Securities and Exchange Commission v. Xia et al

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
-------------------------------------------------------x
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,
- against -
RICHARD XIA, a/k/a YI XIA; et al.,
Defendants,
- and -
JULIA YUE, a/k/a JIQING YUE; et al.,
Relief Defendants.
-------------------------------------------------------x
MEMORANDUM & ORDER
21-CV-5350 (PKC) (CHK)
PAMELA K. CHEN, United States District Judge:
Plaintiff Securities and Exchange Commission (the “SEC”) commenced this action on
September 27, 2021 against Defendants Richard Xia (“Xia”) and Fleet New York Metropolitan
Regional Center, LLC (“Fleet”) (together, “Defendants”) for violations of various federal
securities laws, and against Relief Defendants Julia Yue (“Yue”), Xi Verfenstein, and Xinming
Yu (collectively, “Relief Defendants”) for unjust enrichment as a result of Defendants’ alleged
violations of securities laws. 	On July 16, 2024, the Court entered a Final Judgment against
Defendants and Relief Defendant Yue. (Final J., Dkt. 460.) Before the Court is the SEC’s motion
to enforce the Final Judgment, (Pl.’s Ltr., Dkt. 582)1, and Defendants’ motion to stay such
enforcement, (Mot. to Stay Final J. (“Mot. to Stay”), Dkt. 586). For the reasons described herein,
1 In this Memorandum & Order and throughout this litigation, the Court construes the
SEC’s letter requesting the enforcement of the Final Judgment as a motion. (See also 05/28/2025
Dkt. Order (describing that docket entry as a “motion to enforce the Final Judgment”).)
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 1 of 25 PageID #:
<pageID>

2
Defendants’ motion is denied and the SEC’s motion to enforce the Final Judgment is granted in
part and denied in part.
BACKGROUND
I. 	Final Judgment
The Court assumes the parties’ familiarity with the extensive factual and procedural history
of this case,2 and therefore only sets forth those facts relevant to this Memorandum and Order. On
July 5, 2024, Defendants and Relief Defendant Yue entered their consent (the “Consent”) to the
entry of a proposed Final Judgment, which would impose a series of restraints and obligations on
them. (See Proposed Consent of Defs. and Relief Def., Dkt. 450-2; Proposed Final J., Dkt. 450-3.)
On July 26, 2024, the Court approved the Consent, (Consent of Defs. and Relief Def. (“Consent”),
Dkt. 459), and entered the Final Judgment as proposed by the parties, (Final J., Dkt. 460).3
Under the Final Judgment, Defendants and Relief Defendant Yue were required to, among
other things, pay “the total disgorgement, prejudgment interest, and penalty . . . of $272,140,380”
in installments to be completed by March 28, 2025. (See id. at 5–6.) Defendants do not contest
the SEC’s assertions that “Defendants have failed to meet this obligation” and that “[t]o date, only
$42.5 million has been paid toward disgorgement.” (Pl.’s Mem. in Supp. Mot. to Enforce Final J.
(“Pl.’s Mem.”), Dkt. 600, at 1–3.) Defendants also do not contest the SEC’s assertion that “the
2 See, e.g., SEC v. Xia, No. 21-CV-5350 (PKC) (RER), 2022 WL 17539124, at *1–10
(E.D.N.Y. Dec. 8, 2022); SEC v. Xia, No. 21-CV-5350 (PKC) (JAM), 2024 WL 964676, at *1–5
(E.D.N.Y. Mar. 4, 2024); SEC v. Xia, No. 21-CV-5350 (PKC) (JAM), 2024 WL 3447849, at *2
(E.D.N.Y. July 9, 2024).
3 The Final Judgment explicitly incorporates the Consent “with the same force and effect
as if fully set forth [t]herein” and provides that “Defendant Xia shall comply with all of the
undertakings and agreements set forth therein.” (Final J., Dkt. 460, at 10.)
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 2 of 25 PageID #:
<pageID>

3
Final Judgment required Xia to transfer ownership of Fleet by September 28, 2024, but he has not
done so.” (Id. at 3 (internal citations omitted).)
As part of the Consent and the Final Judgment, the SEC acquired senior security interests
in three assets (the “Assets”) controlled by Defendants as security in the event of Defendants’ non-
payment of the $272,140,380 due under the Final Judgment. (See Consent, Dkt. 459, ¶ 3(a); Pl.’s
Mem., Dkt. 600, at 1, 3–4.) 	The Assets include the “Eastern Mirage Project,” located at 42-31
Union Street; the “Eastern Emerald Project,” located at 112-51 Northern Boulevard; and the
“Kings Point Property,” located at 144 Kings Point Drive, Kings Point, Town of West Hempstead,
New York 11024. (Consent Appx. C, Dkt. 459, at ECF4 22.) The SEC maintains, and Defendants
do not contest, that Defendant Xia controls the Eastern Mirage Project and the Eastern Emerald
Project (collectively, the “Projects”) via his entities X&Y Development Group, LLC (“X&Y”) and
Eastern Emerald Group, LLC (“EEG”), respectively, and that the Kings Point Property is
nominally owned by Relief Defendant Yue.5 (Pl.’s Mem., Dkt. 600, at 3.)
The security interests conveyed by Yue, X&Y, and EEG to the SEC are formalized in three
mortgages (the “Mortgages”), all of which provide that if Defendants fail to meet the Final
Judgment’s payment obligations, the Mortgages will be in default.6 (See id. at 4; Mortgage and
4 Citations to “ECF” refer to the pagination generated by the Court’s CM/ECF docketing
system and not the document’s internal pagination.
5 The Kings Point Property is one of the residences Defendant Xia and his spouse (Relief
Defendant Yue) own. (See Han Decl., Dkt. 600-1, ¶ 4); Xia, 2022 WL 17539124, at *2, *9.
6 The Court understands that there is at least one action in which another party seeks to,
inter alia, invalidate part of the Mortgages. See O.S.C., Mushkudiani v. Racanelli Constr. Grp.,
Inc., 25-CV-5474 (PKC) (CHK) (E.D.N.Y. Sep. 30, 2025), Dkt. 1-1. That action, like this one,
seeks the same relief: the appointment of a receiver in order to liquidate one or more of the Assets.
Accordingly, and because the Court does not rely exclusively on the Mortgages, the Court does
not find that that action precludes the decision herein.
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 3 of 25 PageID #:
<pageID>

