STIPULATED ORDER APPOINTING RECEIVER OVER BCS

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Federal Trade Commission, all Fifty 

States, and the District of Columbia,

Plaintiffs,

vs.

Cancer Fund of America, Inc., a Delaware 

corporation, et al.,

 Defendants.

 

CASE NO.

STIPULATED ORDER APPOINTING

RECEIVER OVER THE BREAST 

CANCER SOCIETY, INC.

Plaintiffs, the Federal Trade Commission (“FTC” or “Commission”) and the states 

of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, 

Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, 

Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, 

Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North 

Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South 

Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West 

Virginia, Wisconsin, Wyoming, and the District of Columbia (“Plaintiff States”), and 

Defendant The Breast Cancer Society, Inc., also d/b/a The Breast Cancer Society of 

America (“BCS”), having stipulated to the entry of a separate and concurrently filed 

Stipulated Order for Permanent Injunction and Monetary Relief Against The Breast 

Cancer Society, Inc., further stipulate to entry of this Stipulated Order Appointing

Receiver Over The Breast Cancer Society, Inc. (“Order”).

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STIPULATED ORDER APPOINTING RECEIVER OVER BCS

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THEREFORE, IT IS ORDERED as follows:

FINDINGS

1. Plaintiffs and BCS have consented to entry of a Stipulated Order for 

Permanent Injunction and Monetary Judgment Against The Breast Cancer Society, Inc.

(“Permanent Injunction”).

2. The Permanent Injunction requires that the assets of BCS be liquidated to 

partially satisfy the monetary judgment entered against it and its corporate existence be 

dissolved.

3. Plaintiffs and BCS have consented to entry of this Stipulated Order 

Appointing Receiver Over The Breast Cancer Society, Inc.

4. Pursuant to the Federal Rules of Civil Procedure, this Court’s general 

equitable authority, and Sections 13(b) and 19 of the Federal Trade Commission Act, 

15 U.S.C. § 53(b) and 57(b), this Court has the authority to enter the requested relief.

DEFINITIONS

For purposes of this Order, the following definitions shall apply:

1. “BCS” means The Breast Cancer Society, Inc., also d/b/a The Breast 

Cancer Society of America, and its successors and assigns.

2. “GAIC Policies” means the Great American Insurance Company (“GAIC”) 

“Nonprofit Solution” Insurance Policies, Policy No. EPP1092321, for the Policy Periods 

of: (1) January 20, 2010 to January 20, 2011; (2) January 20, 2011 to January 20, 2012;

(3) January 20, 2012 to January 20, 2013; (4) January 20, 2013 to January 20, 2014; and 

(5) January 20, 2014 to January 20, 2015.

3. “Permanent Injunction” means the Stipulated Order for Permanent 

Injunction and Monetary Judgment Against The Breast Cancer Society, Inc., agreed to by 

BCS.

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4. “STCO Fund” means the Litigation Deposits Trust Fund (Fund Code “Txx-909N”), an interest bearing trust fund held by the Hawaii Attorney General’s Office in 

trust for the Plaintiff States into which Section VII.D.1 of the Permanent Injunction 

requires the BCS Receiver to deposit all monies to be paid to the Plaintiff States.

5. “Person” means a natural person, an organization or other legal entity, 

including a corporation, partnership, sole proprietorship, limited liability company, 

association, cooperative, or any other group or combination acting as an entity.

6. “Fundraising” means a plan, program, or campaign that is conducted to 

induce charitable contributions by mail, telephone, electronic mail, social media, or any 

other means. 

7. “Nonprofit organization” means any person that is, or is represented to be, a 

nonprofit entity, or that has, or is represented to have, a charitable purpose, specifically 

including but not limited to any such entity that purports to benefit, either in whole or in 

part, individuals who suffer or have suffered from cancer.

8. “HSW Assets” means the BCS assets related to operating its Hope Supply 

Warehouse program, including, e.g., inventory, equipment, furnishings, and fixtures, and, 

separately, the cash set aside for operating the existing Hope Supply Warehouse program

and disbursing to an Approved Qualified Charity or Charities as set forth in Section IV, 

below. The cash set aside for this purpose is dependent on the funds available in the BCS

Receivership estate and shall not exceed $800,000.

9. “And” and “or” shall be construed both conjunctively and disjunctively to 

make the applicable sentence or phrase inclusive rather than exclusive.

