Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-04034/USCOURTS-cand-5_06-cv-04034-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:631 Small Business Act

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C06-04034 JW - STIPULATION FOR CONSENT ORDER OF RECEIVERSHIP; 

ORDER

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KEVIN V. RYAN (SBN 118321) 

United States Attorney 

JOANN M. SWANSON (SBN 88143) 

Chief, Civil Division 

EDWIN L. JOE (SBN 112328) 

Special Assistant United States Attorney 

455 Market Street, 6th Floor 

 San Francisco, California 94105-2420 

 Telephone: (415) 744-8494 

 Facsimile: (202) 481-1810 or (415) 744-6812 

 Email: edwin.joe@sba.gov 

Attorneys for Federal Plaintiff 

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

SAN JOSE DIVISION 

UNITED STATES OF AMERICA, ) 

 Plaintiff, ) E-Filing 

 ) 

 v. ) Civil Case No. C06-04034 JW 

 ) 

ASPEN VENTURES WEST II., L.P. ) Stipulation for Receivership 

) Order; ORDER 

 ) 

 Defendant. ) (Cover Page) 

 ) 

____________________________________) 

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Case 5:06-cv-04034-JW Document 10 Filed 10/04/06 Page 1 of 9
C06-04034 JW - STIPULATION FOR CONSENT ORDER OF RECEIVERSHIP; 

ORDER

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IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

UNITED STATES OF AMERICA, ) 

 Plaintiff, ) 

 ) 

 v. ) Civil Case No. C06-04034 JW 

 ) 

ASPEN VENTURES WEST II, L.P. ) 

 ) 

 Defendant. ) 

 ) 

____________________________________) 

STIPULATION FOR CONSENT ORDER OF RECEIVERSHIP

 WHEREAS, Plaintiff, United States of America, on behalf of its agency, the 

United States Small Business Administration, has filed and caused to be served upon 

defendant, ASPEN VENTURES WEST II, L.P., a complaint; and 

 WHEREAS, the parties desire to resolve the matter amicably and without further 

proceedings, trial or adjudication of any issue, and stipulate as follows: 

 1. That defendant ASPEN VENTURES WEST II, L.P. (“Licensee”), the 

holder of the U.S. Small Business Administration’s (“SBA”) Small Business Investment 

Company License No. 09790400 has a condition of Capital Impairment, as that term is 

defined under Title 13 of the Code of Federal Regulations, Part 107; 

 2. That this Court has jurisdiction over the subject matter of this action and 

over defendant; 

 3. That the only mutually agreeable method by which to distribute the assets 

of the Licensee to the appropriate creditors and SBA is through the appointment of SBA 

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C06-04034 JW - STIPULATION FOR CONSENT ORDER OF RECEIVERSHIP; 

ORDER

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as the receiver of the Licensee pursuant to the following Consent Order of Receivership 

without further proceedings; and 

 4. To the entry of the following Consent Order of Receivership without 

further proceedings. 

IT IS HEREBY ORDERED, ADJUDGED AND DECREED:

 1. Pursuant to the provisions 15 U.S.C. § 687c, this Court hereby takes 

exclusive jurisdiction of the Licensee, and all of its assets and property, of whatever kind 

and wherever located, and the SBA is hereby appointed Receiver of the Licensee 

("Receiver") to serve without bond until further order of this Court. The Receiver is 

appointed for the purpose of marshaling and liquidating all of the Licensee’s assets and 

satisfying the claims of creditors therefrom in the order of priority as determined by this 

Court. 

 2. The Receiver shall have all powers, authorities, rights and privileges 

heretofore possessed by the officers, directors, managers and general and limited partners 

of the Licensee under applicable state and federal law, by the Limited Partnership 

Agreement, and By-Laws of said limited partnership, in addition to all powers and 

authority of a receiver at equity, and all powers and authority conferred upon the 

Receiver by the provisions of 15 U.S.C. § 687c and 28 U.S.C. § 754. The trustees, 

directors, officers, managers, employees, investment advisors, accountants, attorneys and 

other agents of the Licensee are hereby dismissed and the powers of any general partners 

are hereby suspended during the pendency of the receivership. Such persons and entities 

shall have no authority with respect to the Licensee’s operations or assets, except to the 

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C06-04034 JW - STIPULATION FOR CONSENT ORDER OF RECEIVERSHIP; 

ORDER

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extent as may hereafter be expressly granted by the Receiver. The Receiver shall assume 

and control the operation of the Licensee and shall pursue and preserve all of its claims. 