4
Assignment of Leases and Rents (“X&Y Mortgage”), Dkt. 600-2, ¶¶ 2, 7, 22; Mortgage and
Assignment of Leases and Rents (“EEG Mortgage”), Dkt. 600-3, ¶¶ 2, 7, 22; Mortgage and
Assignment of Leases and Rents (“Yue Mortgage”), Dkt. 600-4, ¶¶ 2, 7, 20.) 	The Mortgages
further provide that the SEC “shall have any rights provided by law or equity” to recover the
amounts owed under the Final Judgment. 	(X&Y Mortgage, Dkt. 600-2, ¶ 24; EEG Mortgage,
Dkt. 600-3, ¶ 24; see also Yue Mortgage, Dkt. 600-4, ¶ 22 (providing the SEC with the right to
have a receiver take control of the Kings Point Property).)
Notably, the investors whose interests the SEC represents were part of the “EB-5
Immigrant Investor Program” (the “EB-5 Program”), which “permits noncitizens to apply for
permanent residence in the United States by investing in . . . commercial enterprises that are based
on ‘proposals for promoting economic growth’” and are approved by the United States Citizenship
and Immigration Services (“USCIS”). Liu v. SEC, 591 U.S. 71, 77 (2020) (citation omitted); Xia,
2022 WL 17539124, at *2 n.6; see also SEC v. Hui Feng, 935 F.3d 721, 731 (9th Cir. 2019) (“The
EB-5 program by design links the success of the investment to the investor’s success in obtaining
a visa.”). 	The construction of the Projects has been part of the EB-5 Program. 	(See Xia Decl.,
Dkt. 586-2, ¶ 18.)
II. 	Relevant Procedural History
On April 25, 2025, the SEC filed a request to enforce the Final Judgment and reported that
it was “explor[ing] steps to enforce the Final Judgment by seeking a Court-appointed agent to
market and sell [the three Assets].” (Pl.’s Ltr., Dkt. 582.) The same day, Defendants filed a letter
opposing those efforts. (Dkt. 583.) Thus, on April 30, 2025, the Court ordered the SEC to file “a
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 4 of 25 PageID #:
<pageID>

5
memorandum of law explaining the SEC’s legal authority to appoint a liquidation agent.”7
(04/30/2025 Dkt. Order.) On May 5, 2025, Defendants filed a motion seeking “to stay enforcement
of the [F]inal [J]udgment.” (Mot. to Stay, Dkt. 586, at ECF 1.) On May 23, 2025, the SEC filed
the court-ordered memorandum of law in support of its original request and, in the same filing,
opposed Defendants’ motion for a stay. (Pl.’s Mem., Dkt. 600.) “[I]n the spirit of compromise,”
the SEC also proposed that the Court find the appointment of a sales agent “necessary and
appropriate” and direct the parties to confer and agree on a sales agent for the Court to appoint.
(Dkt. 599.) On June 30, 2025, Defendants filed their opposition to Plaintiff’s enforcement motion,
(Defs.’ Mem. in Opp’n to Pl.’s Mot. to Enforce Final J. (“Defs.’ Opp’n”), Dkt. 619), and on July
7, 2025, Plaintiff filed its reply, (Pl.’s Reply in Supp. Mot. to Enforce Final J. (“Pl.’s Reply”),
Dkt. 634.)
DISCUSSION
I. 	The SEC’s Motion to Enforce the Final Judgment
The SEC seeks to enforce the Final Judgment by selling the three Assets and asks that the
Court appoint a sales agent for that purpose. While the SEC argues that it has “at least four avenues
to pursue the appointment of a sales agent,” (Pl.’s Mem., Dkt. 600, at 1–2)8, the Court focuses on
the equitable powers and the equitable relief available under Section 21(d)(5) of the Securities
Exchange Act of 1934 (“Section 21(d)(5)”). 	Defendants counter that federal equitable relief is
inapplicable here because the Court may only liquidate assets for the satisfaction of a money
7 The Court and the relevant case law use the terms “liquidation agent,” “sales agent,” and
“liquidation receiver” interchangeably.
8 The SEC claims that it could (1) seek equitable relief; (2) request to sell the Assets as a
remedy to Defendants’ contempt; (3) pursue enforcement under Federal Rule of Civil Procedure
(“Rule”) 69 and New York law; or (4) foreclose on the Mortgages based on their terms and seek a
receiver to act as a sales agent. (See Pl.’s Mem., Dkt. 600, at 2.)
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 5 of 25 PageID #:
<pageID>

6
judgment through New York’s Real Property Actions and Proceedings Law. (See Defs.’ Opp’n,
Dkt. 619, at 10–12.)
A. 	The Court’s Equitable Powers
The SEC contends that the Court has “broad equitable powers to protect investors” and that
federal district courts “often grant” the appointment of a receiver or sales agent to sell real property
as relief. (Pl.’s Mem., Dkt. 600, at 7–8 (collecting cases and quoting 15 U.S.C. § 78u(d)(5)).) The
SEC maintains that these equitable powers are “even broader and more flexible” where “the
government is the plaintiff and the broader public interest is at stake.” 	(Id. at 8–9 (collecting
cases).) 	The SEC offers three reasons why the Court should exercise its equitable powers to
appoint a receiver or sales agent to sell the Assets: (1) “[t]he SEC has alleged fraudulent conduct
by Defendants”; (2) “the value of the [Assets] . . . is deteriorating”; and (3) “Defendants would not
be injured by the appointment because a sales agent would only monetize the [Assets] for fair
market value.” (Id. at 9–10.)
The Court agrees with the SEC that Section 21(d)(5) authorizes the Court to grant the
equitable relief the SEC seeks and that there is just cause to do so in this case.
1. 	The Court may appoint a liquidation receiver.
Section 21(d)(5) provides that “[i]n any action or proceeding brought or instituted by the
[SEC] under any provision of the securities laws, the [SEC] may seek, and any Federal court may
grant, any equitable relief that may be appropriate or necessary for the benefit of investors.” 15
U.S.C. § 78u(d)(5); see SEC v. GPB Cap. Holdings, No. 23-8010, 2024 WL 4945247, at *3 (2d
Cir. Dec. 3, 2024) (summary order) (characterizing Section 21(d)(5) as a “broad[]” provision).
Such equitable relief includes the power to appoint a receiver. See GPB Cap. Holdings, 2024 WL
4945247, at *3 (compiling cases). 	Additionally, “[a] receiver appointed in any civil action or
proceeding involving property, real, personal or mixed . . . shall . . . be vested with complete
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 6 of 25 PageID #:
<pageID>

7
jurisdiction and control of all such property with the right to take possession thereof.” 28 U.S.C.
§ 754.
Even prior to the enactment of Section 21(d)(5), and “in the absence of explicit statutory
authority,” the Second Circuit has “upheld the appointment of . . . receivers to effectuate the
purposes of the federal securities laws.” GPB Cap. Holdings, 2024 WL 4945247, at *3 (quoting
SEC v. Manor Nursing Ctrs., Inc., 458 F.2d 1082, 1105 (2d Cir. 1972), abrogated on other grounds
by SEC v. Ahmed, 72 F.4th 379 (2d Cir. 2023)); SEC v. Am. Bd. of Trade, Inc., 830 F.2d 431, 436
(2d Cir. 1987) (“Although neither the Securities Act of 1933 nor the Securities Exchange Act of
1934 explicitly vests district courts with the power to appoint trustees or receivers, courts have
consistently held that such power exists . . . .”). As the Second Circuit has summed up, “[t]here is
no question that district courts may appoint receivers as part of their broad power to remedy
violations of federal securities laws.” SEC v. Byers, 609 F.3d 87, 92 (2d Cir. 2010); see Eberhard
v. Marcu, 530 F.3d 122, 131 (2d Cir. 2008) (noting that “[d]istrict courts possess broad power to
remedy violations of federal securities laws” such as appointing receivers (citing Manor Nursing
Ctrs., 458 F.2d at 1103)); see also SEC v. First Jersey Sec., Inc., 101 F.3d 1450, 1474 (2d Cir.
1996) (noting that a Court has “broad equitable power to fashion appropriate remedies”); SEC v.
Materia, 745 F.2d 197, 200 (2d Cir. 1984) (“The sweeping mandate manifest in the securities laws
would be all but meaningless were it not for the broad investigatory and enforcement powers
created under the statutory scheme. . . . [O]nce the equity jurisdiction of the district court properly
has been invoked, the court has power to order all equitable relief necessary under the
circumstances.” (citing Chris-Craft Indus., Inc. v. Piper Aircraft Corp., 480 F.2d 341, 390 (2d Cir.
1973))).
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 7 of 25 PageID #:
<pageID>

