New York Life Insurance Company v. Waxenberg et al

Filing 106

ORDER granting 71 Motion for attorney fees; denying 72 Motion for fees and expenses. Signed by Judge James D. Whittemore on 3/11/2009. (KE)

UNITED STATES D I S T R I C T COURT MIDDLE D I S T R I C T OF F L O R I D A TAMPA DIVISION N E W Y O R K L I F E INSURANCE COMPANY, Plaintiff, vs. Z E L D A J. WAXENBERG, et al., Defendant. _ _ _ _ _ _ _ _ _ _ _ _ _ _----:1 ORDER B E F O R E T H E COURT are: (1) Defendant Zelda Waxenberg Family T r u s t ' s Verified
M o t i o n for A t t o r n e y ' s Fees and Costs Pursuant to Section 768.79 (Dkt. 71) and (2) Defendant Zelda W a x e n b e r g F a m i l y T r u s t ' s Verified Motion for Fees and Expenses (Dkt. 72). Defendant Burton W. Wiand, the Receiver, and his counsel have filed a response in opposition to b o th motions. (Dkt. 81). B o t h parties have filed supplemental authority. (Dkts. 90, 91). The C o u r t held a hearing on the motions on February 20, 2009. (Dkt. 105). U p o n consideration, D e f e n d a n t ' s motion for fees and costs pursuant to Fla. Stat. § 768.79 is GRANTED, and the motion for fees and expenses pursuant to 28 U.S.C. § 1927 is DENIED.

Case No.: 8:07-cv-401-T-27TGW

Background
The Defendants, Burton W. Wiand, as Receiver for Howard Waxenberg Trading, LLC, H K W Trading LLC, H K W Trading Fund I LLC, Downing & Associates Technical Analysis, and the Estate o f Howard Waxenberg ("the Receiver") and Zelda Waxenberg, as Trustee o f the Zelda Waxenberg Family Trust are parties in two separate actions before this Court. A b r i e f history o f these cases as

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well as the original Securities and E x c h a n g e C o m m i s s i o n e n f o r c e m e n t a c t i o n a p p o i n t i n g the R e c e i v e r follows. On JUJ;le 9, 2005, t h e Securities a n d E x c h a n g e C o m m i s s i o n ( " S E C " ) filed an e n f o r c e m e n t a c t i o n against H o w a r d W a x e n b e r g T r a d i n g , LLC, H K W T r a d i n g L L C , H K W T r a d i n g F u n d I LLC, D o w n i n g & Associates T e c h n i c a l Analysis, a n d the E s t a t e o f H o w a r d W a x e n b e r g . ( C a s e No. 8:05c v - 1 0 7 6 - T - 2 4 T B M , D k t . 1). T h e S E C a l l e g e d t h a t H o w a r d W a x e n b e r g o p e r a t e d a P o n z i s c h e m e b e t w e e n 1990 and 2005, i n v o l v i n g a p p r o x i m a t e l y 2 0 0 h u n d r e d investors. (Id., <][<][1- 2). S h o r t l y b e f o r e t h a t a c t i o n was filed, Mr. W a x e n b e r g c o m m i t t e d suicide. (Id., <][ 9). In the c o u r s e o f the e n f o r c e m e n t action, the H o n o r a b l e S u s a n C. B u c k l e w a p p o i n t e d B u r t o n W. W i a n d as the R e c e i v e r o v e r H o w a r d W a x e n b e r g T r a d i n g , LLC, H K W T r a d i n g LLC, H K W T r a d i n g F u n d I LLC, D o w n i n g & A s s o c i a t e s T e c h n i c a l Analysis, and the E s t a t e o f H o w a r d W a x e n b e r g (collectively, " t h e R e c e i v e r s h i p E n t i t i e s " ) ( C a s e No. 0 5 - c v - 1 0 7 6 , Dkts. 1 0 , 4 4 ) . The A p p o i n t i n g O r d e r a u t h o r i z e d the R e c e i v e r to t a k e p o s s e s s i o n o f the R e c e i v e r s h i p E n t i t i e s ' assets and to: institute s u c h actions and legal p r o c e e d i n g s , for the b e n e f i t and on b e h a l f o f the [Receivership Entities] and t h e i r investors a n d o t h e r creditors, as the R e c e i v e r d e e m s necessary against those individuals, corporations, partnerships, associations a n d / o r u n i n c o r p o r a t e d organizations, w h i c h the R e c e i v e r m a y c l a i m h a v e wrongfully, illegally or o t h e r w i s e i m p r o p e r l y m i s a p p r o p r i a t e d or transferred m o n i e s or o t h e r proceeds directly or indirectly traceable f r o m investors in the [ R e c e ive r ship Entities]. ( C a s e No. 0 5 - c v - 1 0 7 6 , Dkt. 10 at 2-3). T h e R e c e i v e r u l t i m a t e l y initiated eighty-five ancillary actions against investors, seeking to r e c o v e r payments m a d e by Mr. W a x e n b e r g to t h o s e investors. T h e R e c e i v e r s o u g h t to distribute r e c o v e r e d funds pro r a t a a m o n g all investors. T h e first a c t i o n o f t h e s e ancillary actions