Vous êtes sur la page 1sur 10

Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 1 of 10

IN THE UNITED STATES DISTRICT COURT


FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION

SECURITIES AND EXCHANGE §


COMMISSION, §
§
Plaintiff, §
§
v. § CASE NO. 3-09-CV0298-L
§
STANFORD INTERNATIONAL BANK, §
LTD., STANFORD GROUP COMPANY, §
STANFORD CAPITAL MANAGEMENT, §
LLC, R. ALLEN STANFORD, §
JAMES M. DAVIS, and §
LAURA PENDERGEST-HOLT, §
§
Defendants. §
______________________________________________________________________________

EMERGENCY MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING


RECEIVER AS TO DEFENDANT LAURA PENDERGEST-HOLT
______________________________________________________________________________

SUMMARY OF MOTION

On March 2, 2009, counsel for Defendant Laura Pendergest-Holt appeared in this case

and, with some reservations, consented to the entry of an Agreed Preliminary Injunction. Later

that same afternoon, in a stunning exercise in bad faith, two lawyers acting on behalf of the

Receiver showed up at Ms. Pendergest-Holt’s home in Mississippi. Without any warning or

notice to Ms. Pendergest-Holt or to her counsel, the lawyers (aided by a U.S. Marshal) entered

Defendant’s house and began rummaging through her and her husband’s personal effects. The

lawyers took what they pleased (including a car belonging to Ms. Pendergest-Holt and Mr.

Holt’s personal tax returns) and were so delighted in doing so that, at one point, they gleefully

indicated to Mr. Holt that he was not going to be living in the house much longer.

______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 1
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 2 of 10

The apparent justification for the raid was the ex parte order entered by the Court on

February 17, 2009, which appointed a receiver for both the Stanford corporate entities and for

Ms. Pendergest-Holt personally (the “Receivership Order”). As explained below, the

Receivership Order as it applies to Ms. Pendergest-Holt (and to her husband) is so broad as to be

unconstitutional. Further, because the order was entered on an ex parte basis, Ms. Pendergest-

Holt has never been given a chance to contest the terms of the order, much less whether it should

apply to her. Meanwhile, the Receiver’s lawyers appear to believe that the Receivership Order

suspends Ms. Pendergest-Holt’s constitutional rights and allows them free rein to invade her

home at will, without any advance notice to Defendant or her counsel.

There is no other way to explain the Receiver’s lawyers’ shocking behavior in

rummaging through Ms. Pendergest-Holt’s undergarment drawer, rifling through her personal

items and re-directing Defendant’s and her husband’s personal mail to the Receiver’s office. For

those who think the accused have at least minimal rights, they might be wise to rethink that view

when entering the world inhabited by the Receiver’s counsel. For obvious reasons, Defendant

needs this Court’s help in ensuring that these outrageous events never happen again.

By this motion, Defendant Laura Pendergest-Holt asks the Court to terminate the

Receivership Order as it applies to her, seeks protection from further improper intrusions by the

Receiver and its counsel, the Securities and Exchange Commission, and the Department of

Justice, and seeks the immediate return of property improperly seized by the Receiver.

Given the extraordinary actions taken by the Receiver’s lawyers, Defendant requests that

her motion to dissolve the Receivership Order be heard on an expedited, emergency basis at

10:00 a.m. on Thursday, March 12, 2009, when the Court is already set to hear the SEC’s

application for preliminary injunction against other defendants in this matter.

______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 2
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 3 of 10

BACKGROUND FACTS

1. The SEC filed this lawsuit on February 17, 2009, against multiple corporate and

individual defendants affiliated with Stanford International Bank.1 On the same day it filed its

lawsuit, the SEC asked the Court (O’Connor, J.) to enter a broad temporary restraining order and

preliminary injunction against the defendants as well as an order appointing Ralph Janvey as a

receiver for all defendants in the case, including for the individual Defendant Pendergest-Holt.

On February 17, 2009, the Court entered both the temporary restraining order and Receivership

Order requested by the SEC. [Docket Nos. 8, 10].

2. Under the Receivership Order, the Receiver was granted unlimited power to

collect all “Receivership Assets” belonging to any of the Defendants and or to any entities they

own or control. [Docket No. 10 at ¶ 1]. “Receivership Assets” is defined broadly in the

Receivership Order to include all “assets, monies, securities, properties, real and personal,

tangible and intangible, or whatever kind and description, wherever located [.]” Id. Further, the

Receivership Order authorized the Receiver to “immediately take and have complete and

exclusive control, possession, and custody of the Receivership Estate,” which is defined to

include “Receivership Assets and Receivership Records.” Id. at ¶¶ 2, 4. As an example,

Ms. Pendergest-Holt’s personal correspondence and personal effects would be part of the

“Receivership Estate” created by the Court’s order. Indeed, the Receiver has already diverted

Ms. Pendergest-Holt’s mail pursuant to paragraph 14 of the Receivership Order.