8
Defendants maintain that “[w]hile courts may appoint receivers to manage fraudulently
obtained or ill-gotten assets,” this power is circumscribed by a requirement that liquidation of
assets for the satisfaction of a money judgment must accord with “the legal process historically
recognized at equity.” (Defs.’ Opp’n, Dkt. 619, at 10.) 	Defendants cite to Grupo Mexicano de
Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308, 319–20, 333 (1999), in which “the
Supreme Court held that a preliminary injunction [freezing assets] issued under Fed. R. Civ. P. 65
had to be within the district court’s equitable authority under the Judiciary Act of 1789.” Adelphia
Bus. Sols., Inc. v. Abnos, 482 F.3d 602, 606–07 (2d Cir. 2007) (citing Grupo, 527 U.S. at 318–19).
However, as the Court has previously found, “Grupo is irrelevant to this matter.” See Xia,
2022 WL 17539124, at *11. 	As discussed then, and as the Second Circuit has confirmed, “in
concluding that a court does not have authority to freeze assets to preserve them to satisfy a
potential award of money damages, the Supreme Court in Grupo Mexicano ‘distinguished those
cases where the ultimate relief sought is equitable.’” 	SEC v. Kontilai, No. 23-7537, 2025 WL
615190, at *5 (2d Cir. Feb. 26, 2025) (summary order) (quoting SEC v. ETS Payphones, Inc., 408
F.3d 	727, 	734 	(11th 	Cir. 	2005)); 	see 	also 	Liu, 	591 	U.S. 	at 	85 	(noting 	that 	Congress
“incorporat[ed] . . . longstanding equitable principles into §78u(d)(5)”). The relief sought here is
equitable, and Grupo does not control.
To be sure, the Second Circuit has “in the past criticized the use of receivers to effect the
liquidation of a defendant . . . in litigation under the Securities Act or Securities Exchange Act.”
Am. Bd. of Trade, 830 F.2d at 436; see e.g., Lankenau v. Coggeshall & Hicks, 350 F.2d 61, 63 (2d
Cir. 1965) (recommending, but not requiring, bankruptcy court as the forum for liquidation in SEC
action against brokers or broker-dealers in a case involving insolvency). But criticism has been
the extent of it and largely cabined to the bankruptcy context. The Circuit has “never vacated or
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 8 of 25 PageID #:
<pageID>

9
modified a receivership order on the ground that a district court improperly attempted to effect a
liquidation.” SEC v. Malek, 397 F. App’x 711, 715 (2d Cir. 2010) (summary order) (quoting Am.
Bd. of Trade, Inc., 830 F.2d at 437). As the SEC points out, (see Pl.’s Mem., Dkt. 600, at 9), courts
in this Circuit have regularly appointed liquidation agents or receivers in enforcing securities
actions.9
Accordingly, the Court concludes that it has the equitable powers to both appoint a receiver
and, if appropriate, to task that receiver with liquidating the Assets.
2. 	Equitable principles favor appointment of a liquidation receiver.
The Court now turns to whether the exercise of its equitable power to appoint a liquidation
receiver here is appropriate. “Appointment of a receiver . . . is a ‘drastic remedy usually imposed
only where no lesser relief will be effective.’” SEC v. Amerindo Inv. Advisors, Inc., No. 05-CV-
5231 (RJS), 2013 WL 1385013, at *13 (S.D.N.Y. Mar. 11, 2013) (quoting Ferguson v. Tabah, 288
F.2d 665, 674 (2d Cir. 1961)), modified on reconsideration, 2014 WL 405339 (S.D.N.Y. Feb. 3,
2014). Section 21(d)(5) requires that equitable relief be “appropriate or necessary for the benefit
of investors.” 15 U.S.C. § 78u(d)(5). In determining whether a receiver should be appointed, the
Court considers, inter alia:
9 See, e.g., SEC v. GPB Cap. Holdings, LLC, No. 21-CV-583 (MKB) (VMS), 2023 WL
8468467, at *15 (E.D.N.Y. Dec. 7, 2023) (“[T]he Court finds it appropriate to exercise its statutory
and equitable power to convert the monitorship to a receivership.”), aff’d, 2024 WL 4945247;
Order, SEC v. Borland, No. 18-CV-4352 (PKC) (S.D.N.Y. May 9, 2024), Dkt. 63 (appointing a
liquidation agent); SEC v. Ahmed, No. 3:15-CV-0675 (JBA), 2022 WL 122269, at *5 (D. Conn.
Jan. 11, 2022) (approving liquidation plan); Malek, 397 F. App’x at 714–15 (affirming district
court’s approval of a receiver’s distribution plan that included “effective liquidation” of
defendant’s estate); see also CFTC v. Alexandre, No. 22-CV-3822 (VEC), 2025 WL 252435, at
*3 (S.D.N.Y. Jan. 21, 2025) (“[A] district court’s power to supervise an equity receivership and to
determine the appropriate action to be taken in the administration of the receivership is extremely
broad.” (citing SEC v. Hardy, 803 F.2d 1034, 1037 (9th Cir. 1986)).
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 9 of 25 PageID #:
<pageID>

