge Mortgage Investment Fund 1, LLC (together, the “Remaining Debtors”) were cancelled and new equity interests representing all of the newly issued and outstanding equity interests in the Remaining Debtors were issued to the Trust, (c) all of the other Debtors other than the Remaining Debtors were dissolved and (d) the real estate-related assets of the Debtors were automatically vested in the Trust’s wholly-owned subsidiary, Woodbridge Wind-Down Entity LLC (the “Wind-Down Entity”) or one of the Wind-Down Entity’s 43 wholly-owned single member LLCs (the “Wind-Down Subsidiaries”) formed to own the respective real estate assets. The Trust, the Remaining Debtors, the Wind-Down Entity and the Wind-Down Subsidiaries are collectively referred to herein as the “Company.”

As further discussed in Note 10, the Trust has two classes of liquidation trust interests, Class A Liquidation Trust Interests (“Class A Interests”) and Class B Liquidation Trust Interests (“Class B Interests”). The holders of Class A Interests and Class B Interests are collectively referred to as “All Interestholders.”

On December 24, 2019, the Trust’s Registration Statement on Form 10 became effective under the Securities Exchange Act of 1934 (the “Exchange Act”). The trading symbol for the Trust’s Class A Interests is WBQNL. Bid and asked prices for the Trust’s Class A Interests are quoted on the OTC Link ATS, the SEC-registered alternative trading system. The Class A Interests are eligible for the Depository Trust Company’s Direct Registration System (DRS) services. The Class B Interests are not registered with the SEC.

Description of Business

The Trust is prosecuting various Causes of Action acquired by the Trust pursuant to the Plan and is resolving claims asserted against the Debtors. As of September 30, 2022, the Company is the plaintiff in several pending lawsuits. The Company has accrued an estimate of the amount of legal costs to be incurred to pursue this litigation, excluding contingent fees. As more fully discussed in Note 2, the Company’s consolidated financial statements do not include any estimate of future net recoveries from litigation and settlement, since the Company cannot reasonably estimate them.

The Wind-Down Entities’ operations are almost complete. As of September 30, 2022, the Wind-Down Subsidiaries owned one single-family home, located in Los Angeles, California. Construction of this single-family home is substantially complete, and it is listed for sale. For this single-family home and several previously sold homes, the Wind-Down Subsidiaries are completing punch list and repair items. As of September 30, 2022, the Wind-Down Subsidiaries also owned two secured loans and two other properties located in other states. (See Note 3.)

The Company is required to liquidate its assets and distribute available cash to the Trust beneficiaries. The liquidation activities are carried out by the Trust, the Wind-Down Entity and the Wind-Down Subsidiaries. As of September 30, 2022, the Company estimates that the liquidation activities will be completed by February 15, 2024. As more fully discussed in Note 2, the Company uses the Liquidation Basis of Accounting. The Trust currently operates as one reportable segment comprised primarily of real estate assets held for sale.

Net assets in liquidation represent the remaining estimated aggregate value available to Trust beneficiaries upon liquidation, with no discount for the timing of proceeds (undiscounted).  Net liquidation proceeds, other recoveries and actual liquidation costs may differ materially from the estimated amounts due to the unpredictability of real estate selling prices, the impact of the COVID-19 virus and other global health crises (see below), as well as the uncertainty in the timing of liquidation of the real estate and other assets.

The Trust’s expectations about the amount of any additional distributions and when they will be paid are subject to risks and uncertainties and are based on certain estimates and assumptions, one or more of which may prove to be incorrect.  As a result, the actual amount of any additional distributions may differ materially, perhaps in adverse ways, from the Trust estimates. Furthermore, it is not possible to predict the timing of any additional distributions and any such distributions may not be made within the timing referenced in the consolidated financial statements.

No assurance can be given that total distributions will equal or exceed the estimate of net assets in liquidation presented in the consolidated statements of net assets in liquidation.

The Company observes health and safety guidelines, including allowing its employees to work remotely. The Company will continue to evaluate the impact of the COVID-19 virus and other global health crises on its activities, including the cost and timing of construction related services, the time needed to market and sell its remaining real estate assets and the price at which these real estate assets will be sold.

The ultimate impact of the COVID-19 virus and other global health crises will depend on many factors, some of which cannot be foreseen, including the duration, severity, and geographic concentrations of the pandemic and any resurgence of the disease.

XML

Summary of Significant Accounting Policies

3 Months Ended

Sep. 30, 2022

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2) Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the consolidated financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. These consolidated financial statements have been presented in accordance with Accounting Standards Codification (“ASC”) Subtopic 205-30, “Liquidation Basis of Accounting,” as amended by Accounting Standards Update (“ASU”) No. 2013-07, “Presentation of Financial Statements (Topic 205), Liquidation Basis of Accounting.” The June 30, 2022 consolidated statement of net assets in liquidation included herein was derived from the audited consolidated financial statements but does not include all disclosures or notes required by U.S. GAAP for complete financial statements.

All material intercompany accounts and transactions have been eliminated.

Use of Estimates

U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and for the period then ended. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the carrying amounts of assets and liabilities are revised in the period that available information supports a change in the carrying amount.

Liquidation Basis of Accounting

Under the liquidation basis of accounting, all assets are recorded at their estimated net realizable value or liquidation value, which represents the estimated amount of net cash that will be received upon the disposition of the assets (on an undiscounted basis). The measurement of real estate assets held for sale is based on current contracts (if any), estimates and other indications of sales value, net of estimated selling costs. To determine the value of real estate assets held for sale, the Company considered the three traditional approaches to value (cost, income and sales comparison) commonly used by the real estate appraisal community. The applicability and relevancy of each valuation approach as applied may differ by asset. In most cases, the sales comparison approach was accorded the greatest weight. This approach compares a property to other properties with similar characteristics that have recently sold. To validate management’s estimate, the Company also considered opinions from qualified real estate professionals and local real estate brokers and, in some cases, obtained third party appraisals. The estimated selling costs range from 5.0% to 6.5% of the property sales price.

Liabilities, including estimated costs associated with implementing and completing the Plan, are measured in accordance with U.S. GAAP that otherwise applies to those liabilities. The Company has also recorded the estimated development costs to be incurred to prepare the assets for sale as well as the estimated holding costs to be incurred until the projected sale date and the estimated general and administrative costs to be incurred until the completion of the liquidation of the Company and estimated reserves for contingencies. When estimating development costs, the Company considered third party construction contracts and estimates of costs to complete based on construction status, progress and projected completion timing. Estimated development costs also include the costs of design and furnishings necessary to prepare and stage the homes for marketing as well as an accrual for warranty claims. Holding cost estimates consider property taxes, insurance, utilities, maintenance and other costs to be incurred until the sale of the property is closed. Projected general and administrative cost estimates take into account operating costs through the completion of the liquidation of the Company.

These estimated amounts are presented in the accompanying consolidated statements of net assets in liquidation.  All changes in the estimated liquidation value of the Company’s real estate held for sale, or other assets and liabilities are reflected as a change to the Company’s net assets in liquidation.

The Company does not record any amount from the future settlement of unresolved Causes of Action or recoveries from Fair Fund or Forfeited Assets in the accompanying consolidated financial statements since they cannot be reasonably estimated. The amount recovered may be material to the Company’s net assets in liquidation.

On a quarterly basis, the Company reviews the estimated net realizable values, liquidation costs and the estimated date of the completion of the liquidation of the Company and records any significant changes. The Company will also revalue an asset when it is under contract for sale and the buyer’s contingencies have been removed. During the period when this occurs, the carrying value of the asset and the estimated closing and other costs will be adjusted, if necessary. If the Company has a change in its plan for the disposition of an asset, the carrying value will be adjusted to reflect this change in the period that the change is approved. The change in value may include the accrued liquidation costs related to the asset.

