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Full title: Objection to (related document(s): 406 Motion to sell property free and clear of liens under Section 363(f) / Debtors' Expedited Motion for Entry of an Order Authorizing Sale Procedures for Sale of Personal Property Assets Free and Clear of All Liens, Claims, and Encumbrances an filed by Debtor Studio Movie Grill Holdings, LLC)LIMITED OBJECTION filed by Interested Party State of Texas. (Binford, Jason)

Document posted on Jan 25, 2021 in the bankruptcy, 5 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

20- 32633-SGJ § Studio Movie Grill Holdings, LLC, et al.,1 § Chapter 11 § Debtors. § Jointly Administered LIMITED OBJECTION OF THE STATE OF TEXAS TO THE DEBTORS’ EXPEDITED MOTION FOR AN ENTRY OF AN ORDER AUTHORIZING SALE PROCEDURES FOR SALE OF PERSONAL PROPERTY ASSETS FREE AND CLEAR OF ALL LIENS, CLAIMS, AND ENCUMBRANCES AND INTERESTS 1The Debtors in these Chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, include: Studio Movie Grill Holdings, LLC (6546) (“SMG Holdings”); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie Grill Concepts LIII, LLC (3066); Movie Grill Concepts LIV, LLC (2018); Movie Grill Concepts LV, LLC (4699); Movie Grill Partners 3, LLC (4200); Movie Grill Partners 4, LLC (1363); Movie Grill Partners 6, LLC (3334); and MGC ManagementI, LLC (3224). COMES NOW, the State of Texas (“State of Texas” or “State”),

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Texas State Bar No. 24026015 Assistant Attorneys General Bankruptcy & Collections Division P. O. Box 12548 Austin, Texas 78711-2548 P: (512) 463-2173/F: (512) 936-1409 jason.binford@oag.texas.gov layla.milligan@oag.texas.gov ATTORNEYS FOR THE STATE OF TEXAS UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION In re: § Case No. 20- 32633-SGJ § Studio Movie Grill Holdings, LLC, et al.,1 § Chapter 11 § Debtors. § Jointly Administered LIMITED OBJECTION OF THE STATE OF TEXAS TO THE DEBTORS’ EXPEDITED MOTION FOR AN ENTRY OF AN ORDER AUTHORIZING SALE PROCEDURES FOR SALE OF PERSONAL PROPERTY ASSETS FREE AND CLEAR OF ALL LIENS, CLAIMS, AND ENCUMBRANCES AND INTERESTS 1 The Debtors in these Chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, include: Studio Movie Grill Holdings, LLC (6546) (“SMG Holdings”); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie Grill Concepts LIII, LLC (3066); Movie Grill Concepts LIV, LLC (2018); Movie Grill Concepts LV, LLC (4699); Movie Grill Partners 3, LLC (4200); Movie Grill Partners 4, LLC (1363); Movie Grill Partners 6, LLC (3334); and MGC Management I, LLC (3224).

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COMES NOW, the State of Texas (“State of Texas” or “State”), by and through the Office of the Texas Attorney General, and respectfully files this limited objection (the “Limited Objection”) to the Debtors’ Emergency Motion for Entry of an Order Authorizing Sale Procedures for Sale of Personal Property Assets Free and Clear of All Liens, Claims, and Encumbrances and Interests [Doc. No. 406] (the “Motion”). In support of its Limited Objection, the State of Texas respectfully states as follows: I. OVERVIEW 1. The State, out of an abundance of caution, files its Limited Objection to the Motion in order to assure the ability of the State protect its consumers from potential exposure of their personally identifiable information. II. LIMITED OBJECTION Protection of “Personally Identifiable Information” 2. The Debtors’ Motion seeks permission to abandon de minimus personal property assets. However, the Debtors’ Motion and proposed order thereto do not address safeguards required by Texas law for the proper destruction and disposal of “Personally Identifiable Information”2 (“PII”) that the property in question may contain. 3. As such, the State objects to the sale or abandonment of any of the Debtors’ property without the proper destruction and disposal of any PII. 4. To address this issue, the State requests that the following paragraphs be added to any order entered by this Court on the Motion: 2 11 U.S.C. § 101(41A) defines the term “personally identifiable information.”

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Notwithstanding anything to the contrary herein, nothing in this Order authorizes the Debtors to sell or abandon any personal property containing or constituting “Personally Identifiable Information,” (“PII”) as that term is defined in Bankruptcy Code section 101(41A). The Debtors shall remove or cause to be removed any confidential and/or PII in any of the Debtors hardware, software, computers or cash registers or similar equipment which are to be sold, donated, transferred, abandoned or otherwise disposed of so as to render the PII unreadable or undecipherable. PRAYER Wherefore, the State respectfully requests that the Court sustain its Limited Objection to Debtors’ Motion and grants such further relief to the State as this Court deems just and equitable. [Remainder of Page Intentionally Left Blank]

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Dated: January 26, 2021 Respectfully submitted, KEN PAXTON Attorney General of Texas BRENT WEBSTER First Assistant Attorney General GRANT DORFMAN Deputy First Assistant Attorney General SHAWN E. COWLES Deputy Attorney General for Civil Litigation RACHEL R. OBALDO Assistant Attorney General Chief, Bankruptcy & Collections Division /s/ Jason B. Binford JASON B. BINFORD Texas State Bar No. 24045499 LAYLA D. MILLIGAN Texas State Bar No. 24026015 Office of the Attorney General of Texas Bankruptcy & Collections Division P. O. Box 12548 MC008 Austin, Texas 78711-2548 Telephone: (512) 463-2173 Facsimile: (512) 936-1409 jason.binford@oag.texas.gov layla.milligan@oag.texas.gov ATTORNEYS FOR THE STATE OF TEXAS

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CERTIFICATE OF SERVICE I certify that a true and correct copy of the foregoing has been served via the Court’s Electronic Filing System on all parties requesting notice in this proceeding on January 26, 2021. /s/Jason B. Binford JASON B. BINFORD Assistant Attorney General