10
[F]raudulent conduct on the part of defendant[s]; the imminent danger of the
property being lost, concealed, injured, diminished in value, or squandered; the
inadequacy of the available legal remedies; the probability that harm to plaintiff by
denial of the appointment would be greater than the injury to the parties opposing
appointment; and, in more general terms, plaintiff’s probable success in the action
and the possibility of irreparable injury to his interests in the property.
GPB Cap. Holdings, 2023 WL 8468467, at *12 (citations omitted).
The SEC argues that Defendants have engaged in fraudulent conduct with respect to the
handling of EB-5 investors’ funds and the Assets, as supported by the Court’s preliminary findings
in a December 2022 order freezing Defendants’ assets. (Pl.’s Mem., Dkt. 600, at 9–10); see Xia,
2022 WL 17539124 at *4–5, *23–28 (determining that the SEC had proven a sufficient likelihood
of success in its unjust enrichment claims and Section 10(b) of the Securities Exchange Act and
17 C.F.R. § 240.10b-5 misrepresentation claims). 	The SEC also argues that the value of the
Projects is deteriorating and that “Defendants would not be injured by the appointment because a
sales agent would only monetize the [Assets] for fair market value.” (Pl.’s Mem., Dkt. 600, at 10.)
In response, Defendants do not contest the SEC’s allegations that Defendants have engaged
in fraudulent conduct with respect to their handling of EB-5 investor funds and the Assets.
Defendants do, however, contest the SEC’s arguments that the Assets are deteriorating and that no
harm would result from selling the Assets, arguing that the proposed enforcement would
“undermine [the investors’] immigration status [and] could trigger irrevocable consequences under
USCIS regulations.” (Defs.’ Opp’n, Dkt. 619, at 12, 16–17.)
The Court finds that the equitable factors favor appointing a receiver, at least as to the
Eastern Mirage and Eastern Emerald Projects. 	In addition to the clear evidence of fraud by
Defendants, upon which the Court based its initial freezing of Defendants’ assets, see Xia, 2022
WL 17539124 at *23–28, the Court also finds that there is sufficient evidence to support the SEC’s
claims that at least two of the Assets are deteriorating and “diminish[ing] in value,” GPB Cap.
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 10 of 25 PageID
#: <pageID>

11
Holdings, 2023 WL 8468467, at *12. 	Defendants’ own past filings explicitly admit the
deterioration of the Projects. 	(See Dkt. 124, at 3 (stating that the Eastern Mirage Project “sits
fallow and deteriorates day by day”); id. at 23 (“Conditions at the site have deteriorated . . . since
Defendants’ assets were frozen and the Monitor was appointed.”); id. at 2 (reporting “deteriorating
conditions”); Dkt. 207, ¶ 50 (“[T]he site conditions [of both construction sites] have deteriorated
substantially since the Asset Freezing Order was entered on September 27, 2021.”); Dkt. 274, at
10, 25 n.19.) 	The SEC also offers as additional evidence its communications with a non-party
who is allegedly an interested investor who examined the buildings’ prospects. 	(Han Decl.,
Dkt. 600-1, ¶¶ 2–5; Dkt. 600-5.) Defendants provide no credible evidence to the contrary.
The Court also concludes that that neither Defendants nor the EB-5 investors have a
credible threat of prejudice from the sales of the Assets. The Court agrees with the SEC that, at
least as to the Eastern Mirage and Eastern Emerald Projects, “Defendants would not be injured by
the appointment because a sales agent would only monetize [these Projects] for fair market value,
with the proceeds of that sale to be held pending a further Court order directing, if appropriate,
that the proceeds be applied to what Defendants owe under the Final Judgment.” 	(Pl.’s Mot.,
Dkt. 600, at 10.) While Defendants are correct that the relief sought must specifically benefit the
investors, at least under the Securities Exchange Act, see Liu, 591 U.S. at 89 (concluding that relief
under Section 21(d)(5) “must do more than simply benefit the public at large by virtue of depriving
a wrongdoer of ill-gotten gains” to give effect to language in Section 21(d)(5)), the Court is not
persuaded that more effective alternatives to the appointment of a receivership exist at this time to
benefit investors, especially given the protracted and fraught history of this case and the fact that
Defendants have paid only approximately 15% of the more than $272 million owed under the
Consent in the 18 months since its execution.
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 11 of 25 PageID
#: <pageID>

12
In arguing that appointing a receiver would harm investors, Defendants point to filings
early in this case to support the statement that the EB-5 investors’ “primary objective [is] project
completion.” 	(Defs.’ Opp’n, Dkt. 619, at 16–17 (citing Dkts. 78; 86).) 	Not so. 	First, even
assuming these filings—filed nearly four years ago, ahead of the Court’s show cause hearing, and
two years prior to the Final Judgment—are still accurate representations of the EB-5 investors’
interests, the filings describe the investors’ “ultimate objective” as “obtain[ing] permanent resident
status in the United States through the EB-5 program.” (Dkt. 78, at 3; see also Dkt. 86, at 2 (stating
investors also “wish to receive . . . repayments of capital”).) 	The investors’ representatives
favorably discussed the possibility that the investors’ green card applications could be maintained
within a receivership where the projects they had invested in were “sold to an unrelated third-party
developer in a ‘restructuring transaction’ that included specified conditions designed to preserve
the investors’ ability to maintain their EB-5 petitions.” (Dkt. 78, at 4.) Indeed, the Distribution
Plan approved as part of the Consent allows the EB-5 investors to move their investments into
other EB-5 projects, thus allowing them to preserve their EB-5 applications. 	(See Distribution
Plan, Dkt. 500-3, ¶ 76; 11/05/2024 Dkt. Order (adopting the Distribution Plan).) 	In sum, even
assuming the benefit that the EB-5 investors care most about is obtaining their immigration status,
the completion of the Projects is not essential for the investors to achieve that goal.
In fact, Defendants’ proposed course of action—preventing the sales of the Projects—
would achieve the opposite of what investors are seeking. To the extent the EB-5 investors might
wish to keep their investments in the Projects, their immigration benefits require the Projects’
success and profitability. See Xia, 2022 WL 17539124, at *21 (“[T]he success of any investor’s
visa application hinge[s] on the ability of the EB-5-funded Projects to turn a profit, be sustainable,
and create jobs.” (citing Hui Feng, 935 F.3d at 731)). 	But, as the Distribution Plan states, and
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 12 of 25 PageID
#: <pageID>

13
consistent with the Final Judgment and the Consent, the EB-5 investors are only able to maintain
their investments in the Projects if Defendants meet certain requirements in the Final Judgment
with respect to control over the Projects. (Distribution Plan, Dkt. 500-3, ¶¶ 79–80; see Final J.,
Dkt. 460, at 9; Consent, Dkt. 459-2, ¶ 3(c).) These requirements have not been met and, as such,
they directly conflict with and prevent the “project completion” as envisioned by Defendants. See
SEC v. Xia, No. 21-CV-5350 (PKC) (JAM), 2025 WL 1332018, at *5 (E.D.N.Y. May 7, 2025)
(documenting “Defendants’ history of non-compliance with the terms of the Final Judgment—
including, most notably, Defendant Xia’s failure to relinquish control of Fleet”). 	Second, even
assuming that the EB-5 investors could maintain their investments in the projects as they are,
Defendants have been uncooperative with investors’ efforts to advance their immigration
documents. At least two investors have sought the Court’s intervention, complaining of a lack of
responsiveness by Defendants. (See Ltr. of EB-5 Investor Yongxiang Pan (“Pan Ltr.”), Dkt. 616,
at 1 (stating an investor was “unable to obtain the documentation necessary” to support their
immigration process “because [Defendant Fleet] controls these records and has shown no
indication it will provide them”); Ltr. of EB-5 Investor Chen Li (“Li Ltr.”), Dkt. 714, at 1 (similarly
describing a failure to respond to “repeated written requests” for “materials in Fleet’s exclusive
possession” necessary to immigration processes).) 	Third, as the Court has noted before,
Defendants’ “promises to complete the Eastern Emerald and Eastern Mirage Projects are
speculative, at best, and [have formed] a long line of similar proposals that have never come to
fruition.” Xia, 2025 WL 1332018, at *5.
Accordingly, the Court finds that appointment of a receiver to sell the Eastern Mirage and
the Eastern Emerald Projects is warranted to preserve the EB-5 investors’ interests and satisfy the
Final Judgment under Section 21(d)(5) of the Securities Exchange Act of 1934.
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 13 of 25 PageID
#: <pageID>