Other Assets

The Company recognizes recoveries from the settlement of unresolved Causes of Action when an agreement is executed and collectability is reasonably assured. An allowance for uncollectible settlement installment receivables is recorded when there is doubt about the collectability of the receivable.  Insurance claims are recognized when the insurance company accepts the claim or if a claim is pending and the recoverable amount can be estimated. The Company records escrow receivables at the amount that is expected to be received when the escrow receivable is released. The Forfeited Assets (Note 7) received from the United States Department of Justice (the “DOJ”), other than cash, have been recorded at their estimated net realizable value. In addition, the Company recognizes other amounts to be received based on contractual terms or when the amounts to be received are certain.

Accrued Liquidation Costs

The Company accrues for estimated liquidation costs to the extent they are reasonably determinable. These costs consist of (a) estimated development costs of the single-family homes, including construction and other project related costs, architectural and engineering, project management, city fees, bond payments (net of refunds), furnishings, marketing and other costs; (b) estimated holding costs, including property taxes, insurance, maintenance, utilities and other; and (c) estimated general and administrative costs including payroll, legal and other professional fees, trustee and board fees, rent and other office related expenses, and other general and administrative costs to operate the Company and estimated reserves for contingent liabilities.

Cash Equivalents

The Company considers short-term investments that have a maturity date of ninety days or less at the time of investment to be a cash equivalent. The Company’s cash equivalents include deposits with financial institutions that are insured by the Federal Deposit Insurance Corporation (the “FDIC”).

Restricted Cash

Restricted cash includes cash that can only be used for certain specified purposes.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and restricted cash. At times, balances in any one financial institution may exceed the FDIC insurance limits. The Company mitigates this risk by depositing its cash, cash equivalents and restricted cash in high-credit quality financial institutions. In addition, the Company uses strategies to reduce deposit balances at any one financial institution consistent with FDIC insurance limits.

Income Taxes

The Trust is intended to be treated as a grantor trust for income tax purposes and, accordingly, is not subject to federal or state income tax on any income earned or gain recognized by the Trust. The Trust’s beneficiaries will be treated as the owner of a pro rata portion of each asset, including cash and each liability received by and held by the Trust. Each beneficiary will be required to report on his or her federal and state income tax return his or her pro rata share of taxable income, including gains and losses recognized by the Trust. Accordingly, there is no provision for federal or state income taxes recorded in the accompanying consolidated financial statements.

The Company regularly analyzes its various federal and state filing positions and only recognizes the income tax effect in the consolidated financial statements when certain criteria regarding uncertain income tax positions have been met. The Company believes that its income tax positions would more likely than not be sustained upon examination by all relevant taxing authorities. Therefore, no provision for uncertain income tax positions has been recorded in the consolidated financial statements.

Net Assets in Liquidation - Restricted for Qualifying Victims

The Company separately presents the portion of net assets in liquidation that are restricted for Qualifying Victims (Note 7) from the net assets in liquidation that are available to All Interestholders.

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Real Estate Assets Held for Sale

3 Months Ended

Sep. 30, 2022

Real Estate Assets Held for Sale [Abstract]

Real Estate Assets Held for Sale

3) Real Estate Assets Held for Sale

The Company’s real estate assets held for sale as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022									June 30, 2022
	Number of Assets		Gross Value		Closing and Other Costs			Net Value		Number of Assets		Gross Value		Closing and Other Costs			Net Value
Single-family homes		1	$	28,000	$	(1,680	)	$	26,320		1	$	28,000	$	(1,680	)	$	26,320
Other real estate assets:
Secured loans		2		960		(40	)		920		2		972		(40	)		932
Other properties		2		2,000		(190	)		1,810		2		2,000		(190	)		1,810
Subtotal		4		2,960		(230	)		2,730		4		2,972		(230	)		2,742
Total		5	$	30,960	$	(1,910	)	$	29,050		5	$	30,972	$	(1,910	)	$	29,062

As of September 30, 2022, the single-family home was listed for sale and is located in the Los Angeles, California area. The loans are secured by properties located primarily in the eastern United States. The other properties are located in the state of Hawaii and the state of New York. The property located in the state of New York is listed for sale.

During the three months ended September 30, 2022, the Company did not sell any real estate assets. During the three months ended September 30, 2021, the Company sold two single-family homes for net proceeds of approximately $42,445,000. One of the single-family homes sold during the three months ended September 30, 2021 was under construction.

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Restricted Cash

3 Months Ended

Sep. 30, 2022

Restricted Cash [Abstract]

Restricted Cash

4) Restricted Cash

The Company’s restricted cash as of September 30, 2022, with comparative information as of June 30, 2022, is as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Distributions restricted by the Company related to unresolved claims, distributions for recently allowed claims, uncashed distribution checks, distributions withheld due to pending avoidance actions and distributions that the Trust is waiting for further beneficiary information	$	1,228	$	3,726
Forfeited Assets (Note 7)		2,964		2,395
Total restricted cash	$	4,192	$	6,121

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Other Assets

3 Months Ended

Sep. 30, 2022

Other Assets [Abstract]

Other Assets

5) Other Assets

The Company’s other assets as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Escrow receivables (a)	$	370	$	3,420
Forfeited Assets, net (Note 7)		678		1,258
Settlement installment receivables, net (b)		511		756
Other		244		391
Total other assets	$	1,803	$	5,825

(a) Escrow receivables as of September 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022. Escrow receivables as of June 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022 and one single-family home sold prior to June 30, 2021. Amounts are to be released upon the completion of punch list items and/or obtaining a certificate of occupancy.

(b) The allowance for uncollectible settlement installment receivables was approximately $35,000 and $7,000 as of September 30, 2022 and June 30, 2022, respectively.

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Accrued Liquidation Costs

3 Months Ended

Sep. 30, 2022

Accrued Liquidation Costs [Abstract]

Accrued Liquidation Costs

6) Accrued Liquidation Costs

The following is a summary of the items included in accrued liquidation costs as of September 30, 2022, with comparative information as of June 30, 2022 ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Development costs:
Construction costs	$	2,685		$	4,331
Construction warranty		4,184			4,184
Indirect costs		82			170
Bond refunds		(388	)		(506	)
Total development costs		6,563			8,179
Holding costs:
Property tax		771			771
Maintenance, utilities and other		302			428
Insurance		200			388
Total holding costs		1,273			1,587
General and administrative costs:
Legal and other professional fees		10,578			12,377
Payroll and payroll-related		5,185			7,989
Directors and officers insurance		2,508			2,508
Board fees and expenses		473			630
State, local and other taxes		330			331
Other		757			936
Total general and administrative costs		19,831			24,771
Total accrued liquidation costs	$	27,667		$	34,537

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Forfeited Assets - Restricted for Qualifying Victims

3 Months Ended

Sep. 30, 2022

Forfeited Assets - Restricted for Qualifying Victims [Abstract]

Forfeited Assets - Restricted for Qualifying Victims

7) Forfeited Assets - Restricted for Qualifying Victims

The Trust entered into a resolution agreement with the DOJ which provided that the Trust would receive the assets forfeited (“Forfeited Assets”) by Robert and Jeri Shapiro. The agreement provided for the release of specified Forfeited Assets by the DOJ to the Trust and for the Trust to liquidate those assets and distribute the net sale proceeds to Qualifying Victims.  Qualifying Victims include the vast majority of Trust beneficiaries (specifically, all former holders of allowed Class 3 and 5 claims and their permitted assigns), but do not include former holders of Class 4 claims. Distributions to Qualifying Victims are to be allocated pro-rata based on their net allowed claims without considering the (i) 5% enhancement for contributing their causes of action and (ii) 72.5% Class 5 coefficient.