ORDER

I. LIQUIDATING RECEIVER

IT IS FURTHER ORDERED that Receivership Management, Inc., 783 Old 

Hickory Boulevard, Suite 255, Brentwood, Tennessee 37027, is appointed by this Court 

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as Liquidating Receiver (“Receiver”) with all the rights and privileges of an equity 

receiver over BCS for the purposes of taking charge of the property and assets (except the 

GAIC Policies) of BCS, conducting the necessary steps to wind down its affairs, 

transferring or liquidating its assets as specified below, and dissolving its corporate 

existence. The Receiver shall be the agent of this Court, and solely the agent of this 

Court, in acting as Receiver under this Order. The Receiver shall be accountable directly 

to this Court.

II. RECEIVER’S DUTIES AND AUTHORITIES

IT IS FURTHER ORDERED that the Receiver shall be authorized and directed to 

do any and all acts necessary to the proper and lawful conduct of this receivership, 

subject to the control of this Court, including but not limited to:

A. Take any and all steps that the Receiver concludes are appropriate to wind 

down the affairs of BCS, transfer or liquidate its assets as specified below, and dissolve 

its corporate existence;

B. Exercise full control of BCS and collect, marshal, and take custody, 

control, and possession of all the funds, property, premises, accounts, documents, mail, 

and other assets of, or in the possession or under the control of, BCS (except the GAIC 

Policies), wherever situated, the income and profits therefrom, and all sums of money 

now or hereafter due or owing to BCS, with full power to collect, receive and take 

possession of all goods, chattels, rights, credits, monies, rents, effects, lands, leases, 

books and records, limited partnership records, work papers, and records of accounts, 

including computer maintained information, contracts, financial records, monies on hand 

in banks and other financial institutions, and other papers and documents of other 

individuals, partnerships or corporations whose interests are now held by or under the 

direction, possession, custody, or control of BCS;

C. Perform all acts necessary or advisable to complete an accounting of the 

assets of BCS, prevent unauthorized transfer, withdrawal, or misapplication of the assets 

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of BCS, and preserve and pursue recovery of the assets of BCS from third parties (except 

the GAIC Policies);

D. Make disbursements for operating expenses as required to operate the BCS 

Hope Supply Warehouse program pursuant to Section IV.C, below, and as may be 

appropriate to wind down the affairs of BCS, such as for undertaking repairs, and take

any other actions necessary to efficiently manage all real and personal property in order 

to maintain its value;

E. Purchase insurance as advisable or necessary. The Receiver may keep in 

force the existing insurance coverage(s), each of which shall name the Receiver as an 

additional insured thereunder. The Receiver acknowledges and agrees that when this 

Order is entered, the GAIC Policies are not part of this Order;

F. Enter into new or amended contracts, agreements, understandings, or other 

commitments and terminate or abrogate, in the Receiver’s sole sound business discretion, 

any or all agreements, contracts, understandings, or commitments entered into by BCS, to 

the extent permitted by applicable law. The Receiver shall not be bound by any 

unsecured contracts, agreements, understandings, or other commitments in the nature of 

service contracts that BCS has, had, or may have with third parties, whether oral or 

written. The Receiver may agree to become bound by any such contracts, agreements, 

understandings, or other commitments by affirmative written ratification executed by the 

Receiver. Provided that the Receiver shall terminate any and all fundraising contracts 

within 30 days of entry of this Order.

G. Make payments and disbursements from the assets of BCS that are 

necessary or advisable for carrying out the provisions of, or exercising the authority 

granted by, this Order. The Receiver shall apply to the Court for prior approval of any 

payment of any debt or obligation incurred by BCS prior to the date of entry of this 

Order, except payments that the Receiver deems necessary or advisable to operate the 

BCS Hope Supply Warehouse program pursuant to Section IV.C, below, or to secure and 

liquidate assets of BCS, such as rental payments or payment of liens;

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H. Issue subpoenas to obtain documents and records pertaining to the assets of 

BCS, and conduct discovery in this action on behalf of BCS;

I. Institute, prosecute, defend, compromise, intervene, adjust, appear in, and 

become a party either in the Receiver’s name or in the name of BCS to such suits, 

actions, or proceedings in state, federal, or foreign courts as may be necessary for the 

protection, maintenance, recoupment, or preservation of the assets of BCS, including 

proceedings seeking the avoidance of fraudulent transfers, disgorgements of profits, 

imposition of constructive trusts, and any other legal and equitable relief that the 

Receiver deems necessary and appropriate to preserve and recover assets of BCS.

