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needdiamonds: There were nice people who tried telling the truth without belittling the longs in the process. They were ignored as well.
The standard response to anyone who was trying to tell you guys what was going on was they were obviously paid to bash by the NSSers.
Brilliant... Thanks again.
Cool... Thanks.
What I don't understand is I have yet to see anything that indicates the receiver is attempting to get RA and Babs to pay back the 1.7M in loans.
Does she even know these loans exist?
So does anyone think that the documents in the 4 suitcases still exist, and wasn't it nice of RA to give the jackson master tapes to himself as a going away present.
And let's not talk about USXP picking up the gambling tab in Las Vegas.
Stolen from the RB board (cbeemer post):
One of the exhibits with the SEC latest filings is a demand letter sent to Tifford on October 31, 2007 stating the following:
Demand is hereby made upon Mr. Altomare for payment of the following amounts to Universal Express:
1. $558,900 to reimburse Universal Express for the purchase of jewelery from Les Bijoux.
2. $30,000 to reimburse Universal Express for the payment of gambling markers at the Wynn Las Vegas.
3. $200,000 to reimburse Universal Express for the bonus paid to Mr. Altomare on January 12, 2007.
Demand is further made for the return of four briefcases full of files taken from Universal Express on September 6, 2007.
Demand is further made for the return of master recording of Jackson Family music.
Here's the text from the main document. To me, the most interesting part is about the 558+K in jewelry (500K for a single
diamond) RA bought using USXP funds.
Well, the info that Talbot lied about RA's wife selling a bunch of her jewelry - it was RA selling jewelry that he claimed as his own property.
Leslie J. Hughes (Colo. 15043) Attorney for Plaintiff Securities and Exchange Commission, Central Regional Office 1801 California Street, Suite 1500 Denver, Colorado 80202 303.844.1080 303.844.1068 (facsimile)
Robert B. Blackburn (RB 1545) Local Counsel for Plaintiff Securities and Exchange Commission, Northeast Regional Office 3 World Financial Center RM 4300 New York, NY 10279
(212) 336-1050
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
U.S. SECURITIES AND EXCHANGE COMMISSION, :
:
Plaintiff :
: 04 Civ. 2322 (GEL)
v. :
:
UNIVERSAL EXPRESS, INC., :
RICHARD A. ALTOMARE, :
CHRIS G. GUNDERSON, :
MARK S. NEUHAUS, :
GEORGE J. SANDHU, :
SPIGA, LTD., :
TARUN MENDIRATTA, :
:
Defendants. :
MOTION IN THE NATURE OF INTERPLEADER FOR AN ORDER DIRECTING MARSHAL TO SELL PROPERTY BEING HELD BY THE RECEIVER
Plaintiff U.S. Securities and Exchange Commission (“SEC”), respectfully moves this court for an order: 1) setting aside the fraudulent transfer of jewelry, watches and precious metals from Richard A. Altomare; 2) directing the United States Marshals Service for the Southern District of Florida to sell Mr. Altomare’s fraudulently conveyed property seized from Kravit Estate Buyers d/b/a/ The Estate Department, Inc.; 3) directing the deposit of the proceeds from the sale into the registry of the court; and 4) determining the proper application of the proceeds. In support of this Motion, the SEC relies upon the Declaration of Leslie J. Hughes with exhibits attached, the Memorandum submitted with this motion, and the following grounds:
I. Background
1.
SEC commenced this action on March 24, 2004 against defendants, including defendant Richard A. Altomare (“Altomare”), Universal Express Inc., (the “Company”) and others, alleging violations of the federal securities laws [Doc. No. 1]. This Motion pertains to Altomare and the Company.
2.
On March 8, 2007, this court entered Final Judgment Against Universal Express, Inc., Richard A. Altomare, and Chris G. Gunderson, [Doc. No. 179]. (“Judgment”). The Judgment ordered Altomare to pay disgorgement of $1,419,025 plus prejudgment interest of $283,073, and a civil penalty of $1,419,025. The Judgment remains wholly unpaid.
3.