In March 2021, the Trust received certain Forfeited Assets from the DOJ, including cash, wine, jewelry, handbags, clothing, shoes, art, gold and other assets. The Company recorded the total estimated net realizable value of the Forfeited Assets of approximately $3,459,000. During the three months ended September 30, 2022, the Company sold some of the jewelry, handbags, clothing, shoes and art. During the year ended June 30, 2022, the Company sold the wine and gold and some of the handbags, clothing and shoes. The Forfeited Assets included in the Company’s September 30, 2022 and June 30, 2022 consolidated financial statements are as follows ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Restricted cash (Note 4)	$	2,964		$	2,395
Other assets, net of selling costs (Note 5)		678			1,258
Accrued liquidation costs -primarily legal and professional fees		(159	)		(168	)
Net assets in liquidation - restricted for Qualifying Victims	$	3,483		$	3,485

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Net Change In Assets and Liabilities

3 Months Ended

Sep. 30, 2022

Net Change in Assets and Liabilities [Abstract]

Net Change in Assets and Liabilities

8) Net Change In Assets and Liabilities

Restricted for Qualifying Victims:

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		569			-		569
Other assets		(579	)		-		(579	)
Total assets	$	(10	)	$	-	$	(10	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(8	)		-		(8	)
Total liabilities	$	(8	)	$	-	$	(8	)
Change in carrying value of assets and liabilities, net	$	(2	)	$	-	$	(2	)

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		(19	)		-		(19	)
Other assets		-			-		-
Total assets	$	(19	)	$	-	$	(19	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(19	)		-		(19	)
Total liabilities	$	(19	)	$	-	$	(19	)
Change in carrying value of assets and liabilities, net	$	-		$	-	$	-

All Interestholders

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(12	)	$	-		$	(12	)
Cash and cash equivalents		(2,540	)		-			(2,540	)
Restricted cash		2			-			2
Other assets		(3,332	)		(110	)		(3,442	)
Total assets	$	(5,882	)	$	(110	)	$	(5,992	)
Accounts payable and accrued liabilities	$	(25	)	$	9		$	(16	)
Accrued liquidation costs		(6,480	)		(381	)		(6,861	)
Total liabilities	$	(6,505	)	$	(372	)	$	(6,877	)
Change in carrying value of assets and liabilities, net	$	623		$	262		$	885

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		2,638
Distributions declared, net	$	2,638

Distributions payable decreased by approximately $67,541,000 during the three months ended September 30, 2022.

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(42,454	)	$	2,965		$	(39,489	)
Cash and cash equivalents		34,803			-			34,803
Restricted cash		-			-			-
Other assets		(700	)		823			123
Total assets	$	(8,351	)	$	3,788		$	(4,563	)
Accounts payable and accrued liabilities	$	-		$	49		$	49
Accrued liquidation costs		(8,723	)		(793	)		(9,516	)
Total liabilities	$	(8,723	)	$	(744	)	$	(9,467	)
Change in carrying value of assets and liabilities, net	$	372		$	4,532		$	4,904

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		99
Distributions declared, net	$	99

Distributions payable decreased by approximately $137,000 during the three months ended September 30, 2021.

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Credit Agreement

3 Months Ended

Sep. 30, 2022

Credit Agreement [Abstract]

Credit Agreements

9) Credit Agreement

The Company does not currently have any outstanding credit agreements.  On May 16, 2022, the Company terminated its prior credit agreement.  Also, the Company never had outstanding borrowings on its credit agreement.

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Beneficial Interests

3 Months Ended

Sep. 30, 2022

Beneficial Interests [Abstract]

Beneficial Interests

10) Beneficial Interests

The following table summarizes the Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Outstanding at beginning of period		11,513,535			675,617		11,512,855			654,784
Allowed claims		1,348			-		302			-
5% enhancement for certain allowed claims		67			-		-			-
Settlement of claims by cancelling Liquidation
Trust Interests		(760	)		-		(1,392	)		(167	)
Outstanding at end of period		11,514,190			675,617		11,511,765			654,617

Of the 11,514,190 Class A Interests outstanding at September 30, 2022, 11,436,259 are held by Qualifying Victims (Note 7).

At the Plan Effective Date, certain claims were disputed. As those disputed claims are resolved, additional Class A Interests and (if applicable) Class B Interests are issued on account of allowed claims or Class A Interests and (if applicable) Class B Interests are cancelled. No Class A Interests or Class B Interests are issued on account of disallowed claims. The following table summarizes the unresolved claims against the Debtors as they relate to Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Reserved for unresolved claims at beginning of period		90,793			333		124,609			5,011
Allowed claims		(1,348	)		-		(302	)		-
5% enhancement for certain allowed claims		-			-		-			-
Disallowed claims		(75,570	)		-		(3,146	)		-
Reserved for unresolved claims at end of period		13,875			333		121,161			5,011

Of the 13,875 Class A Interests relating to unresolved claims at September 30, 2022, 1,880 would be held by Qualifying Victims (Note 7).

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Distributions

3 Months Ended

Sep. 30, 2022

Distributions [Abstract]

Distributions

11) Distributions

The Plan provides for a distribution waterfall that specifies the priority and manner of distribution of available cash to all Interestholders, excluding distributions of the net sales proceeds from Forfeited Assets (Note 7). Distributions are to be made (a) to the Class A Interests until they have received distributions of $75.00 per Class A Interest; thereafter (b) to the Class B Interests until they have received distributions of $75.00 per Class B Interest; thereafter (c) to each Liquidation Trust Interest (whether a Class A Interests or Class B Interest) until the aggregate of all distributions made pursuant to this clause equals an amount equivalent to interest, at a per annum fixed rate of 10%, compounded annually Interests, accrued on the aggregate principal amount of all Net Note Claims, Allowed General Unsecured Claims and Net Unit Claims, all as defined in the Plan, treating each distribution pursuant to (a) and (b) above as reductions of such principal amount; and thereafter (d) to the holders of Allowed Subordinated Claims, as defined in the Plan, until such claims are paid in full, including interest, at a per annum fixed rate of 10% or such higher rate as may be agreed to, as provided for in the Plan, compounded annually, accrued on the principal amount of each Allowed Subordinated Claim, as defined.

The following distribution was paid during the three months ended September 30, 2022 relating to the tenth distribution ($ in millions, except for $ per Class A Interest):

									Deposits Into
			$ per						Restricted
	Date		Class A		Total				Cash
	Declared		Interest		Declared		Paid		Account
Tenth Distribution	6/15/2022	(a)	$	5.63	$	-	$	64.19	$	0.83

(a) The $65.02 million distribution was declared on June 15, 2022 and the distribution was paid on July 15, 2022.  The deposit into the restricted cash account was made on July 26, 2022.

There were no distributions declared during the three months ended September 30, 2021.

For every distribution, a deposit is made into a restricted cash account for amounts (a) payable for Class A Interests that may be issued in the future upon the allowance of unresolved claims, (b) in respect of Class A Interests issued on account of recently allowed claims (c) for holders of Class A Interests who failed to cash distribution checks mailed in respect of prior distributions (d) for distributions that were withheld due to pending avoidance actions and (e) for holders of Class A Interests for which the Trust is waiting for further beneficiary information.

