Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-00319/USCOURTS-casd-3_13-cv-00319-5/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:78m(a) Securities Exchange Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

SECURITIES AND EXCHANGE

COMMISSION,

Plaintiff,

CASE NO. 13cv319-GPC(BGS)

ORDER RE: FINAL JUDGMENT

vs.

ABS MANAGER, LLC and GEORGE

CHARLES CODY PRICE,

Defendants,

ABS FUND, LLC [ARIZONA]; ABS

FUND, LLC [CALIFORNIA];

CAPITAL ACCESS, LLC; CAVAN

PRIVATE EQUITY HOLDINGS,

LLC; and LUCKY STAR EVENTS,

LLC,

 Relief Defendants.

On February 9, 2015, Magistrate Judge Skomal held a mandatory settlement

conference and the case settled on the eve of trial. (Dkt. No. 142.) On June 26, 2015,

the SEC filed a notice of consent to settlement as to Defendants ABS Manager, LLC

and George Charles Cody Price (“Price”). (Dkt. Nos. 149, 150.) On the same day, the

SEC submitted two separate proposed Final Judgments as to Defendants George

Charles Cody Price and ABS Manager, LLC which seek injunctive and other relief.

“[T]he mere fact that the parties agree that the court should exercise continuing

jurisdiction is not binding upon the court.” Arata v. Nu Skin Int’l, Inc., 96 F.3d 1265,

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1269 (9th Cir. 1996). “According to well established principles of equity, a plaintiff

seeking a permanent injunction must satisfy a four-factor test before a court may grant

such relief.” eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006). “The

Court has repeatedly held that the basis for injunctive relief in the federal courts has

always been irreparable injury and the inadequacy of legal remedies.” Weinberger v.

Romero-Barcelo, 456 U.S. 305, 312 (1982) (citations omitted). Indeed, injunctive

relief is an “extraordinary and drastic remedy that is never awarded as of right.” 

Perfect 10, Inc. v. Google, Inc., 653 F.3d 976, 980 (9th Cir. 2011) (internal quotation

marks omitted) (citing Munaf v. Geren, 553 U.S. 674, 689-90 (2008)). Moreover,

Federal Rule of Civil Procedure 65(d) states that “[e]very order granting an injunction

and every restraining order must: (A) state the reasons why it issued; (B) states its

terms specifically; and (C) describe in reasonable detail – and not by referring to the

complaint or other document–the act or acts restrained or required.” Fed. R. Civ. P.

65(d). 

The parties essentially seek a “consent decree” which is a “judgment, has the

force of res judicata, and it may be enforced by judicial sanctions, including, . . .

citations for contempt.” S.E.C. v. Randolph, 736 F.2d 525, 528 (9th Cir. 1984) (citing

United States v. City of Miami, 664 F.2d 435, 4349 (5th Cir. 1981)). A consent decree

“embodies an agreement of the parties and thus in some respects is contractual in

nature. But it is an agreement that the parties desire and expect will be reflected in, and

be enforceable as, a judicial decree that is subject to the rules generally applicable to

other judgments and decrees.” Rufo v. Inmates of the Suffolk County Jail, 502 U.S.

367, 378 (1992) (citing Railway Emp. Dep’t, AFL-CIO v. Wright, 364 U.S. 642,

650–51 (1961)). “The partiesto a consent decree expect and achieve a continuing basis

of jurisdiction to enforce the terms of the resolution of their case in the court entering

the order.” Smyth ex rel. Smyth v. Rivero, 282 F.3d 168, 280 (4th Cir. 2002). Since

a consent decree is entered as an order of the court, the court must examine the terms

of the consent degree. Id. More scrutiny is required over a consent decree where

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injunctive relief “reaches into the future and has continuing effects.” Id. (citation

omitted). 

Here, the Court concludes that the Final Judgment provides no basis for

injunctive relief. Second, the Court has concerns that the Final Judgment is overbroad

since it applies not only to the named Defendants ABS Manager, LLC and Price but

to “Defendant’s agents, servants, employees, attorneys, and all persons in active

concert or participation with them. . .” without providing any basis for injunctive relief

as to these parties. 

Based on the above, the Court is not prepared to enter the Final Judgment and 

declines to adopt the Final Judgment as proposed by the parties. On or before July 15,

2015, the parties shall submit a revised proposed Final Judgment in compliance with

applicable law. 

IT IS SO ORDERED. 

DATED: June 29, 2015

HON. GONZALO P. CURIEL

United States District Judge

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