14
The Court denies as currently unnecessary the appointment of a receiver to sell the Kings
Point Property, which the SEC has not shown to be in deterioration or necessary to support the
EB-5 investors’ interests. 	Furthermore, at this time, the Court cannot determine whether the
additional funds that might be gained through a sale of the Kings Point Property is needed to satisfy
the monetary sums still owed under the Final Judgment. As the SEC notes, this ruling is limited
to disgorgement and prejudgment interest, but not the civil penalty. (Pl.’s Mem., Dkt. 600, at 9
n.5.) The Court will revisit this decision with respect to the Kings Point Property and the other
grounds for effectuating the Final Judgment should it prove necessary.
B. 	Applicability of Foreclosure Requirements
Defendants oppose enforcement of the Final Judgment by claiming that, “[a]s a matter of
law, the SEC cannot bypass New York’s Real Property Actions and Proceedings Law, which
mandates that all mortgage foreclosures . . . proceed through a separate judicial action.” (Defs.’
Opp’n, Dkt. 619, at 3.) Even if New York law does not impose this barrier, Defendants maintain,
“the plain language of the [Mortgages] . . . reflects the parties’ intent for New York’s mortgage
and foreclosure laws, rights, and substantive procedures to apply.” (Id.) 	Defendants argue that
New York law requires the SEC to file a separate action to foreclose on its Mortgages and to meet
the law’s procedural and substantive requirements. 	(Id. at 5.) Meanwhile, the SEC replies that
“the Mortgages, the Final Judgment, and all applicable law make clear . . . [that] the SEC need not
proceed by mortgage foreclosure.” (Pl.’s Reply, Dkt. 634, at 3.) The Court finds that neither New
York law, nor the terms of the Mortgages, nor any of the parties’ agreements preclude the
enforcement of the Final Judgment in this action.
1. 	Applicability of New York Real Property Actions and Proceedings Law
The parties’ dispute regarding the effect of New York law on this matter starts with the
applicability of New York Real Property Actions and Proceedings Law’s (“N.Y. RPAPL”) Article
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 14 of 25 PageID
#: <pageID>

15
13, which Defendants claim requires a separate action for mortgage debt, among other non-
waivable procedural requirements. (See Defs.’ Opp’n, Dkt. 619, at 4–8.) Although the SEC also
argued that it could proceed on the basis of enforcing the mortgage’s terms alone—and even
assuming, without deciding, that Defendants’ are correct about the procedural requirements for
that avenue of relief—that is not how the Court is proceeding at this juncture. 	Rather than a
mortgage foreclosure action, which Article 13 might govern, this decision grants “equitable relief”
that is “appropriate or necessary for the benefit of investors” as provided by federal statute. 	15
U.S.C. § 78u(d)(5).10 	This distinction separates this matter from all of the decisions cited by
Defendants.11 	Defendants themselves note that foreclosure is not the only way a debtor may
10 New York caselaw confirms that Article 13 does not apply where a decision does not
concern a mortgage foreclosure. See Hoge v. Chautauqua Cnty., 104 N.Y.S.3d 813, 815 (4th Dep’t
2019) (finding that Article 13 of the RPAPL “does not apply” to a sale of property that is not a
“mortgage foreclosure[]”); In re Foreclosure of Tax Liens by Proc. in Rem Pursuant to Article 11
of Real Prop. Tax L. by Cnty. of Niagara, 103 N.Y.S.3d 334, 335 (4th Dep’t 2019) (same); Wang
v. Hon, No. 12353/17, 2018 WL 5309874, at *6 (N.Y. Sup. Ct. Oct. 23, 2018) (finding Article 13
of the RPAPL “has no relevance” where a judgment lien “was not obtained by a mortgage in a
foreclosure action”); see also Citibank, N.A. v. Yanling Wu, 154 N.Y.S.3d 327, 330 (2d Dep’t
2021) (“[A]rticle 13, which governs mortgage foreclosure actions, distinguishes between an action
to recover any part of the mortgage debt and an action to foreclose the mortgage. ‘An action to
foreclose a mortgage is not an action to recover the mortgage debt from the mortgagor personally,
but to collect it out of the land by enforcing the lien of the mortgage.’” (quoting Jamaica Sav. Bank
v. M. S. Investing Co., 274 N.Y. 215, 219 (1937))); Ivy Hill Commodities Corp. v. Beekharry, 967
N.Y.S.2d 75, 77 (2d Dep’t 2013) (finding that certain procedural requirements under New York
law did not apply, based on the distinction between a judgment based on a “mortgage debt” and
one based on “fail[ure] to make payments due under the stipulation of settlement”).
11 Leonia Bank v. Kouri concerned only the distinction between a common mortgage and
a deed issued as a security; it did not concern N.Y. RPAPL’s Article 13. 772 N.Y.S.2d 251, 254
(2004); see also In re First Union Baptist Church of Bronx, No. 17-CV-7184 (KBF), 2018 WL
770401, at *5–6 (S.D.N.Y. Feb. 7, 2018) (addressing the same issue). 	In In re Soho 25 Retail,
LLC, “the parties agree[d] that New York law applie[d] to the . . . dispute,” and the decision
centered around a debtor’s security interest in rents from the property in question and did not
concern N.Y. RPAPL. 	No. ADV. 11-1286 (SHL), 2011 WL 1333084, at *5 (Bankr. S.D.N.Y.
Mar. 31, 2011). 	SEC v. Levine, 881 F.2d 1165, 1178–79 (2d Cir. 1989), and Audiovisual
Publishers, Inc. v. Cenco Inc., 964 F. Supp. 861, 875–76 (S.D.N.Y. 1997), support only the
statement that Consents are construed as contracts, and not that any mortgage foreclosure
requirements apply. Wyo. Cnty. Bank & Tr. Co. v. Kiley did not include the language quoted by
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 15 of 25 PageID
#: <pageID>