On September 4, 2007, this court appointed a Receiver to take custody, control and possession of the property and other assets of Universal Express, Inc. (the “Company”). [Doc. No. 203].
4.
On October 4, 2007, a Writ of Execution was issued as to Altomare for judgment #07,0605 in the amount of $1,419,025. (“Writ”) The Writ was signed by the Clerk of the Court,
J. Michael McMahon, on October 4, 2007.
II. Execution of the Writ
5.
Pursuant to Fed. R. Civ. P. 5, notice of issuance of the Writ was served electronically through the Electronic Court Filing System on Altomare on October 4, 2007. The Writ commanded the Marshals Service to seize the goods and chattels of Richard A. Altomare including jewelry possessed by Kravit Estate Buyers, Inc. to pay the Judgment.
6.
On October 4, 2007, counsel for the SEC faxed a copy of the Writ to the Marshals Service in Boca Raton, Florida.
7.
On October 10, 2007, the Marshal served the Writ on The Estate Department, Inc., located at 7775 Glades Road, Boca Raton, Florida 33434, and seized the following twenty-four items of property which The Estate Department had obtained from Richard Altomare (collectively referred to as the “Seized Property”):
1. Diamond necklace 13.00 ct 9. Diamond Ring 9.00 ct 17. 18 K Yellow Gold Necklace
2. Diamond Bracelet 9.00 ct 10. Breguet Watch 18. Diamond Bracelet 2.00 ct
3. Pearl Shaped Diamond Ring 1.85 ct 11. Arnold & Sons Steel Watch 19. Pearl and Diamond Earrings and Necklace
4. Pearl Necklace 12. A. Langhe & Sohne Watch 20. Loose Emerald cut diamond 11.02 ct
5. Pearl Earrings 13. Corum Yellow Gold Watch 21. Fancy Yellow Diamond ring 7.00 ct
6. A. Langhe & Sohne Watch 14. F.P. Journe Watch 22. Aquamarine Broach/ pendant
7. Jaeger LeCoultre Watch 15. Audemars Piguet Watch 23. Two Silver Bars
8. Franck Muller Steel Watch 16. Rolex Cellini Watch 24. Diamond Bracelet 17.5 ct
A report titled Seized Property and Evidence Control with photographs prepared by the Marshal on October 10, 2007, is attached as Exhibit C.
8. On October 10, 2007, the Marshal delivered the Seized Property to the Receiver for safekeeping.
III. Richard Altomare Purchased Some of the Seized Property with Funds Stolen from Universal Express, Inc.
9. On or about April 13, 2006, Richard Altomare purchased an 11.02 ct emerald-cut diamond from Les Bijoux LLC in Boca Raton, Florida for approximately $500,000. (Item 20 of the Seized Property listed above in paragraph 7.) Richard Altomare paid Les Bijoux for the diamond with wire transfers from the bank account of Universal Express, Inc. in the following amounts: on April 13, 2006 a wire for $325,000, on April 26, 2006 two wires for $30,000 and $40,000, on June 5, 2006 a wire for $33,900, on July 27, 2006 a wire for $30,000 and on August 21, 2006 a wire for $50,000. Richard Altomare misappropriated these funds from Universal Express, Inc. to pay for this diamond. In the annual report for Universal Express that Mr. Altomare signed on March 27, 2007, he did not list any of the payments to Les Bijoux as part of his annual compensation. See the Summary Compensation Table at page 41 of 49 in the Company’s annual report on Form 10-K for the year ending June 30, 2006, which is attached as Exhibit H. The only compensation that Mr. Altomare identified for 2006 in Exhibit H is his cash salary of $650,000, which was paid to him in bi-weekly payroll checks.