Provided that the Receiver may not pursue an action against any individual BCS director 

under Ariz. Rev. Stat. Section 10-3833;

J. Bring such proceedings and actions as are necessary to enforce or modify 

the provisions of this Order; 

K. Perform all incidental acts that the Receiver deems to be advisable or 

necessary to operate and otherwise manage the affairs of BCS during its winding down

phase, transfer or liquidate its assets, and dissolve its corporate existence, including, 

without limitation, the following powers and responsibilities to: 

1. Retain, hire, or dismiss any employees, independent contractors, and 

agents as the Receiver deems advisable or necessary;

2. Supervise and oversee the management of BCS, including making 

payments and paying taxes as and when the Receiver has funds available from BCS, or 

from the liquidation thereof; 

3. Employ such counsel, real estate agents, auctioneers, appraisers, 

accountants, contractors, other professionals, and other such persons as may be necessary 

in order to carry out the duties as Receiver and to preserve, maintain, recover, recoup,

and protect the assets of BCS;

4. Open new accounts with, or negotiate, compromise or otherwise 

modify the existing obligations of BCS with third parties, including utility companies and 

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other service providers or suppliers of goods and services, and to otherwise enter into 

such agreements, contracts, or understandings with such third parties as are necessary to 

maintain, preserve, and protect the assets of BCS; and

5. Open new bank, brokerage or investment accounts with respect to 

the Receiver’s management and operation of BCS, and deposit any cash or other assets 

into said accounts;

L. Dispose of, or arrange for the disposal of, the records of BCS no later than 

six months after the Court’s approval of the Receiver’s final report, except that, to the 

extent that any federal, state, or local law regulating BCS’s activities requires the 

retention of particular records for a specified period, the Receiver shall arrange for such 

records to be disposed of after the specified period has expired. For any such records, the 

Receiver may elect to retain records in their original form, or to retain photographic or 

electronic copies. Records containing personal financial information, personal 

identifying information, or sensitive health information must be shredded, incinerated, or 

otherwise disposed of in a secure manner. Records containing the name, address, email 

address and/or telephone number of any person who made a donation to BCS (i.e., any 

donor list) may not be sold, rented, leased, transferred, or otherwise disclosed to any third 

party except as provided for in Section IV.C.1.c, below, and must be destroyed; and

M. Pay to the STCO Fund any and all sums collected over and above those 

necessary to wind down the affairs of BCS, transfer HSW Assets as specified in Section 

IV, below, or otherwise liquidate its assets, and dissolve it, or those necessary to make 

payments authorized by this Receivership Order.

III. TRANSFER OF RECEIVERSHIP PROPERTY TO RECEIVER

IT IS FURTHER ORDERED that BCS, its representatives, agents, officers, 

directors, employees, managers, members, and any other persons with possession, 

custody, or control of property of or records relating to BCS shall:

A. Upon notice of this Order by personal service or otherwise, immediately

notify the Receiver of all such property and records and, upon receiving a request from 

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the Receiver, immediately transfer or deliver to the Receiver possession, custody, and 

control of the following:

1. All assets of BCS, including but not limited to any legal or equitable 

interest in, right to, or claim to, any real, personal, or intellectual property, including 

chattel, goods, instruments, equipment, fixtures, general intangibles, effects, leaseholds, 

contracts, mail or other deliveries, shares of stock, securities, inventory, checks, notes, 

accounts, credits, receivables (as those terms are defined in the Uniform Commercial 

Code), insurance policies (except the GAIC Policies), lines of credit, cash, trusts 

(including asset protection trusts), lists of donor names, and reserve funds or any other 

accounts associated with any donations or other payments processed by, or on behalf of, 

BCS, including such reserve funds held by payment processors, credit card processors, 

caging companies, banks, or other financial institutions;

2. All documents of BCS, including books and records of accounts, all 

financial and accounting records, balance sheets, income statements, bank records 

(including monthly statements, canceled checks, records of wire transfers, and check 

registers), client lists, donor lists, title documents, and all other materials listed in Federal 

Rule of Civil Procedure 34(a), including writings, drawings, graphs, charts, photographs, 

audio and video recordings, computer records, digital records, and other data 

compilations from which information can be obtained and translated, if necessary, into 

reasonably usable form through detection devices;

3. All computers, electronic devices, machines, and data in whatever 

form used to conduct the business of BCS; 

4. All assets and documents belonging to other persons or entities 

whose interests are under the direction, possession, custody, or control of BCS; and 

5. All keys, codes, user names, and passwords necessary to gain or to 

secure access to any assets or documents of BCS, including access to its business

premises, means of communication, accounts, computer systems, or other property.