16
recover with respect to a note holder secured by mortgage, (see Defs.’ Opp’n, Dkt. 619, at 5 (noting
that a “secured party” may “either . . . foreclose on the mortgage or . . . recover on the note”
(citation omitted))), but nonetheless address only the requirements as to foreclosure proceedings.
2. 	The Terms of the Final Judgment, the Consent, and the Mortgages
Defendants maintain that foreclosure requirements must apply because “[n]either the
[Consent] nor the Final Judgment or related mortgage documents authorize appointment of a
liquidation agent by motion outside New York’s foreclosure framework.” 	(Defs.’ Opp’n,
Dkt. 619, at 8–9.) The Court reads the Consent, the Final Judgment, and the Mortgages differently.
“[C]onsent judgments should be interpreted in a way that gives effect to what the parties
have agreed to, as reflected in the judgment itself or in documents incorporated in it by reference.”
Levine, 881 F.2d at 1179; see Allen v. Cnty. of Nassau, No. 22-CV-1572 (HG) (JMW), 2022 WL
4468173, at *2 (E.D.N.Y. Sep. 26, 2022) (“For purposes of enforcement, ‘a Consent should be
construed and interpreted as a contract.’” (citation omitted)). 	Likewise, “a mortgage document
should be interpreted like any contract.” 	Secured Asset Mgmt., LLC v. Dushinsky, No. 17-CV-
5588 (DLI) (CLP), 2023 WL 2429689, at *3 (E.D.N.Y. Mar. 9, 2023).
The plain terms of the Final Judgment specifically provide that “[t]he [SEC] may enforce
the Court’s judgment for disgorgement and prejudgment interest by using all collection procedures
authorized by law.” 	(Final J., Dkt. 460, at 5; see id. (likewise providing that “[t]he [SEC] may
enforce the Court’s judgment for penalties by the use of all collection procedures authorized by
law”).) The Final Judgment includes no indication that the SEC must proceed by enforcing the
mortgages or by bringing an action in New York court. Neither does the Consent, which provides
Defendants, (see Defs.’ Opp’n, Dkt. 619, at 4), focused primarily on the express terms of N.Y.
CPLR § 5206, and specifically addressed the requirements for other ways a creditor may recover
with respect to a note secured by mortgage. See 430 N.Y.S.2d 900, 902–03 (1980).
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 16 of 25 PageID
#: <pageID>

17
only that Defendant Xia would “undertake[] to . . . grant and assign to the [SEC], in a form
agreeable to the [SEC], as security for Defendants’ payment and performance of their obligations
under . . . this Consent, a senior security interest in all of Defendants’ rights, directly and
indirectly, in and to the assets[,]” including the Eastern Mirage and the Eastern Emerald Projects.
(Consent, Dkt. 459-2, ¶ 3(a).) Likewise, each of the Mortgages for the Projects provide that “[t]he
[SEC]’s rights in th[is] Action with respect to Xia, Fleet, Yue, the Final Judgment, or the Debt,
including, but not limited to, the [SEC’s] rights to seek Court intervention to satisfy monies owed
by Xia, Fleet, or Yue, are not limited by this Mortgage.” (X&Y Mortgage, Dkt. 600-2, ¶ 30; EEG
Mortgage, Dkt. 600-3, ¶ 30.)
Thus, the Court finds that none of the terms of the Consent, the Final Judgment, or the
Mortgages preclude the Court’s ruling here.
* * *
Accordingly, the Court finds that neither N.Y. RPAPL nor the terms of the agreements
between the parties precludes the appointment of a receiver in this action towards selling the
Eastern Mirage and the Eastern Emerald Projects.
II. 	Defendants’ Request for a Stay
Defendants seek a stay “of any further proceedings in this case in furtherance of
enforcement of the Final Judgment.” 	(Defs.’ Mem. in Supp. of Mot. to Stay (“Defs.’ Mem”),
Dkt. 586-1, at 2.) 	Defendants request the stay “as ‘matter of right’ pursuant to Federal Rule of
Civil Procedure 62,” or, in the alternative, “based on the exercise of sound judgment.” (Id. at 3.)
A. 	Stay Pending Post-Judgment Motions and Appeals
Defendants first request that the Court stay enforcement of the Final Judgment “pending
resolution 	of 	post-judgment 	motions 	in 	trial 	court, 	including 	but 	not 	limited 	to 	the[ir]
contemporaneously filed Motion to Modify [the Final Judgment] and issues on appeal.” (Id. at 8.)
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 17 of 25 PageID
#: <pageID>

18
As a starting point, Defendants’ Motion to Modify the Final Judgment, (Dkt. 585), has since been
denied by the Court, (05/07/2025 Dkt. Order), and there are no other unresolved post-judgment
motions concerning the enforcement of the Final Judgment. Although Defendant Xia has appealed
the Court’s denial of the Motion to Modify, (see Notice of Appeal, Dkts. 620, 635)12, and that
appeal is currently pending, see SEC v. Xia, 25-1683 (2d Cir. Jan. 8, 2026) (pending appeal over
denial of Defendants’ motion to modify the Final Judgment), the Court has already found that the
pending appeal does not deprive the Court of jurisdiction or authority to rule on the SEC’s Motion
to Enforce the Final Judgment.13 	(07/28/2025 Dkt. Order (determining judgment remains
operative unless a stay is granted by the district court or Court of Appeals, neither of which has
occurred).)
The SEC argues that the appeal should not factor into consideration of a stay, as it claims
Defendants, through the Final Judgment, “expressly waive[d] [their] right to appeal that
judgment.” (Pl.’s Mem., Dkt. 600, at 17; see also Final J., Dkt. 460, at 1 (noting that the parties
“waived findings of fact and conclusions of law; and waived any right to appeal from this Final
Judgment”).) Defendants request another opportunity to brief this issue. (Defs.’ Opp’n, Dkt. 619,
12 Dkt. 620 and Dkt. 635 are two entries of the same notice of appeal.
13 Defendant Xia has another two appeals currently pending, which do not concern the
liquidation at issue here. 	See SEC v. Xia, 25-2039 (2d Cir. Jan. 8, 2026) (pending appeal over
denial of Defendant Xia’s motion for release of funds); (see also Dkt. 652 (notice of appeal for the
same); Dkt. 727 (notice of appeal over order denying release of funds and directing Defendants to
assist investor with access to certain documents)). 	Although a Second Circuit mandate filed in
this case referenced the notice of appeal in Dkt. 652, (see Dkt. 677), the Second Circuit case
number in the mandate reveals that it concerned an earlier appeal in this action, and therefore that
appeal is still pending. Defendants’ other appeals have been dismissed. See Order, SEC v. Xia,
22-3137 (2d Cir. Aug. 15, 2022), Dkt. 222 (dismissing appeal over asset-freezing preliminary
injunction); (see also Dkt. 219 (notice of appeal)); Order, SEC v. Xia, 23-0231 (2d Cir. Feb. 22,
2024), Dkt. 115 (dismissing appeal over denial of a motion hearing under Rule 65); (see also
Dkt. 262 (notice of appeal)).
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 18 of 25 PageID
#: <pageID>