3. On February 25, 2009, the United States Government filed a criminal complaint

against Ms. Pendergest-Holt in the Northern District of Texas for obstructing a proceeding

before the SEC in violation of 18 U.S.C. § 1505. At the time the criminal complaint was filed,

1
Ms. Pendergest-Holt was not served with a copy of the Complaint until weeks later, when her current
lawyer agreed to accept service on her behalf.
______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 3
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 4 of 10

Ms. Pendergest-Holt and her lawyers, unaware of the Government’s intentions, were in

negotiations with the SEC over the terms of an agreed preliminary injunction in this civil case.

4. Had Ms. Pendergest-Holt’s counsel known that the Government was in the

process of seeking to charge Ms. Pendergest-Holt with a crime, they never would have continued

negotiating with the SEC.

5. On March 2, 2009, Ms. Pendergest-Holt (through her counsel) and the SEC

entered into an agreed preliminary injunction in this matter, subject to working out certain details

as to payment of Defendant’s living and legal expenses. [Docket No. 79] Later on the same day,

two lawyers purportedly representing the Receiver, Charles Gale (a partner at Krage & Janvey)

and Richard Phillips (an appellate lawyer at Thompson Knight), based upon ostensible authority

from the Receivership Order, went to Ms. Pendergest-Holt’s personal residence, improperly

entered and seized documents, rummaged through drawers containing personal items of clothing

and Defendant’s undergarments, rifled through shelves of personal family effects, and carried off

four boxes of documents containing the Holt family’s mail2, tax documents3 and other personal

papers unrelated to the civil action filed by the SEC. In addition, during the raid of

Ms. Pendergest-Holt’s residence, the Receiver’s lawyers photographed each room and its

contents. Finally, as the ultimate insult, the Receiver’s lawyers seized one of the family’s cars.

6. It is important to remember these are two lawyers who work for the Receiver; not

FBI agents with a duly-authorized and Constitutional search or seizure warrant. Although the

Receiver’s lawyers were accompanied by a United States marshal on their raid, it is unknown

2
Since the Receivership Order was entered, the Receiver has redirected and kept all of Ms. Pendergest-
Holt’s and her family’s mail, including mail containing financial help to Defendant from members of her church.
There has been no indication from the Receiver’s office when Ms. Pendergest-Holt’s and her husband’s mail will be
turned over, if ever.
3
For example, the Receiver’s lawyers took several years of Mr. Holt’s individual tax returns that pre-dated
his marriage to the Defendant.
______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 4
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 5 of 10

whether the Receiver’s lawyers were acting in conjunction with or at the behest of the

Department of Justice or the Federal Bureau of Investigation when they raided Defendant’s

home. As a practical matter, however, the Receiver’s raid on Defendant’s house will clearly be

used to advance the Government’s position in both the civil and criminal cases: the Receivership

Order provides specifically that the Receiver shall “[p]romptly provide the United States

Securities and Exchange Commission and other governmental agencies with all information

and documentation they may seek in connection with its regulatory or investigatory activities.”

Receivership Order at ¶ 5(k) (emphasis added).

7. Even more importantly, the Receiver’s raid on Defendant Pendergest-Holt’s

house occurred on the afternoon of March 2, 2009 – the same day that this Court was presented

an agreed preliminary injunction by Ms. Pendergest-Holt’s counsel in this matter. No advance

notice of this raid was provided by the Receiver to Ms. Pendergest-Holt or her counsel, even

though the Receiver undoubtedly knew that Ms. Pendergest-Holt was represented by counsel at

the time, and even though Ms. Pendergest-Holt and the SEC had just negotiated the terms of the

agreed preliminary injunction.

8. Neither Defendant nor her counsel would have agreed to the raid, particularly

given the pending criminal complaint against Ms. Pendergest-Holt. At the very least, counsel for

Defendant would have insisted on being present during the raid to insure that Defendant’s rights

were fully protected and to prevent spoliation of evidence by the Receiver’s actions. More

significantly, Defendant would never have agreed to the terms of the preliminary injunction had

she been informed of the Receiver’s intent to raid her home and take her personal property

pursuant to the Receivership Order.