During the three months ended September 30, 2022 and 2021, as (a) claims were resolved, (b) claims were recently allowed, (c) addresses for holders of uncashed distribution checks were obtained, (d) pending avoidance actions were resolved and (e) further beneficiary information was received, distributions of approximately $651,000 and $38,000, respectively, were paid to holders of Class A Interests from the restricted cash account and distributions payable were reduced by the same amount.

During the three months ended September 30, 2022 and 2021, as a result of claims being disallowed or Class A Interests being cancelled, approximately $2,483,000 and $99,000, respectively, were released from the restricted cash account and distributions payable were reduced by the same amount.

As a result of distribution checks that had not been cashed within 180 days of their issuance, Interestholders were deemed to have forfeited their rights to reserved and future Class A Interest distributions. During the three months ended September 30, 2022, some Interestholders that had previously been deemed to have been forfeited their rights to receive Class A Interest distributions had responded and therefore approximately $12,000 was added to the restricted cash account and distributions payable were increased by the same amount. During the three months ended September 30, 2021, no Interestholders were deemed to have forfeited their rights to reserved and future Class A distributions.

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Related Party Transactions

3 Months Ended

Sep. 30, 2022

Related Party Transactions [Abstract]

Related Party Transactions

12) Related Party Transactions

Terry Goebel, a member of the Trust Supervisory Board, is president and a principal owner of G3 Group LA (G3), a construction firm specializing in the development of high-end luxury residences. G3 is owned by Terry Goebel and his son Kelly Goebel. As of September 30, 2022, the Company was under contract with G3 for the development of one single-family home in Los Angeles, California. As of September 30, 2022 and June 30, 2022 the remaining amounts payable under this contract were approximately $438,000 and $438,000, respectively. During the three months ended September 30, 2022 and 2021, approximately $0 and $1,286,000, respectively, were paid by the Company to G3 related to this contract.

The Liquidation Trustee of the Trust is entitled to receive 5% of the total gross amount recovered by the Trust from the pursuit of the Causes of Action. During the three months ended September 30, 2022 and 2021, approximately $8,000 and $49,000, were accrued as amounts due to the Liquidation Trustee, respectively. As of September 30, 2022 and June 30, 2022, approximately $89,000 and $81,000, respectively, were payable to the Liquidation Trustee. These amounts are included in accounts payable and accrued liabilities in the accompanying consolidated statements of net assets in liquidation. During the three months ended September 30, 2022 and 2021, no amounts were paid to the Liquidation Trustee.

In November 2019, the Trust entered into an arrangement with Akerman LLP, a law firm based in Miami, Florida of which the Liquidation Trustee is a partner, for the provision, at the option of the Trust on an as-needed basis, of e-discovery and related litigation support services in connection with the Trust’s prosecution of the Causes of Action. Under the arrangement, the Trust is charged for the services at scheduled rates per task which, depending on specific task, include flat rates, rates based on volume of data processed, rates based on the number of data users, the hourly rates of Akerman LLP personnel, or other rates. During the three months ended September 30, 2022 and 2021, respectively, approximately $115,000 and $107,000, respectively, were paid related to these services and there are no outstanding payables as of September 30, 2022 and June 30, 2022.

The executive officers of the Wind-Down Entity are entitled to a bonus based on the Wind-Down Entity achieving certain specified cumulative amounts of distributions to the Trust. Based on the carrying amounts of the net assets in liquidation included in the accompanying consolidated statements of net assets in liquidation, approximately $827,000 and $3,000,000 were accrued as of September 30, 2022 and June 30, 2022, respectively, as the estimated amount of the bonus (including associated payroll taxes). This amount is included in the payroll and payroll-related costs portion of accrued liquidation costs in the accompanying consolidated statement of net assets in liquidation. During the three months ended September 30, 2022 and 2021, $2,173,000 and $0, respectively, were paid related to bonuses.

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Causes of Action

3 Months Ended

Sep. 30, 2022

Causes of Action [Abstract]

Causes of Action

13) Causes of Action

During the three months ended September 30, 2022 and 2021, the Company recorded approximately $190,000 and $971,000, respectively, from the settlement of Causes of Action. The Company also recorded liabilities of 5% of the settlement as amounts payable to the Liquidation Trustee and an allowance for uncollectible settlement installment receivables.

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Commitments and Contingencies

3 Months Ended

Sep. 30, 2022

Commitments and Contingencies [Abstract]

Commitments and Contingencies

14) Commitments and Contingencies

As of September 30, 2022, the Company had construction contracts under which approximately $600,000 was unpaid.

The Company had a lease for its office space that expired on August 31, 2021. The Company had one three-month option to extend the lease. The amount of rent paid, including common area maintenance and parking charges, during the three months ended September 30, 2022 and 2021, was approximately $13,000 and $50,000, respectively. On June 4, 2021, the Company opted not to extend its existing lease and entered into a new office lease at a different location. The new lease was for the period from August 1, 2021 through July 31, 2022. The annual base rent was approximately $43,000 plus common area maintenance charges. On May 16, 2022, the Company extended its lease for six months. The Company has one additional six-month option to extend the lease. The Company paid approximately $55,000 relating to prepaid rent, common area maintenance charges and a security deposit for the new lease during the year ended June 30, 2021. The monthly rent during the six-month extension is approximately $4,000 per month.

The Company is not presently the defendant in any material litigation nor, to the Company’s knowledge, is any material litigation threatened against the Company.

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Subsequent Events

3 Months Ended

Sep. 30, 2022

Subsequent Events [Abstract]

Subsequent Events

15) Subsequent Events

The Company evaluates subsequent events up until the date the unaudited consolidated financial statements are issued.

Distributions

During the period from October 1, 2022 through November 10, 2022, as (a) claims were resolved, (b) claims were recently allowed, (c) addresses for holders of uncashed distribution checks were obtained, (d) pending avoidance actions were resolved and (e) further beneficiary information was received, distributions of approximately $6,000 were paid to holders of Class A Interests from the restricted cash account and distributions payable were reduced by the same amount.

Escrow Receivable

During the period from October 1, 2022 through November 10, 2022, $350,000 of escrow receivable was released relating to one single-family home that was sold during the year ended June 30, 2022.

Causes of Action

During the period from October 1, 2022 through November 10, 2022, the Trust recorded approximately $41,000 from the settlement of Causes of Action. The Company recorded approximately $2,000 as the amount due to the Liquidation Trustee on account of such settlements.

Forfeited Assets

During the period from October 1, 2022 through November 10, 2022, the Company realized net proceeds of approximately $62,000 from the sale of Forfeited Assets.

Other Refunds and Receipts

During the period from October 1, 2022 through November 10, 2022, the Company received approximately $53,000 of property tax refunds.

On October 7, 2022, a construction performance escrow deposit of approximately $24,000 was returned to the Company following the satisfactory completion of work related to one single-family home.

On November 1, 2022, the Company received approximately $45,000 of net proceeds from the sale of furniture used in the staging of a previously sold single-family home.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2022

Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the consolidated financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. These consolidated financial statements have been presented in accordance with Accounting Standards Codification (“ASC”) Subtopic 205-30, “Liquidation Basis of Accounting,” as amended by Accounting Standards Update (“ASU”) No. 2013-07, “Presentation of Financial Statements (Topic 205), Liquidation Basis of Accounting.” The June 30, 2022 consolidated statement of net assets in liquidation included herein was derived from the audited consolidated financial statements but does not include all disclosures or notes required by U.S. GAAP for complete financial statements.

Consolidation

All material intercompany accounts and transactions have been eliminated.

Use of Estimates

Use of Estimates

U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and for the period then ended. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the carrying amounts of assets and liabilities are revised in the period that available information supports a change in the carrying amount.

