Federal Trade Commission v. Loma International Business Group, Inc. et al

Filing 214

AMENDED MEMORANDUM AND ORDER: Asset Freeze. Signed by Judge Marvin J. Garbis on 4/25/14. (jnls, Deputy Clerk)

THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
FEDERAL TRADE COMMISSION
Plaintiff
vs.
MANUEL AND LOLA ALBAN
et al.

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CIVIL ACTION NO. MJG-11-1483

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Defendants
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AMENDED1 MEMORANDUM AND ORDER RE: ASSET FREEZE
The Court has before it Defendants’ letters and proposed
orders [Documents 207 and 210] requesting the Court to clarify
that the asset freeze2 is no longer in effect, and response
[Document 208] from the Federal Trade Commission (“FTC”) asking
the Court to exercise its equitable authority to continue the
asset freeze.
The Court initially granted Plaintiff’s Ex Parte
Application for Temporary Restraining Order with Asset Freeze,
Appointment of a Temporary Monitor, Immediate Access to Business
Premises, Limited Expedited Discovery, and an Order to Show
Cause Why a Preliminary Injunction Should Not Issue [Document
13] (“TRO”).

1

The Stipulated Order of Preliminary Injunction and

Correcting account number per counsel’s request in letter
to the Court dated April 25, 2014 [Document 213].
2
See Stipulated Order of Preliminary Injunction and Other
Equitable Relief [Document 48] 7-10.

Other Equitable Relief [Document 48] (“Preliminary Injunction”)
superseded the TRO, and it was clearly issued to provide
“preliminary” relief to preserve the status quo during the
pendency of the lawsuit.
On March 24, 2014, after a full trial on the merits, the
Court issued the Permanent Injunction [Document 206], which
superseded the Preliminary Injunction.

In addition to a

monetary judgment, the Permanent Injunction incorporates
recordkeeping obligations and compliance reporting, but it does
not incorporate an asset freeze.
initial payment of $75,000.00.

The Court has ordered an

There is the possibility that

further payments could be required.
The FTC raises a concern that, absent the asset freeze, the
Defendants could dissipate their assets and evade compliance
with further payment orders. While this is theoretically
possible, the Court finds that the Albans are not likely to take
such steps. The Albans state that the asset freeze sought by the
FTC would cause them a hardship since they need the funds in
question for ordinary living expenses.

Both sides have a point.

However, without any hardship being imposed on the Albans, the
FTC can be provided with adequate security.

This can be done by

requiring the Albans to seek leave of Court before selling or
encumbering their residence, an asset with a value well in

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excess of $400,000.

See Hr’g Tr., Aug. 9, 2013 at 9, 63-64, and

Document 198-2.
Accordingly:
1.

Sun Trust Investment Services shall sell
sufficient shares in Manuel Alban’s individual
retirement account (account number ending in XXXXX7813)to generate the sum of $75,000.00, which
sum shall be sent via a check made payable to
“Kramon & Graham, P.A.” to John A. Bourgeois,
Kramon & Graham, P.A., One South Street, Suite
2600, Baltimore, Maryland 21202.

2.

Kramon & Graham, P.A. shall deposit the
$75,000.00 from Sun Trust Investment Services
into its attorney trust account, and when those
funds clear, remit $75,000.00 to the Federal
Trade Commission in satisfaction of the payment
obligation set forth in Section III.A of the
Permanent Injunction [Document 206] entered in
this Matter on March 24, 2014.

3.

The following Orders entered in this Matter have
been and are superseded by the Permanent
Injunction [Document 206] entered in this Matter
on March 24, 2014 and are of no continuing force
or effect:
a.

b.
4.

Ex Parte Temporary Restraining Order with
Asset Freeze, Appointment of A Temporary
Monitor, Immediate Access to Business
Premises, And Limited Expedited Discovery,
And an Order to Show Cause Why A Preliminary
Injunction Should Not Issue [Document 13];
and
Stipulated Order of Preliminary Injunction
and Other Equitable Relief [Document 48].

The Asset Freeze provided for in the
aforementioned Orders [Documents 13 and 48] is
hereby LIFTED.

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5.

Except as may be permitted by further Order,
Defendants shall not sell or encumber in any
manner the property owned by Mr. and Mrs. Alban
at 2711 Wesleyan Drive, Churchville, Maryland
21208-1208.

6.

This Order shall be effective on May 5, 2014.3

SO ORDERED, on Friday, April 25, 2014.

/s/__________
Marvin J. Garbis
United States District Judge

3

The deferred effective date is included to enable any party
wishing to do so, to seek relief from the United States Court of
Appeals for the Fourth Circuit prior to the effective date.

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