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B. Waive all claims to, and unconditionally release and consent to transfer 

possession and legal and equitable title, of all property of BCS to the Receiver or a trust 

designated by the Receiver; and

C. Until BCS surrenders possession and legal and equitable title of all property 

of BCS to the Receiver, BCS shall:

1. Maintain and take no action to diminish the value of BCS’s property, 

including any structures, fixtures, and appurtenances thereto;

2. Remain current on all amounts due and payable on the property of 

BCS, including but not limited to taxes, insurance, maintenance, and similar fees; and

3. Cause existing insurance coverage for the property of BCS to remain 

in force until the surrender of possession and legal and equitable title, and shall both 

notify the insurance carrier(s) immediately of the appointment of the Receiver and 

request that the Receiver be added to the insurance policy or policies as an additional 

insured thereunder.

D. Notwithstanding any other term, condition, or provision of this Order, the 

Receiver shall not have any legal or equitable rights to the GAIC Policies including, but 

not limited to, the payment of $389,500 being made by GAIC and into the STCO Fund 

(the “GAIC Payment”). The Receiver expressly agrees that: (i) the GAIC Policies and 

the GAIC Payment are not assets that are subject to this Order; and (ii) prior to this Order 

becoming effective, BCS has agreed that the GAIC Policies are completely released, null 

and void, and of no effect whatsoever.

IV. TRANSFER OF HOPE SUPPLY WAREHOUSE ASSETS

IT IS FURTHER ORDERED that the Receiver shall, if practicable, transfer BCS 

assets related to its existing Hope Supply Warehouse program (“HSW Assets”) and cash 

disbursements in an amount not to exceed $800,000 to a qualified charity or charities

approved by the Receiver and willing to operate a similar program, as follows:

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A. Recommending Qualified Charities: 

1. Any member of the BCS board of directors who held such position 

as of the date of entry of this Order may recommend to the Receiver potential qualified 

charities to receive HSW Assets and operate a Hope Supply Warehouse-type program or 

programs in each location where BCS currently operates such a program.

2. To be qualified, a charity must:

a. Be incorporated as a nonprofit corporation;

b. Have been granted tax-exempt status pursuant to Section 

501(c)(3) by the IRS or have filed a Form 1023 application for such status and obtained a 

written fiscal sponsorship with another nonprofit corporation;

c. Be registered in each jurisdiction where such registration is 

necessary;

d. Have timely filed a Form 990 or Form 990 EZ for the last 

fiscal period when such a filing was due;

e. Have a mission related at least in part to serving the needs of 

breast cancer patients; 

f. Have adequate insurance;

g. Have a fiscally responsible budget and a plan for operating a 

Hope Supply Warehouse-type program or programs for at least one (1) year in a location 

or locations where BCS operates existing Hope Supply Warehouse programs;

h. Have reasonable safeguards in place to prevent violations of 

state and federal law, specifically including laws prohibiting deceptive charitable 

solicitations and those regarding private inurement in the governance of nonprofit 

organizations. Any charity following practices recommended by the Better Business 

Bureau’s Wise Giving Alliance “Standards,” the Evangelical Council for Financial 

Accountability’s “Standards for Responsible Stewardship,” or the Independent Sector’s

“Principles for Good” shall be deemed to have such reasonable safeguards in place; and

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i. Agree to enter into a contract with the Receiver that includes 

the requirements set forth in Section IV.F, below.

3. The Receiver shall verify the qualifications of each suggested charity 

and may make any further inquiries reasonably necessary to assist in selecting a qualified 

charity. Any charity wishing to be selected must cooperate with the Receiver during this 

verification and selection process.

4. All recommendations of qualified charities must be made to the 

Receiver within 120 days of entry of this Order.

B. Selecting a Qualified Charity

1. If the Receiver verifies that one or more charities have the necessary 

qualifications, the Receiver shall use the following factors to select one or more qualified 

charities (“Approved Qualified Charity” or “Approved Qualified Charities”): 

a. Its mission;

b. Its fiscal soundness;

c. Its governance and financial controls;

d. Its history of compliance with federal, state, and local laws; 

e. The background and expertise of its directors and staff;

f. The nature and scope of any existing operations; and

g. The nature and viability of its plans for long-term operation 

of a Hope Supply Warehouse-type program, including, e.g., staffing, fundraising, and 

budget.