Liquidation Basis of Accounting

Liquidation Basis of Accounting

Under the liquidation basis of accounting, all assets are recorded at their estimated net realizable value or liquidation value, which represents the estimated amount of net cash that will be received upon the disposition of the assets (on an undiscounted basis). The measurement of real estate assets held for sale is based on current contracts (if any), estimates and other indications of sales value, net of estimated selling costs. To determine the value of real estate assets held for sale, the Company considered the three traditional approaches to value (cost, income and sales comparison) commonly used by the real estate appraisal community. The applicability and relevancy of each valuation approach as applied may differ by asset. In most cases, the sales comparison approach was accorded the greatest weight. This approach compares a property to other properties with similar characteristics that have recently sold. To validate management’s estimate, the Company also considered opinions from qualified real estate professionals and local real estate brokers and, in some cases, obtained third party appraisals. The estimated selling costs range from 5.0% to 6.5% of the property sales price.

Liabilities, including estimated costs associated with implementing and completing the Plan, are measured in accordance with U.S. GAAP that otherwise applies to those liabilities. The Company has also recorded the estimated development costs to be incurred to prepare the assets for sale as well as the estimated holding costs to be incurred until the projected sale date and the estimated general and administrative costs to be incurred until the completion of the liquidation of the Company and estimated reserves for contingencies. When estimating development costs, the Company considered third party construction contracts and estimates of costs to complete based on construction status, progress and projected completion timing. Estimated development costs also include the costs of design and furnishings necessary to prepare and stage the homes for marketing as well as an accrual for warranty claims. Holding cost estimates consider property taxes, insurance, utilities, maintenance and other costs to be incurred until the sale of the property is closed. Projected general and administrative cost estimates take into account operating costs through the completion of the liquidation of the Company.

These estimated amounts are presented in the accompanying consolidated statements of net assets in liquidation.  All changes in the estimated liquidation value of the Company’s real estate held for sale, or other assets and liabilities are reflected as a change to the Company’s net assets in liquidation.

The Company does not record any amount from the future settlement of unresolved Causes of Action or recoveries from Fair Fund or Forfeited Assets in the accompanying consolidated financial statements since they cannot be reasonably estimated. The amount recovered may be material to the Company’s net assets in liquidation.

On a quarterly basis, the Company reviews the estimated net realizable values, liquidation costs and the estimated date of the completion of the liquidation of the Company and records any significant changes. The Company will also revalue an asset when it is under contract for sale and the buyer’s contingencies have been removed. During the period when this occurs, the carrying value of the asset and the estimated closing and other costs will be adjusted, if necessary. If the Company has a change in its plan for the disposition of an asset, the carrying value will be adjusted to reflect this change in the period that the change is approved. The change in value may include the accrued liquidation costs related to the asset.

Other Assets

Other Assets

The Company recognizes recoveries from the settlement of unresolved Causes of Action when an agreement is executed and collectability is reasonably assured. An allowance for uncollectible settlement installment receivables is recorded when there is doubt about the collectability of the receivable.  Insurance claims are recognized when the insurance company accepts the claim or if a claim is pending and the recoverable amount can be estimated. The Company records escrow receivables at the amount that is expected to be received when the escrow receivable is released. The Forfeited Assets (Note 7) received from the United States Department of Justice (the “DOJ”), other than cash, have been recorded at their estimated net realizable value. In addition, the Company recognizes other amounts to be received based on contractual terms or when the amounts to be received are certain.

Accrued Liquidation Costs

Accrued Liquidation Costs

The Company accrues for estimated liquidation costs to the extent they are reasonably determinable. These costs consist of (a) estimated development costs of the single-family homes, including construction and other project related costs, architectural and engineering, project management, city fees, bond payments (net of refunds), furnishings, marketing and other costs; (b) estimated holding costs, including property taxes, insurance, maintenance, utilities and other; and (c) estimated general and administrative costs including payroll, legal and other professional fees, trustee and board fees, rent and other office related expenses, and other general and administrative costs to operate the Company and estimated reserves for contingent liabilities.

Cash Equivalents

Cash Equivalents

The Company considers short-term investments that have a maturity date of ninety days or less at the time of investment to be a cash equivalent. The Company’s cash equivalents include deposits with financial institutions that are insured by the Federal Deposit Insurance Corporation (the “FDIC”).

Restricted Cash

Restricted Cash

Restricted cash includes cash that can only be used for certain specified purposes.

Concentrations of Credit Risk

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and restricted cash. At times, balances in any one financial institution may exceed the FDIC insurance limits. The Company mitigates this risk by depositing its cash, cash equivalents and restricted cash in high-credit quality financial institutions. In addition, the Company uses strategies to reduce deposit balances at any one financial institution consistent with FDIC insurance limits.

Income Taxes

Income Taxes

The Trust is intended to be treated as a grantor trust for income tax purposes and, accordingly, is not subject to federal or state income tax on any income earned or gain recognized by the Trust. The Trust’s beneficiaries will be treated as the owner of a pro rata portion of each asset, including cash and each liability received by and held by the Trust. Each beneficiary will be required to report on his or her federal and state income tax return his or her pro rata share of taxable income, including gains and losses recognized by the Trust. Accordingly, there is no provision for federal or state income taxes recorded in the accompanying consolidated financial statements.

The Company regularly analyzes its various federal and state filing positions and only recognizes the income tax effect in the consolidated financial statements when certain criteria regarding uncertain income tax positions have been met. The Company believes that its income tax positions would more likely than not be sustained upon examination by all relevant taxing authorities. Therefore, no provision for uncertain income tax positions has been recorded in the consolidated financial statements.

Net Assets in Liquidation - Restricted for Qualifying Victims

Net Assets in Liquidation - Restricted for Qualifying Victims

The Company separately presents the portion of net assets in liquidation that are restricted for Qualifying Victims (Note 7) from the net assets in liquidation that are available to All Interestholders.

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Real Estate Assets Held for Sale (Tables)

3 Months Ended

Sep. 30, 2022

Real Estate Assets Held for Sale [Abstract]

Real Estate Assets Held for Sale

The Company’s real estate assets held for sale as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022									June 30, 2022
	Number of Assets		Gross Value		Closing and Other Costs			Net Value		Number of Assets		Gross Value		Closing and Other Costs			Net Value
Single-family homes		1	$	28,000	$	(1,680	)	$	26,320		1	$	28,000	$	(1,680	)	$	26,320
Other real estate assets:
Secured loans		2		960		(40	)		920		2		972		(40	)		932
Other properties		2		2,000		(190	)		1,810		2		2,000		(190	)		1,810
Subtotal		4		2,960		(230	)		2,730		4		2,972		(230	)		2,742
Total		5	$	30,960	$	(1,910	)	$	29,050		5	$	30,972	$	(1,910	)	$	29,062

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Restricted Cash (Tables)

3 Months Ended

Sep. 30, 2022

Restricted Cash [Abstract]

Restricted Cash

The Company’s restricted cash as of September 30, 2022, with comparative information as of June 30, 2022, is as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Distributions restricted by the Company related to unresolved claims, distributions for recently allowed claims, uncashed distribution checks, distributions withheld due to pending avoidance actions and distributions that the Trust is waiting for further beneficiary information	$	1,228	$	3,726
Forfeited Assets (Note 7)		2,964		2,395
Total restricted cash	$	4,192	$	6,121

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Other Assets (Tables)

3 Months Ended

Sep. 30, 2022

Other Assets [Abstract]

Other Assets

The Company’s other assets as of September 30, 2022, with comparative information as of June 30, 2022, are as follows ($ in thousands) (unaudited):

	September 30, 2022		June 30, 2022
Escrow receivables (a)	$	370	$	3,420
Forfeited Assets, net (Note 7)		678		1,258
Settlement installment receivables, net (b)		511		756
Other		244		391
Total other assets	$	1,803	$	5,825

(a) Escrow receivables as of September 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022. Escrow receivables as of June 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022 and one single-family home sold prior to June 30, 2021. Amounts are to be released upon the completion of punch list items and/or obtaining a certificate of occupancy.

