Securities and Exchange Commission v. Amerindo Investment Advisors Inc.
- Richard Sullivan
- 1:05-cv-05231
- U.S. District Court · Southern District of New York
- 26
In Securities and Exchange Commission v. Amerindo Investment Advisors Inc., Judge Sullivan issued a continuing garnishment writ to collect a prior $17.9 million judgment.
The order directly affects the Amerindo defendants and the garnishees—Citibank, N.A., American Stock Transfer & Trust Co., LLC, and EQ Shareowner Services—by requiring the garnishees to withhold covered nonexempt property and answer the court. It allows the Securities and Exchange Commission to pursue collection of the prior judgment.
What happened
In Securities and Exchange Commission v. Amerindo Investment Advisors Inc., the Securities and Exchange Commission sought to collect a 2014 judgment against the Amerindo defendants.
The court found that the application met the legal requirements for a continuing garnishment writ, including the requirement that the Commission believe the garnishees held property in which a defendant had a substantial nonexempt interest.
Judge Sullivan ordered Citibank, American Stock Transfer & Trust, and EQ Shareowner Services to withhold covered property and file written answers within 10 days after receiving the writ. The writ will continue until the court quashes it, the property is exhausted, or the debt is satisfied.
The detailed version
- Securities and Exchange Commission v. Amerindo Investment Advisors Inc. · No. 1:05-cv-05231
- Richard Sullivan
- Jan. 8, 2021
Background
In 2014, the court entered a $17.9 million judgment in favor of the Securities and Exchange Commission against Amerindo Investment Advisors Inc., Amerindo Investment Advisors, Inc., Amerindo Advisors UK Ltd., Amerindo Management Inc., Amerindo Technology Growth Fund, Inc., and Amerindo Technology Growth Fund II, Inc. The caption also lists Techno Raquia, S.A. as a defendant, and the writ provides that it owed a $17,969,803.27 civil penalty plus post-judgment interest. The Commission applied for a continuing writ of garnishment under 28 U.S.C. § 3205 to collect the judgment.
Court’s Analysis
The court concluded that the Commission’s application satisfied the statutory requirements for a writ. In particular, the United States must represent that the garnishee is believed to possess property in which the debtor has a substantial nonexempt interest. The court determined that this requirement was met. Because of the risk that another person could execute a lien before the writ was served, the court also ordered that the application and writ remain under seal until service.
Order
The court ordered Citibank, N.A., American Stock Transfer & Trust Co., LLC, and EQ Shareowner Services to withhold and retain property in their possession, custody, or control in which a defendant had an interest when the writ was served, or in which a defendant might obtain a substantial nonexempt interest later. This included nonexempt disposable earnings. A garnishee that failed to comply could be held in contempt or could face a judgment for the value of the defendant’s nonexempt interest, plus a reasonable attorney’s fee to the Commission.
The garnishees were ordered to file written answers with the court within 10 days after receiving the writ and serve copies on the Commission’s counsel and the defendants. The writ would terminate only if the court ordered it quashed, the property in the garnishee’s possession or control was exhausted, or the debt was satisfied. The attached notices also explained that defendants could object to a garnishee’s answer, request a hearing, and claim exemptions under federal or applicable state law.
Read the full 26-page opinion on CourtListener, the free public archive maintained by the Free Law Project.