2. The Receiver shall give preference to qualified charities local to 

each existing Hope Supply Warehouse that can demonstrate involvement in and support 

from the local community.

3. The Receiver shall select the Approved Qualified Charities within 

180 days of entry of the Order. If no charity or charities is recommended, or if the 

Receiver determines that no such recommended charity or charities is sufficiently 

qualified, the Receiver shall notify BCS and Plaintiffs and, except as continued 

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operations are provided for in Section IV.D, below, close the existing Hope Supply 

Warehouse programs and liquidate the HSW Assets pursuant to Section II, above. 

4. If an Approved Qualified Charity is not located to operate all 

existing Hope Supply Warehouse locations, the Receiver shall liquidate the assets of each 

such Hope Supply Warehouse location for which no Approved Qualified Charity was 

selected pursuant to Section II, above.

5. The Receiver shall notify BCS and Plaintiffs of each selected 

Approved Qualified Charity ten days prior to the Receiver filing its notice and request for 

approval below with the Court, as provided under Section IV.B.6, below.

6. Upon selection of the Approved Qualified Charities and notice to 

BCS and Plaintiffs, the Receiver shall timely file with the Court a “Notice of Selection of 

Approved Qualified Charities” and seek the Court’s authorization to transfer the HSW 

Assets to the Approved Qualified Charities. 

7. BCS or the Plaintiffs may file an objection with the Court within ten 

days of the Receiver’s filing the “Notice of Selection of Approved Qualified Charities.” 

If no such objection is timely filed, BCS and Plaintiffs shall be deemed to have waived 

any objections to the Approved Qualified Charities.

8. After receiving authorization from the Court, the Receiver shall

close the existing Hope Supply Warehouse operations and provide the HSW Assets to the 

Approved Qualified Charities.

C. Transfer of HSW Assets: 

1. If the Receiver is operating the existing Hope Supply Warehouse

locations at the time the Approved Qualified Charities are selected, the Receiver shall 

close them and transfer HSW Assets to each Approved Qualified Charity as follows:

a. Transfer the HSW Assets used by BCS to operate each 

existing Hope Supply Warehouse to the Approved Qualified Charity selected to operate a 

Hope Supply Warehouse-type program in that location;

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b. Lease, transfer the lease, or sublet the space occupied by each 

existing Hope Supply Warehouse location to the Approved Qualified Charity that will 

operate in that location, to the extent commercially reasonable and contractually 

permitted; and

c. Share with each Approved Qualified Charity relevant 

information about the operation of each existing Hope Supply Warehouse location where 

the Approved Qualified Charity will operate a new Hope Supply Warehouse-type 

program, including but not limited to, inventories, volunteer lists, local community 

contacts, corporate sponsors, and patient information. Provided that the Receiver shall 

not transfer any donor list or other donor information originating from any telemarketing 

call. All such telemarketing donor lists shall be destroyed pursuant to Section II.L, 

above. Provided further that, to the extent that the information is readily ascertainable, 

the Receiver may provide each Approved Qualified Charity with lists of donors who 

participated in any in-person or online fundraising effort specifically seeking support for 

the BCS Hope Supply Warehouse program in any location that the Approved Qualified 

Charity will operate. All personal identifying information or sensitive health information 

about any volunteer, patient, donor, or other individual must be maintained and 

transferred in compliance with appropriate security protocols and in accordance with 

applicable laws.

2. If, at the time the Approved Qualified Charities are selected, the 

Receiver has closed the existing Hope Supply Warehouse operations pursuant to Section 

IV.D.2, below, the Receiver may, at the Receiver’s sole discretion, transfer to the 

Approved Qualified Charities any HSW Asset identified in Section IV.C.1, above that 

still remains in the BCS receivership estate. Any such Approved Qualified Charity shall 

receive cash distributions as set forth in Section IV.E, below.

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D. Continuing Hope Supply Warehouse Operation:

1. To the extent that sufficient BCS assets exist to do so, the Receiver 

shall use reasonable best efforts to operate the existing Hope Supply Warehouse program 

for 90 days following entry of this Order. 

2. If no qualified charity or charities is recommended pursuant to 

Section IV.A, above, within the initial 90 day operation period, the Receiver may close 

the existing Hope Supply Warehouse program and liquidate its assets pursuant to Section 

II, above.