(b) The allowance for uncollectible settlement installment receivables was approximately $35,000 and $7,000 as of September 30, 2022 and June 30, 2022, respectively.

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Accrued Liquidation Costs (Tables)

3 Months Ended

Sep. 30, 2022

Accrued Liquidation Costs [Abstract]

Summary of Accrued Liquidation Costs

The following is a summary of the items included in accrued liquidation costs as of September 30, 2022, with comparative information as of June 30, 2022 ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Development costs:
Construction costs	$	2,685		$	4,331
Construction warranty		4,184			4,184
Indirect costs		82			170
Bond refunds		(388	)		(506	)
Total development costs		6,563			8,179
Holding costs:
Property tax		771			771
Maintenance, utilities and other		302			428
Insurance		200			388
Total holding costs		1,273			1,587
General and administrative costs:
Legal and other professional fees		10,578			12,377
Payroll and payroll-related		5,185			7,989
Directors and officers insurance		2,508			2,508
Board fees and expenses		473			630
State, local and other taxes		330			331
Other		757			936
Total general and administrative costs		19,831			24,771
Total accrued liquidation costs	$	27,667		$	34,537

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Forfeited Assets - Restricted for Qualifying Victims (Tables)

3 Months Ended

Sep. 30, 2022

Forfeited Assets - Restricted for Qualifying Victims [Abstract]

Forfeited Assets Included in Consolidated Financial Statements

The Forfeited Assets included in the Company’s September 30, 2022 and June 30, 2022 consolidated financial statements are as follows ($ in thousands) (unaudited):

	September 30, 2022			June 30, 2022
Restricted cash (Note 4)	$	2,964		$	2,395
Other assets, net of selling costs (Note 5)		678			1,258
Accrued liquidation costs -primarily legal and professional fees		(159	)		(168	)
Net assets in liquidation - restricted for Qualifying Victims	$	3,483		$	3,485

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Net Change In Assets and Liabilities (Tables)

3 Months Ended

Sep. 30, 2022

Net Change in Assets and Liabilities [Abstract]

Details of Change in Carrying Value of Assets and Liabilities, Net

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		569			-		569
Other assets		(579	)		-		(579	)
Total assets	$	(10	)	$	-	$	(10	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(8	)		-		(8	)
Total liabilities	$	(8	)	$	-	$	(8	)
Change in carrying value of assets and liabilities, net	$	(2	)	$	-	$	(2	)

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment		Total
Real estate assets, net	$	-		$	-	$	-
Cash and cash equivalents		-			-		-
Restricted cash		(19	)		-		(19	)
Other assets		-			-		-
Total assets	$	(19	)	$	-	$	(19	)
Accounts payable and accrued liabilities	$	-		$	-	$	-
Accrued liquidation costs		(19	)		-		(19	)
Total liabilities	$	(19	)	$	-	$	(19	)
Change in carrying value of assets and liabilities, net	$	-		$	-	$	-

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(12	)	$	-		$	(12	)
Cash and cash equivalents		(2,540	)		-			(2,540	)
Restricted cash		2			-			2
Other assets		(3,332	)		(110	)		(3,442	)
Total assets	$	(5,882	)	$	(110	)	$	(5,992	)
Accounts payable and accrued liabilities	$	(25	)	$	9		$	(16	)
Accrued liquidation costs		(6,480	)		(381	)		(6,861	)
Total liabilities	$	(6,505	)	$	(372	)	$	(6,877	)
Change in carrying value of assets and liabilities, net	$	623		$	262		$	885

The following provides details of the change in the carrying value of assets and liabilities, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

	Cash			Remeasure-
	Activities			ment			Total
Real estate assets, net	$	(42,454	)	$	2,965		$	(39,489	)
Cash and cash equivalents		34,803			-			34,803
Restricted cash		-			-			-
Other assets		(700	)		823			123
Total assets	$	(8,351	)	$	3,788		$	(4,563	)
Accounts payable and accrued liabilities	$	-		$	49		$	49
Accrued liquidation costs		(8,723	)		(793	)		(9,516	)
Total liabilities	$	(8,723	)	$	(744	)	$	(9,467	)
Change in carrying value of assets and liabilities, net	$	372		$	4,532		$	4,904

Distributions Declared, Net

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2022 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		2,638
Distributions declared, net	$	2,638

The following provides details of the distributions (declared) reversed, net during the three months ended September 30, 2021 ($ in thousands) (unaudited):

Distributions declared	$	-
Distributions reversed		99
Distributions declared, net	$	99

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Beneficial Interests (Tables)

3 Months Ended

Sep. 30, 2022

Beneficial Interests [Abstract]

Liquidation Trust Interests

The following table summarizes the Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Outstanding at beginning of period		11,513,535			675,617		11,512,855			654,784
Allowed claims		1,348			-		302			-
5% enhancement for certain allowed claims		67			-		-			-
Settlement of claims by cancelling Liquidation
Trust Interests		(760	)		-		(1,392	)		(167	)
Outstanding at end of period		11,514,190			675,617		11,511,765			654,617

Unresolved Claims Relating to Liquidation Trust Interests

The following table summarizes the unresolved claims against the Debtors as they relate to Liquidation Trust Interests (rounded) for the three months ended September 30, 2022 and 2021 (unaudited):

	For the Three Months Ended September 30,
	2022					2021
Liquidation Trust Interests	Class A			Class B		Class A			Class B
Reserved for unresolved claims at beginning of period		90,793			333		124,609			5,011
Allowed claims		(1,348	)		-		(302	)		-
5% enhancement for certain allowed claims		-			-		-			-
Disallowed claims		(75,570	)		-		(3,146	)		-
Reserved for unresolved claims at end of period		13,875			333		121,161			5,011

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Distributions (Tables)

3 Months Ended

Sep. 30, 2022

Distributions [Abstract]

Distributions Declared and Paid

The following distribution was paid during the three months ended September 30, 2022 relating to the tenth distribution ($ in millions, except for $ per Class A Interest):

									Deposits Into
			$ per						Restricted
	Date		Class A		Total				Cash
	Declared		Interest		Declared		Paid		Account
Tenth Distribution	6/15/2022	(a)	$	5.63	$	-	$	64.19	$	0.83

(a) The $65.02 million distribution was declared on June 15, 2022 and the distribution was paid on July 15, 2022.  The deposit into the restricted cash account was made on July 26, 2022.