______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 5
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 6 of 10

9. To date, despite demands from Mr. Pendergest-Holt’s counsel that all personal

property be returned immediately, the Receiver’s lawyers have refused to do so. The Receiver’s

lawyers have also refused to provide an inventory of the materials taken during their raid.

LEGAL ARGUMENT

THE COURT SHOULD DISSOLVE THE RECEIVERSHIP ORDER


AS TO MS. PENDERGEST-HOLT

A. The Receivership Order Should Be Dissolved Because It Is Overbroad.

In its Memorandum of Law in support of its application for ex parte appointment of a

receiver in this case, the SEC argued that a receiver was necessary as to Ms. Pendergest-Holt

because “defendants in this case have made every effort to deny access to the records and data

necessary to enforce the federal securities law.” [Docket No. 6 at 34]. The SEC further

contended that a receiver was necessary “to marshal, liquidate and distribute assets to the victims

of the defendants’ scheme [.]” Id.; see also Docket Entry No. 9. Based on the SEC’s arguments,

this Court appointed Ralph Janvey as the receiver for Ms. Pendergest-Holt, giving Mr. Janvey

the right to “collect, marshal, and take custody, control, and possession of” all of

Ms. Pendergest-Holt’s personal assets. [Docket No. 10].

There are two reasons why the Receivership Order is overbroad as it applies to

Ms. Pendergest-Holt and should be dissolved. First, the Receivership Order is overbroad as to

Mr. Pendergest-Holt because it grants the Receiver far too much power to invade

Ms. Pendergest-Holt’s home and to take Ms. Pendergest-Holt’s personal property, without any

showing that the property subject to the Receiver’s action is even related to the subject matter of

the SEC’s complaint. Indeed, the Receiver has interpreted the Receivership Order broadly to

allow the Receiver’s agents, among other things, to divert Ms. Pendergest-Holt’s mail, to raid

Ms. Pendergest-Holt’s home, to question Ms. Pendergest-Holt’s husband, to rummage through


______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 6
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 7 of 10

Ms. Pendergest-Holt’s undergarments, to take Ms. Pendergest-Holt’s personal possessions, and

to drive off in her family car, all with the help of a United States Marshal – and all with no

showing that any of the property is even related to, much less belongs to, the alleged victims of

the scheme pleaded by the SEC.4 The Receiver should not be allowed to show up, unannounced,

at Ms. Pendergest-Holt’s home, and to take whatever personal property belongs to Defendant or

her family, where there has been no showing to the Court that such a raid is justified by the facts

or the law.5

Second, the Receivership Order is overbroad as to Ms. Pendergest-Holt and should be

dissolved because there is no legal support for the appointment of a receiver for an individual

defendant in an SEC enforcement action, particularly where there has been no showing that the

individual defendant owns or controls any assets of the corporate defendant. While Defendant

concedes that this Court has equitable authority to impose a receivership in an SEC action, if the

Court determines such to be necessary, see, e.g., In re San Vicente Medical Partners, Ltd., 962

F.2d 1402, 1406 (9th Cir. 1992), the SEC has cited no legal support for appointing a receiver as

to Ms. Pendergest-Holt individually. Moreover, the SEC has provided no legal support for the

notion that a receiver, with unlimited power to invade Defendant’s home and to take whatever

property strikes the Receiver’s fancy, is appropriate when the Defendant is also subject to a

criminal complaint brought by the DOJ and SEC.

For these reasons, the Receivership Order is overbroad and should be dissolved as to

Ms. Pendergest-Holt.

4
The SEC filed a two-volume appendix in support of its Application for an Ex Parte Temporary Restraining
Order. [Docket Nos. 12-13]. Nothing in that Appendix suggests that there is any justification for appointing a
receiver to “collect, marshal, and take custody, control, and possession of” Ms. Pendergest-Holt’s personal property
on an ex parte and pre-judgment basis.
5
There is also a substantial concern that the Receiver’s actions have invaded and will continue to invade
Ms. Pendergest-Holt’s attorney-client privilege.
______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 7
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 8 of 10

B. The Receivership Order Should Be Dissolved In Order To Prevent Further Abuse


by the Receiver’s Lawyers.

By raiding Ms. Pendergest-Holt’s home with no advance notice to Ms. Pendergest-Holt’s

lawyers, the Receiver’s lawyers conclusively demonstrated that they have no regard for their

ethical obligations under the Texas Rules of Professional Conduct with respect to dealing with

parties represented by counsel, much less any respect for Ms. Pendergest-Holt’s constitutional

rights. Given the actions taken by the Receiver’s lawyers, the only way to prevent further abuse

of power under the Receivership Order is to dissolve the order as it applies to Ms. Pendergest-

Holt and to order immediate return of all property seized by the Receiver.

