Opinion
Case No. C 08-03517 EMC
11-21-2011
SECURITIES AND EXCHANGE COMMISSION, Plaintiff, v. ROBERT C. BROWN, JR. AND TREBOR COMPANY (AKA TREBOR INVESTMENT COMPANY, TREBOR SEMINARS, TREBOR GROUP AND TREBOR GROUP FUND), Defendants, and DUANE EDDINGS, CDC GLOBAL, INC. AND WISE INVESTORS SIMPLY EXCEL, LLC, Relief Defendants.
MARC J. FAGEL (Cal. Bar No. 154425) SHEILA E. O'CALLAGHAN (Cal. Bar No. 131032) SUSAN L. LAMARCA (Cal. Bar No. 215231) JEREMY E. PENDREY (Cal. Bar No. 187075) Attorneys for Plaintiff SECURITIES AND EXCHANGE COMMISSION
MARC J. FAGEL (Cal. Bar No. 154425)
SHEILA E. O'CALLAGHAN (Cal. Bar No. 131032)
SUSAN L. LAMARCA (Cal. Bar No. 215231)
JEREMY E. PENDREY (Cal. Bar No. 187075)
Attorneys for Plaintiff
SECURITIES AND EXCHANGE COMMISSION
JOINT CASE MANAGEMENT
CONFERENCE STATEMENT
ORDER RESETTING CMC
Pursuant to the Northern District's March 1, 2007 Standing Order, plaintiff Securities and Exchange Commission (the "Commission") and defendant Duane Eddings ("Eddings") submit this Joint Case Management Statement.
On July 23, 2008, the Commission filed this action against defendant Robert C. Brown, Jr., and his sole proprietorship, Trebor Company, also known as Trebor Investment Company, Trebor Seminars, Trebor Group and Trebor Group Fund (collectively, "Trebor Company"). The Commission alleged that since at least 2000, Brown misappropriated more than $20 million from hundreds of investors in a classic ponzi scheme, using new investor money to pay off earlier investors. As part of its complaint, the Commission named Duane Eddings and two affiliated entities Wise Investors Simply Excel, LLC and CDC Global, Inc. as relief defendants. According to the Commission's complaint, Wise and CDC, both entities which Eddings controlled, received approximately $8.5 million through Brown and Trebor Company's fraudulent scheme and had no legitimate claim to the money.
On February 26, 2009, Brown and Eddings were indicted by a Grand Jury in the United States District Court for the Eastern District of California for four counts of mail fraud [18 U.S.C. § 1341], eight counts of wire fraud [18 U.S.C. § 1343] and 10 counts of engaging in monetary transactions over $10,000 in property derived from specified unlawful activity [18 U.S.C. § 1957]. The indictment alleged essentially the same misconduct alleged in the Commission's complaint in this action. On April 6, 2010, pursuant to a plea agreement, Brown entered a change of plea in the criminal case. The date for judgment and sentencing for Brown has been continued on several occasions and is now scheduled for March 6, 2012. Shortly thereafter, Brown entered into a settlement with the Commission, and on July 1, 2011, the Court entered a Final Judgment as to Brown based on the settlement. Accordingly, the case against Brown is resolved and the Commission does not expect him to appear at the CMC.
On May 12, 2009, a Grand Jury issued a Superseding Indictment against Mr. Eddings. The criminal action against Mr. Eddings went to trial on October 24, 2011, resulting in a jury verdict of guilty on six counts of mail fraud, one count of wire fraud, three counts of engaging in monetary transactions over $10,000 in property derived from specified unlawful activity, three counts of tax evasion [18 U.S.C. § 7201] and criminal forfeiture [18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c)]. The Court has set judgment and sentencing for Mr. Eddings for March 6, 2012.
The Commission and relief defendant Eddings have discussed a possible resolution regarding disgorgement of the monies Mr. Eddings and the entities he controlled received from Brown as a result of the fraud. The parties currently anticipate waiting for the sentencing before coming to a complete resolution of this action as both the Commission and Mr. Eddings expect what is ordered in the criminal case will be important to the outcome here. The parties therefore recommend that the Court put off the Case Management Conference until after Mr. Eddings is sentenced. The parties should be in a better position to inform the Court about the prospects for possible resolution at that time.
Therefore the Commission and relief defendant Eddings ask the Court to continue the case management conference until after Mr. Eddings' March 6, 2012 date for sentencing. The parties ask the Court to continue the conference currently set for November 28, 2011 at 4:00 p.m. to March 19, 2012 at 4:00 p.m. March 23, 2012 at 9:00 a.m.
The parties' joint case management conference statements shall be filed on or before March 16 12, 2012.
Respectfully Submitted,
Sheila E. O'Callaghan
Jeremy E. Pendrey
Attorneys for Plaintiff
SECURITIES AND EXCHANGE
COMMISSION
Respectfully Submitted,
Joseph J. Wiseman
Wiseman Law Group
Attorney for Defendant
Duane A. Eddings (in the criminal action)
The Commission's undersigned counsel of record, Sheila E. O'Callaghan, hereby attests that Joseph J. Wiseman concurs in the filing of this Case Management Conference Statement in accordance with General Order No. 45, Electronic Case Filing, section 10(b).
IT IS SO ORDERED that the CMC is reset from 11/28/11 to 3/23/12 at 9:00 a.m. A joint CMC statement shall be filed by 3/16/12.
Edward M. Chen
U.S. District Judge