3. If the Receiver so recommends and adequate funds exist, BCS and 

Plaintiffs may agree to extend the Receiver’s operation of the existing Hope Supply 

Warehouse program for up to an additional 90 days. Such agreement may not be 

unreasonably withheld. Factors that reasonably may be considered in agreeing to an 

extension include the cost of ongoing operations and any progress in identifying and 

selecting a qualified charity or charities. Costs related to operating the existing Hope 

Supply Warehouse program shall be deducted from the total amount of cash available for 

distribution to any Approved Qualified Charity pursuant to Section IV.E, below.

E. Cash Distributions:

1. To the extent that funds from the BCS receivership estate are 

available, the Receiver may spend up to $800,000 operating the existing Hope Supply 

Warehouse program and distributing cash to the Approved Qualified Charities for their 

use in operating Hope Supply Warehouse-type programs at each general location where 

BCS previously operated a Hope Supply Warehouse. In addition, the Receiver may 

distribute up to an additional $45,000 to a charity for use in Texas, as set forth in Section 

IV.E.1.b, below. The cash shall be distributed as follows:

a. To the extent that funds from the BCS receivership estate are 

available, the Receiver shall make an initial distribution of the cash necessary to operate a

Hope Supply Warehouse-type program for 60 days to each Approved Qualified Charity 

for each location it will operate. The Receiver shall determine that amount based on the 

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Receiver’s experience operating the BCS Hope Supply Warehouse program and the 

budget initially proposed by the Approved Qualified Charity.

b. To the extent that funds from the BCS receivership estate are 

available, at the time that the Receiver makes an initial distribution to any Approved 

Qualified Charity pursuant to IV.E.1.a, above, or determines that no Approved Qualified

Charity can be selected pursuant to Section IV.B.3, above, the Receiver shall also make a 

one-time distribution not to exceed $45,000 to a charity to be used solely to provide 

direct aid to breast cancer patients in Texas (“Texas Charity”). The Texas Charity shall 

be recommended and selected as provided for in Sections IV.A and B., above, except that 

the Texas Charity need not agree to operate a Hope Supply Warehouse-type program, but 

rather must agree that it will use the $45,000 exclusively to provide direct aid to breast 

cancer patients and for no other purpose.

c. To the extent that funds from the BCS receivership estate are 

available and some portion remains of the $800,000 total allotted in Section IV.E.1, 

above, the Receiver shall make a second distribution of the cash necessary to operate a 

Hope Supply Warehouse-type program for an additional 60 days to each Approved 

Qualified Charity for each location it is operating. The Receiver shall determine that 

amount based on the Receiver’s experience previously operating the BCS Hope Supply 

Warehouse program, the budget initially proposed by the Approved Qualified Charity, 

and the report of the Approved Qualified Charity made pursuant to Section IV.G, below.

d. To the extent that funds from the BCS receivership estate are 

available and some portion remains of the $800,000 total allotted in Section IV.E.1, 

above, the Receiver shall make a third distribution of the cash necessary to operate a 

Hope Supply Warehouse-type program for an additional 60 days to each Approved 

Qualified Charity for each location it is operating. The Receiver shall determine that 

amount based on the Receiver’s experience previously operating the BCS Hope Supply 

Warehouse program, the budget initially proposed by the Approved Qualified Charity, 

and the report of the Approved Qualified Charity made pursuant to Section IV.G, below.

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e. To the extent that funds from the BCS receivership estate are

available and some portion remains of the $800,000 total allotted in Section IV.E.1, 

above, no later than 180 days after the Receiver’s initial distribution of cash the Receiver 

shall equally divide the remaining portion of the $800,000 between each Approved 

Qualified Charity for each location, not to exceed a disbursement of $200,000 per 

location.

2. The Receiver shall make no cash distributions to any Approved

Qualified Charity that has:

a. An outstanding report required by Section IV.G, below;

b. A pending request for information by the Receiver related to 

the Approved Qualified Charity’s budget, its operation of the Hope Supply Warehousetype program, or its compliance with the contract for transfer described in Section IV.F, 

below; or

c. Materially violated the terms of the contract to transfer assets 

described in Section IV.F below.

