Injazat Technology Fund B.S.C. v. Najafi et al

Filing 144

ORDER OF CLARIFICATION (nclc1, COURT STAFF) (Filed on 10/24/2013)

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1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 NORTHERN DISTRICT OF CALIFORNIA 11 SAN FRANCISCO DIVISION 12 13 INJAZAT TECHNOLOGY FUND B.S.C., Judgment Creditor, 14 15 v. Case No. 11-cv-04133 PJH (NC) ORDER OF CLARIFICATION Re: Dkt. No. 139 DR. HAMID NAJAFI and MICHAEL 16 CUMMISKEY, 17 Judgment Debtors. 18 19 20 21 22 23 24 25 26 27 Judgment Creditor Injazat seeks clarification and objects to this Court’s order of September 17, 2013, which found for purposes of enforcing a judgment that Defendant Najafi’s stock options must be treated as earnings, and his rental house income must be held in trust until further notice. Dkt Nos. 137, 139. Injazat seeks clarification with regard to the portion of the Court’s order finding that stock options must be treated as earnings, and Injazat objects to the portion of the order which finds that Najafi’s rental house income must be held in trust because Najafi’s former wife appears to have a priority claim on that income. Judge Phyllis J. Hamilton referred to this Court the request for clarification. Dkt. No. 143. Therefore the Court will not address the issue of Najafi’s rental house income. 28 Case No. 11-cv-04133 PJH (NC) ORDER OF CLARIFICATION 1 The Court found that stock options must be treated as earnings under California Civil 2 Procedure Code § 706.011, and that therefore Injazat is entitled to a 25% garnishment of the 3 value of any exercised options after deductions for Najafi’s exemptions and tax liability. 4 Dkt. No. 137 at 9. In its request for clarification, Injazat now asks that the Court compel 5 Najafi to either turn over a portion of his exercised shares or sell his shares. Injazat, 6 however, cites no authority stating that the Court can compel the sale or transfer of stock to 7 satisfy a judgment. 8 At this point, the Court finds that remedy to be unnecessary. The value of Najafi’s 9 exercised stock options is hypothetical until the stock is sold, but Najafi and Injazat share an 10 interest in getting the most value possible for the sale of Najafi’s stock. Once Najafi sells 11 any portion of his exercised stock options, its value will be known and Injazat will be 12 entitled to 25% of that value after taxes and exemptions. Najafi’s proposal to submit to 13 Injazat a schedule of withholdings when transferring to Injazat their garnishment is 14 reasonable, and the Court does now ORDER Najafi to inform Injazat of the sale of stock 15 and provide a schedule of all withholdings within 14 days of the sale. 16 Any party may object to this order within 14 days. Civ. L. R. 72-2. 17 IT IS SO ORDERED. 18 Date: October 24, 2013 19 _________________________ Nathanael M. Cousins United States Magistrate Judge 20 21 22 23 24 25 26 27 28 Case No. 11-cv-04133 PJH (NC) ORDER OF CLARIFICATION 2

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