19
at 19–20.) The Court finds that it need not decide whether the waiver covered Defendants’ Motion
to Modify, because Defendants have failed to meet the other requirements of the stay.
B. 	Stay Pursuant to Federal Rule of Civil Procedure 62
Federal Rule of Civil Procedure (“Rule”) 62(b) provides that, “[a]t any time after judgment
is entered, a party may obtain a stay by providing a bond or other security” and that “[t]he stay
takes effect when the court approves the bond or other security and remains in effect for the time
specified in the bond or other security.” Rule 62(d) also provides that “[w]hile an appeal is pending
from an interlocutory order or final judgment that grants, continues, modifies, refuses, dissolves,
or refuses to dissolve or modify an injunction, the court may suspend, modify, restore, or grant an
injunction on terms for bond or other terms that secure the opposing party’s rights.”
Although both Rule 62(b) and Rule 62(d) would require a bond, Defendants assert that the
bond requirement can and should be waived as unnecessary. (See Defs.’ Mem., Dkt. 586-1 at 3–
4.) 	“A district court . . . may, in its discretion, waive the bond requirement ‘if the appellant
provides an acceptable alternative means of securing the judgment.’” 	In re Nassau Cnty. Strip
Search Cases, 783 F.3d 414, 417 (2d Cir. 2015) (per curiam) (citation omitted). 	In deciding
whether to forego the bond requirement, courts consider what are often referred to as the “Nassau
factors”:
(1) the complexity of the collection process; (2) the amount of time required to
obtain a judgment after it is affirmed on appeal; (3) the degree of confidence that
the district court has in the availability of funds to pay the judgment; (4) whether
the defendant’s ability to pay the judgment is so plain that the cost of a bond would
be a waste of money; and (5) whether the defendant is in such a precarious financial
situation that the requirement to post a bond would place other creditors of the
defendant in an insecure position.
Id. at 417–18 (citation omitted). 	“The Nassau factors are designed to accomplish the ‘primary
purpose’ of Rule 62(b): ‘to ensure recovery for a party who ultimately prevails on appeal, and to
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 19 of 25 PageID
#: <pageID>

20
protect the judgment debtor from the risk of losing the money if the decision is reversed.’” Tatas
v. Ali Baba’s Terrace, Inc., No. 19-CV-10595 (ER), 2025 WL 1190806, at *3 (S.D.N.Y. Apr. 22,
2025) (quoting In re Nassau Cnty., 783 F.3d at 418); see also id. (“The vast majority of courts in
[the Southern District of New York] applying [the Nassau] factors have denied a motion to stay
enforcement without a supersedeas bond.” (citation omitted)).
Defendants claim that the Nassau factors favor waiving the bond requirement, focusing on
the extant preliminary injunction freezing Defendants’ assets and the Mortgages for the Eastern
Mirage and Eastern Emerald Projects. (Defs.’ Mem., Dkt. 586-1, at 9–10.) Defendants claim that
these projects are worth far more than the amount owed under the Final Judgment and that
Defendants “will be reasonably likely to secure the necessary funding to fulfill the remaining Final
Judgment payment obligations in the relatively near future if the SEC is reasonably cooperative.”
(Id. at 9 n.12.)
But as discussed supra, the Court has found that the Eastern Mirage and Eastern Emerald
Projects are deteriorating. 	The Court also expects that the liquidation of the Projects would be
complex, as both involve millions of dollars and are backed by hundreds of EB-5 investors with
immigration concerns. As the Court has previously noted, these Projects “are highly illiquid and
might never be sold,” and the value of expert reports purportedly showing that the Projects are
worth substantially more than what is owed under the Final Judgment is “almost nil.” Xia, 2022
WL 17539124, at *31. Defendants’ present projections that “the combined fair market value of
the collagenized properties exceeds $600 million,” (Defs.’ Mem., Dkt. 586-1, at 10), like those
expert reports, are based on Xia’s self-serving and unsupported affirmations, and the Court
accordingly finds these assertions to be of little probative value, see Xia, 2022 WL 17539124, at
*31 (noting Xia’s lack of credibility).
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 20 of 25 PageID
#: <pageID>

21
Likewise, there is insufficient reliable evidence to support Defendants’ claims that they are
reasonably likely to secure funding via new creditors for the amounts still owed under the Final
Judgment in the relatively near future. 	First, Defendants provide no specific evidence to that
effect—only an affirmation by Defendant Xia, which deserves little weight. See id. Second, as
the SEC points out, Defendants have argued elsewhere that they have been “unable to secure
lenders or investors who are willing to commit the funds necessary” under the Final Judgment.
(Pl.’s Mem., Dkt. 600, at 18–19 (quoting Dkt. 562, at 3).) Third, Defendants have made similar
claims multiple times over the course of this case, yet none have “come to fruition.” Xia, 2025
WL 1332018, at *5 (noting “long line” of proposals and “promises to complete the Eastern
Emerald and Eastern Mirage Projects . . . that have never come to fruition”). 	Fourth, in the ten
months that have passed since Defendants filed their enforcement motion, there has been no
indication that Defendants might be able to secure additional funds to meet the Final Judgment’s
obligations or complete the Projects.
On the record before it, the Court, in its discretion, finds under the Nassau factors that
Defendants have not shown their ability to pay the amount owed under the Final Judgment
“without substantial delay or other difficulty.” 	In re Nassau Cnty., 783 F.3d at 418 (citation
omitted). Accordingly, Defendants’ motion for a stay pursuant to Rule 62 is denied.
C. 	Discretionary Stay
Finally, Defendants argue that a stay is the proper exercise of the Court’s discretion. (See
Defs.’ Mem., Dkt. 586-1, at 5–7, 12–17.) “It is well settled that district courts have the inherent
power, in the exercise of discretion, to issue a stay when the interests of justice require such
action.” 	Vista Food Exch., Inc. v. Law, No. 21-CV-4689 (ALC), 2023 WL 2760965, at *1
(S.D.N.Y. Mar. 31, 2023) (citation omitted); see also Kashi v. Gratsos, 790 F.2d 1050, 1057 (2d
Cir. 1986) (“[A] court may decide in its discretion to stay civil proceedings . . . when the interests
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 21 of 25 PageID
#: <pageID>

22
of justice seem . . . to require such action.”) (internal citations and quotations omitted). Defendants
carry the burden to establish “a clear case of hardship or inequity in being required to go forward.”
Est. of Henkin v. Kuveyt Turk Katilim Bankasi A.S., No. 19-CV-5394 (BMC), 2025 WL 622546,
at *2 (E.D.N.Y. Feb. 26, 2025) (citation omitted). 	“Courts take into account ‘(1) the private
interests of the plaintiffs in proceeding expeditiously with the civil litigation as balanced against
the prejudice to the plaintiffs if delayed; (2) the private interests of and burden on the defendants;
(3) the interests of the courts; (4) the interests of persons not parties to the civil litigation; and (5)
the public interest’ in deciding whether to stay a case.” 	Id. (citation omitted). 	Under these
standards, the Court finds that a stay is not warranted.
Defendants’ request primarily relies on three arguments. 	First, Defendants argue that
staying enforcement of the Final Judgment “will help resolve, or at least greatly simpl[ify] the
issues . . . and provide guidance that would allow this litigation to conclude thereafter on a
reasonable and efficient basis.” (Defs.’ Mem., Dkt. 586-1, at 13.) Second, Defendants argue that
they have a “compelling interest in pursuing their post-judgment motion practice and appeal
without the danger of enforcement of the judgment vitiating or otherwise impairing their assets
and rights.” (Id. at 14.) Third, Defendants argue that a stay “serves the public interest . . . given
the EB-5 interests and complex financial-related issues at stake.” (Id.) The Court finds no merit
in any of these arguments.
First, the purported “simplification” does not justify a stay here. 	Defendants’ argument
relies entirely on their likelihood of success in challenging the Court’s denial of Defendant Xia’s
Motion to Modify the Final Judgment.14 In “summarily den[ying]” that motion, the Court found
14 As noted supra n.13, Defendants only have one appeal that could affect the Court’s
decision herein. Defendant Xia had sought to modify the Consent and Final Judgment under “just
terms,” or in the alternative, “to modify the Final Judgment’s payment schedule . . . and . . . cease
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 22 of 25 PageID
#: <pageID>