F. Contract for Transfer:

1. The Receiver and any Approved Qualified Charity shall enter into a 

contract outlining the terms of the transfer of HSW Assets and cash disbursements and 

the Approved Qualified Charity’s on-going operation of a Hope Supply Warehouse-type 

program at each location for which the charity was approved (“Transfer Contract”). The 

Transfer Contract shall include the following requirements:

a. The Approved Qualified Charity may use any HSW Assets or 

cash disbursements it receives only to operate a Hope Supply Warehouse-type program 

for the benefit of financially distressed breast cancer patients;

b. The Approved Qualified Charity must operate the Hope 

Supply Warehouse-type program for at least one year, provided that if it becomes 

impracticable to operate such a program within six months of transfer of any HSW Assets 

or cash disbursements, the Approved Qualified Charity agrees to notify the Receiver and 

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transfer any remaining HSW Asset or cash disbursement monies to the Receiver pursuant 

to Section III, above.

c. The Approved Qualified Charity must, to the extent 

practicable, follow the proposed budget and operational plan described in Section IV.A.2, 

above.

d. The Approved Qualified Charity may not employ James 

Reynolds, II or Kristina Reynolds in any capacity;

e. The Approved Qualified Charity may not permit James 

Reynolds II, Kristina Reynolds, Eric Fransen, or any Individual Defendant named in this 

matter, or any of their relatives, to serve as a director or officer of its Board of Directors; 

and 

f. The Approved Qualified Charity may not permit a majority of 

its Board of Directors to be comprised of persons who at any time served as directors or 

officers of the Boards of Directors of BCS, Cancer Fund of America, Inc., Cancer 

Support Services, Inc., or Children’s Cancer Fund of America, Inc. 

G. Approved Qualified Charity Reports:

1. Each Approved Qualified Charity must provide three reports to the 

Receiver at intervals of 45, 105, and 165 days following transfer of HSW Assets and 

receipt of the initial cash disbursement described in Section IV.E, above. The reports

shall i) specifically describe the Approved Qualified Charity’s compliance with the terms 

of the Transfer Contract; ii) identify and describe any material changes in the charity’s 

qualifications categorized in Section IV.A.2, above which occurred since it first provided 

them to the Receiver; and iii) identify and describe any material deviations by the charity 

from the plan, budget, or other representation it made to the Receiver relating to its 

proposed operation of a Hope Supply Warehouse-type program. The Receiver may seek 

additional information from each Approved Qualified Charity about any such report or

otherwise related to the Approved Qualified Charity’s budget, its operation of the Hope 

Supply Warehouse-type program, or its compliance with the Transfer Contract. 

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H. Breach of Contract for Transfer:

In the event that any Approved Qualified Charity breaches the terms of the

Transfer Contract or otherwise violates the provisions of Section IV, above, the Receiver 

shall have the standing and authority to pursue the Approved Qualified Charity for breach

of contract, damages, attorney’s fees, and costs.

V. COOPERATION

IT IS FURTHER ORDERED that:

A. BCS, its representatives, agents, officers, directors, employees, managers, 

members or any other persons with possession, custody, or control of property or records 

relating to BCS, must cooperate fully with the Receiver and take such other steps as the 

Receiver may require to transfer to the Receiver, or to his or her designated trust, 

possession and legal and equitable title to all assets of BCS within five days of request by 

the Receiver, including executing any documents, procuring the signature of any person 

or entity under their control, providing access to the property of BCS and any necessary 

information, and turning over any property of BCS. 

B. In the event that any person fails to deliver or transfer any asset or 

document, or otherwise fails to comply with any provision of this Order, the Receiver 

may file ex parte an affidavit of non-compliance regarding the failure. Upon filing of the 

affidavit, the Court may authorize, without additional process or demand, writs of 

possession or sequestration or other equitable writs requested by the Receiver. The writs 

shall authorize and direct the United States Marshal or any sheriff or deputy sheriff of 

any county, or any other federal, state, or local law enforcement officer, to seize the asset, 

document, or other item covered by this Section and to deliver it to the Receiver.

VI. PROVISION OF INFORMATION TO RECEIVER

IT IS FURTHER ORDERED that BCS shall provide to the Receiver, immediately 

upon request, the following:

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A. A list of all assets and property, including accounts, of BCS that are held in 

any name other than the name of BCS, or by any person or entity other than BCS; and

B. A list of all agents, employees, officers, directors, managers, members, 

employees, agents, or those persons in active concert and participation with BCS, who 

have been associated with or done business with BCS.

VII. PROHIBITION ON INTERFERENCE WITH THE RECEIVER

IT IS FURTHER ORDERED that BCS and its representatives, whether acting 

directly or through any entity, corporation, subsidiary, division, director, manager, 

member, employee, agent, affiliate, independent contractor, accountant, financial advisor, 

or other device, except as provided herein, as stipulated by the parties, or as directed by 

further order of the Court, are hereby restrained and enjoined from:

A. Interfering with the Receiver’s efforts to manage, or take custody, control, 

or possession of, the assets or documents subject to this receivership; 

B. Transacting any of the business of BCS;

C. Transferring, receiving, altering, selling, encumbering, pledging, assigning, 

liquidating, or otherwise disposing of any assets owned, controlled, or in the possession

or custody of, or in which an interest is held or claimed by, BCS or the Receiver; and

D. Refusing to cooperate with the Receiver or the Receiver’s duly authorized 

agents in the exercise of their duties or authority under any order of this Court.

