Below is a list of selected current and past matters in which our experts were appointed as Receiver.
Experts from multiple practice areas were engaged to assist the Receiver appointed in a matter brought by the Commodity Futures Trading Commission (“CFTC”) against Eddy Alexandre and EminiFX, Inc. The CFTC alleged that Defendant Alexandre operated EminiFX in a “ponzi-like” manner, pooling at least $59 million from hundreds of members of the public for the stated purpose of trading foreign currency and cryptocurrencies in an “investment club”. Defendants promised weekly returns of 5-9.99%, and represented to the participants that the operation was profitable. David Castleman was appointed Receiver over EminiFX in May 2022, and engaged JSH to assist in identifying and recovering receivership assets, analyzing and assess the financial condition of EminiFX, and wind-down of business operations, among other duties. Teams from our Digital Investigations & Discovery, Global Investigations, and Strategic Advisory teams co-authored the Receiver’s Financial Condition Report, and our experts continue to assist the Receiver in transaction verification and claims resolution.
Appointed as Receiver by the Arizona State Board of Education, our experts are tasked with resolving the district’s financial mismanagement helping the district to achieve financial solvency. Our experts have replaced the leadership team and key accounting personnel and continues to work with the district to restructure operations in order to operate within budget and repay outstanding debts. Our experts are proactively working with the district to implement policies and procedures to avoid future overspending, while improving the quality of education.
Our experts were appointed Receiver for DenSco Investment Corporation in a matter brought by the Arizona Corporation Commission in August 2016. DenSco was engaged primarily in funding hard money loans for the purchase of real estate secured by deeds of trust using money raised from investors. In the short time since the inception of the receivership, our experts have identified the underlying fraud schemes that resulted in DenSco’s collapse and has collected over $12 million for the benefit of investor victims. Our experts have completed the administration of DenSco’s remaining loan portfolio and continue to pursue numerous additional avenues of recovery. Additional information regarding this ongoing receivership is available on the Receiver’s website at http://denscoreceiver1.godaddysites.com/.
As Receiver for Cedar, our experts successfully achieved financial solvency, corrected deficiencies in the district’s compliance with the Uniform System of Financial Records (“USFR”), disposed of unnecessary assets, and reduced operating costs. Our experts worked with Cedar to repay debt and state aid overages, increase operating efficiencies, and further reduce costs.
Our experts were appointed Receiver for MMJ Apothecary, GP, et al., which operates a medical marijuana dispensary based in Wickenburg, AZ, due to a dispute between the company’s directors. The Receiver was tasked with maintaining the status quo of the business, which proved to be difficult due to the lackluster market for medical marijuana in the town of Wickenburg. As Receiver, our experts closed and liquidated the company’s cultivation facility, evaluated the potential costs and benefits of moving the dispensary, and assisted with the refinancing of the company’s debts. Our experts continued to oversee dispensary operations while ensuring compliance with strict Arizona rules and regulations during the pendency of the underlying litigation.
Our experts were appointed Receiver for a cinder pit operator as a result of litigation between the company’s members. The receivership entity extracts and sells gravel and other rock materials from a pit located in Navajo County, AZ. As Receiver, our experts oversaw management of the business by employees of a related entity while attempting to untangle three highly commingled entities. Our experts also coordinated the preparation of an aggregate reclamation plan pursuant to Arizona State Mine Inspector requirements and conducted an extensive investigation into whether the business had any basis to claim an ownership in the pit property.
Our experts were appointed Receiver for a construction contractor due to litigation resulting from a dispute between the company’s partners. The company was a designer, builder and installer of custom garage doors, doors and windows, masonry work, and custom indoor and outdoor fireplaces. The company ceased operations after the Plaintiff filed a lawsuit and the Defendant essentially took control and possession of Elite’s assets for the purposes of carrying on the business under a new name and ownership. The Receiver was appointed to investigate the disposition of the company’s assets and take actions to recover assets for the benefit of its creditors.
Our experts were appointed Receiver for an Arizona company that franchised and operated Carl’s Junior and other fast food restaurants and convenience stores at various locations nationwide, including a property located in Guadalupe, Arizona. Our experts were appointed Receiver for the property as a result of litigation brought forth by the secured lender due to the company’s failure to make payments. The Receiver was responsible for safeguarding the property and collecting lease income until the Plaintiff foreclosed on the property.