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Formation and Description of Business (Details)	3 Months Ended
	Sep. 30, 2022 Asset Segment Class	Feb. 15, 2019 USD ($) Subsidiary
Formation [Abstract]
Cash received for funding initial expenses of operation | $		$ 5,000,000
Number of wind-down subsidiaries | Subsidiary		43
Number of classes of liquidation trust interests | Class	2
Description of Business [Abstract]
Number of reportable segments | Segment	1
Single-Family Homes [Member] | Los Angeles, California [Member]
Description of Business [Abstract]
Number of real estate assets owned by Wind-Down Subsidiaries	1
Secured Loans [Member] | Other States [Member]
Description of Business [Abstract]
Number of real estate assets owned by Wind-Down Subsidiaries	2
Other Properties [Member] | Other States [Member]
Description of Business [Abstract]
Number of real estate assets owned by Wind-Down Subsidiaries	2

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Summary of Significant Accounting Policies (Details) - Estimated Selling Costs [Member]	Sep. 30, 2022
Minimum [Member]
Liquidation Basis of Accounting [Abstract]
Real estate assets held for sale, measurement input	0.05
Maximum [Member]
Liquidation Basis of Accounting [Abstract]
Real estate assets held for sale, measurement input	0.065

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Real Estate Assets Held for Sale (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Sep. 30, 2022 USD ($) Asset	Sep. 30, 2021 USD ($) Asset	Jun. 30, 2022 USD ($) Asset
Real Estate Investment Property, Net [Abstract]
Single-family homes, number of assets | Asset	1		1
Single-family homes, gross value	$ 28,000		$ 28,000
Single-family homes, closing and other costs	(1,680)		(1,680)
Single-family homes, net value	$ 26,320		$ 26,320
Other real estate assets, number of assets | Asset	4		4
Other real estate assets, gross value	$ 2,960		$ 2,972
Other real estate assets, closing and other costs	(230)		(230)
Other real estate assets, net value	$ 2,730		$ 2,742
Real estate assets held for sale, number of assets | Asset	5		5
Real estate assets held for sale, gross value	$ 30,960		$ 30,972
Real estate assets held for sale, closing and other costs	(1,910)		(1,910)
Real estate assets held for sale, net	$ 29,050		$ 29,062
Net proceeds from sale of real estate		$ 42,445
Number of assets sold | Asset	0
Single-Family Homes [Member]
Real Estate Investment Property, Net [Abstract]
Number of assets sold | Asset		2	1
Number of single family homes sold on obligation to complete | Asset		1
Secured Loans [Member]
Real Estate Investment Property, Net [Abstract]
Other real estate assets, number of assets | Asset	2		2
Other real estate assets, gross value	$ 960		$ 972
Other real estate assets, closing and other costs	(40)		(40)
Other real estate assets, net value	$ 920		$ 932
Other Properties [Member]
Real Estate Investment Property, Net [Abstract]
Other real estate assets, number of assets | Asset	2		2
Other real estate assets, gross value	$ 2,000		$ 2,000
Other real estate assets, closing and other costs	(190)		(190)
Other real estate assets, net value	$ 1,810		$ 1,810

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Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Restricted Cash [Abstract]
Distributions restricted by the Company related to unresolved claims, distributions for recently allowed claims, uncashed distribution checks, distributions withheld due to pending avoidance actions and distributions that the Trust is waiting for further beneficiary information	$ 1,228	$ 3,726
Forfeited Assets (Note 7)	2,964	2,395
Total restricted cash	$ 4,192	$ 6,121

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Other Assets (Details) $ in Thousands		3 Months Ended	12 Months Ended
		Sep. 30, 2022 USD ($) Property	Jun. 30, 2022 USD ($) Property	Jun. 30, 2021 Property
Other Assets [Abstract]
Escrow receivables	[1]	$ 370	$ 3,420
Forfeited Assets, net (Note 7)		678	1,258
Settlement installment receivables, net	[2]	511	756
Other		244	391
Total other assets		1,803	5,825
Allowance for uncollectible settlement installment receivables		$ 35	$ 7
Single-Family Homes [Member]
Other Assets [Abstract]
Number of properties with escrow receivables, which were sold in current year | Property		2	2
Number of properties with escrow receivables, which were sold in prior year | Property				1

[1] Escrow receivables as of September 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022. Escrow receivables as of June 30, 2022 relate to two single-family homes that were sold during the year ended June 30, 2022 and one single-family home sold prior to June 30, 2021. Amounts are to be released upon the completion of punch list items and/or obtaining a certificate of occupancy.

[2] The allowance for uncollectible settlement installment receivables was approximately $35,000 and $7,000 as of September 30, 2022 and June 30, 2022, respectively.

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Accrued Liquidation Costs (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Development costs [Abstract]
Construction costs	$ 2,685	$ 4,331
Construction warranty	4,184	4,184
Indirect costs	82	170
Bond refunds	(388)	(506)
Total development costs	6,563	8,179
Holding costs [Abstract]
Property tax	771	771
Maintenance, utilities and other	302	428
Insurance	200	388
Total holding costs	1,273	1,587
General and administrative costs [Abstract]
Legal and other professional fees	10,578	12,377
Payroll and payroll-related	5,185	7,989
Directors and officers insurance	2,508	2,508
Board fees and expenses	473	630
State, local and other taxes	330	331
Other	757	936
Total general and administrative costs	19,831	24,771
Total accrued liquidation costs	$ 27,667	$ 34,537

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Forfeited Assets - Restricted for Qualifying Victims (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Forfeited Assets - Restricted for Qualifying Victims [Abstract]
Enhancement percentage for contributing causes of action	5.00%
Class 5 coefficient percentage	72.50%
Estimated net realizable value of forfeited assets	$ 3,459
Forfeited Assets [Abstract]
Restricted cash (Note 4)	2,964	$ 2,395
Other assets, net of selling costs (Note 5)	678	1,258
Accrued liquidation costs - primarily legal and other professional fees	(159)	(168)
Net assets in liquidation - restricted for Qualifying Victims	$ 3,483	$ 3,485

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Net Change In Assets and Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Change in carrying value of assets and liabilities, net	$ (2)	$ 0
Change in carrying value of assets and liabilities, net	885	4,904
Distributions Declared, Net [Abstract]
Distributions declared, net	2,638	99
Decrease in distribution payable	(67,541)	(137)
Restricted for Qualifying Victims [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	0	0
Cash and cash equivalents	0	0
Restricted cash	569	(19)
Other assets	(579)	0
Total assets	(10)	(19)
Accounts payable and accrued liabilities	0	0
Accrued liquidation costs	(8)	(19)
Total liabilities	(8)	(19)
Change in carrying value of assets and liabilities, net	(2)	0
Change in carrying value of assets and liabilities, net	0	0
Distributions Declared, Net [Abstract]
Distributions declared, net	0	0
All Interestholders [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	(12)	(39,489)
Cash and cash equivalents	(2,540)	34,803
Restricted cash	2	0
Other assets	(3,442)	123
Total assets	(5,992)	(4,563)
Accounts payable and accrued liabilities	(16)	49
Accrued liquidation costs	(6,861)	(9,516)
Total liabilities	(6,877)	(9,467)
Change in carrying value of assets and liabilities, net	0	0
Change in carrying value of assets and liabilities, net	885	4,904
Distributions Declared, Net [Abstract]
Distributions declared	0	0
Distributions reversed	2,638	99
Distributions declared, net	2,638	99
Cash Activities [Member] | Restricted for Qualifying Victims [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	0	0
Cash and cash equivalents	0	0
Restricted cash	569	(19)
Other assets	(579)	0
Total assets	(10)	(19)
Accounts payable and accrued liabilities	0	0
Accrued liquidation costs	(8)	(19)
Total liabilities	(8)	(19)
Change in carrying value of assets and liabilities, net	(2)	0
Cash Activities [Member] | All Interestholders [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	(12)	(42,454)
Cash and cash equivalents	(2,540)	34,803
Restricted cash	2	0
Other assets	(3,332)	(700)
Total assets	(5,882)	(8,351)
Accounts payable and accrued liabilities	(25)	0
Accrued liquidation costs	(6,480)	(8,723)
Total liabilities	(6,505)	(8,723)
Change in carrying value of assets and liabilities, net	623	372
Remeasurement [Member] | Restricted for Qualifying Victims [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	0	0
Cash and cash equivalents	0	0
Restricted cash	0	0
Other assets	0	0
Total assets	0	0
Accounts payable and accrued liabilities	0	0
Accrued liquidation costs	0	0
Total liabilities	0	0
Change in carrying value of assets and liabilities, net	0	0
Remeasurement [Member] | All Interestholders [Member]
Changes in Carrying Value of Assets and Liabilities, Net [Abstract]
Real estate assets, net	0	2,965
Cash and cash equivalents	0	0
Restricted cash	0	0
Other assets	(110)	823
Total assets	(110)	3,788
Accounts payable and accrued liabilities	9	49
Accrued liquidation costs	(381)	(793)
Total liabilities	(372)	(744)
Change in carrying value of assets and liabilities, net	$ 262	$ 4,532