VIII. STAY OF ACTIONS AGAINST BCS

IT IS FURTHER ORDERED that, except by leave of this Court, during pendency 

of the receivership ordered herein, BCS, its representatives, and other persons seeking to 

establish or enforce any claim, right, or interest against or on behalf of BCS, and all 

others acting for or on behalf of such persons, are hereby enjoined from taking action that 

would interfere with the exclusive jurisdiction of this Court over the assets or documents 

of BCS, including:

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A. Petitioning, or assisting in the filing of a petition, that would cause BCS to 

be placed in bankruptcy;

B. Commencing, prosecuting, or continuing a judicial, administrative, or other 

action or proceeding against BCS, including the issuance or employment of process 

against BCS, except that such actions may be commenced if necessary to toll any 

applicable statute of limitations;

C. Filing or enforcing any lien on any asset of BCS, taking or attempting to 

take possession, custody, or control of any asset of BCS, or attempting to foreclose, 

forfeit, alter, or terminate any interest in any asset of BCS, whether such acts are part of a 

judicial proceeding, are acts of self-help, or otherwise; and

D. Initiating any other process or proceeding that would interfere with the 

Receiver’s efforts to manage or take custody, control, or possession of the assets or 

documents subject to this receivership.

PROVIDED THAT, this Order does not stay: (i) the commencement or continuation of 

a criminal action or proceeding; (ii) the commencement or continuation of an action or 

proceeding by a governmental unit to enforce such governmental unit’s police or 

regulatory power; or (iii) the enforcement of a judgment, other than a monetary 

judgment, obtained in an action or proceeding by a governmental unit to enforce such 

governmental unit’s police or regulatory power.

IX. RECEIVER’S BOND

IT IS FURTHER ORDERED that the Receiver shall file with the Clerk of this 

Court a bond in the sum of $_______________ with sureties to be approved by the Court, 

conditioned that the Receiver will well and truly perform the duties of the office and 

abide by and perform all acts the Court directs. 28 U.S.C. § 754.

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X. COMPENSATION OF RECEIVER

IT IS FURTHER ORDERED that the Receiver and all personnel hired by the 

Receiver as herein authorized, including counsel to the Receiver and accountants, are 

entitled to reasonable compensation for the performance of duties undertaken pursuant to 

this Order and for the cost of actual out-of-pocket expenses incurred. The Receiver’s 

compensation and the compensation of any persons hired by the Receiver are to be paid 

solely from the assets of BCS and any proceeds from the liquidation of BCS, and such 

payments shall have priority over all other distributions except for any transfer fees, 

recording fees, or other payments owed through the transfer of the assets of BCS. The 

Receiver shall file with the Court and serve on the parties a request for the payment of 

reasonable compensation at the time of the filing of periodic reports and no less than 

every 60 days. The Receiver shall not increase the fees or rates used as the basis for such 

fee applications without prior approval of Plaintiffs and the Court. BCS shall have no 

right to object to the Receiver’s fees or compensation. Absent a violation of this Order 

that causes the Receiver to incur fees or expenses, BCS shall not be liable for the 

Receiver’s fees or expenses.

XI. RECEIVER REPORTS

IT IS FURTHER ORDERED that the Receiver shall periodically file with the 

Court, no less than every 60 days, a Receivership Report, under oath, accurately 

identifying any and all revenues received and expenditures made, including adequately 

detailed information concerning income, expenses, payables, and receivables. These 

periodic filings shall be served by the Receiver on Plaintiffs and BCS.

XII. TERMINATION OF RECEIVERSHIP

IT IS FURTHER ORDERED that, upon the final transfer of all funds to the STCO 

Fund and the dissolution of BCS, the duties of the Receiver shall terminate. The 

Receiver shall file a final application for fees, complete liquidation, and terminate his or 

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her service within 360 days of the entry of this Order, unless good cause is shown to 

extend the receivership beyond 360 days. At the termination of the Receiver’s duties, the 

Receiver shall transfer any unliquidated assets of BCS to the STCO Fund described in 

Section VII.D of the Permanent Injunction.

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