 3. The Receiver is entitled to take immediate possession of all assets, bank 

accounts or other financial accounts, books and records and all other documents or 

instruments relating to the Licensee. The past and/or present officers, directors, agents, 

managers, general and limited partners, trustees, attorneys, accountants, and employees 

of the Licensee, as well as all those acting in their place, are hereby ordered and directed 

to turn over to the Receiver forthwith all books, records, documents, accounts and all 

other instruments and papers of and relating to the Licensee and all of the Licensee’s 

assets and all other assets and property of the limited partnership, whether real or 

personal. The Licensee’s general partner shall furnish a written statement within five (5) 

days after the entry of this Order, listing the identity, location and estimated value of all 

assets of the Licensee, a list of all employees (and job titles thereof), other personnel, 

attorneys, accountants and any other agents or contractors of the Licensee, as well as the 

names, addresses and amounts of claims of all known creditors of the Licensee. Within 

thirty (30) days following the entry of this Order, the Licensee’s general partner shall also 

furnish a written report describing all assets. All persons and entities having control, 

custody or possession of any assets or property of the Licensee are hereby directed to turn 

such assets and property over to the Receiver. 

 4. The Receiver shall promptly give notice of its appointment to all known 

officers, directors, agents, employees, shareholders, creditors, debtors, managers and 

general and limited partners of the Licensee, as the Receiver deems necessary or 

advisable to effectuate the operation of the receivership. All persons and entities owing 

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ORDER

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any obligation, debt, or distribution, with respect to a partnership interest to the Licensee, 

shall, until further ordered by this Court, pay all such obligations in accordance with the 

terms thereof to the Receiver and its receipt for such payments shall have the same force 

and effect as if the Licensee had received such payments. 

 5. The Receiver is hereby authorized to open such Receiver's accounts at 

banking or other financial institutions to extend credit on behalf of the Licensee, to utilize 

SBA personnel, and to employ such other personnel as it may deem necessary to 

effectuate the operation of the receivership including, but not limited to, attorneys, 

accountants, consultants and appraisers, and is further authorized to expend receivership 

funds to compensate such personnel in such amounts and upon such terms as the 

Receiver shall deem reasonable in light of the usual fees and billing practices and 

procedures of such personnel. The Receiver is not required to obtain Court approval 

prior to the disbursement of receivership funds for payments to personnel employed by 

the Receiver or for expenses that the Receiver deems advantageous to the orderly 

administration and operation of the receivership. In addition, the Receiver is authorized 

to reimburse the SBA for travel expenses incurred by SBA personnel in the establishment 

and administration of the receivership. The Receiver may, without further order of this 

Court, transfer, compromise, or otherwise dispose of any claim or asset in the ordinary 

course of business, other than real estate. 

 6. The Licensee’s past and/or present officers, directors, agents, attorneys, 

managers, shareholders, employees, accountants, debtors, creditors, managers and 

general and limited partners of the Licensee, and other appropriate persons or entities 

(including without limitation, the defendant's portfolio of small business concerns and 

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financial institutions doing business with defendant and/or defendant's portfolio of small 

business concerns) shall answer under oath to the Receiver all questions which the 

Receiver may put to them and produce any documents as required by the Receiver 

regarding the business of said limited partnership, or any other matter relevant to the 

operation or administration of the receivership or the collection of funds due to the 

Licensee. In the event that the Receiver deems it necessary to require the appearance of 

the aforementioned persons or entities, the Receiver shall make its discovery request(s) in 

accordance with the Federal Rules of Civil Procedure. 

