Securities and Exchange Commission v. Peterson

Filing 4

MEMORANDUM & ORDER ON PLEA AND PROPOSED SETTLEMENT AGREEMENT as to Garth Peterson: Sentencing hearing will be held on July 17,2012 at 10:00 a.m. The United States Probation Department shall prepare the pre-sentence report as soon as is practicable. I n a civil case filed the same day in this court, 12-CV-2033, the Securities and Exchange Commission (SEC) applied for immediate approval of a settlement agreement with the same defendant, Garth Peterson. The request for immediate approval of the SEC& #039;s settlement is denied. A hearing on the reasonableness of the proposed civil settlement is ordered for May 2, 2012 at 12:15 p.m. in courtroom 10B. Any person may appear by telephone after arrangement with Ms. June Lowe, Courtroom Deputy. Ms. Lowe can be reached at [phone]. The court will consider any papers filed by May 1, 2012 at 3:00 p.m. Ordered by Senior Judge Jack B. Weinstein, on 4/26/2012. (Barrett, C)

FllEu

IN CLERK'S OFFIO~
U.S. DISTRICT COURT E.D.N.Y.

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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UNITED STATES OF AMERICA

APR 2 6 lOl2

BROOKLYN OFFICE
MEMORANDUM & ORDER
ON PLEA AND
PROPOSED SETTLEMENT
AGREEMENT

- against-

12-CR-224

GARTH PETERSON,
Defendant.
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SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,

12-CV-2033

- againstGARTH RONALD PETERSON,
Defendant.
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JACK B. WEINSTEIN, Senior United States District Judge:

The defendant in the criminal case, l2-CR-224, pleaded guilty on April 25, 2012 to a
security violation-namely, conspiracy to circwnvent intemalcontrols, 18 U.S.C. § 371. A
sentencing hearing will be held on July 17,2012 at 10:00 a.m. The United States Probation
Department shall prepare the pre-sentence report as soon as is practicable.
In a civil case filed the same day in this court, 12-CV-2033, the Securities and Exchange

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Commission (SEC) applied for immediate approval of a settlement agreement with the same
defendant, Garth Peterson. That case was assigned by the clerk of the court to the undersigned
judge as related to the criminal case.
Issues of punishment, restitution, and forfeiture in criminal cases, and compensation and
deterrence in related civil and administrative actions, are often intertwined in financial fraud
litigation. It is desirable to coordinate treatment of pleas, settlement of related administrative
matters, and possible civil suits. See, e.g., Adam S. Zimmerman & David M. Jaros, The
Criminal Class Action, 159 U. Pa. 1. Rev. 1385, 1439-41 (2011); Essay, Compensation for Mass
Private Delicts: Evolving Roles ofAdministrative, Criminal, and Tort Law, 2001 U. III. 1. Rev.
947,975-981 (2001); see also, e.g., United States v. Kenneth Marsh, et al., 10-CR-480
(E.D.N.Y.), with related case, Securities and Exchange Commission v. Gryphon Holdings, Inc.,
10-CV-1742 (E.D.N.Y.). In the instant case, for example, paragraph five of the plea agreement
in the criminal case requires the defendant, in lieu offorfeiture, to cooperate with the SEC in
obtaining assets that were instrumentalities of his crime.
The request for immediate approval of the SEC's settlement is denied. Time for
consideration and for briefing supporting or opposing the settlement is called for since discretion
of the trial court is required. See, e.g.,

s.E.c.

v. Wang, 944 F.2d 80, 84-85 (2d Cir. 1991)

(holding that the trial court is required to determine whether a. consent decree is "fair and
reasonable").
A hearing on the reasonableness of the proposed civil settlement is ordered for May 2,
2012 at 12:15 p.m. in courtroom JOB. Any person may appear by telephone after arrangement
with Ms. June Lowe, Courtroom Deputy. Ms. Lowe can be reached at [phone]. The
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court will consider any papers filed by May I, 2012 at 3 :00 p.m.

o ORDERED.

Jack B. Weinstein
Senior District Judge
Dated: April 26, 2012
Brooklyn, N.Y.

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