National Credit Union Administration Board v. Vangh

Background

The court had entered a preliminary injunction in 2015 that prohibited True Yang Vangh and Nkajlo Vangh from selling, dissipating, or otherwise disposing of personal and business assets. In 2018, the court converted that injunction into a permanent injunction and incorporated the parties’ settlement agreement. The settlement required the defendants to make monthly payments of $15,000 to the National Credit Union Administration Board (NCUAB), which was acting as liquidating agent for the Hmong American Federal Credit Union.

After entry of the permanent injunction, the Minnesota Department of Human Services took administrative action seeking to revoke the license needed to operate the defendants’ adult day care business. The opinion states that the defendants’ home health care business faced a similar risk. The parties asserted that license revocations could force the businesses to close and prevent the defendants from continuing their monthly payments to NCUAB. The defendants therefore negotiated sales of the businesses to third parties, and NCUAB participated in the negotiations and agreed to the sale terms and transaction documents.

Legal Standard and Analysis

The court explained that a district court has authority, as part of its equitable discretion, to modify an injunction it issued. Modification is appropriate when changed circumstances require it to achieve the purpose of the original relief.

The court concluded that modification was warranted. When it entered the permanent injunction, the court had found that the injunction advanced the interests and public-policy goals of the Federal Credit Union Act, including protecting creditors and ensuring a legitimate credit union system. The court found that the proposed sales would advance those goals. It also found that the sales were necessary because future license revocations could eliminate NCUAB’s ability to collect its judgment against the defendants.

Order

Judge Wilhelmina M. Wright granted the parties’ Joint Motion to Modify Permanent Injunction. The modified injunction permits the defendants to sell the assets of Twin Cities Home Health Services, LLC, to North Star Health Alliance, LLC, and the assets of Hmong Elite Home Care, Inc., to Golden Crescent Health Services, LLC. The order states that North Star Health Alliance, LLC and Golden Crescent Health Services, LLC are Minnesota limited liability companies.

The defendants must remit the sale proceeds to NCUAB as provided in the parties’ respective agreements. The combined purchase price must be at least the full amount of restitution the defendants owe NCUAB on the sales’ closing dates. Before the sales, NCUAB may review and approve the final transaction documents, and the sales may not occur without that approval. The permanent injunction remains in effect in all other respects.