23
that Defendant Xia’s arguments sought to “improperly relitigate issues that the Court ha[d] already
resolved” and “border[ed] on frivolous.” 	(05/07/2025 Dkt. Order.) 	Now, in the context of
Defendants’ request to stay, the Court reiterates and relies on its prior finding that Defendant Xia’s
appeal is frivolous and, as such, a stay until the resolution of Defendant Xia’s appeals would not
serve the interests of the courts, the interest of persons not parties to the civil litigation, or the
public interest.15 See also Maltese v. Delta Airlines Corp., No. 24-CV-4311 (RPK) (LB), 2024
WL 4389282, at *1 (E.D.N.Y. Oct. 3, 2024) (“While a district court must ordinarily stay its
proceedings while an interlocutory appeal is pending, ‘district courts may certify an interlocutory
appeal as frivolous and retain jurisdiction of the case despite the ongoing appeal.’” (collecting
cases)); Motorola Credit Corp. v. Uzan, No. 02-CV-0666 (JSR), 2002 WL 31426202, at *1
(S.D.N.Y. Oct. 29, 2002) (“[A] district court “retains discretion to deny . . . a stay in at least those
further enforcement of the Final Judgment, . . . including any steps toward appointment of a
liquidator.” (Dkt. 585-1, at 23.)
15 The Court has considered the fact that, if granted, Defendant Xia’s appeal could result
in modification of the Final Judgment. The Court reiterates that “the vitality of [a] judgment is
undiminished by pendency of the appeal” and “[u]nless a stay is granted either by the court
rendering the judgment or by the court to which the appeal is taken, the judgment remains
operative.” (07/28/2025 Dkt. Order (quoting In re Gorsoan Ltd., No. 18-MC-0431 (RA) (KNF),
2020 WL 3264159, at *2 (S.D.N.Y. June 17, 2020))); see Coleman v. Tollefson, 575 U.S. 532, 539
(2015) (“Unless a court issues a stay, a trial court’s judgment . . . normally takes effect despite a
pending appeal.”); see also C.H. Sanders Co. v. BHAP Hous. Dev. Fund Co., 750 F. Supp. 67, 69
(E.D.N.Y. 1990) (“[T]he district Court has jurisdiction to act to enforce its judgment so long as
the judgment has not been stayed or superseded.” (alteration in original) (quoting N.L.R.B. v.
Cincinnati Bronze, Inc., 829 F.2d 585, 588 (6th Cir. 1987))); In re Hornbeam Corp., No. 14-MC-
0424 (Part 1), 2017 WL 3491962, at *2 (S.D.N.Y. Aug. 14, 2017) (noting that “a Court may
enforce its orders while review of those orders is pending on appeal,” even if “a Court does not
retain jurisdiction over ‘the expansion and amendment of orders and judgments’” (quoting In re
Gushlak, No. 11-MC-218 (NGG), 2012 WL 1514824, at *4 & n.5 (E.D.N.Y. Apr. 30, 2012))).
Accordingly, the Court reiterates its earlier ruling that “the notices of interlocutory appeal [do not]
preclude the Court from considering and deciding the SEC’s . . . motion to enforce judgment
against Defendants.” (07/28/2025 Dkt. Order.)
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 23 of 25 PageID
#: <pageID>

24
circumstances where the appeal is patently frivolous or taken for an obviously improper purpose.”
(quoting Cendant Corp. v. Forbes, 72 F.Supp.2d 341, 343 (S.D.N.Y. 1999))).
Defendants’ alternative arguments are equally unavailing and would support the contrary
conclusion. 	As discussed supra, the Court does not find that the EB-5 investors would benefit
from Defendants’ continued ownership of the Projects given the Final Judgment and the Consent’s
requirement that Defendants entirely divest their control over the EB-5 projects involving the
Eastern Mirage and Eastern Emerald Projects, (see Distribution Plan, Dkt. 500-3, ¶¶ 79–80; Final
J., Dkt. 460, at 9; Consent, Dkt. 459-2, ¶ 3(c)), and the complaints the Court has received from
these investors about Defendants’ cooperation with their immigration processes, (see Pan Ltr.,
Dkt. 616, at 1; Li Ltr., Dkt. 714, at 1). Furthermore, to the extent Defendants are prejudiced by
having to address any post-judgment motions and the SEC’s motion for liquidation at the same
time, the same is true for the SEC, or any other litigant seeking a post-judgment stay for that matter.
Finally, Defendants ignore the harm that the SEC and the EB-5 investors would suffer if
the Court issued the requested stay. 	As previously discussed, all the credible evidence in this
matter, and even some of Defendants’ own statements, point to the conclusion that the Projects are
depreciating in value and that a stay or any other delay will only exacerbate that loss in value. This
would, in turn, harm the EB-5 investors both financially and in their immigration processing as
well as the SEC with respect to their enforcement efforts. 	See supra, Part I.B.2. 	On the other
hand, to the extent Defendants claim that denying the stay will hinder their efforts to secure
additional funding to continue the Projects, the Court finds, as discussed supra, that the likelihood
of such funding materializing, especially given that Defendants are required to fully divest control
over the Projects under the Final Judgment, is wholly speculative and unsupported by any credible
evidence. See id.; supra, Part II.B.
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 24 of 25 PageID
#: <pageID>

25
Accordingly, Defendants’ request for a discretionary stay is denied.
CONCLUSION
For the reasons stated above, the SEC’s motion to enforce the Final Judgment is granted in
part and denied in part, and Defendants’ motion for a stay of the enforcement of the Final Judgment
is denied in full. 	The Court finds that, pursuant to its equitable powers under the Securities
Exchange Act, appointment of a receiver to liquidate the Eastern Mirage and Eastern Emerald
Projects is warranted, but the Court defers at this time on whether to order liquidation of the Kings
Point Property.
SO ORDERED.
/s/ Pamela K. Chen
Pamela K. Chen
United States District Judge
Dated: March 6, 2026
Brooklyn, New York
Case 1:21-cv-05350-PKC-CHK Document 740 Filed 03/06/26 Page 25 of 25 PageID
#: <pageID>