U.S. Commodity Futures Trading Commission v. Deutsche Bank AG

Filing 23

OPINION & ORDER APPOINTING INDEPENDENT MONITOR: The U.S. Commodity Futures Trading Commission ("CFTC") brings this enforcement action against Deutsche Bank AG ("Deutsche Bank") alleging a chronic failure to comply with swap da ta reporting regulations under the Dodd-Frank Act. On August 18, 2016, simultaneous with the filing of its Complaint, the CFTC submitted a Proposed Consent Order of Preliminary Injunction and Other Equitable Relief against Deutsche Bank (the &qu ot;Proposed Consent Order"). Among other things, the Proposed Consent Order provides for the appointment of an independent monitor. In its initial application, the CFTC informed this Court that the parties had agreed on an independent monit or that the CFTC would recommend to the Court at a subsequent hearing. This Court agrees that the appointment of an independent monitor is warranted. "The power of the federal courts to appoint special masters to monitor compliance wit h their remedial orders is well established." City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 145 (2d Cir. 2011) (citation omitted). This Court has broad discretion to appoint a compliance monitor as a form of equitable remedy, and may tailor the appointment order to "the special needs of the individual case." U.S. v. Apple, 992 F. Supp. 2d 263, 280 (S.D.N.Y. 2014). Here, it is obvious that Deutsche Bank's efforts to comply with the September 2015 CFTC O rder have not been sufficient. In such situations, the use of independent monitors is appropriate. Apple, 992 F. Supp. 2d at 280 ("external monitors have been found to be appropriate where consensual methods of implementation of remedial order s are 'unreliable'..."). Accordingly, this Court appoints Paul S. Atkins, Esq. of Patomak Global Partners LLC as the independent monitor with all of the powers set forth in the Proposed Consent Order, which is also approved. Mr. A tkins has assured this Court that he and his firm have no conflicts of interest that would preclude them from this engagement. Finally, this Court notes that Proposed Consent Order does not obligate the independent monitor to provide periodic report s to the Court. Use of external monitors, in addition to remediating the problems at hand, is "to aid judges in the performance of specific judicial duties, as they may arise in the progress of a cause," namely this Court's duty to ensure that the Consent Order serves the public interest. La Buy v. Howes Leather Co., 352 U.S. 249, 256 (1957). This Court will confer ex parte with Mr. Atkins, as necessary and appropriate. (As further set forth in this Opinion & Order.) (Signed by Judge William H. Pauley, III on 10/20/2016) (mro)