10. On or about January 26, 2007, Richard Altomare purchased from Les Bijoux a
7.00 ct radiant cut fancy yellow SI1 diamond ring set in platinum for $85,000 (Item 21 of the Seized Property listed above in paragraph 7), a Jaeger LeCoultre Atmos Clock for $40,000,1 and a FP Journe Chronometre Souverain platinum watch for $20,000 (Item 14 of the Seized Property listed above in paragraph 7). Richard Altomare made partial payment for these items in three wire transfers of funds from the bank account of Universal Express in the following amounts: $20,000 and $40,000 on January 26, 2007, and $20,000 on May 16, 2007. As of approximately September, 2007, Altomare owed Les Bijoux $65,000 for these three items. Richard Altomare misappropriated the funds from Universal Express, Inc. to pay for these three items. In the annual report on Form 10-K for the year ending June 30, 2006, which was filed on March 26, 2007, Altomare represented that he was currently employed under an employment contract that provides an annual base salary of $650,000. See Exhibit H at page 42 of 49.
11. On October 31, 2007, the Receiver made demand upon Altomare, through
counsel, to reimburse the Company for $558,900, the amount misappropriated from the The Jaeger LeCoultre Atmos Clock was not seized on October 10, 2007.
Company to purchase the Property. Exhibit G. Altomare has not reimbursed the Company, so the Property belongs to the Company.
IV. Altomare Fraudulently Conveyed Property to The Estate Department Inc.
12. The Estate Department is a Second Hand Dealer licensed and doing business at 7775 Glades Road, Boca Raton, Florida 33434. On an unknown date in September 2007, Richard Altomare signed a Second Hand Dealers Property Form with The Estate Department selling them a “Fancy Yellow Diamond Ring 7.85 approx ct” for $56,000 “with GIA cert.2 needed – without [GIA cert.] full refund on ring,” an aquamarine broach for $10,000, two silver bars for $2,400 and a diamond straight line bracelet for $21,600, which together total of $90,000. When Mr. Altomare signed the Form he represented that:
“I verify that I am eighteen years or older, and I am the rightful owner of the above described property which is being sold or pledged, or that I am entitled to sell or pledge such property; and that the property is clear of all liens and encumbrances, including liens for past due child support, if proven otherwise, I promise full restitution, and understand that I will be criminally prosecuted to the fullest extent of the law.”
The Form also appears to be signed by Mark Kravit on behalf of The Estate Department.
13.
The $56,000 price the Estate Department paid for the fancy yellow diamond ring is substantially less than its purchase price of $85,000 or the diamond straight line bracelet purchased for approximately $100,000. The price of the aquamarine broach, and silver bars is currently unknown.
14.
At the time of Mr. Kravit’s purchase, on behalf of The Estate Department, of the items listed above in paragraph 12 from Mr. Altomare, Mr. Kravit telephoned Greg Osipov, one of the managing members of Les Bijoux, LLC. Mr. Kravit was known to Mr. Osipov through previous business dealings and identified himself as the person speaking during the telephone call. Mr. Kravit informed Mr. Osipov that Richard Altomare was in the office of Mr. Kravit and
GIA cert. refers to a report from the Gemological Institute of America.
trying to sell a ring and that Mr. Kravit needed the GIA certificate from Les Bijoux for the diamond ring that it had sold to Mr. Altomare. Mr. Osipov advised Mr. Kravit during the telephone conversation that Mr. Altomare could not sell the ring because Mr. Altomare still owed $65,000 on the purchase price of the ring.
15.
After the telephone call, Mr. Kravit came to the business location of Les Bijoux and demanded that Mr. Osipov produce the GIA certificates for the diamond ring and the emerald cut diamond bracelet, and turn over an old diamond that Mr. Osipov possessed as collateral for the amounts owed by Mr. Altomare. Mr. Kravit asked Mr. Osipov to come to his car, where he produced the Jaeger LeCoultre Atmos Clock, which Mr. Altomare had previously purchased for $40,000. Mr. Osipov was angered by Mr. Kravit’s demand and called Mr. Altomare who confirmed that he had told Mark Kravit to return the clock, which was damaged in transport back, to Les Bijoux. As a result of his conversations with Mr. Osipov, Mr. Kravit knew that Mr. Altomare owed money to Les Bijoux for his purchase of the yellow diamond ring.
16.