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Credit Agreement (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Revolving Line of Credit [Member]
Line of Credit [Abstract]
Line of credit outstanding	$ 0

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Beneficial Interests (Details) - shares	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Liquidation Trust Interests [Abstract]
Held by qualifying victims (in shares)	11,436,259
Unresolved Claims Relating to Liquidation Trust Interests [Abstract]
Unresolved claims held by qualifying victims (in shares)	1,880
Class A [Member]
Liquidation Trust Interests [Abstract]
Outstanding at beginning of period (in shares)	11,513,535	11,512,855
Allowed claims (in shares)	1,348	302
5% enhancement for certain allowed claims (in shares)	67	0
Settlement of claims by cancelling Liquidation Trust Interests (in shares)	(760)	(1,392)
Outstanding at end of period (in shares)	11,514,190	11,511,765
Percentage of enhancement for certain allowed claims	5.00%	5.00%
Unresolved Claims Relating to Liquidation Trust Interests [Abstract]
Outstanding at beginning of period (in shares)	90,793	124,609
Allowed claims (in shares)	(1,348)	(302)
5% enhancement for certain allowed claims (in shares)	0	0
Disallowed claims (in shares)	(75,570)	(3,146)
Outstanding at end of period (in shares)	13,875	121,161
Percentage of enhancement for certain allowed claims	5.00%	5.00%
Class B [Member]
Liquidation Trust Interests [Abstract]
Outstanding at beginning of period (in shares)	675,617	654,784
Allowed claims (in shares)	0	0
5% enhancement for certain allowed claims (in shares)	0	0
Settlement of claims by cancelling Liquidation Trust Interests (in shares)	0	(167)
Outstanding at end of period (in shares)	675,617	654,617
Percentage of enhancement for certain allowed claims	5.00%	5.00%
Unresolved Claims Relating to Liquidation Trust Interests [Abstract]
Outstanding at beginning of period (in shares)	333	5,011
Allowed claims (in shares)	0	0
5% enhancement for certain allowed claims (in shares)	0	0
Disallowed claims (in shares)	0	0
Outstanding at end of period (in shares)	333	5,011
Percentage of enhancement for certain allowed claims	5.00%	5.00%

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Distributions (Details) $ / shares in Units, $ in Thousands			3 Months Ended
		Jun. 15, 2022 USD ($)	Sep. 30, 2022 USD ($) $ / shares	Sep. 30, 2021 USD ($) Distribution
Distributions [Abstract]
Number of distributions declared | Distribution				0
Forfeited distributions, cash released from restricted cash account			$ 12
Distributions deemed to have been forfeited				$ 0
Tenth Distribution [Member]
Distributions [Abstract]
Date declared	[1]		Jun. 15, 2022
Total declared		$ 65,020	$ 0
Paid			64,190
Deposits into restricted cash account			$ 830
All Net Note Claims [Member]
Distributions [Abstract]
Interest, fixed rate			10.00%
Class A [Member]
Distributions [Abstract]
Preferential distributions payable per interest (in dollars per share) | $ / shares			$ 75
Subsequent distributions paid			$ 651	38
Disallowed or cancelled claims, cash released from restricted cash account			$ 2,483	$ 99
Class A [Member] | Tenth Distribution [Member]
Distributions [Abstract]
$ per interest (in dollars per share) | $ / shares			$ 5.63
Class B [Member]
Distributions [Abstract]
Preferential distributions payable per interest (in dollars per share) | $ / shares			75
Subordinated preferential distributions payable per interest (in dollars per share) | $ / shares			$ 75

[1] The $65.02 million distribution was declared on June 15, 2022 and the distribution was paid on July 15, 2022.  The deposit into the restricted cash account was made on July 26, 2022.

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Related Party Transactions (Details) $ in Thousands	3 Months Ended
	Sep. 30, 2022 USD ($) Asset	Sep. 30, 2021 USD ($)	Jun. 30, 2022 USD ($)
Executive Officer [Member]
Related Parties Transactions [Abstract]
Accrued amount due to officers	$ 827		$ 3,000
Payments for bonuses	2,173	$ 0
Liquidation Trustee [Member]
Related Parties Transactions [Abstract]
Amount payable to related party	89		81
Amount paid under contract	$ 0	0
Percentage entitled to receive from total gross amount recovered	5.00%
Accrued amount due to related party	$ 8	49
G3 Group LA [Member] | Single-Family Homes [Member]
Related Parties Transactions [Abstract]
Number of real estate assets under contract for development | Asset	1
Amount payable to related party	$ 438		438
Amount paid under contract	0	1,286
Akerman LLP [Member]
Related Parties Transactions [Abstract]
Amount payable to related party	0		$ 0
Payments for legal services	$ 115	$ 107

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Causes of Action (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Causes of Action [Abstract]
Amount from settlement of causes of action	$ 190	$ 971
Liquidation Trustee [Member]
Causes of Action [Abstract]
Percentage of liabilities payable to related party	5.00%

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Commitments and Contingencies (Details) $ in Thousands		3 Months Ended		12 Months Ended
	Jun. 04, 2021 USD ($) Option	Sep. 30, 2022 USD ($) Option	Sep. 30, 2021 USD ($)	Jun. 30, 2021 USD ($)
Commitments and Contingencies [Abstract]
Construction contracts unpaid		$ 600
Number of options to extend lease | Option	1	1
Option period to extend lease	3 months	6 months
Rent paid		$ 13	$ 50
Annual base rent	$ 43
Lease extension period		6 months
Payment relating to prepaid rent, common area maintenance charges and a security deposit				$ 55
Monthly rent		$ 4

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Subsequent Events (Details) $ in Thousands			1 Months Ended	3 Months Ended		12 Months Ended
	Nov. 01, 2022 USD ($)	Oct. 07, 2022 USD ($) Asset	Nov. 10, 2022 USD ($)	Sep. 30, 2022 Asset	Sep. 30, 2021 Asset	Jun. 30, 2022 Asset
Escrow Receivable [Abstract]
Number of assets sold | Asset				0
Single-Family Homes [Member]
Escrow Receivable [Abstract]
Number of assets sold | Asset					2	1
Subsequent Event [Member]
Escrow Receivable [Abstract]
Proceeds from escrow			$ 350
Causes of Action [Abstract]
Settlement of causes of action			41
Forfeited Assets [Abstract]
Proceeds from sale of forfeited assets			62
Other Refunds and Receipts [Abstract]
Property tax refunds			53
Subsequent Event [Member] | Liquidation Trustee [Member]
Causes of Action [Abstract]
Amount due to related party			2
Subsequent Event [Member] | Single-Family Homes [Member]
Other Refunds and Receipts [Abstract]
Escrows returned upon satisfactory completion of work		$ 24
Number of real estate assets completed | Asset		1
Net proceeds from sale of furniture	$ 45
Subsequent Event [Member] | Class A [Member]
Distributions [Abstract]
Allowed claims, distributions paid from restricted cash account			$ 6