UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934 

Release No. 96340 / November 17, 2022

ADMINISTRATIVE PROCEEDING 

File No. 3-17582

In the Matter of

Weatherford International PLC, f/k/a 

Weatherford International LTD., 

James Hudgins, CPA, and Darryl 

Kitay, CPA 

Respondents.

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NOTICE OF PROPOSED PLAN OF 

DISTRIBUTION AND 

OPPORTUNITY FOR COMMENT

ADMINISTRATIVE PROCEEDING 

File No. 3-17628

In the Matter of

Ernst & Young LLP, Craig R.

Fronckiewicz, CPA, and Sarah E. 

Adams, CPA

Respondents.

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Notice is hereby given, pursuant to Rule 1103 of the United States Securities and 

Exchange Commission’s (“Commission”) Rules on Fair Fund and Disgorgement Plans 

(“Commission’s Rules”), 17 C.F.R. § 201.1103, that the Division of Enforcement has submitted 

to the Commission a proposed plan of distribution (the “Proposed Plan”) for the distribution of 

monies paid in the above-captioned matters.

On September 27, 2016, the Commission issued an Order Instituting Public 

Administrative and Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act 

of 1933, Sections 4C and 21C of the Securities Exchange Act of 1934, and Rule 102(e) of the 

Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions and a 
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Cease-and-Desist Order (the “Weatherford Order”)1against Weatherford International PLC, f/k/a 

Weatherford International LTD. (“Weatherford”), James Hudgins, CPA, and Darryl Kitay, CPA 

(collectively, the “Weatherford Respondents”). In the Weatherford Order, the Commission 

found that, between 2007 and 2012, Weatherford, a large multinational provider of oil and 

natural gas equipment and services, issued false financial statements that inflated its earnings by 

over $900 million in violation of Generally Accepted Accounting Principles (“GAAP”). As a 

result, Weatherford was forced to restate its financial statements on March 8, 2011, and again in 

February and July 2012. As a result of the conduct described in the Weatherford Order, the 

Commission ordered the Weatherford Respondents to pay a total of $140,364,067 in 

disgorgement, prejudgment interest, and civil money penalties. Pursuant to Section 308(a) of the 

Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”), the Order created a Fair Fund for distribution 

of the amounts ordered to harmed investors. 

On October 18, 2016, the Commission issued an Order Instituting Public Administrative 

and Cease-and-Desist Proceedings Pursuant to Sections 4C and 21C of the Securities Exchange 

Act of 1934 and Rule 102(e) of the Commission’s Rules of Practice, Making Findings, and

Imposing Remedial Sanctions and a Cease-and-Desist Order (the “E&Y Order” and together 

with the Weatherford Order, the “Orders”)2against Ernst & Young LLP (“Ernst & Young”), 

Craig R. Fronckiewicz, CPA, and Sarah E. Adams, CPA (collectively, the “E&Y Respondents”, 

and together, with the Weatherford Respondents, the “Respondents”). According to the E&Y 

Order, the E&Y Respondents violated the federal securities laws and engaged in improper 

professional conduct while serving as the external auditor, coordinating (i.e., signing) partner, 

and tax partner, respectively for Weatherford in connection with its 2007-2010 financial 

statements. As a result of this conduct, the Commission ordered the E&Y Respondents to pay a 

total of $11,840,107 in disgorgement, prejudgment interest, and civil money penalties to the 

Commission, and created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley.

On November 30, 2017, the Commission issued an Order consolidating the Weatherford 

and Ernst & Young Fair Funds into a single Fair Fund for distribution to harmed investors, for a 

total Fair Fund in the amount of $152,204,174 (the “Fair Fund”).3

The assets of the Fair Fund are subject to the continuing jurisdiction and control of the 

Commission. The Fair Fund is currently on deposit in an interest bearing account at the United 

States Department of Treasury’s Bureau of the Fiscal Service, and any interest accrued will be 

added to the Fair Fund.

OPPORTUNITY FOR COMMENT

Pursuant to this Notice, all interested persons are advised that they may obtain a copy of 

the Plan from the Commission’s public website at http://www.sec.gov/litigation/fairfundlist.htm. 

Interested persons may also obtain a written copy of the Proposed Plan by submitting a written 

request to Adriene Mixon, Esq., Chief Litigation Counsel, United States Securities and Exchange 

Commission, 444 South Flower Street, Suite 900, Los Angeles, CA 90071. All persons who 

 

1

 Securities Act Rel. No. 10221 (Sept. 27, 2016). 

2

 Exchange Act Rel. No. 79109 (Oct. 18, 2016).

3

 Order Consolidating Fair Funds, Exchange Act Rel. No. 82185 (Nov. 30, 2017).
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desire to comment on the Proposed Plan may submit their comments, in writing, no later than 

thirty (30) days from the date of this Notice:

1. to the Office of the Secretary, United States Securities and Exchange 

Commission, 100 F Street, NE, Washington, DC 20549-1090;

2. by using the Commission’s Internet comment form 

(http://www.sec.gov/litigation/admin.shtml); or

3. by sending an e-mail to rule-comments@sec.gov.

Comments submitted by email or via the Commission’s website should include “Administrative 

Proceeding File Nos. 3-17582 and 3-17628” in the subject line. Comments received will be 

publicly available. Persons should submit only information they wish to make publicly 

available.

THE PROPOSED PLAN

The Net Available Fair Fund4is comprised of the $152,204,174.00 in disgorgement, 

prejudgment interest, and civil money penalties paid by the Respondents, plus interest and 

income earned thereon, less taxes, fees, and expenses. The Proposed Plan provides for the 

distribution of the Net Available Fair Fund to investors based on their losses on the shares of 

Weatherford common stock purchased between February 25, 2009 and November 12, 2012 due 

to the conduct of the Respondents described in the Orders.

For the Commission, by the Division of Enforcement, pursuant to delegated authority.5

Vanessa A. Countryman

Secretary 

 

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 All capitalized terms used herein but not defined shall have the same meanings ascribed to them in the Proposed 

Plan.

5

 17 C.F.R. § 200.30-4(a)(21)(iii).