On or about September 24, 2007, Richard Altomare entered into a second transaction with The Estate Department, in which he sold twenty-one additional items including his collection of expensive watches for $481,000. The items included 1) a diamond necklace, 2) diamond bracelet, 3) pear-shaped diamond ring, 4) cultured pearl necklace and 5) pearl earrings, 6) A. Lange & Sohne watch, 7) Jaeger LeCoultre watch, 8) Franck Muller steel watch, 9) diamond eternity band ring 9 ct, 10) Breguet 18 K yellow gold watch, 11) Rolex 18k gold watch, 12) A. Lange & Sohne steel watch, 13) A. Lange & Sohne watch, 14) Corum 18k yellow gold watch, 153) F.P. Journe watch, 16) Audemars Piguet watch, 17) Rolex Cellini watch, 18) 18K yellow gold necklace, 19) Diamond Bracelet, 20) cultured pearl and diamond necklace, and 21) loose emerald cut diamond 11.02 ct. Mr. Altomare signed another Second Hand Dealers
Property Form in which he acknowledged receipt of $411,000 in cash with the balance of $70,000 due on October 5, 2007. This Form was subsequently signed by Barbara Altomare when she received the additional $70,000 in cash.
17.
The price that The Estate Department paid for the 11.02 ct emerald cut diamond (along the other twenty items) of $481,000 is substantially less than the purchase price of the diamond alone which was approximately $500,000, and the F.P. Journe platinum watch which was purchased for $20,000.
18.
Mr. Altomare’s conveyance of these items of jewelry, watches and precious metals were made without fair consideration at a time while he was a defendant in an action for money damages and a judgment had been docketed against him. He knew at the time of the transactions that he had not satisfied the Judgment entered against him on March 8, 2007.
19.
Mr. Altomare conveyed these items of jewelry, watches, and precious metals with actual intent to hinder, delay or defraud the Securities and Exchange Commission, which is a present creditor. He and his wife requested payment for the items be made in cash rather than a check. Although Altomare clearly represented on the Second Hand Dealer’s Property Form that the property was his to sell, he did not advise The Estate Department of the existing Judgment obtained by the Securities and Exchange Commission on March 8, 2007. Moreover, at the hearing on October 12, 2007, Mr. Altomare’s attorney misrepresented to the Court that proceeds from the jewelry sales belonged to Barbara Altomare, when in fact Mr. Altomare had purchased part of the jewelry with money stolen from Universal Express, and he represented in the transactions with The Estate Department that these items were his property. He placed his thumb print on the report as the seller of the property. Upon information and belief, Mr. Altomare paid part of the proceeds from these sales to his attorney for legal services in this case.
V. Multiple Claimants Claim an Interest in the Property
20.
The SEC claims an interest in the Property to satisfy the Judgment.
21.
The Receiver claims the Property belongs to the Company.
22.
The Estate Department claims to have an interest in the Property.
23.
The SEC has given notice of this Motion to The Estate Department, who is represented by counsel. The Estate Department’s counsel has informed the SEC that The Estate Department will intervene to be heard on this Motion. The SEC will not object to The Estate Department’s motion to intervene.
24.
This matter is in the nature of an interpleader and pursuant to 28 U.S.C. § 2361, the SEC requests that the Court enter an Order restraining all claimants from instituting proceedings affecting the property until further order of the court.
WHEREFORE, SEC requests entry of an Order: 1) setting aside the fraudulent transfer of jewelry, watches and precious metals from Richard A. Altomare; 2) directing the United States Marshals Service for the Southern District of Florida to sell Mr. Altomare’s fraudulently conveyed property seized from Kravit Estate Buyers d/b/a/ The Estate Department, Inc.; 3) directing the deposit of the proceeds from the sale into the registry of the court; 4) determining the proper application of the proceeds and 5) restraining all claimants from instituting proceedings affecting the property until further order of the court.
