U.S. Securities and Exchange Commission v. Wilson et al

Filing 271

ORDER Granting 254 Motion to Allow Claims and Disallow Others. Denying as Moot 259 Motion.) Signed by District Judge Thomas L. Ludington. (KWin)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
NORTHERN DIVISION
SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.

Case No. 12-cv-15062
Honorable Thomas L. Ludington

JOEL I. WILSON, et al.,
Defendants.
__________________________________________/
ORDER GRANTING MOTION TO ALLOW CLAIMS AND DISALLOW OTHERS
On September 6, 2018, the Receiver filed a motion to allow certain claims and disallow
others. ECF No. 254. The Receiver was directed to submit supplemental briefing to clarify his
intentions with respect to the disposition of receivership assets. He clarified that his intention is
to make an interim distribution equal to 10% of the allowable claims, not 10% of the assets of
the receivership estate. See ECF No. 259. He filed his clarification as a miscellaneous motion
(ECF No. 259).
A hearing was scheduled for December 5, 2018, and the Receiver was directed to serve
the motion and notice of the hearing on interested parties. The courts were ultimately closed on
December 5 to honor the late President George H. W. Bush. The hearing was rescheduled for
January 28, 2019. That hearing was also cancelled, as the Court was closed due to extreme
weather. The hearing was rescheduled for January 31, 2019 and was held on that day.
The Receiver seeks to disallow claims of any officer, director or employee/agent who
participated in the fraud committed upon the innocent investors in this case including Joel
Wilson (no claim filed), Mary Faher (claim >$9,441.50- commissions and $211,400.00), and
Shawn Dicken (no claim filed). The motion will be granted as unopposed with respect to those

claimants and their claims will be disallowed, as they did not file an objection or appear at the
hearing.
The Receiver originally sought to either disallow a distribution in its entirety or to
equitably subordinate a distribution to the following relatives and/or friends of Joel Wilson,
including, but not limited to Madlon Bosquet, (the mother of Joel Wilson, with a claim of
$58,490.56), Philip Bosquet, (the step-father of Joel Wilson, with a claim of $239,479.00), Tony
Butterfield, (the sister of Joel Wilson, with a claim of $7,008.00), and Jamie Wilson (relationship
unknown, with a claim of $3,750.00 in wages and $700.00 as an investor). On November 28,
2018, Phillip and Madlon Bosquet, with the assistance of their attorney, filed a response to the
Receiver’s motion objecting to the proposal that their claims be subordinated to the other
investors. ECF No. 266. They argued that they were unaware of Joel Wilson’s illegal activities,
and that they are no different than Joel Wilson’s other unwitting investors. The receiver modified
his proposal with respect to the Bosquets, seeking instead to offset a previous distribution they
had received. The Bosquets appeared at the hearing as did their attorney, Michael Rock. Ms.
Butterfield and Ms. Wilson also appeared.
The receiver has now withdrawn his request to subordinate or offset the claims of the
Bosquets. The receiver has also withdrawn his request to subordinate or disallow the claims of
Ms. Butterfield and Ms. Wilson. Madlon Bosquet, Phillip Bosquet, Tony Butterfield, and Jamie
Wilson will receive their distribution at the same level of priority as the rest of the investors.
The Receiver also seeks to subordinate payment to any director of any of the defendant
entities to the extent of the full amount of compensation received by such director for his or her
services as a director of such entity including Melissa Everett, (wife of T. James Everett) and T.
James Everett. Melissa Everett filed a claim in the amount of $51,148.00 and T. James Everett

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filed a claim in the amount of $19,108.00. The Receiver’s request will be granted as unopposed,
as neither Mr. nor Mrs. Everett filed an objection or appeared at the hearing.
Receiver also seeks to allow late claims of Michael K. Lee, and Ruth B. Lee in an amount
of $56,739.90, and $119,127.09, due to the fact that Mr. Lee and Mrs. Lee are elderly. The
Receiver also has proposed an amendment to the claim of Carl. A. Lengerman to $207,797.91.
No interested party has objected to the proposed disposition of these claims, and they will be
granted.
The Receiver also seeks to disallow claims of certain individuals due to their failure to
submit the required documentation initially or upon follow up request: Calvin and Susan
Bennett, Shirley Broihier, Larry Sanders, Shivonny Williams and Leo Wirtz and Joseph P.
Tallerieu, Sr. be disallowed. The request will be granted as unopposed.
Receiver seeks an entry of an order denying the claims filed by the State of Michigan,
Department of Treasury in the amounts of $1,000,000.00 and $4,704.59 against the corporate
and limited liability entity defendants in this matter and denying a distribution to the claimant of
funds held by the Receiver. The basis for the request is the claimant has indicated, through its
authorized representative, that it does not have a claim against the corporate or limited liability
companies that are defendants in this matter and only maintains claims against Joel Wilson. The
request will be granted as unopposed. Finally, the Receiver seeks to disallow claims by the IRS
as they have failed to file a claim thus far. The request will be granted.
Accordingly, it is ORDERED that the Receiver’s motion, ECF No. 254 is GRANTED
as set forth above.
It is further ORDERED that the miscellaneous motion, ECF No. 259, is DENIED as
moot.

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It is further ORDERED as follows:


The

following

claims

are

DISALLOWED

as

set

forth

in

the

Receiver’s motion: Joel Wilson, Mary Faher, and Shawn Dicken;


The following claims are SUBORDINATED as set forth in the Receiver’s
motion: distributions to directors of the defendant entities and their spouses,
including Melissa J. Everett and T. James Everett until all innocent claimants
have been paid in full or in the alternative (at the receiver’s election) to allow a
distribution to T. James Everett and/or Melissa J. Everett of fifty percent (50%) of
what each would be entitled to receive pursuant to the Equitable Distribution
Order in this case;



The following late or amended claims are ALLOWED as set forth in the
Receiver’s motion: the claim of Michael K. Lee in the amount of $56,739.90, the
claim of Ruth B. Lee in the amount of $119,127.09 and the claim of Carl
Lengerman in the amount of $207,797.91;



The following claims are DISALLOWED: the claims filed by the State of
Michigan, Department of Treasury in the amounts of $1,000,000.00 and
$4,704.59 with respect to the corporate, limited liability and limited partnership
defendants in this matter and that the State of Michigan, Department of Treasury
is denied a distribution from the proceeds held by the Receiver; the claims filed
by Calvin and Susan Bennett, Shirley Broihier, Larry Sanders, Shivonny Williams
and Leo Wirtz. And Joseph P. Talleieu, Sr., are disallowed and such claimants are

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denied a distribution in this matter; the IRS is denied a claim in this matter and
distribution in this matter.

s/Thomas L. Ludington
THOMAS L. LUDINGTON
United States District Judge
Dated: February 1, 2019

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