Federal Trade Commission v. AWS, LLC et al
Filing
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ORDER granting Stipulation for Qualified Turnover of Reserve Funds. Signed by Judge James C. Mahan on 9/12/2018. (Copies have been distributed pursuant to the NEF - JM)
Case 2:18-cv-00442-JCM-PAL Document 89 Filed 09/10/18 Page 1 of 4
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Michael F. Lynch (NV SBN 8555)
Michael@LynchLawPractice.com
LYNCH LAW PRACTICE, PLLC
3613 S. Eastern Ave.
Las Vegas, Nevada 89169
Telephone: (702) 684-6000
Facsimile: (702) 543-3279
Gary Owen Caris (CA SBN 088918)
gcaris@btlaw.com
Admitted Pro Hac Vice dated March 27, 2018
BARNES & THORNBURG LLP
2029 Century Park East, Suite 300
Los Angeles, California 90067
Telephone: (310) 284-3880
Facsimile: (310) 284-3894
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Attorneys for Receiver
ROBB EVANS & ASSOCIATES LLC
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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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FEDERAL TRADE COMMISSION,
Case No. 2:18-cv-00442-JCM-PAL
Plaintiff,
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v.
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AWS, LLC, et al.,
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STIPULATED ORDER FOR QUALIFIED
TURNOVER OF RESERVE FUNDS
Defendants.
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The Federal Trade Commission (the “FTC”), the Court-Appointed Receiver Robb Evans
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& Associates LLC (the “Receiver”), Non-Party Synovus Bank (“Synovus”), and Non-Party
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Qualpay, Inc. (“Qualpay,” and collectively with Synovus, the “Acquirers”) stipulate to the entry
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of this Stipulated Order for Qualified Turnover of Reserve Funds to facilitate the resolution of
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competing claims to the reserve funds referenced in Section III, paragraph C, subsection 31 of the
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Court’s Stipulated Order for Permanent Injunction and Monetary Judgment (the “Stipulated
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Order”) [Doc. No. 80].
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B ARNES &
T HORNBURG LLP
ATTO RNEY S AT LAW
LOS A NG EL ES
Case 2:18-cv-00442-JCM-PAL Document 89 Filed 09/10/18 Page 2 of 4
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THEREFORE, IT IS ORDERED as follows:
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1.
The Acquirers currently hold $2,601,106.85 in reserve funds associated with
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payment card transactions initiated by cardholders doing business with Defendant FBA Stores
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LLC (the “Reserve Funds”). The FTC and the Receiver claim that such Reserve Funds are
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property of Defendant FBA Stores LLC and must be turned over to the Receiver pursuant to the
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Stipulated Order. The Acquirers, by contrast, claim that such Reserve Funds, as well as income
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therefrom, are not the property of the Defendants and that, in any event, the Acquirers are entitled
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to use those Reserve Funds to offset consumer-initiated chargebacks based on, inter alia,
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ownership of the Reserve Funds, their contract with Defendant FBA Stores, their security interest
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in the Reserve Funds, and the doctrine of recoupment.
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The FTC and the Receiver have agreed to promptly negotiate with the Acquirers in
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good faith regarding the proper disposition of the Reserve Funds, but only after a preliminary
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turnover of the Reserve Funds to the Receiver. At the same time, the FTC and the Receiver have
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agreed that such a turnover will not operate to prejudice or limit the rights, claims, or defenses of
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the Acquirers vis-à-vis the Reserve Funds, if any.
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3.
The Court therefore ORDERS the Acquirers to turn over the Reserve Funds to the
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Receiver, but finds that such a turnover will not impair, and is without prejudice to or limitation
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on, the Acquirers’ rights, claims, and defenses with respect to the Reserve Funds, and income
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therefrom, whether based on ownership of the Reserve Funds, the Acquirers’ contract with
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Defendant FBA Stores, any security interest in the Reserve Funds (and any perfection of that
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security interest that exists or existed prior to the turnover), the doctrine of recoupment, or
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otherwise.
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4.
The Receiver shall place the Reserve Funds on deposit in a separate interest-
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bearing receivership account. Unless otherwise ordered by the Court, such funds shall not be
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available to pay the expenses of the receivership estate. In the event the Receiver shall seek any
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disbursement of Reserve Funds or income therefrom, the Receiver shall give the Acquirers
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fourteen (14) days advance notice of such request and an opportunity to object. Should any
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B ARNES &
T HORNBURG LLP
ATTO RNEY S AT LAW
LOS A NG EL ES
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Case 2:18-cv-00442-JCM-PAL Document 89 Filed 09/10/18 Page 3 of 4
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objection be filed with the Court, the Receiver shall not make such disbursement until the Court
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resolves Acquirer(s)’ objection
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SO ORDERED.
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Dated: September 12, 2018.
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JAMES C. MAHAN
UNITED STATES DISTRICT JUDGE
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B ARNES &
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ATTO RNEY S AT LAW
LOS A NG EL ES
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Case 2:18-cv-00442-JCM-PAL Document 89 Filed 09/10/18 Page 4 of 4
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CERTIFICATE OF SERVICE
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STATE OF CALIFORNIA, COUNTY OF LOS ANGELES
I am employed in the County of Los Angeles, State of California. I am over the age of 18
and not a party to the within action; my business address is: 2029 Century Park East, Suite 300,
Los Angeles, CA 90067. On September 10, 2018, I served the foregoing document(s) described
as: STIPULATED ORDER FOR QUALIFIED TURNOVER OF RESERVE FUNDS on the
interested party(ies) below, using the following means:
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All parties identified for Notice of Electronic Filing generated
by the Court’s CM/ECF system under the referenced case
caption and number
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BY ELECTRONIC MAIL. I caused the document(s) to be sent to the respective e-mail
address(es) of the party(ies) as stated above. I did not receive, within a reasonable time after the
transmission, any electronic message or other indication that the transmission was unsuccessful.
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Edward A. Marshall, edward.marshall@agg.com
Steven Kaufmann, SKaufmann@mofo.com
Theresa Kananen, Theresa.Kananen@AGG.com
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I declare that I am employed in the office of a member of the bar of this court at whose
direction the service was made.
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Executed on September 10, 2018 at Los Angeles, California.
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/s/ Stephanie L. Moore
Stephanie L. Moore
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13260096v1
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B ARNES &
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ATTO RNEY S AT LAW
LOS A NG EL ES
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