United States Of America v. Narco Freedom, Inc.
Filing
299
MEMORANDUM OPINION AND ORDER: The Court also received a letter dated October 20, 2015, from counsel for Alan Brand. There is nothing in the letter that suggests that the Temporary Receiver should not be authorized to pay up to 8 weeks of vacation pay to former employees. While the letter indicates that the Court would entertain briefing by counsel for Jason Brand and Alan Brand, that briefing was not in opposition to the payment of 8 weeks of vacation pay to other employees, but rather co ncerns specific issues affecting payments to Jason Brand and Alan Brand. No party has advanced a reasoned objection to granting the Temporary Receiver's current application. The accompanying order approving the Temporary Receivers application does not bar any of the interested parties from seeking payment above the 8-week limit. (As further set forth in this Order) (Signed by Judge John G. Koeltl on 10/21/2015) (kl)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
────────────────────────────────────
UNITED STATES OF AMERICA,
Plaintiff,
- against -
14 Cv. 8593 (JGK)
MEMORANDUM OPINION AND
ORDER
NARCO FREEDOM, INC.,
Defendant.
────────────────────────────────────
JOHN G. KOELTL, District Judge:
The Court received the Temporary Receiver’s request to pay
accrued vacation time and personal days to former employees on
September 25, 2015. This Court reviewed the objections filed by
Gerald Bethea, Alan Brand, Jonathan Brand, and Jason Brand and
held a hearing on the Temporary Receiver’s application and other
issues on October 7, 2015. Pursuant to this Court’s order, the
Temporary Receiver filed supplemental documentation, supporting
the application on October 16, 2015.
The Court approved the Temporary Receiver’s request in the
accompanying Order Granting Application of Temporary Receiver to
Pay Accrued Vacation Pay to Employees of Narco Freedom, Inc. The
Court approved the Temporary Receiver’s application to pay
vacation and accrued time of up to 8 weeks. The Temporary
Receiver provided the necessary factual record to support the
application and to explain the reasonableness of the
application. See F.T.C. v. Fortune Hi-Tech Mktg., Inc., No.
CIV.A. 13-123-KSF, 2013 WL 4495829, at *3 (E.D. Ky. Aug. 20,
2013) (“[T]he Receiver must make “a prima facie case in support
of the requested award.” (quoting In re Blackwood Assoc., L.P.,
165 B.R. 108, 111 (Bankr. E.D.N.Y. 1994)). None of the responses
to the motion provide a basis to deny the Temporary Receiver’s
request for authorization to pay vacation pay to former
employees.
By letter dated October 13, 2015, the Fuchsberg Law Firm
outlined partial objections to the Temporary Receiver’s
application on behalf of former employees of Narco Freedom who
were terminated between July 28, 2015 and September 21, 2015.
Dkt. No. 283.
In a second letter, dated October 16, 2013, the
former employees clarified that they do not oppose the
application to pay up to 8 weeks of vacation pay. Dkt. No. 289.
The employees have represented that they will continue to
discuss the possibility of additional payments above the 8-week
limit with the Temporary Receiver and if necessary, may file a
separate application at a later date. The Temporary Receiver is
presently only authorized to pay up to 8 weeks of vacation pay.
The Court’s approval of the Temporary Receiver’s application
does not foreclose the employees’ ability to seek further
payment from the Temporary Receiver.
Gerald Bethea, a former employee of Narco Freedom, filed a
response to the Temporary Receiver’s application on October 19,
2015. Dkt. No. 294. Bethea does not oppose the payment of 8
weeks of vacation pay to the former employees. Rather Bethea
opposes the 8-week limit and also opposes the Temporary
Receiver’s proposal to reserve 8 weeks of vacation pay for
Bethea along with the fund reserving the vacation pay for four
other former members of Narco Freedom’s management. Pursuant to
this Court’s order approving the Temporary Receiver’s
application, a reserve will be created for Bethea to cover
vacation pay for 8 weeks, placing Bethea in the same position as
other former employees except for the fact that his 8 weeks of
vacation pay is being held in reserve. The vacation pay will be
kept in reserve along with the vacation pay for four other
employees. Bethea is under indictment, and it is wholly
reasonable for the Temporary Receiver to keep Bethea’s vacation
pay in reserve because possible claims between Bethea and Narco
Freedom have not been adjudicated.
The Court also received a letter dated October 20, 2015,
from counsel for Alan Brand. There is nothing in the letter that
suggests that the Temporary Receiver should not be authorized to
pay up to 8 weeks of vacation pay to former employees. While the
letter indicates that the Court would entertain briefing by
counsel for Jason Brand and Alan Brand, that briefing was not in
opposition to the payment of 8 weeks of vacation pay to other
employees, but rather concerns specific issues affecting
payments to Jason Brand and Alan Brand. No party has advanced a
reasoned objection to granting the Temporary Receiver’s current
application.
The accompanying order approving the Temporary Receiver’s
application does not bar any of the interested parties from
seeking payment above the 8-week limit.
SO ORDERED.
Dated:
New York, New York
October 21, 2015
_______________/s/___________
John G. Koeltl
United States District Judge
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