Dated November 5, 2007.
s/ Leslie J. Hughes Leslie J. Hughes Attorney for the Plaintiff
U.S. Securities and Exchange Commission
CERTIFICATE OF SERVICE
I hereby certify that I caused a true and correct copy of the MOTION IN THE NATURE OF INTERPLEADER FOR AN ORDER DIRECTING MARSHAL TO SELL PROPERTY BEING HELD BY THE RECEIVER to be served on November 5, 2007 by electronic filing to the following persons at the following addresses and by Federal Express courier to counsel for The Estate Department and its counsel:
Arthur Tifford, Esq. John A. Hutchings, Esq. Tifford & Tifford, P.A. Dill Dill Carr Stonbraker & Hutchings, PC 1385 NW 15th Street 455 Sherman Street, Suite 300 Miami, FL 33125 Denver, Colorado 80203
Jason Brown, Esq. Harry S. Wise III, Esq. Holland & Knight LLP 770 Lexington Avenue 195 Broadway 6th Floor New York, NY 10007 New York, NY 10021
Marvin Pickholz, Esq. The Estate Department Pickholz Law Firm, LLP 7775 Glades Road 570 Lexington Avenue, 45th Floor Boca Raton, Fl 33434 New York, NY 10022 And
Carl Schoeppl Schoeppl & Burke, P.A. 4651 North Federal Highway Boca Raton, Fl. 33431-5133
By Federal Express
s/ Leslie J. Hughes Leslie J. Hughes
Haven't verified the filings yet, but this is a post by cbeemer on RB, and from years of experience I've never seen him post lies as facts:
PACER
Bunch of new filings. Seems Federal Marshalls seized 24 items of jewelery Altomare has been selling. Getting pretty nasty as some of the filings accuse Altomare of theft from the company as the receiver has tied transfers from company accounts to the jeweler. Filings also claim that Altomares attorney (Tifford) misrepresented the facts at the comtempt hearing stating that the jewelery was Barbara Altomares as they have Richard Altomares thumb print and affidavit from Estate Sellers stating that he was the owner. Goes on to says they believe some of Tifford's legal expenses were paid with proceeds of jewelery.
Of the 24 items the marshalls seized one was a 11 karat diamond ring which Altomare paid $500,000 for out of USXP accounts in 2006!
Can any kind of educated guess be made as to when the receiver might file another report with the court?
Will she file one soon, or wait until after she files the 10K?
If she files a 10K, will she file a 10Q for the quarter that ended Sept 30th?
Just curious.
It appears that any problem with Sports Express and the takeover of LE/VB has been resolved. The LE/VB websites are no longer unable to be reached, and morph into the Sports Express welcome page for LE/VB users, once again:
http://www.sportsexpress.com/vb/welcome/
Pedro: As to USXP only. But the problem with that, is that if by some absolutely friggin' miracle, the appeals court finds in RA and Gunderson's favor, and nullifies the summary judgement against them, I'm pretty sure that nullifies any of the judgement against USXP, since USXP's culpability is based on RA and Gunderson charges.
Of course, IMNSVHO, the appeal has zero chance of success.
Pedro: I just told you that PACER does not work for the 2nd circuit court of appeals unless you access that search through the 2nd circuit court of appeals website:
http://www.ca2.uscourts.gov/
Select Dockets
Select Pacer
Enter the case number (07-2407)
You can view the full docket by clicking on Full Docket at the top of the page.
Pedro: Apparently you are not aware of the fact that PACER doesn't work for the 2nd circuit court of appeal unless you go to that court's website, select Docket, and select PACER.
If you go there, and search pacer for 07-2407, you will find the case.
It's there.
Pedro2004: Check the docs cited, particularly the 2nd circuit court case number, and the pdf of the court docket.
I have no doubts the case is on that docket, dispite the lack of PACER info.
Surprise, surprise - Apparently RA's appeal is on the 2nd circuit appeal's court docket. Someone on another board has posted a copy of the docket and the initial appellant brief on the following web site:
www.proseresource.com/sec.html
Should be no surprise, but there's nobody home at the Coalition for Luggage Security.
The website still comes up:
http://www.luggagesecuritycoalition.com
But try emailing anything and you'll find that none of the email addresses are valid anymore (what a surprise, since they're all @usxp.com addresses).
puppydotcom: I agree that it makes no sense, but it is clear that by filing an NT 10K, the receiver is planning on filing the 10K.