 7. The parties to any and all civil legal proceedings of any nature, including, 

but not limited to, bankruptcy proceedings, arbitration proceedings, foreclosure actions, 

default proceedings, or other actions of any nature involving the Licensee or any assets of 

the Licensee, including subsidiaries and partnerships, wherever located, and excluding 

the instant proceeding, involving the Licensee, the Receiver, or any of the Licensee 's 

past or present officers, directors, managers, agents, or general or limited partners sued 

for, or in connection with, any action taken by them while acting in such capacity of any 

nature, whether as plaintiff, defendant, third-party plaintiff, third-party defendant, or 

otherwise, are enjoined from commencing or continuing any such legal proceeding, or 

from taking any action, in connection with any such proceeding or any such asset. All 

civil legal proceedings of any nature, including but not limited to bankruptcy 

proceedings, arbitration proceedings, foreclosure actions, default proceedings, or other 

action of any nature involving the Licensee or any assets of the Licensee, including 

subsidiaries and partnerships, wherever located, and excluding the instant proceeding, 

involving the Licensee, the Receiver, or any of the Licensee’s past or present officers, 

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directors, managers, agents, or general or limited partners sued for, or in connection with, 

any action taken by them while acting in such capacity of any nature, whether as plaintiff, 

defendant, third-party plaintiff, third-party defendant, or otherwise, are stayed in their 

entirety, and all Courts having any jurisdiction thereof are enjoined from taking or 

permitting any action until further Order of this Court. Further, as to a cause of action 

accrued or accruing in favor of the Licensee against a third person or party, any 

applicable statute of limitation is tolled during the period in which this injunction against 

commencement of legal proceedings is in effect as to that cause of action. 

 8. The Licensee and its past and/or present directors, officers, managers, 

general or limited partners, agents, employees and other persons or entities acting in 

concert or participating therewith be, and they hereby are, enjoined from either directly or 

indirectly taking any actions or causing any such action to be taken which would 

dissipate the assets and/or property of the Licensee to the detriment of the Licensee or of 

the Receiver appointed in this cause, including but not limited to destruction of corporate 

records, or which would violate the Small Business Investment Act of 1958, as amended, 

15 U.S.C. 661 et. seq., or the regulations promulgated thereunder, ("Regulations"), 13 

C.F.R. §107.1 et. seq. 

 9. The Receiver is authorized to borrow on behalf of the Licensee, from the 

SBA, up to $1,000,000 and is authorized to cause the Licensee to issue Receiver's 

Certificates of Indebtedness in the principal amounts of the sums borrowed, which 

certificates will bear interest at or about 10 percent per annum and will have a maturity 

date no later than 18 months after the date of issue. Said Receiver's Certificates of 

Indebtedness shall have priority over all other debts and obligations of the Licensee, 

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excluding administrative expenses of the Receivership, whether currently existing or 

hereinafter incurred, including without limitation any claims of general or limited 

partners of the Licensee. 

 10. This Court determines and adjudicates that SBA has made a sufficient 

showing that the Licensee has violated the Act and the Regulations, as alleged in the 

Complaint filed against the Licensee in the instant action, to obtain the relief so 

requested. After completing its activities in accordance with this Order, the Receiver 

may submit a report to this Court recommending that the Licensee’s SBIC license be 

revoked. 

SEEN, STIPULATED AND AGREED: 

Aspen Ventures West II, L.P., through its authorized representative 

By: /s/ E. David Crockett 

 E. David Crockett 

Title: General Partner 

 Aspen Ventures West Management Company, L.P. 

 General Partner of Aspen Ventures West II, L.P. 

Date: ___4/27/06________________ 

United States Small Business Administration 

By: /s/ Thomas G. Morris 

 Thomas G. Morris, Director 

 Office of Liquidation 

Date: ___4/28/06_____________ 

PURSUANT TO STIPULATION, IT IS SO ORDERED, 

 DATED this _________day of _________________, 2006. 

 _____________________________________ 

 HON. JAMES WARE 

 UNITED STATES DISTRICT COURT JUDGE 

4th October

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