Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_16-cv-01386/USCOURTS-cand-3_16-cv-01386-14/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:77 Securities Fraud

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[PROPOSED] STIPULATION AND ORDER APPROVING AMENDMENT TO SEC. IX OF THE ORDER 

APPOINTING RECEIVER 

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA

SECURITIES AND EXCHANGE 

COMMISSION, 

 Plaintiff, 

 v. 

JOHN B. BIVONA; SADDLE RIVER 

ADVISERS, LLC; SRA 

MANAGEMENT ASSOCIATES, LLC; 

FRANK GREGORY MAZZOLA 

 Defendants. 

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Case No. 3:16-cv-1386

[PROPOSED] ORDER AND 

STIPULATION GRANTING 

THE INDEPENDENT 

MONITOR’S REQUEST FOR 

AN AMENDMENT TO SEC. 

IX OF THE ORDER 

APPOINTING RECEIVER 

Date: No Date 

Time: No Time 

Judge: Edward M. Chen 

 

 The parties, U.S. Securities & Exchange Commission, counsel for 

defendants Saddle River Advisers, LLC (“Saddle River”) and SRA 

Management Associates, LLC (“SRA Management”), and counsel for the 

Receiver hereby stipulate and agree to the entry of an order as follows: 

1.) The Receiver in this matter, Sherwood Partners Inc., has attempted 

several times to open a Receivership securities account for the purposes of 

receiving publicly tradable stock, but has been informed by the securities firms 

interviewed that they believe the language of this Court’s October 11, 2016 

Order Appointing Receiver, Sec. IX, requires additional language in order to 

Case 3:16-cv-01386-EMC Document 160 Filed 12/09/16 Page 1 of 3
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[PROPOSED] STIPULATION AND ORDER APPROVING AMENDMENT TO SEC. IX OF THE ORDER 

APPOINTING RECEIVER 

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permit the securities firms to open such an account, since such firms are not 

“federally insured banks” as Sec. IX by its terms seems to require. 

2.) Counsel to the Receiver brought this problem with the language of 

Sec. IX to the Court’s attention during the CMC hearing on November 18, 

2016, and suggested at the hearing that Sec. IX be amended as set forth below. 

3.) The parties in attendance at the CMC hearing, plaintiff U.S. 

Securities & Exchange Commission and counsel for defendants Saddle River 

and SRA Management informed the Court and the Counsel for the Receiver 

that they did not object to the amendment (in italics below) of the first sentence 

of Sec. IX as follows: 

 IX. Managing Assets 

“ For each of the Receivership Estates, the Receiver shall establish 

one or more custodial accounts at a federally insured bank and/or 

a broker dealer that is both a member of FINRA and Securities 

Investment Protection Corporation (“SIPC”), to receive and hold 

all cash equivalent Receivership Property (the “Receivership 

Funds”). Securities that are not certificated may be held in any 

manner generally acceptable under Rule 206(4)-2 of the 

Investment Advisers Act of 1940, as amended (the “SEC Custody 

Rule”), including maintaining custody of only an appropriate 

indicia of ownership (such as a subscription agreement) with a 

“qualified custodian” (as such term is defined in the SEC Custody 

Rule). Applicable security accounts may be maintained either 

directly with a qualified custodian or through a FINRA member 

introducing broker that maintains trading and custodial 

arrangements with a qualified custodian. 

4.) Based on the parties’ agreement, the Court will amend the language 

of Sec. IX as agreed in Paragraph 3 above and issue an amended Order for the 

Appointment of A Receiver, Docket No. 142. 

Case 3:16-cv-01386-EMC Document 160 Filed 12/09/16 Page 2 of 3
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[PROPOSED] STIPULATION AND ORDER APPROVING AMENDMENT TO SEC. IX OF THE ORDER 

APPOINTING RECEIVER 

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SO STIPULATED. 

 

 Pursuant to Civil L.R. 5.1, I hereby attest that I have on file all 

holographic signatures corresponding to any signatures indicated by a 

conformed signature (/S/) within this e-filed document. 

Dated: December 5, 2016 GARTENBERG GELFAND HAYTON 

LLP 

 By: /s/ John W. Cotton 

 JOHN W. COTTON 

 Special Counsel to the Monitor 

DATED: December 5, 2016 SECURITIES & EXCHANGE COMMISSION

 

By://s// By Permission (Civ. L.R. 5-1 (i) 

 JOHN YUN 

 Attorneys for Plaintiff 

DATED: December 5, 2016 DEFENDANTS SADDLE RIVER AND SRA 

MANAGEMENT 

 By://s// By Permission (Civ. L.R. 5-1 (i) 

 JAHAN P. RAISSI 

 SHARTSIS FRIESE LLP 

Attorneys for Defendants Saddle River and 

SRA Management 

IT IS SO ORDERED. 

DATED: December 5, 2016 

 ________________________ 

Judge Edward M. Chen 

 United States District Court U

NITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IT IS SO ORDERED

Judge Edward M. Chen

Case 3:16-cv-01386-EMC Document 160 Filed 12/09/16 Page 3 of 3