It is a way to show, in legitimate SEC documentation, the actual status of the company on 6/30, and subsequent to that, status that I believe will show just how poorly the company was doing despite all of RA's claims.
We'll see, I'm assuming, sometime within the next month.
virginian: The statement about the 3/31 10Q is indeed in error. The problem is with the 10K for the quarter/year that ended 6/30, and only with that document.
Well, very soon there will be a problem with the 10Q for the quarter that ended 9/30.
The error about the 3/31 10Q will have no bearing on the NT 10K legitimacy (for whatever it has).
Just checked the Deliquency list at otc.bb. According to that list, the grace period for filing a 10K ends today.
So, it appears that the receiver will not have a 10K filed in time, and the question becomes did she get any extension from the otc.bb?
If not, USXPE.OB will become USXP.PK tomorow.
Yeah, all of 500.00...
puppydotcom: What I don't understand is why did it take her so long?
That's what I said I thought happened when I first flagged this issue on the 28th.
Someone, somewhere posted that the cruise company went with another luggage company, and that it counted for about 65% of LE/VB business. IF that is true, then I'm sure SportsExpress was no longer interest in paying 100K, the price stated in the receiver's report, for what was left...
All of the LE and VB websites appear to have been closed down completely.
Madpackers.com is the only USXPE related site that still is up and running.
When you go to usxp.com now, you get a rather crude web page about the receivership:
http://www.usxp.com/
Took her long enough...
Odd - None of the web addresses for Luggage Express or VB can be found by my browser.
Probably just the host for those sites is down, but if this continues for a couple of more days, it may indicate that the deal with Sports Express fell through: Sports Express would be foolish to close down the LE/VB web sites. It makes much more sense that they would continue with the switch to their LE/VB is now part of Sports Express announcement. Shutting it down would result in LE/VB customers searching the web for new service, and Sports Express is only one of those.
Probably just the host down, but I'll be watching this.
janice shell: The company has to go through BK before anyone would think of buying it. As long as BK hasn't been declared, and all debts settled in response to that BK, anyone buying USXP would be buying all of its liabilities.
Maybe even the 21M fine.
virginian: She clearly states in her report that she is in the process of selling or otherwise disposing of all the assets.
She stated that a deal was in place for LE/VB for 100K pending DD. LE/VB is now a part of Sports Express.
She stated that she was negotiating with someone for the sale of MadPackers.
She stated this in the 10K:
ANTICIPATED CHANGES
The Receiver has sold some assets of the company and liquidated others.
Future financial statements will, therefore, be very different from
those filed in prior periods. The Receiver is unable at this
point to quantify the expected differences.
I'd say my opinion is far more than speculation. Is it all done yet? Maybe not, but it is pretty clear she has no intention of continuing any subsidiary that losses money, and she clearly stated in her report that none of the subsidiaries were profitable.
We'll see, apparently, at some point in the future.
Stockdung: You do know that there is a Universal Express in the middle east that is quite large, and that has been around for over 20 years, don't you?
It has nothing to do with our 'beloved' USXP.
puppydotcom: What rules? She had no reason to file an NT 10K 22 days late.
I think she will file a 10K, but not in time to keep this from going to USXP.PK. I also believe it will show just how bad the revenues were vs what RA had been claiming they were.
The 10K will layout how bad things were at the end of June, and how bad things are now.
She will probably use it to cite her plans going forward.
virginian: I can't agree. She has already gotten rid of all subsidiaries that were doing any business at all, with one possible exception (MadPackers).
There is no business left.
The best I can say about it is that she is planning to file financials that show how bad things were, and how bad they are.
Not sure if she will get those financials out in time to stop the delisting to the pinks. And I find it difficult to believe that the financials will actually be audited, as required.
But I guess we'll find out, eventually.
flaflyersfan: Very interesting. Looks like she will be filing a 10K afterall.
Will it be in time to stop this stock from becoming usxp.pk?
wii1dr: Where do you get your quote info from, because ETrade shows .0001 x .0002, with two MMs on ask at .0002.
virginian: That webpage did exist for awhile, but it did not come up when you launched to an LE or VB website.