Our experts were appointed Receiver for Titan Capital Holdings, LLC, et al. in February 2016 after the companies’ founder determined that the companies were insolvent. The insolvency was caused in whole or in part by non-performing loans, including loans to Titan principals and related entities, and by the failure of the companies to effectively collect funds due. The Receiver was appointed to conduct an orderly liquidation of Titan’s assets. During the investigation, our experts determined that Titan was insolvent only six short months after the company began operating, and only two months after it began accepting investor funds. Our experts continue to administer Titan’s remaining loan portfolio and pursue claims against Titan principals and third parties for the benefit of its creditors.
Our experts were appointed Receiver for a collections software developer, which provided cloud-based collections software that allowed homeowners associations to take control of the collections process and to manage thousands of accounts online in one centralized location. The Receivership arose out of an ownership dispute. After our experts were appointed Receiver, our experts discovered that virtually all of the company’s assets had been removed. Our experts investigated the dissipation of the company’s assets and presented its findings to the Court.
Our experts were appointed Receiver for a commercial flooring contractor due to litigation resulting from a dispute between the company’s partners. The Receiver was appointed to take possession and control of the company’s assets and to wind down the company. Our experts took a supervisory role in this matter to reduce receivership costs by working with the partners and their staff to complete all outstanding projects, collect remaining accounts receivable, and pay remaining debts.
Our experts were appointed Receiver for a hospice provider due to litigation resulting from a dispute between the company’s owners. The Receivership was limited to monitoring and approving cash disbursements with no operational control. Due to the financial condition of the company and the disposition of the underlying litigation it was determined that the limited Receivership was no longer necessary and the Receivership was dissolved.
Two Arizona companies acquired interests in multiple subsidiaries that operated several Taco Bell and Pizza Hut restaurants in the Midwest and East Coast. Our experts were appointed Receiver for the companies due to litigation between various members and managers resulting from a dispute over management fees. Our expert’s investigation in this matter determined that both companies were insolvent prior to the payment of certain management fees. Due to the financial condition of the entities and because of additional remedies available to a trustee in bankruptcy that would not be available to the Receiver, our experts obtained the Court’s to file bankruptcy petitions on behalf of the companies in the United States Bankruptcy Court for the District of Arizona.
Our experts were appointed Receiver for an Arizona company due to litigation resulting from a dispute between the company’s partners. The Receivership entity established and managed physical, occupational, and speech therapy programs by providing regulatory compliance guidance, billing systems, and other solutions. Our experts were appointed Receiver to take control of the company’s assets and manage ongoing operations pending the resolution of the parties’ claims. Our experts assisted with the dissolution, liquidation, and closing of the books of the company pursuant to a settlement agreement between the parties.
Our experts were appointed Receiver for Absolute Healthcare, Inc., a medical marijuana dispensary based in Gilbert, AZ, due to a dispute between the company’s members. The Receiver was tasked with several challenging responsibilities in this case, including (1) identifying and selecting a management candidate with sufficient background and expertise to operate the dispensary, a cultivation, and a commercial kitchen operation; (2) closing down the dispensary’s cultivation site and liquidating its assets; (3) operating the business in compliance with strict federal banking laws; and (4) keeping the dispensary viable after losing access to internally produced medical marijuana products. Our experts successfully operated the dispensary until conclusion of the litigation.
The Federal Trade Commission (“FTC”) sought the appointment of our experts, on an ex parte basis, as the Receiver over a fraudulent telemarketing operation in Phoenix Arizona. The perpetrators of the telemarking scam targeted elderly individuals offering a number of different fraudulent work-from-home or investment opportunities and ultimately defrauded consumers of over $10.7 million. With the assistance of United States Postal Inspectors and the Phoenix Police Department, our experts shuttered several active telemarketing “boiler rooms” throughout Phoenix and located and searched a number of abandoned locations for information.
The individual defendants in this matter created a maze of interrelated companies to confuse consumers and to evade detection. Our experts performed extensive forensic research to locate over 60 entities used by the perpetrators to defraud consumers. Our experts subpoenaed and analyzed over 100 bank and merchant accounts from 34 financial institutions in its efforts to recover estate assets and to identify the perpetrators of the scam. Once the FTC’s civil actions against the perpetrators were completed and it was determined that additional recoveries would be unlikely, the Receivership was terminated. Our experts also provided information to law enforcement to assist in criminal proceedings against the perpetrators.
