Securities Exchange v. Truong, et al

Filing 198

ORDER by Judge Whyte granting 191 Motion for an Order Appointing a Tax Administrator and for the Disbursement of Remaining Funds in the Court's Registry to the United States Treasury.(rmwlc1, COURT STAFF) (Filed on 11/17/2011)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA 10 SAN JOSE DIVISION 11 12 ________________________________________________ Civil No. C-98-21137-RMW 13 14 SECURITIES AND EXCHANGE COMMISSION, 15 Plaintiff, 16 vs. 17 18 HANH TRUONG, HIEU TRUONG, HEN TRUONG, NINA VINH, MIKE PIRBAZARI, and CHRISTOPHER NGUYEN 19 Defendants. 20 21 _______________________________________________ 22 23 24 25 26 27 28 Order for Tax Administrator C-98-21137-RMW ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) [] ORDER GRANTING PLAINTIFF'S MOTION TO APPOINT A TAX ADMINISTRATOR AND FOR THE DISBURSEMENT OF REMAINING FUNDS IN THE COURT’S REGISTRY TO THE UNITED STATES TREASURY 1 ORDER APPOINTING TAX ADMINISTRATOR AND TRANSFERRING REMAINING 2 FUNDS TO THE UNITED STATES TREASURY 3 Plaintiff Securities and Exchange Commission (“Commission”) has filed a regularly notice motion 4 for an order by the Court appointing Damasco & Associates, LLP as the tax administrator responsible for 5 preparing the necessary tax returns for the $92,792 in disgorgement, prejudgment interest and post-judgment 6 interest that defendant Hen Truong previously paid into the court’s registry pursuant to a final judgment that 7 the Court entered against him. Hen Truong’s payments have earned $15,588 in interest while in the court’s 8 registry, and those earnings may be subject to federal and state income taxes. 9 The Commission therefore moves for an order to have Damasco & Associates prepare the necessary 10 tax returns and to have the Clerk of the Court pay the tax preparation fees of Damasco & Associates from 11 the funds in the court’s registry. The Commission also moves for an order to have the Clerk of the Court 12 pay any federal and state income taxes that Damasco & Associates determines to be owed from the court’s 13 registry. The Commission further moves for an order authorizing the Clerk of the Court to transfer to the 14 United States Treasury any funds remaining in the court’s registry after the payment of tax administrator 15 fees and income taxes on the grounds that there is no practical way of distributing Hen Truong’s 16 disgorgement and interest payments to injured investors. 17 Based upon the papers and arguments submitted, the Court finds that Damasco & Associates should 18 be appointed as the tax administrator for this proceeding to prepare and file the necessary federal and state 19 tax returns for the funds being held in the court’s registry. The Court also finds that the fees of Damasco 20 & Associates and any federal and state income taxes should be paid by the Clerk of the Court from the funds 21 in the court’s registry. The Court further finds that the amount of funds in the court’s registry remaining 22 after the payment of tax administration fees and income taxes cannot be feasibly disbursed to the investors 23 in Molecular Dynamics, Inc. common stock given the difficulties and costs associated with locating and 24 making a distribution to such investors. 25 GOOD CAUSE APPEARING, it is hereby ordered that: 26 1. 27 28 Damasco & Associates is appointed as the tax administrator for the funds in the court’s registry for this case and is authorized to prepare the necessary federal and state tax returns and filings. 2. The Clerk of the Court is authorized to pay the tax administration fees of Damasco & Order for Tax Administrator C-98-21137-RMW 1 1 2 Associates and any federal and state income taxes or assessments from the funds in the court’s registry. 3. Following the payment of Damasco & Associates’ tax administration fees and any federal 3 and state income taxes or assessments, the Clerk of the Court is authorized to transfer the residual amount 4 in the court’s registry for this case to the Commission so that the Commission can transfer those fund to the 5 United States Treasury. 6 SO ORDERED. 7 Dated: November 17, 2011 8 9 ___________________________ Ronald M. Whyte, Judge United States District Court 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Order for Tax Administrator C-98-21137-RMW 2

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