The deal wasn't done back then. It is done now.
P.S. Eventually we should see a doc on the court docket that spells out how much LE/VB cost Sports Express. The receiver's report cited 100K with dd to be done.
Looks like the LE/VB sale has gone through.
I've been checking www.usaluggageexpress.com every other day or so to see if any change has occurred. Today, when you go to this website, it comes up, but then switches to the following website:
http://www.sportsexpress.com/le/welcome/default.asp
This offers discount to LE customers to use Sports Express.
Same thing happens if you go to usxpluggageexpress.com and virtualbelhop.com.
puppydotcom: They're already focusing on the 35 days allowed for all NSSers to cover.
After that, they will be focusing on the idea that, yes, the rules have changed, but the SEC and DTC and MMs are ignoring the rules and hiding what is going on.
wii1dr: And nobody is buying.
Where are all the supposed NSSers?
More info from anvil:
last post on this, although I went with another shareholder that has posted his thoughts. There was also another shareholder that spoke to RA and his posted his thoughts. But I am only posting mine.
1. A quick but substantial correction. In reviewing my notes, I
previously posted that Jane said there was not going to be enough
money to pay creditors. Actually, what she said was she wanted to sell
the remaining assets asap so creditors would not be left in a "lurch".
She said that the proposals are not perfect, as no one wants to assume
any of USXP's debt. So they are proposals to sell assets, not ongoing
businesses.
2. The trial for the remaining defendants is 11/26. Lynch will not
tolerate any delays as his calendar is "important real estate". He
told sec and counsel if they are going to cut deals to flip, get it
done asap, so Lynch knows who will be on trial and how long it will
take. All the remaining defendants have agreed to "bench trials" aka
non-jury trials.
3. Again, on the Fed probe, Lynch could care less. He is not delaying
the trial. The investigation is being run out of the 3rd district of
the US Atoorney's Office.
4. I beleive that RA really thought he was going to jail. He was
greatly relieved as Nikki stated. I would to be if I were him.
5. In regards to contempt, his biggest concern was RA not stepping
down, issuing false/misleading pr's and issuing illegal shares. With
all that taken care of by the appointment of the receiver and RA's
resignation, all that was left was disgorgement, which Lynch does not
like to throw people in jail for, but will if needed.
6. There is where Lynch cut RA alot of slack. The courts judgement has
been out there for months, but the first action RA took, was Tifford's
offer right before court. This obviously did not please Lynch, but
essentially gave RA until Jan. 11th to work out a settlement with the
SEC for repayment. Same timeline goes for Gundy and Lynch does not
want last minute shenanigans on the 11th date.
7. After Tifford made the offer sound so grand, and how generous it
was for Bab's to agree to have the proceeds from condo sale applied to
the disgorgement. The judge called it very modest and cited the
Reciever's report about RA's compensation. Lynch asked SEC's opinion
and SEC said that they had not received RA's bank records. Tifforded
said that he assistant has been faxing them, but they may be blurry.
Then the SEC said that Babs has sold the jewelry. Lynch basically said
that RA needs to work it out with the SEC by the 11th and that as far
as he is concerned, the Judge has ruled on the amount of disgorement
and he is only there to enforce the ruling.
(side bar) I have to laugh when Tifford gave the last detail of the
offering and I quote "and Mr. Altomare is trying to raise $1.5MM of
capital from his relationship". My guess is that the SEC will dig
deeper and get RA to pay more, but clearly RA is moving toward settlement.
8. Next was SEC's request for RA to make public his convictions and
status of SEC case etc. Judge said it is public record and RA had no
authority to issue any SEC filings.
I do think the Judge said that the full transcripts of the hearing
will be available, most likely on Pacer soon. Again, my guess is that
jane will put them on the USXP.com website.
9. Again, wrt to RA's settlement offer, Tiff said that is as good as
RA can do "AS FAR AS HE KNEW".