Our experts were appointed Receiver for All Greens, Inc., a medical marijuana dispensary based in Surprise, Arizona due to a dispute between the company’s members. The Receiver was tasked with several challenging responsibilities in this case, including (1) meeting strict Arizona Department of Health Services (“AZDHS”) deadlines in order to open the dispensary before the company’s dispensary registration certificate expired; (2) identifying and selecting a management candidate with sufficient background, expertise, and resources to finance, open, and operate the dispensary; (3) the difficulty of obtaining inventory given the infancy of the Arizona dispensary industry in 2013; and (4) operating the business in compliance with strict federal banking laws. Our experts worked with the parties to negotiate a settlement agreement that successfully settled many of the receivership estate’s largest claims and debt obligations and helped to ensure that All Greens remained economically viable after the receivership.
Our experts were appointed Receiver for Palo Verde Capital, LLC, et al. as a result of litigation brought forth by several investors due to the financial distress and mismanagement of two hedge funds. As Receiver, our experts were tasked with identifying, recovering, and liquidating receivership assets consisting of several business interests and foreign investments, which required the extensive analysis and investigation of numerous financial and business records. Our experts determined that the receivership entities raised investor funds totaling $37.5 million and returned only $12.6 million, resulting in approximately $24.9 million in investor losses.
Our experts were appointed Receiver for certain assets managed by a debt collection agency based in Hamburg, New York due to litigation brought by the Plaintiff, for whom the agency provided debt collection services. As Receiver, our experts were responsible for confirming the accuracy, propriety, and timeliness of the agency’s remittances of collections, as well as coordinating the transfer of certain collections accounts to a new service provider. In addition, our experts performed various analyses and tests to determine the propriety of the balances and activity related to nearly two million consumer accounts. Our experts filed a detailed report and provided testimony regarding the Receiver’s investigation into the agency’s significant violation of the terms and provisions of the Court’s receivership order.
Appointed as Receiver by the Arizona State Board of Education (“SBE”), our experts restructured the debts and reorganized the operations of the Union Elementary School District (“UESD”) located in Maricopa County. As Receiver, our experts successfully addressed the district’s financial mismanagement and over-expenditures. UESD is now out of receivership and functioning on its own.
Our experts were appointed Receiver over a bad debt investment scheme in a matter brought by the Arizona Corporation Commission in November 2006. This case involved an extensive fraud examination and financial investigation in order to trace approximately $16 million raised from the sale of unregistered securities to over 375 investors nationwide. Our experts recreated the Trend investment scheme from bank records, while addressing numerous inquiries from over 375 investors, most of whom were elderly. Our expert’s investigation determined that the funds that the Trend entities were operating a Ponzi scheme. As Receiver, our experts oversaw various causes of action including fraudulent transfer claims resulting in the recovery of over $6 million. Our experts completed three interim distributions totaling approximately 42% of net investments to investor victims, which is significantly higher than typical investor returns in similar investment schemes.
During a hearing, the Court stated that the Trend receivership had been “wildly successful…in large part, if not completely, because of Mr. Davis’ services in protecting whatever has been received from distribution to the victims.” The Court expressed appreciation for Mr. Davis’ willingness to accommodate the Court’s concerns, and further reiterated Mr. Davis’ “great work on this case.”
In December 2015, CCUSD became the first Arizona school district to be placed in receivership following the enactment of the new state law in the spring of the same year. Appointed as Receiver by the Arizona State Board of Education (“SBE”), our experts encountered and overcame numerous obstacles as the first School Receiver over a district serving a remote northern Arizona community long dominated by a polygamist sect. As Receiver for CCUSD, our experts investigated various allegations of fraud and determined that former staff and governing board members had embezzled over $600,000. Our experts replaced the leadership team and the key accounting personnel, liquidated unnecessary assets, resolved various outstanding claims and oversaw the passage of legislation enabling a longer payback period of debt repayments. Our experts successfully addressed and resolved the district’s gross financial mismanagement, corrected deficiencies in CCUSD’s compliance with the Uniform System of Financial Records (“USFR”), assisted CCUSD’s staff in maintaining and improving the quality of education, and achieved financial solvency by the fiscal year ending June 30, 2008.