United States Securities and Exchange Commission v. Mediatrix Capital Inc. et al

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Raymond P. Moore
Civil Action No. 19-cv-02594-RM-SKC
UNITED STATES SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.
MEDIATRIX CAPITAL INC., et al.,
Defendants,
And
MEDIATRIX CAPITAL FUND LTD., et al.,
Relief Defendants.
ORDER
This civil enforcement action is before the Court on Plaintiff’s Motion to Modify Asset
Freeze to Permit the Transfer of Funds, Including Certain Disputed Funds, from Equity UK to
the Receiver (ECF No. 295), seeking an order directing non-party Equity UK Capital Limited
(“Equity UK”) to transfer $11,183,135.06 from Blue Isle’s Equity UK account to the Receiver
and releasing the remaining $1,756,723.41 in the account from the Court’s asset freeze to Equity
UK. Non-parties Equity UK and Equity Armenia CJSC (collectively, “Equity”) have filed a
Consent (ECF No. 297), stating that they consent to the relief sought. (ECF No. 297.) The
Motion is opposed by only the Youngs, who have filed a Response to the Motion. (ECF
No. 301.) Plaintiff has filed a Reply. (ECF No. 304.) The Motion is granted for the reasons
below.
Case No. 1:19-cv-02594-PAB-STV Document 331 filed 05/18/22 USDC Colorado
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In June 2020, the Court ordered Equity to “liquidate and convert to U.S. Dollars all
foreign currencies and precious metals . . . and further to preserve and hold such U.S. dollar
balances in such respective accounts.” (ECF No. 134 at 2.) Equity’s position is that it is entitled
to offset the $3,513,446.82 negative balance in Blue Isle’s Equity AM account with the
$12,939,858.47 held in Blue Isle’s Equity UK account. Plaintiff’s position is Equity is not
entitled to any such offset. To resolve this dispute, Plaintiff and Equity have agreed to split the
difference. And aside from the Youngs, no party in this case opposes the Motion.
Under the circumstances, the Court sees no problem with granting the relief requested.
As noted in the Reply, Plaintiff and Equity conducted lengthy arms-length negotiations, and
there is uncertainty as to whether Plaintiff’s or Equity’s position would ultimately prevail, either
in this Court or in another jurisdiction. The Young’s unsupported arguments against granting the
Motion are unpersuasive. Moreover, even if they are correct that “Equity UK is the primary
wrongdoer” (ECF No. 301 at 2), nothing in this Order precludes them from pursuing any claims
they have against Equity.
Therefore, Plaintiff’s Motion (ECF No. 295) is GRANTED.
DATED this 18th day of May, 2022.
BY THE COURT:
____________________________________
RAYMOND P. MOORE
United States District Judge
Case No. 1:19-cv-02594-PAB-STV Document 331 filed 05/18/22 USDC Colorado
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