10. The whole flight risk think was off base by the SEC. It was based
on an email Jane saw in RA's files about going to Dubai to start a
company. Tifford assured Lynch, that based on RA's religious beliefs
that RA would only be interested in going to Dubai or the ME for a
very short time (i.e. vacation).
11. Tiff also said that a number of paycheck issued to RA in the
recent months have not been cashed.
12. Judge then wrapped it up saying he is concerned that the company
had less than $100k when Jane arrived has issued billions of shares
and RA had recieved substantial compensation.
13. Lastly, he went into the whole email thing.
That's it. Although, I will note that never, ever was NSS or the
$700MM judgement mentioned. Also, the judge was open to testimony from
RA but it was clear that Tifford thought the better of that,
particularly since most of the contempt issue were now moot.
Just found more information about what happened today, from anvil who went to the hearing with slh today (this info is not from RB, but I do admit that I will be posting this there):
a retort to some misinformation:
Let me state unequivocally, Lynch had no problem with criminal
investigation going pararell. If fact, he was unaware of it and does
not even know what they are investigating. This came up as Sandu's
attorney thought the November trial should wait until the Feds do
their work. Judge said no way.
Lynch has no control over criminal case and could not throw it out.
Whoever Bud is getting his info from is totally wrong.
In terms of the appeal, Judge said RA and Gundy have their rights to
appeal, but all counsel agreed that Jane had "dismissed" Tifford from
an appeal work. Tifford agreed with this. SLH and I sat right behind
Tifford.
Yes, Gundy appeared very perturbed and scowled at SLH and I as we left
the court room. While sitting in the pew as RA, Babs and Brian, he sat
at the far end of the pew, alone, as if distancing himself from the A's.
The only admonishment of the SEC by the Judge was in regards to:
1.processing Mendratta's settlement offer. The paperword was just sent
to Washington DC and takes 6-8 weeks for the Commissioners to sign off
on. Obviously, the trial will occur before this is processed in that
time frame. Also, in light of Neuhaus desire to flip, the Judge wants
this all cleared up before trial. So the SEC needs to process the
settlement ASAP.
2. The SEC requested that RA issue a pr, 8k and revised 10k's to
announce RA's resignation, that RA, Gundy and USXP, convicted of
securities fraud, etc. Judge said that SEC got what it wanted, RA out,
company in receivership, really only issue is disgorgement and
contempt. He jokingly said "what do you want, RA to take out a full
page ad in the NY Times stating his mea culpa"
Lynch said that SEC has vast resources to get the word out, and the
court documents showing RA et al's guilt is available to the public.
SEC mentioned something about a website to post the info. Look for the
court filings to show up on the USXP website.
I have 5 pages of notes that I will fill in more details today. Let's
try and keep this a no spin zone. SLH and I were there, as obviously
some RB poster. From what I have been able to tell, the collective
posters have the same story.
Funny, how Bud/Gundy is coming out with a different angle.
janice shell: It appears that tkalantzis was one of the people who sent a threatening e-mail to the receiver.
http://materialevidence.angelfire.com/exhibite.pdf
EXHIBIT E
Case 1:04-cv-02322-GEL Document 206-6 Filed 09/28/2007 Page 6 of 6
Jane Moscowitz - what are you doing ?
From: tony kalantzis tkalantzis@yahoo.com
To: jmoscowitz@mmmpa.com
Date: 9/28/2007 6:23 AM
Subject: what are you doing ?
Hi Jane
What are you doing selling luggage express ??
are you trying to kill the company because we sued the SEC for 700 million dollars and tey told you to
destroy us .... you f*cking sl*t ..
dont get smart ,... you have no idea what could happen to you .
we never forget
lifegear: There is no evidence that an appeal was ever filed, and all reports of what happened in court yesterday are devoid of any mention of any appeal.
Also, the receiver has terminated Talbot as USXP's lawyer in the SEC vs USXP case, and stated that she will not be supporting any appeal by USXP.
needdiamonds: There are various psychological states that a person can be afflicted with that can explain RA's compulsive lying and behaviours.
It is very possible that he really believed that he could never be held accountable for any of it, that he was untouchable.