C. Ms. Pendergest-Holt’s Constitutional Rights Are Seriously Jeopardized By The


Receiver’s Actions.

As the Court is aware, there is a pending criminal complaint against Ms. Pendergest-Holt

and she is the subject of an ongoing criminal investigation by the DOJ in concert with the SEC.

The Receiver’s actions against Ms. Pendergest-Holt jeopardize her rights under the Fourth and

Fifth Amendments to the United States Constitution. In effect, the Receiver’s lawyers, in the

context of the civil case, have conducted a free-wheeling warrantless search of Ms. Pendergest-

Holt’s home and have taken Ms. Pendergest-Holt’s personal property without due process of

law. Because the Receiver’s lawyers are duty-bound to cooperate with the SEC, DOJ and FBI

under the Receivership Order, the Government will no doubt be the primary beneficiary of the

Receiver’s unlawful search and seizure of Defendant’s property. This Court should dissolve the

Receivership Order to protect Ms. Pendergest-Holt’s constitutional rights.

D. The Receivership Order Is No Longer Necessary Because of the Agreed Preliminary


Injunction Entered by Ms. Pendergest-Holt.

On March 2, 2009, the Court entered an Agreed Preliminary Injunction as to

Ms. Pendergest-Holt. [Docket No. 79]. The Preliminary Injunction requires Ms. Pendergest-
______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 8
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 9 of 10

Holt, among many other things, to preserve her assets, provide an accounting under oath, and to

preserve all of her records. Id. Given the entry of the Preliminary Injunction, there is no longer

any need for the Receivership Order.

E. The Receivership Order Should Be Dissolved Because The Ex Parte Entry of the
Order Violated Ms. Pendergest-Holt’s Due Process Rights.

The Court entered the Receivership Order on February 17, 2009, with no notice to

Ms. Pendergest-Holt and without ever affording Ms. Pendergest-Holt an opportunity to

participate in the proceedings in which the order was entered. Due process requires notice and

an opportunity to be heard. Cleveland Bd. of Education v. Loudermill, 470 U.S. 532, 542, 105

S.Ct. 1487, 1493 (1985). Because entry of the Receivership Order against Ms. Pendergest-Holt

on an ex parte basis violated her due process rights, the order should be dissolved. In the

alternative, upon the opportunity to be heard on this matter, the Receivership Order should

modified to limit the powers of the Receiver.

CONCLUSION

For these reasons, Defendant Laura Pendergest-Holt respectfully requests that the Court

(1) dissolve the Receivership Order as it applies to her; (2) order immediate return of all of the

property seized by the Receiver; (3) prohibit the Receiver from intercepting her mail; and (4)

grant such other relief to which she may be justly entitled. In making this motion, Defendant

Pendergest-Holt does not waive any other rights she may have to seek additional relief made

necessary by the Receiver’s conduct.

______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 9
02174.901/204368
Case 3:09-cv-00298-N Document 141 Filed 03/10/2009 Page 10 of 10

DATED this 10th day of March, 2009.

Respectfully submitted,

/s/ Jeffrey M. Tillotson, P.C.


________________________________________
Jeffrey M. Tillotson, P.C.
Texas Bar No. 20039200
John Volney
Texas Bar No. 24003118
LYNN TILLOTSON PINKER & COX, L.L.P.
2100 Ross Avenue, Suite 2700
Dallas, Texas 75201
(214) 981-3800 Telephone
(214) 981-3839 Facsimile

ATTORNEY FOR DEFENDANT


LAURA PENDERGEST-HOLT

CERTIFICATE OF CONFERENCE

Counsel for movant and counsel for respondent have personally conducted a conference
at which there was a substantive discussion of every item presented to the Court in this motion
and despite best efforts the counsel have not been able to resolve those matters presented.

Certified to this 10th day of March, 2009.

/s/ Jeffrey M. Tillotson, P.C.


__________________________________________
Jeffrey M. Tillotson, P.C.

CERTIFICATE OF SERVICE

The undersigned hereby certifies that a true and correct copy of the above and foregoing
document has been served via ECF on counsel of record on this the 10th day of March, 2009:

/s/ Jeffrey M. Tillotson, P.C.


__________________________________________
Jeffrey M. Tillotson, P.C.

______________________________________________________________________________
MOTION TO SET ASIDE OR DISSOLVE ORDER APPOINTING RECEIVER Page 10
02174.901/204368

Vous aimerez peut-être aussi